Logistics sector can unlock regional growth under budget plans, says Logistics UK

Business group Logistics UK, the only trade body to represent the whole of logistics, has welcomed measures in the Budget aimed at accelerating growth across the UK, while setting out how its members are uniquely positioned to unlock regional growth, address the NEETs crisis and drive the government’s reindustrialisation agenda.

“The government’s ambition for growth in every postcode aligns with the role the logistics sector already performs across the UK,” commented Logistics UK’s Chief Executive Ben Fletcher. “As a sector, we support 5.3 million jobs across the economy, directly employ 2.7 million people, and enable more than £1 trillion of trade every year. Independent research shows that every £1 of economic activity directly generated by the logistics sector more than doubles its value, to provide a further £1.04 across the wider economy.”

The organisation is also encouraged by measures in the Fiscal Devolution Roadmap, published alongside the Budget, that could incentivise regional mayors to support logistics development, by enabling them to keep a share of business rates.

“Mayoral strategic authorities will be permitted to borrow to invest in transport and infrastructure, which should help unlock investment and support the development of the support networks, skills and industrial clusters that businesses need to thrive,” continues Fletcher.  “As an industry with operations in every corner of the country, logistics stands ready to help local and national government turn these ambitions into tangible economic growth.”

The government’s commitment to reforming the UK’s energy system and delivering faster grid connections for businesses and strategic developments also promises to boost the logistics sector and the economy.

“Current delays to electricity connections are holding back investment in fleet decarbonisation, warehousing, distribution facilities and wider infrastructure projects,” continued Fletcher. “Faster access to grid capacity will be essential if businesses are to invest with confidence and support the transition to a lower-carbon economy but it is important that the government now matches this ambition with real pace for industrial users

Logistics UK also welcomed the extension of the fuel duty freeze and red diesel duty cut: measures which, in conjunction with the existing HGV road tax holiday, are estimated to save the sector £470 million. However, while the organisation welcomed these steps to address these immediate operating costs , it has also expressed disappointment at the lack of measures to address friction at the UK’s borders and the wider costs of doing business:

“If the government is serious about driving growth, improving trade performance must be part of the solution,” concludes Fletcher. “Reducing unnecessary friction at the border would support businesses of all sizes, improve international competitiveness and lower costs throughout UK supply chains. Against that backdrop, it is disappointing there was no mention of the Single Trade Window in yesterday’s budget. A fully functioning Single Trade Window has the potential to streamline border processes, reduce administrative burdens and make trade easier for UK businesses. At a time when economic growth is the government’s overriding objective, measures that facilitate trade should be moving further up the policy agenda.

“Yesterday’s budget was a real opportunity to begin the process of business rate reform and tackling how to bring down the exceptionally high costs of doing business in the UK. This has been missed which will make it harder to fully realise those benefits delivered by the budget and hampers the delivery of growth we all need to see.”

Business group Logistics UK champions the logistics sector, the backbone of the UK economy and global trade, providing a unique, authoritative voice for its members. As the only trade association representing the whole industry, it supports more than 22,000 members, operating in road, rail, waterways, sea and air freight, in ports, airports and warehousing, as well as the customers of freight services such as retailers and manufacturers. The group delivers industry representation, services and thought leadership to support a sector that is critical to economic growth, employing 8% of the UK workforce, contributing £175 billion in annual GVA and enabling over £1 trillion of international trade. For more information about the organisation and its work, please visit logistics.org.uk