Jeremy Hunt must recalibrate UK’s business environment in Spring Budget: Beckie Hart

The last week has been packed with economic and political news. Eyes were firmly on the by-election results in Wellingborough and Kingswood last Friday.

But here at the CBI, we’ve been laser-focused on the abundance of economic data that hit our desks last week – and what it all means for our growth prospects.

And it’s been a bit of a mixed bag.

On Tuesday, the Office for National Statistics (ONS) published the latest labour market statistics, highlighting the UK’s persistently high level of economic inactivity due to long-term sickness.

Chancellor Jeremy Hunt outside Downing Street. PIC: Victoria Jones/PA WireChancellor Jeremy Hunt outside Downing Street. PIC: Victoria Jones/PA Wire
Chancellor Jeremy Hunt outside Downing Street. PIC: Victoria Jones/PA Wire
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Indeed, many firms right across Yorkshire and the Humber are struggling to cope with the lack of staff available to them.

Every day I speak to business leaders who tell me that they don’t have enough people, don’t have access to the right skills, to double down on their growth ambitions.

We also learned that there has been no movement in inflation over January.

Whilst that’s no reason for cheer, we know that the overall direction of travel when it comes to inflation has been encouraging – having fallen from the dizzying heights of 15 months ago.

Beckie Hart is regional director, Yorkshire & Humber at CBIBeckie Hart is regional director, Yorkshire & Humber at CBI
Beckie Hart is regional director, Yorkshire & Humber at CBI
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Yet, the Bank of England will likely wait for more definitive signs that price pressures are softening before lowering interest rates – though it’s now a matter of “when,” rather than “if.”

And finally, on Thursday, we got confirmation that the UK fell into a technical recession in the second half of 2023, concluding a pretty stagnant year for growth.

The future doesn’t look quite as gloomy: in our latest surveys, we’re seeing signs that 2024 has gotten off to a better start.

Expectations are more positive in the services and manufacturing sectors, with firms anticipating that the drag from higher interest rates will lessen.

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But businesses in our region are still under considerable pressure, with increased borrowing costs, higher prices and weak demand weighing down investment ambitions.

Firms are quite clearly still feeling the pinch, and many lack the resources needed to get growing.

In less than a month, on March 6, Chancellor Jeremy Hunt will step up to the despatch box to deliver his Spring Budget.

And that’s a chance to recalibrate the UK’s business environment, a chance to set us on the path for sustainable growth.

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In our Spring Budget submission, we propose a number of building blocks to get the UK economy back on track.

The CBI is calling on the Government for action to help employers invest more in health and wellbeing, in turn boosting labour market participation. For example, through making preventative interventions, like Employee Assistance Programmes, tax-free.

It’s also important to support small businesses who are keen to play a more proactive role – delivery of the promised occupational health subsidy will go a long way to make that possible.

Those are just some of the ways the Government can make life easier for businesses at the Spring Budget. Speaking to business leaders and politicians, the CBI will make sure the voice of business is heard – in Westminster and beyond.

Beckie Hart is CBI regional director for Yorkshire and Humber

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