Mixed emotions after an Autumn Budget that gives with one hand, but takes with another
Rachel Reeves’ first Budget as Chancellor has delivered much to encourage small businesses in the UK.
But, as is often the case, there’s a sting in the tale in the shape of the much talked about National Insurance hike for employers.
That the government briefed on this in advance has in some ways helped to soften the blow, calmed any unwanted turbulence in the markets and offered a degree of stability from which to move forward.
And it’s economic stability that is paramount for the Growth Hub, and all of the businesses we support, so the government’s Industrial Strategy, with multi-year settlements for key sectors, is especially welcome.
It’s this kind of forward-thinking that will provide the fiscal foundations businesses need and want to make investment.
Made Smarter is a flagship programme in the West Midlands and we’re incredibly proud to have played an integral part in its coordination. We welcome the government’s decision to double the current funding to enable a rollout across the whole of England.
More than £200m will be made available for wider small business support, including continued funding for practical support through Growth Hubs, for which I have long advocated.
A further £1bn has been pledged across 2024/25 and 2025/26 for the British Business Bank to enhance access to finance for small businesses - another welcome step for companies in the UK.
Employment allowance, which allows smaller companies to reduce their NI liability, will increase from £5k to £10,500. This positive step, alongside a reform of Business Rates, will extend some relief on retail, hospitality and leisure.
But many businesses will also feel the pinch from the 1.2% increase on NI contributions on salaries above £5,000, in a move that will raise £25bn for the Treasury.
Labour promised to go big and bold ahead of their first Budget for 14 years.
They’ve done exactly that and SMEs will need to be resourceful in the way they counteract the statement’s more challenging elements.
