(qlmbusinessnews.com . Fri 28th Nov, 2025) London, UK —
New Government Budget Falls Short on Promises for Business Growth and Innovation
In a pronounced evaluation by the government’s official watchdog, the Office for Budget Responsibility (OBR), not one element outlined in the government's comprehensive Budget is anticipated to amend the growth forecasts spanning the next half-decade. This revelation strikes as particularly unsettling for a government that has placed economic expansion at the forefront of its agenda.
Despite a mild uplift in this year's growth forecast by the OBR, projections for each subsequent year up to 2030 have seen a reduction. Businesses, having braced for severe fiscal measures akin to the previous Budget's £25 billion increase in employer national insurance contributions, found little within the proposals to stimulate significant pro-business sentiments.
The question echoing among the business community remains, “Where is the growth?” Even industries acknowledged for receiving targeted support, such as retail and hospitality, face impending rises in operational costs due to elevated business rates and labour expenses.
The government proposed recalculating business rates for 750,000 entities in retail and hospitality at a reduced rateable value percentage. Nonetheless, this concession appeared less generous than anticipated, and with the rateable value for many firms on the rise coupled with the cessation of a 40% Covid-era discount this April, the upcoming adjustments in business rates signal substantial financial burdens for numerous establishments.
Furthermore, an 8.5% salary increase for 18-20 year-olds on the national living wage, although beneficial for young workers, might deter employers from hiring, following a 16.3% rise in the previous year. According to a leading executive from a FTSE 100 company, such policies may inadvertently harm the employment prospects they aim to enhance.
Restrictions on salary sacrifice arrangements could affect both employees and firms, potentially leading to scaled-back pension contributions and diminished funds for business expansion or wage hikes. Conversely, minor adjustments, such as expanded tax breaks for investors in emerging companies through the Enterprise Investment Scheme and Venture Capital Trusts, could hold promise for bolstering growth.
A Treasury spokesperson defended the Budget, asserting the existing economic performance surpasses forecasts, with a focus on fuelling growth through considerable new capital investments, robust private investment, and ambitious planning reforms.
Amidst broad scepticism of any chancellor's capacity to genuinely “unleash” growth, the general consensus desires minimal interference through taxation and regulatory burdens, seeking merely the freedom to pursue their endeavours. This year's Budget, offering more fiscal leeway and a reduced need for a “bewildering smorgasbord of policies,” as remarked by Rachel Reeves, might just lay down a more stable foundation for future growth.
Though former Bank of England chief economist Andy Haldane may have exaggerated in attributing the pre-Budget speculations as a principal growth deterrent for the latter half of the year, the consensus is clear: stability and certainty are crucial.
In the period building up to the Budget announcement, Steve Rigby, a prominent business figure, voiced a plea for a fiscal strategy that wouldn't severely disrupt business operations. Post-revelation, the verdict seems to pass this minimal threshold – a modest success for a government striving to reinvigorate growth.
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