Give us a long-term plan in the Autumn Statement, says South West business

BUSINESSES desperately need a long-term plan for economic recovery from the Government if they are to survive a tough winter that could have catastrophic repercussions for regional economies, says the British Chambers of Commerce South West (BCCSW).

Chancellor Jeremy Hunt will set out the Government’s financial strategy today, when he delivers his delayed Autumn Statement in the House of Commons.

Businesses have been telling of their mounting concerns to Chambers for months. They fear tax hikes combined with soaring energy bills, spending cuts, a drop in consumer demand and escalating costs will mean many will fail to survive a harsh economic winter made worse by a fresh programme of austerity.

BCCSW, which represents thousands of companies in the South West, is calling on the Government to recognise the region’s potential as a green/blue powerhouse by not decimating capital spending on much-needed infrastructure projects that could power a green recovery.

BCCSW Chair Stuart Elford said: “Businesses will be watching this budget with apprehension but, overall, we need stability, including control of interest rates and inflation.

“It’s time for the government to recognise the Great South West as the blue/green powerhouse of the country and the South West as the ‘blue peninsula’. That means we need more investment in infrastructure, both physical (transport) and digital.

“I have also repeatedly asked the government, through the BCC, to extend the Annual Investment Allowance, to cover skills. In this tight labour market, with a shortage of employees hampering productivity, this is absolutely crucial.”

Businesses are the very bedrock of the economy but currently face a generational challenge which threatens the survival of many; eye-watering energy bills, labour shortages, 40-year high inflation, and rising interest rates. The Bank of England is now also forecasting a two-year recession. This week, the Chancellor is expected to dismantle much of what his predecessor Kwasi Kwarteng announced in his minibudget back in September, in a bid to reduce the size of the so-called fiscal black hole – the gap between what the government raises and spends.

Expected announcements include more spending cuts, a rise in the rate of Capital Gains Tax, and ongoing support around energy prices, which is going to be key – especially to the leisure, hospitality and tourism sector here in the South West.

The Autumn Statement will be delivered less than two weeks after the British Chambers of Commerce (BCC) sent Prime Minister Rishi Sunak a Business Manifesto to get firms through the tough months ahead and then power the UK’s economic recovery.

This Manifesto sets out 17 key policies designed to tackle the challenges facing businesses across the economy, the labour market, international trade and Net Zero.

The BCC’s latest Quarterly Economic Survey for Q3 highlighted an alarming drop in business confidence and conditions, with key economic indicators falling back to Covid-crisis levels. One in three firms reported a decrease in cash flow, while 25% reported a decrease in domestic sales.