Budget doesn’t go far enough to boost business confidence – Chamber

Business leaders in Greater Birmingham say the Autumn Budget did not go far enough to generate a much-needed boost in business confidence.

Greater Birmingham Chambers of Commerce (GBCC) said that while Chancellor Rachel Reeves made welcome announcements around supporting firm-led innovation and helping people into work, her Budget did little to address key areas such as business rates reform and export activity.

And businesses are set to be burdened with further minimum wage increases - 4.1 per cent for over-21s and 8.5 per cent for 18 to 20-year-olds.

While the Budget vows to provide energy cost relief for “manufacturing and electricity intensive frontier industries”, the Chamber was disappointed that similar support hasn’t been offered to retail and hospitality firms.

Raj Kandola (pictured), acting deputy CEO at the GBCC, said: “Putting aside the unprecedented leak from the OBR, many of the announcements made by the Chancellor offered little surprise as she decided to press ahead with another round of tax rises to facilitate broader spending plans.

“From a business perspective, there were welcome announcements around offering free apprenticeships to SMEs and a commitment to supporting more people into the world of work.

“It was pleasing to see a commitment to driving further firm-led innovation – namely around supporting scale ups listing on the London Stock Exchange, bolstering the remit of the British Business Bank and an extension of the EIS and VCT schemes.

“Consumers will welcome a much-needed cut on energy bills, and many manufacturers will benefit from a similar scheme.

“However, firms operating in hospitality and retail are also crying out for support on this front.

“Plans around supporting the transition to electric vehicle usage also remain unclear – with an increase in both taxes and grant funding for different groups.”

The Budget did reaffirm some of the Government’s prior commitments to the West Midlands – including backing for the Midlands Rail Hub and West Midlands Growth Plan.

Raj Kandola added: “Regionally, it was pleasing to hear the Government reaffirm commitment to the Midlands Rail Hub, the Creative Place Growth Fund and funding to deliver the West Midlands Growth Plan.

“However, additional powers for Mayoral Authorities to raise tourism taxes will need careful implementation to offset any inflationary impact.”

While businesses weren’t directly targeted by the Chancellor, the Chamber says some measures introduced will add to the increasing cost burden on firms.

Emily Stubbs, head of policy at the GBCC, said: “Overall, businesses will be breathing a sigh of relief that they weren’t a marked target for tax hikes like last year, but a number of measures announced yesterday will simply add to the crippling cost pressures that many face on a daily basis.

“Increasing the minimum wage and capping salary sacrifices will simply add to overheads and without meaningful reform to the proposed Employment Rights Bill will do little to encourage businesses to bolster their workforce.

“Changes to the business rates system fall well short of meaningful reform. More support for those in the hospitality and retail sector is welcome, but not at the expense of those operating in larger warehouses.

“It was also disappointing to see very little announced around driving export activity – particularly for an economy like the West Midlands which has been badly knocked by the fallout from the Trump tariffs and wider geopolitical uncertainty.

“Meanwhile, we have also recently seen UK-wide business support funding of almost £1bn axed and replaced with a system of piecemeal support, raising concerns about inequality across the country.

“On entering Government, the Chancellor promised to get a grip of the country’s finances and create an entrepreneurial platform for firms to flourish.

“With taxes set to reach record levels by the end of the decade, coupled with subdued investment and hiring levels, this vision seems a distant reality.

“This Budget does not go far enough to give business confidence the boost it needs.”

• What does the Autumn Budget mean for your business? Read this comprehensive blog from the GBCC policy team.