Budget uncertainty threatens to freeze growth at small businesses

A significant number of small and medium-sized enterprises (SMEs) have warned their growth ambitions may be at risk if Rachel Reeves doesn’t prioritise their concerns in the upcoming Autumn Budget.

According to a survey of over 500 SME leaders on behalf of specialist lender Simply Asset Finance, 74 per cent said the outcomes of the budget on 30 October would have a direct impact their future growth plans.

It comes as Rachel Reeves’ rumoured plans to ditch a slew of tax breaks for entrepreneurs also face growing criticism, with some top business groups warning it could harm Britain’s start-up ecosystem.

Some 33 per cent of those surveyed listed action against rising energy costs as a priority, with 27 per cent voicing their concerns around tax incentives for innovation.

“It’s evident that the Government does not yet have the full confidence of UK business, but the budget is an opportunity for that to be tackled head on,” Mike Randall, chief executive at Simply Asset Finance, said.

Randall added: “Businesses up and down the UK recognise that the next 12 months offer a real opportunity for them to grow. But they need a helping hand to seize it.

“By doing that, we can create an environment where SMEs thrive, driving economic growth and innovation.”

‘Approaching with trepidation’

Some SME leaders have already started to take cautionary measures, with 16 per cent stating they have already halted investment and planning.

Other prominent small business groups, such as Small Business Britain, have begun to advocate for prioritisation of trading opportunities, tax incentives, and access to finance ahead of the budget.

Michelle Ovens, the founder of Small Business Britain, said: “Many of the nation’s 5.5m businesses are approaching this Budget with trepidation.

“Given they collectively represent huge potential for powering UK growth we need measures that boost confidence.

“With high costs and affordability still a major issue for small firms, every effort must be made to avoid further ramping up their costs.”