What British Businesses Really Need from the Next Budget

The Pressure on Government

With inflation still hovering above the Bank of England's target and global markets showing signs of renewed uncertainty, the UK government faces mounting pressure to deliver a budget that supports business growth without exacerbating fiscal challenges. My conversations with business leaders across sectors reveal a common concern: a need for strategic clarity rather than short-term fixes.

"We're not just looking for tax breaks," says Sarah Thompson, CEO of a mid-sized manufacturing firm in the Midlands. "We need policies that help us plan for the next five years."

Businesses are increasingly vocal about their expectations for the upcoming budget. They want measures that address long-term challenges such as energy costs, skills shortages, and access to capital—issues that don't disappear with a single fiscal announcement.

Energy Costs and Industrial Policy

One of the most pressing concerns among British businesses is the continued volatility in energy prices. Despite recent improvements in the wholesale market, many companies are still feeling the strain of high costs, especially in energy-intensive sectors like manufacturing and chemicals.

My research shows that while the government has introduced some relief measures, these are often temporary and insufficient to provide real stability. A sustainable industrial policy is needed—one that supports businesses through long-term contracts for renewable energy projects and helps reduce dependence on volatile international markets.

• Support for green energy transitions
• Long-term contracts for renewable projects
• Investment in infrastructure to reduce reliance on foreign fuels

The challenge here is balancing environmental goals with economic realities. Businesses want incentives that drive innovation, not just subsidies.

Skills and Labour Market Challenges

Another area where businesses are calling for action is the skills gap in the UK workforce. The rise of automation, digital transformation, and global competition means that companies need more skilled employees—but the pipeline of talent isn't keeping up.

This is particularly acute in sectors like technology and engineering. Businesses are asking for public-private partnerships to invest in training programs, apprenticeships, and reskilling initiatives. The budget should not just be about tax cuts; it must also include investments in human capital that can fuel future competitiveness.

"Investing in people is investing in the economy," notes Michael Chen, head of HR at a financial services firm in London. "We've seen how the lack of skilled labor affects productivity and innovation."

From apprenticeship tax relief to expanded funding for technical education, there are several areas where policy can make a tangible difference.

Access to Capital and SME Support

Small and medium enterprises (SMEs) continue to struggle with access to finance. While large corporations may have the resources to navigate complex lending environments, smaller firms often fall through the cracks—particularly those in emerging industries or rural areas.

The budget must include provisions to lower barriers to entry for SMEs. This might involve expanded credit guarantees, simplified loan processes, or even direct investment funds that focus on high-growth potential startups and innovative businesses.

In particular, digital transformation is a key area where SMEs are investing heavily but lack adequate support. Policies that help bridge the gap between tech adoption and financial capacity could be transformative for smaller players in the market.

The Role of Tax Policy

Taxation remains a cornerstone of any budget, but how it's used matters enormously. Many business leaders I've spoken with are weary of complex tax regimes that don't align with business realities.

I believe there's an opportunity to simplify the tax system while still generating revenue for public services. This means focusing on reducing inefficiencies in the current structure—like streamlining corporate tax rates and ensuring that small businesses aren't penalized for their size or sector.

Equally important is a review of incentives aimed at encouraging investment in research and development, which are crucial for long-term economic growth. These should be clearly defined, easy to access, and tied to measurable outcomes rather than just promises.

Looking Ahead: A Budget with Purpose

The next budget must reflect a deeper understanding of how businesses operate today. It should move beyond reactive responses to economic shocks and instead offer forward-looking strategies that create conditions for sustainable growth.

In my view, a successful budget will be one that listens—not just to the government's needs, but to the real-world pressures faced by businesses on the ground. This means integrating feedback from diverse industries and regions, especially those that have been historically underrepresented in policy discussions.

We must ask ourselves: What kind of economy do we want to build? And how can fiscal policy help us get there?