Accelerate investment in UK manufacturing at MACH 2022
For manufacturers and engineers looking to invest for growth, the arrival of MACH 2022 could not be timelier. The exhibition, which opens its doors at the NEC in Birmingham between 4-8th April, features the largest display of new machinery and manufacturing technologies under one roof in the UK for four years.
The Manufacturing Technologies Association (MTA), which organises the exhibition, believes the growing optimism surrounding the sector will see bumper levels of business transacted during the show. Exhibitors too, are excited at the prospect of showcasing their latest products to an eager array of buyers ready to capitalise on current financial incentives such as Super Deduction and the Annual Investment Allowance (AIA).
James Selka, CEO of the MTA, said: “With the UK economy growing above forecasts for 2021 and the CBI predicting that plans for spending on plant and machinery over the coming twelve months have improved considerably, the timing of MACH 2022 could not be better.
“In order to make step change improvements in productivity and therefore competitiveness, you only need three things – technologies, the skill to acquire and deploy those technologies and the finance to make it happen. Technologies have never been more powerful and affordable. The UK has an incredible reputation for its innovative and flexible workforce, and finance assisted by government incentives is incredibly good value and hugely available.
“There has never been a better time to accelerate investment in UK manufacturing and with MACH 2022 bringing together the latest advanced engineering and manufacturing technologies in operation all under one roof, it will be perfect place for manufacturers to come and view the best new machines on the market.”
The findings of the CBI’s Q4 2021 survey, which reflects the MTA’s own data, indicated that plans for spending on plant and machinery during 2022 had considerably improved, with the percentage balance (+26) standing at its highest level since April 1988. Four consecutive double-digit positive balances in a row leading up to the survey is exceptionally rare and represents a stronger recovery than seen after the 2008 global financial crisis.
Crucially, the improvement has been seen in some of the most important sectors within the manufacturing industry, such as Transport Equipment (automotive and aerospace) and Metal Products sub-sectors.
Running until 31st March 2023, the Super Deduction scheme means companies investing in qualifying new plant and machinery assets will be able to claim a 130% super-deduction capital allowance on their plant and machinery investment, plus a 50% first-year allowance for qualifying special rate assets.
The scheme will allow companies to cut their tax bill by up to 25p for every £1 they invest. The incentive scheme, launched by the Chancellor last year to spur the UK economy to invest for growth, is intended to jump-start the manufacturing sector as it looks to bounce back quickly from the pandemic-induced recession.
The Office for Budget Responsibility (OBR) has predicted the scheme could encourage manufacturers to bring forward investment plans originally scheduled for much later in the decade, thereby speeding up the rate of recovery.
For the MTA, the Super Deduction scheme is a vindication of a campaign it started in 2020, urging the Chancellor to introduce an economic stimulus that would incentivise manufacturers and help them take advantage of key opportunities such as decarbonisation, high-speed rail and the Tempest UAV programme.
“Fiscal incentives to raise investment levels are vital, and incentivising capital allowances will boost investment confidence and kick-start investment decision-making, as well as provide a boost to job creation, productivity improvement and export readiness,” said Mr Selka.
“With the extra incentives now in place, MACH 2022 is the perfect opportunity for the manufacturing industry to demonstrate its readiness for the challenge of revitalising the UK’s economy.”