Warren Dickson, CEO, Corporate & Commercial, Howden UK&I – Howden UK&I is part of Howden, a global insurance intermediary group with 23,000 people across 56 countries around the world.
“The freezing of fuel duty creates short-term reprieve but uncertainty for long-term planning, which is the bedrock for creating a sustainable and prosperous business plan. For companies that have already made or will make the transition to electric or plug-in-hybrid vehicle fleets, the new mileage tax means companies still need balance the books, which could mean making cuts in other areas.”
The ban on the sale of petrol and diesel vehicles from 2030 adds a huge pressure for fleet operators to convert to electric or hybrid. And now, for businesses that have or will soon move to electric or hybrid vehicles they need to factor in an additional 3p per mile for battery electric vehicles and 1.5p per mile for plug-in-hybrid cars on top of existing road taxes. Multiply that time and time again for anyone involved in transportation of products or people, and that’s a big squeeze on outgoings.
Attracting and retaining talent is important to any business and the increases to the minimum wage will encourage this. However, the UK economy is comprised of mainly SMEs and an increase to the minimum wage means increased cost pressures at a time when businesses are factoring in more cost raises than ever before.
Creating an environment which encourages aspirations for both business and personal development is crucial for long-term success. One powerful, but often underutilised, tool at our disposal is salary sacrifice. With the changes announced to salary sacrifice has a real time impact on average earners saving for their pension, as well additional cost pressures on employers. It’s important to remember that salary sacrifice is more than pensions, it supports childcare benefits too.
Our recent Employee Benefits research revealed that 68% of SMEs are not currently offering salary sacrifice, which has implications for both the company and its employees. Despite what been announced in the Budget, for businesses, they could still be missing out on potential national insurance savings that could be reinvested into their people and the future growth of their business. Salary sacrifice remains an effective lever that businesses can use during more challenging economic periods.”
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