Leaders call for balanced Budget which recognises importance of business

Business leaders in Greater Birmingham today urged the Government to recognise the crucial impact of SMEs and entrepreneurs in tomorrow’s Budget.

The call from Greater Birmingham Chambers of Commerce comes after Prime Minister Sir Keir Starmer delivered speech in Birmingham yesterday, in which he said the Budget would embrace the “harsh light of fiscal reality”.

Addressing an audience at The REP theatre, the PM admitted his government would take “tough decisions”, opting to raise taxes in order “to prevent austerity and rebuild public services”.

Although he did not set out many details of the Budget, it is widely expected that tax increases, including National Insurance, will be included.

However, the GBCC insists Labour’s first Budget in 15 years must strike the right balance to avoid overburdening businesses with further cost pressures.

In its pre-Budget asks, in line with the British Chambers of Commerce, the GBCC is calling on the Government to:

• Create a competitive investment environment by expanding full expensing to leased assets

• Support a healthier workforce by reducing the employer and employee tax on workplace health services

• Engage employers in skills planning by extending investment in Local Skills Improvement Plans and addressing gaps in local training provision

• Reform business rates, with the aim of lowering the multiplier

• Invest in infrastructure by delivering previously planned transport projects, improving rail capacity, safeguard land earmarked for HS2 and updating planning rules to increase employment land supply

Henrietta Brealey, chief executive of the GBCC, said: “We welcome the Prime Minister choosing Birmingham to deliver his important pre-budget speech.

“He certainly made clear the challenges facing the public purse and that Wednesday’s budget will include many elements that will be hard to swallow.

“While many in the business community can respect an approach that sees real, longstanding issues tackled and tough, long-term decisions being made, this must be approached with the right balance.

“If Wednesday’s Budget goes too far to drive up tax and hit confidence it will curtail the same growth that the Government needs to meet its pledges.

“The Prime Minister talked about employees, public services and the inward investment commitments made by multinational corporations at the recent investment summit.

“One area missing from his speech was recognition of the importance and value of SMEs and the measures that they need to support their growth potential. SMEs are responsible for 61 per cent of employment in the UK.

“They are critical to both the Government’s ambitions to support working people and kickstart economic growth.

“Furthermore, entrepreneurs and business owners are hard-working people many of whom have taken significant personal risks to start and grow their businesses.

“We hope to see this importance and impact recognised in the final mix of measures in Wednesday’s budget.”

Business leaders in attendance for the PM’s speech yesterday included Solihull Chamber of Commerce president Eileen Schofield and Lichfield & Tamworth Chamber president Fiona Rouse.

Eileen Schofield said: “I was particularly pleased that Sir Keir chose to deliver his pre-Budget speech in Birmingham, recognising the importance of the West Midlands as a centre of excellence to deliver on many of his investment and growth policies. 

“Whilst the Prime Minister was reluctant to discuss the Budget, he reinforced the position that the Budget will deliver tough measures to support the NHS, schools and public services. 

“Workers will see improvements in rights and opportunities which is incredibly positive. However, as a small business owner and president of Solihull Chamber of Commerce, I am concerned that costs will increase for all business owners which may restrict growth in the SME sector.

“This could impede any aspiration to increase employment for the long-term inactive, the cornerstone of the Government policy for workers. 

“We need more growth and investment and it remains to be seen if this is the Budget which will serve to retain talent and support business growth in the West Midlands and nationally.”

Fiona Rouse said: “The Prime Minister reiterated the Government's five pillars that included being a clean energy superpower and kickstarting the economy. This included £500 million for development of more efficient battery storage for renewable energy.

“It was encouraging to hear that additional resources are going to be allocated to public services and the NHS, and we hope this will include  schools as well.   

“However, concerning for SME owners is that increased funding for these services will come from business tax and employer NI increases.

“It raises concerns about how this will impact their growth and ability to support the Government's aspirations to get more people back into work.

“I was hoping to hear more about how SMEs would be supported so they are able to underpin the Government's five pillar programme of fixing foundations - this was sadly lacking. 

“I'm hoping Budget day brings a degree of clarity to enable us to replan budgets and strategies, taking into account the inferred changes.”

Pictured: Prime Minister Sir Keir Starmer in Birmingham yesterday (credit: Eileen Schofield)