A survey by international legal practice DLA Piper and YouGovStone has revealed strong feelings in the manufacturing industry about the impact of changes to National Insurance on the sector’s recovery.
In a survey of 545 senior business figures from UK companies drawn from DLA Piper’s own clients exceeding £1m turnover, 76% of those in manufacturing polled stated that they would like to see a reduction in National Insurance (NI) to encourage hiring. Interestingly, a reduction in NI was ranked more highly than R&D tax credits as a way of supporting the sector’s recovery.
The issue of National Insurance is one of the key issues of this election campaign, with Labour planning to increase National Insurance for employers and workers by 1p in the Pound from next April, and the Conservatives planning to reduce it. Many businesses have opposed the plans to increase NI contributions, claiming the move will lead to fewer jobs being created.
The survey, UK Election 2010: The Business Vote, also found 51% of manufacturing clients sampled believe David Cameron is best placed to lead UK plc into recovery with Gordon Brown receiving 4% of votes.
Jonathan Exten-Wright, partner at DLA Piper London said: "There have been strong opinions about the impact of National Insurance hikes expressed from across the sectors during this election campaign, but the strength of feeling around this issue from an industry sector that has been hit hard by the recession is clear .
"It is also interesting to note that manufacturing businesses ranked a reduction in NI contributions as more important than tax incentives for R&D activity. For an industry that relies on innovation to maintain a competitive edge, this is a clear statement from business leaders that their labour cost is a more pressing issue .
Other key findings from the manufacturing sector include;
55% would like to see a complete overhaul of the structure of financial regulation such as replacing the FSA with a new Consumer Protection Agency with responsibility for supervision of banks passing to the Bank of England
53% feel their business is likely to be affected by the Carbon Reduction Commitment Energy Efficiency Scheme, with a third of those surveyed believing Climate Change should be a strategic Government priority.
Overwhelming majority of 90% of those surveyed felt that the Government should not pass legislation with the purpose of increasing the number of women on the boards of UK companies
The survey, carried out online by YouGovStone, aims to gauge the mood of British businesses on key policy areas ahead of the UK General Election on 6 May. This research sample is representative of DLA Piper’s UK client base with a turnover above £1m.