Budget sets a strong foundation for economic recovery, says Logistics UK

Wednesday 03 March 2021

Measures included in the Budget provide a strong foundation for economic recovery, according to Logistics UK, one of the UK’s biggest business groups. But while there are many positive decisions – including a freeze in fuel duty and extension to the furloughing scheme – we need to see greater investment in training programmes to help fill the growing vacancies in the industry.   

Alex Veitch, General Manager of Public Policy at Logistics UK, comments: “Funding to train new entrants to the logistics sector is particularly welcome at a time when the industry is suffering significant skills gaps and the loss of EU workers, and a more flexible approach to apprenticeships will also assist the sector in recruiting the next generation of logistics employees.

“However, the industry needs new recruits now, and a more flexible method of providing direct support to those looking to retrain and reskill into vital operational roles like HGV drivers and transport managers would help that transition.  The average cost for a 12-month apprenticeship training and licence acquisition is £7,000 – Logistics UK would like to see more immediate government support, in the form of interest-free loans or grants, to be made available now to help switch those affected by the pandemic into the vacancies which are open now, and help with the economic recovery from COVID-19.”

On the announcement that fuel duty will be frozen, Mr Veitch comments: “As the economy starts to recover from the impact of the COVID-19 pandemic, Logistics UK and its member businesses are grateful for the news of a continued fuel duty freeze.  At a time when many businesses are yet to open up fully, or to see the first signs of recovery, another charge to already fragile balance sheets could have been catastrophic for the organisations which are at the heart of every element of the economy.

“The continuation of the furloughing scheme is great news for businesses in the logistics industry which rely on sectors of the economy like retail and hospitality which are yet to reopen.  Today’s announcement will provide reassurance for those employed across the sector, and ensure that logistics businesses can maintain their workforce, ready to go as soon as the economy reopens.”

Responding to the announcement of a rise in corporation tax in 2023, and the extension of the business rates holiday until June 2021 before a discounted rate is introduced, Mr Veitch adds: “Many logistics businesses are still to recover fully from the impact of COVID-19, with a large proportion of the industry still in limbo as a result of the continued closure of sectors such as entertainment and hospitality.  It is vital that business is not penalised by additional taxation at this crucial time in the economic recovery, particularly as the logistics sector is the one which drives all other sectors, delivering the raw materials and finished goods needed to boost trade and competitiveness.”

On the news of the infrastructure bank launch, Mr Veitch comments: “Today’s commitment to a multibillion-pound investment into infrastructure is welcome news for the logistics industry. Efficient and effective transport infrastructure is vital for logistics to be able to support the needs of UK businesses; the importance of a strong and resilient network to economic recovery must not be underestimated.

“Logistics UK also welcomes the government's commitment to a Freeport programme, with the confirmation of eight successful Freeport bids. We are confident these will support business and industry in these locations and urge the government considers expanding the programme.”

Logistics UK (formerly FTA) is one of the UK’s leading business groups, representing logistics businesses which are vital to keeping the UK trading, and more than seven million people directly employed in the making, selling and moving of goods. With COVID-19, Brexit, new technology and other disruptive forces driving change in the way goods move across borders and through the supply chain, logistics has never been more important to UK plc. Logistics UK supports, shapes and stands up for safe and efficient logistics, and is the only business group which represents the whole industry, with members from the road, rail, sea and air industries, as well as the buyers of freight services such as retailers and manufacturers whose businesses depend on the efficient movement of goods.