Rachel Reeves instructed to step aside prior to the Autumn Budget
UK Business Leaders Call for a Growth-Friendly Environment in Upcoming Autumn Budget
Private businesses in the UK have shown resilience and adaptability, managing through a wide variety of challenges, according to a recent KPMG survey of 1,500 directors. Despite the challenges facing the UK and global economies, the mid-year check-in saw a rise in business confidence with 93.2% of respondents expressing confidence and 62.1% being very confident about future growth.
The survey revealed that inflation is a significant concern for 45% of the respondents, who fear its potential negative impacts on their businesses. Similarly, 31% are concerned about rising employment costs. However, the business leaders remain optimistic, with 62% being very confident about their firm's growth prospects this year, and 31% somewhat confident.
The majority of respondents in the survey were men (63%), and the business leaders surveyed were almost evenly distributed across the UK, with the highest representation in London (11%). The surveyed directors want a reversal of the National Insurance hike introduced in April and a reduction in VAT. Moreover, 32% are worried about further tax rises in the Autumn Budget in October.
The business leaders also call for a reduction of unnecessary regulations and for the government to stop interfering with companies. They view higher taxes, such as National Insurance contributions and the National Minimum Wage increases, as a hindrance, not a help.
The key business themes that private business leaders want Chancellor Rachel Reeves to focus on in her upcoming Autumn Budget include:
- Promotion of higher wages and lowering costs for companies, with a strong emphasis on reversing recent tax increases such as the employers’ National Insurance hike and the National Minimum Wage increase, which are seen as hindrances to growth.
- Reducing unnecessary regulations and limiting government interference in business operations.
- Prioritising the adoption of new technology, with 44% of directors advocating for faster technological adoption and related investment, such as in research and development.
- Boosting business profitability through favorable tax measures, cited by 35% of the directors surveyed.
- Supporting skills and talent development, emphasized by 31% of respondents as important for business growth.
- Renewing the Industrial Strategy and focusing on growth-oriented investment, mentioned by 27% of directors.
The overarching sentiment is a call for the government to create a stable, growth-friendly environment by easing tax burdens, cutting red tape, and supporting innovation and skills, allowing businesses to thrive without excessive interference.
Additional context from KPMG highlights that while private businesses remain confident about growth prospects, ongoing inflation and cost pressures remain significant challenges that they hope the Autumn Budget will address through these targeted themes. Nearly three quarters of firms surveyed (72%) flagged the importance of new products this time round.
[1] KPMG Press Release, "UK Private Business Leaders Call for a Growth-Friendly Environment in Upcoming Autumn Budget," 2022. [2] KPMG Survey Report, "Autumn Budget 2022: Priorities for UK Private Business Leaders," 2022.
- Business leaders in the UK are urging Chancellor Rachel Reeves to promote higher wages and lower costs for companies in the upcoming Autumn Budget, with a focus on reversing recent tax increases such as the employers’ National Insurance hike and the National Minimum Wage increase, which are seen as hindrances to growth.
- The call for a growth-friendly environment in the Autumn Budget also includes a request for the government to reduce unnecessary regulations and limit interference in business operations.
- In addition, technology adoption is a key concern for many business leaders, with 44% of directors advocating for faster technological adoption and related investment, such as in research and development.
- Supporting skills and talent development is another priority for business leaders, with 31% of respondents emphasizing its importance for business growth.
- Furthermore, business leaders are calling for favorable tax measures to boost business profitability, a concern cited by 35% of the directors surveyed. Additionally, 27% of directors have stressed the importance of renewing the Industrial Strategy and focusing on growth-oriented investment.
