Devon Chamber has welcomed the Chancellor’s commitment to developing the skills of young people, following today’s Autumn Budget and the announcement of a £1.5 billion national skills package.
While the Chamber sees significant opportunity in the measures designed to boost apprenticeships and future talent, it also warns that wider tax changes may add pressure to businesses already managing rising costs.
Skills and Apprenticeships
Funding to make training for under-25 apprenticeships completely free for SMEs is a major step forward and could be worth up to £725 million nationally. Apprenticeships remain one of the most effective ways to build the workforce of the future, and the Chamber welcomes the shift towards fully funded provision and more flexible, modular training options.
From 2026, the current apprenticeship levy will be replaced by a Growth and Skills Levy, opening the door to shorter courses in priority sectors including engineering, construction, health and AI — all of which are critical to Devon’s future skills pipeline.
Devon Chamber says it is ready to work closely with employers, colleges and training providers to ensure this investment translates into meaningful opportunities across the county.
Tax implications
Alongside investment commitments, the Budget confirmed a number of tax changes that will affect business operating costs in Devon:
- Income Tax Threshold Freeze: Extended to 2030–31, expected to bring more people into higher tax bands and increase payroll pressures.
- EV Mileage Tax: A 3p-per-mile charge for electric vehicles from April 2028, increasing fleet costs.
- Salary Sacrifice Cap: A new £2,000 annual limit from 2029 affecting pension and benefits packages.
- Minimum Wage Increases: Significant rises from April 2026 — £12.71/hr (21+) and £10.85/hr (18–20) — creating substantial cost pressures for hospitality, care and service-sector employers.
- VAT Relief Gap: No targeted VAT support for hospitality or construction, placing further strain on sectors already facing rising costs.
The Chamber cautions that these combined measures could tighten margins for many local businesses, especially SMEs.
Infrastructure: Devon still needs more
While the Budget signals continued support for skills and national infrastructure, Devon urgently requires overdue investment in its transport network, digital connectivity and wider enabling infrastructure. Without this, the Chamber warns that businesses risk being held back at a time when competitiveness and productivity need to increase.
Plymouth named Growth Industry Hub
Devon Chamber also welcomed Plymouth’s designation as a Growth Industry Hub, building on the £250 million Defence Growth Deal announced earlier this year. This recognises the region’s strategic contribution to the UK’s defence, manufacturing and innovation capabilities and is expected to attract further investment, strengthen supply chains and create high-value jobs across the county.
Helen Wylde-Archibald, CEO, Devon Chamber of Commerce, said: “We welcome the Chancellor’s commitment to developing the skills of young people. Funding to make training for under-25 apprenticeships completely free for SMEs is a significant step forward. Apprenticeships are one of the most effective ways to build the workforce of the future, and we look forward to continuing our work with employers, colleges and training providers to ensure this investment translates into meaningful opportunities for young people across Devon.
“More broadly, we welcome the Budget’s focus on skills and infrastructure. However, much more is needed to address the longstanding challenges facing businesses in Devon. Our county urgently requires investment in transport, digital connectivity and modern infrastructure to support growth, innovation and inward investment. Without this, businesses risk being held back at a time when they need to be moving forward.
“The Devon Chamber will continue to work with Government, regional partners and the business community to ensure our region gets the support it needs to thrive.”
