Business leaders yesterday welcomed as "an extremely positive step forward" the Chancellor's Budget announcement that the Greater Birmingham and Solihull Local Enterprise Partnership (LEP) will contain an Enterprise Zone.

Christine Braddock, president of Birmingham Chamber of Commerce, said that although no decision had yet been made on the location of the Zone, it had enormous potential for growth that would produce opportunities for investment, including overseas.

She added: "This is an extremely positive step forward. This Zone has the potential to drive growth, incentivise business and encourage entrepreneurship and so will help to support the delivery of our LEP's vision."

Although, as expected, George Osborne scaled back his forecast for growth, early indications from Birmingham Chamber's economic survey for the first quarter of this year suggest that conditions are starting to improve, particularly cash flow and investment intentions.

Dr Braddock added: "Our members inform us that red tape hinders the private community and we are encouraged by today's decision to scrap £350m of business regulation. No new regulation on firms with fewer than 10 staff for three years and business rate relief holiday for small firms extended for another year will make it easier for companies to grow and create jobs. 

"With the majority of Birmingham's businesses relying on transportation in some way and with inflation currently standing at 4.4 per cent, it was integral that next week's fuel duty rise was postponed to alleviate pressure. The business community is also pleased to hear that prices are set to go down by 1p per litre immediately. 

"There is a danger that Britain will become a less competitive arena in which to do business so the Chamber is pleased that the Chancellor acknowledged that the top 50p tax rate is a temporary measure.  

"British airports contribute £18billion to our economy and support 250,000 jobs so we are therefore pleased that the Chancellor has taken the decision to freeze the planned air passenger duty hike. Increases in air passenger duty put us at a real competitive disadvantage. 

"A lower business tax burden is critical to stimulating enterprise and promoting growth so the Chancellor is right to cut corporation tax by 2 per cent, rather than the planned 1 per cent." 

Dr Braddock added that complying with complex tax systems detracts from the time a business owner can spend running their company so the decision to merge National Insurance and income tax would reduce the administrative burden on businesses. 

"While we applaud the government's intention to create an additional 100,000 work experience places for young people it remains to be seen how this can be done in practice.  Many small businesses find it far too costly and time consuming to provide work experience; therefore we would urge the government to look at this proposal in more detail to make it simpler for smaller businesses to do so."  

The Chamber of Commerce also welcomed the government's announcement that it will create an additional 40,000 more apprenticeships. "The UK needs to catch up with key competitors such as Germany where technical training is far more prestigious and entrenched. However is we urge the government to look at the funding of apprentices for people over the age of 18 - for which the employer is expected to make a contribution to the cost of training, which can cost thousands of pounds. This discourages businesses, especially SMEs, from taking on older apprentices," added Dr Braddock. 

Also welcomed was the Chancellor's announcement that planning will "prioritise growth and jobs" with time limits on applications to speed planning decisions and end the constant delays, which businesses consistently cite as a hindrance to investment and expansion.  

The Chamber is also pleased at the announcement that the Climate Change Agreements will be extended to 2023 and offer larger exemption from the climate change levy. This will benefit green firms and make it more attractive for companies to become greener and more energy efficient. In relation to the Green Investment Bank, with no powers to borrow, it remains to be seen the benefits it will bring.