The British Chambers of Commerce (BCC) is calling on Chancellor, John Healey, to ‘Back Business, Cut Costs and Deliver Growth’ in his first Budget statement.
With BCC research showing fragile business confidence, its budget submission asks the Chancellor to give firms the ‘breathing space’ they need to create jobs, invest and grow.
The BCC is recommending three fiscally responsible immediate steps:
- Cut employer National Insurance contributions for all under-25s, to help tackle the youth employment crisis, funded in part by replacing the pensions triple lock.
- Introduce a targeted tax reduction package to ease energy and business rate pressures for all firms. That should include government funding 75% of the Renewables Obligation for business, and lowering all rateable value multipliers.
- Restore consistent, locally delivered export support to help more SMEs trade globally and drive growth.
Taken together these measures will immediately reduce business costs, unlock investment and generate a stronger fiscal return through higher growth.
BCC research from thousands of businesses across the Chamber network shows the problem the Chancellor must tackle. Our analysis shows domestic policies have increased the cost stack facing a typical SME by over 70% in the past decade. Around a quarter of that rise has come since the 2024 budget.
The impact of these rising cost pressures on business behaviour has been significant. The BCC’s latest economic survey found that only 17% of SMEs are planning to increase investment this quarter, the lowest level recorded since the pandemic.
Alongside immediate action, the BCC is also calling for the Chancellor to outline a medium to long-term roadmap of reform. The plan should focus on three areas:
- Investing in people to deliver skills and productivity benefits
- Providing greater certainty on the delivery and outcomes from public sector investment
- Creating a tax reduction roadmap to encourage private sector investment
The BCC believes the government must also ensure fiscal devolution enables growth and will launch ‘a business vision’ for fiscal devolution in the coming weeks. The Chamber network stands ready to work with government as power is further devolved across the UK.
Shevaun Haviland, Director General of the British Chambers of Commerce said:
“We know the government is in a fiscal bind and its choices are limited. But support for business is not just money out the door, it generates vital economic returns. Easing cost pressures will give firms breathing space to create jobs, investment and growth.
“Right now, too many businesses are being held back by ever increasing bills. Our research shows domestic policy costs on firms have piled up by over 70% in the last decade.
“The Chancellor must use his first budget to cut the cost of doing business, allowing everyone to reap the economic benefits. Piling more taxes on firms, would be a road to ruin. The quickest way to destroy business confidence.
“We need to see immediate action on helping young people into work, cutting business rates and energy costs, as well as helping to support more SMEs to export. Taken together, we believe these measures can help light the touch paper for stronger growth.
“The Chancellor must also outline longer term plans to boost investment, skills and productivity across the UK. Our Chamber network is rooted in its communities; they know their local economies and want to work with government to make devolution a success.
“Pro-growth choices have never been more urgent. The Chancellor must ‘back business, cut costs and deliver growth.”
A summary of the BCC’s budget submission can be found here