Outreach to the new government continues

Following the introductory letters sent to ministers by ICAEW’s Chief Executive Alan Vallance highlighting policy overlaps between the government's agenda and ICAEW's manifesto, a series of introductory meetings are now being organised with ministers and senior officials.

One of the first, saw ICAEW’s Director of Public Sector and Taxation, Alison Ring, meet the Chancellor’s Senior Special Advisor for Tax, Spencer Thompson. Ring raised the issues ICAEW members face engaging with HMRC and navigating an increasingly complex tax system, and also discussed ICAEW's position on the regulation of tax advisors and risk-based research and development R&D enforcement regimes. 

Developing an audit reform workplan

The Draft Audit Reform and Corporate Governance Bill, announced in the King’s Speech is not expected to be laid in parliament until next year, but ICAEW is actively engaged in the pre-legislative scrutiny process.

Following recent discussions with the officials responsible for the legislation at the Department for Business and Trade, our understanding is that the starting point will be the previous government’s response to the consultation on strengthening the UK’s audit, corporate reporting and corporate governance systems, published in May 2022.

However, the government will also be looking at issues that have grown in prominence since then, including sustainability reporting and assurance.

ICAEW has already held sessions with members of its Audit and Assurance and Corporate Reporting Faculties and will be reviewing previous policy positions and preparing recommendations of the government on issues to prioritise in the legislation. 

Preparing for the Budget

In a statement to parliament, the Chancellor has set out plans to plug a £22bn ‘black hole’ in the public finances with a Budget on 30 October. In response, ICAEW welcomed plans for a new Office for Value for Money to improve the effectiveness of financial management in central government and called on the Chancellor to adopt fiscal rules that allow her to deliver economic growth.     

ICAEW approves of the government’s ambition to strengthen the resilience and dynamism of the UK’s business environment to deliver economic stability, confirms Chris Lane, ICAEW’s Senior Policy Manager.

“We believe this approach is compatible with economic growth and driving investment. Smart, proportionate regulation, strong institutions and resilient public finances can power existing business successes,” he said. “They can also create the right environment for the next generation of business-led innovation, green growth and improved standards of living, and chartered accountants are ready to support the government to drive this growth.”

Ahead of each Budget ICAEW writes to Treasury and the Chancellor outlining the issues our members believe should be a priority. Our current submission, due by 10 September, will highlight the importance of long-term, joined-up thinking. It will also call for the planned industrial, trade, tax and investment strategies to be integrated and consistent with ambitions to achieve the green transition, leverage AI opportunities and support small businesses.

Local audit

In the week after the general election, ICAEW contacted the government urging for action on the local audit backlog, arguing that the current delays in publishing financial statements have led to unacceptably low levels of accountability in some local authorities. The government has now responded with a written statement from the Minister for Local Government, Jim McMahon MP. 

The statement proposed secondary legislation for five further backstop dates up to and including financial year 2027/2028, allowing the government to rebuild full assurance over several audit cycles     .

In a joint statement, ICAEW and CIPFA commented: “By setting backstop dates there is a reset of the audits of financial statements, which is an important step to restoring credibility and preventing backlogs recurring in the future."

ICAEW’s technical experts, led by Iain Wright, Managing Director of Reputation and Influence, discuss why three-quarters of councils in England are at least a year behind in publishing audited accounts in the August edition of our Accountancy Insights podcast. They also explored ICAEW’s recommendations for the new government’s business tax road map and shared an update on the probate service.

Party conferences

Following the general election in July, party conference season is the next big moment in the calendar to influence policy and ICAEW will be in attendance.

ICAEW Chief Executive Alan Vallance, Managing Director of Reputation and Influence Iain Wright, and ICAEW President Malcolm Bacchus will attend the Labour Conference. Their programme will include participation in Labour’s sold-out Business Day, featuring addresses by Chancellor Rachel Reeves and Prime Minister Sir Keir Starmer.

Additionally, ICAEW will host a member event at KPMG in Liverpool and co-sponsor a significant Labour and business dialogue with the Fabian Society.

At the Conservative Party conference, ICAEW has co-sponsored an event with Enterprise Forum, which will be attended by Shadow Chancellor Jeremy Hunt.

With the Liberal Democrats now holding 72 seats in the House of Commons, their increased influence makes our engagement at their conference more important than ever.

“The party conferences are rich opportunities to engage on policy; you can end up in a conversation with several ministers or shadow ministers while walking around them,” says Vallance. “We are happy to support the government and opposition parties to get effective policies for growth, in the public interest.”