The UK Spring Budget is a chance for the government to lay out how it sees the general economic outlook, as well as an opportunity to set out measures it feels may help in the short term.  

So in the aftermath of last week’s announcement, UK small businesses and trade bodies have responded to chancellor Rachel Reeves’ latest economic update with a mixture of positivity, caution and disappointment.  

Tina McKenzie, policy chair of the Federation of Small Businesses bemoaned the lack of focus on business costs, saying the chancellor had “Missed the chance today to address the costs stack about to hit small firms,” highlighting the fact that from next month, employment costs, business rates and energy bills will all see an increase.  

And she called for the UK government to do more to help small and growing businesses. “As the April costs stack bites, the Chancellor must give assurance that she’ll take decisive action to ease the taxes and costs imperilling small firms and the self-employed, and in turn imperilling the jobs, opportunities and local prosperity they could otherwise bring.” 

‘An improving outlook’ 

On a more positive note, David Williams, head of group risk at Everywhen, said that he was encouraged by the fact that “The broader economic backdrop continues to improve with lower inflation and interest rates. With this improved environment, many employers may feel better placed to invest in their people now or as part of future budgeting later this year – strengthening reward, wellbeing, and benefits packages.  

So, while no news is good news right now, it is important for the government to combine an improving outlook with momentum generated by activity such as the Keep Britain Working report and start to build future policy decisions around recommendations that can improve the productivity of the UK through healthy workforces.

From the tech perspective, one of the leading accounting software vendors gave a measured reaction to the statement. Kate Hayward, UK managing director at  Xero, pointed out that “The Chancellor’s pro-growth message is likely to feel at odds with reality, particularly for small businesses who are still managing the fall-out of a difficult winter and likely bracing for another year of uncertainty. 

Skills needed 

Reeves’ statement was vague about government support for further investment in skills, something Ben Willmott, head of public policy at the Chartered Institute of Personnel and Development (CIPD), highlighted: 

We welcome the Chancellor’s recognition of the challenges that many young people face entering employment, particularly the collapse in apprenticeship starts, and we’re encouraged to hear the Government will be setting out more reforms to support young people in the coming weeks.   

However, meaningful progress will require bold action. Introducing an Apprenticeship Guarantee for 16 to 24-year-olds, a measure strongly backed by employers, would help ensure many more young people have a clear pathway into work.

Paul’s thoughts on the Spring Budget

As for Paul Beare, the key takeaway was ‘no news is good news’. “While the Spring budget update didn’t say anything significant, except a reference without substance to counting to build closer trade ties with the EU – this being something of a focus for those firms working internationally regardless – the message to the businesses is simple, and one we have heard before, and will continue to. ‘Keep calm, and carry on’.  

And Paul was clear as to what businesses looking to set up in the UK should do next. “Continue to talk to us, or your appointed Relationship Manager about structuring your UK business for growth in the UK, and with our partners in IR Global for cross-border activity.” 

Wherever you are in your growth journey, getting the right advice and support from an accountancy practice is vital. That’s why at Paul Beare Ltd we offer a full range of accounting services, from tax and payroll to accounting and banking.