The UK has a new Prime Minister who has promised to revive the nation’s economic fortunes. But he follows a succession of PMs who have pledged the same without ever managing to consistently deliver.
At the British Chambers of Commerce, we think about little else than helping businesses and our economy thrive. That’s why we have developed a plan centred around three clear priorities the government must focus on: trade, investment and productivity.
If Andy Burnham is serious about delivering growth, then he must take a fresh look at investment:
Ensuring that businesses have the confidence to invest is essential if firms are to expand, create more jobs, adopt new technologies and drive economic growth. But too many firms continue to face barriers that hold back long-term investment decisions.
Persistent uncertainty, rising costs, delays in the planning system, infrastructure constraints, and difficulties accessing finance, all reduce business confidence to invest. If the Government wants to deliver stronger economic growth across the UK, it must create the conditions that encourage investment.
Reforming the planning system
An effective planning system is essential for attracting and delivering investment. The government has recognised the danger, but too many businesses continue to encounter delays and uncertainty when seeking planning approvals. And employment land too often is not being prioritised.
The last Government has undertaken significant reforms to the planning system, answering businesses’ decade long call for reform. What does not exist is the workforce to operate it. Capacity is the reform that makes every other change work.
Investment in planning capability must be viewed as an investment in growth itself. When businesses can move projects forward more quickly, the benefits are felt through increased development, more jobs and stronger local economies.
Government must commit to a fully funded, multi-year workforce plan for the planning service, combining a dedicated funding settlement, a growing pipeline of new planners going above the last Government’s target of 1,400 additional planners and a credible strategy to retain experienced ones.
Major Infrastructure projects and supply chains
Investment in transport, energy and digital infrastructure is also critical to enable economic growth. Businesses need confidence that nationally significant projects will be delivered at pace and that the UK has the infrastructure required to support future growth. This requires a well-communicated long-term infrastructure strategy, alongside delivery. The cancellation of the Northern Leg of HS2 undermined business trust in the government’s capabilities to manage major infrastructure projects. It has yet to regain that trust and it will have to work hard to do so. It can make a start on this by seeing through airport expansion at Heathrow, Gatwick and Luton, andmaintaining funding for the Lower Thames Crossing.
This infrastructure investment must also deliver benefits to local economies. Through our Great British Supply Chain work, we have highlighted the benefits of connecting more SMEs to major public and private sector projects. Too many smaller firms remain excluded from procurement, despite their ability to drive innovation, create jobs and strengthen their economies.
By accelerating infrastructure delivery and improving SME access to supply chains, the UK can maximise the economic returns from investment and ensure growth is felt across every nation and region.
Energy costs
High energy costs continue to present one of the greatest challenges facing businesses. BCC research shows that three-quarters of firms expect their energy costs to increase over the next 12 months. This reduces theircompetitiveness, restricts investment capacity, and places additional pressure on business finances; pushing many to increase their prices. The BCC’s recent Quarterly Economic Survey found that 56% of firms said they were under pressure to increase their prices because of utility costs. The conflict in the Middle East has increased uncertainty for businesses further, with firms struggling with fuel costs, as well as raw materials.
Much of the support announced by the Government to help with the cost of energy has been limited either to households, or relatively small numbers of businesses from specific sectors. The government must now take steps to reduce the cost of energy for all businesses by funding the Renewables Obligation on their energy bills. This would more closely align support with the relief provided for households in the Autumn Budget 2025. The Government must also deliver long-term reforms to the energy system, including incentivising electrification to support the energy transition and addressing grid connection delays.
Tax incentives and reducing burdens on businesses
Businesses are more likely to invest when the fiscal and regulatory environment is stable, proportionate and supportive. Frequent policy changes, rising costs and increasing administrative burdens can undermine confidence and delay investment decisions. Over the last 10 years, new government policies have pushed up the average SME’s costs by 70%.
Government should use the tax system to encourage investment, support business expansion and reward innovation. Raising taxes or cutting reliefs simply exacerbates business costs and deters investment. Similarly, the current cliff edge within the VAT system discourages SMEs from growing. The government should look to reduce unnecessary burdens that increase costs without delivering clear economic benefits. Business rates are a prime example of such a tax on business before they have even opened their doors and must be reformed. Rises in employer National Insurance Contributions (NICs) and the National Living Wage have made it harder for business to do the right thing and employ young people.
A more competitive tax environment, alongside greater policy certainty and a better understanding of the cumulative pressures facing firms, would help unlock private sector investment across the economy.
Access to finance
Many businesses have the ambition to grow but struggle to access the finance needed to invest. This is particularly true for SMEs and scale-ups, which often face barriers when seeking funding for expansion, innovation and new technologies. Improving access to finance should be a key priority for government and financial institutions alike. The BCC’s Quarterly Economic Survey for Q2 of 2026 shows that only 17% of firms plan to increase investment, a post-pandemic low.
Businesses need clear routes to funding, better support to become investment-ready and greater access to growth capital, regardless of where they are located. If more firms can secure the finance they need, they will be better placed to invest, expand and contribute to economic growth. One way the new government could address this would be to ensure that Public Finance Institutions (PuFins), such as the British Business Bank and National Wealth Fund, maintain and grow their capacity. Then, they must maximise their impact on investment to deliver growth in every postcode across the UK.
Conclusion
Creating the conditions for investment should sit at the heart of the UK’s growth strategy. Businesses invest when they have confidence in the future, confidence that key infrastructure will be delivered, confidence that costs will remain competitive and confidence that government is providing a stable environment.
We want to see three key things from this new administration to boost private sector investment and drive long-term economic growth across the UK:
- Certainty on and speedy delivery of major infrastructure projects, using local supply chains to boost growth
- A more investment-friendly tax and cost environment
- Better access to finance, especially for SMEs