Spring Statement: Industry Commentary

Chancellor Rachel Reeves has delivered an update on her plans for the UK economy in her Spring Statement, but those in the retail sector have expressed their disappointment at the lack of support for the industry. No specific support for retailers and small businesses was announced, despite planned April increases to National Insurance, the National Living Wage and business rates.

Industry commentary follows:

Virtualstock powered by Logicbroker

Ed Bradley, Chief Growth Officer, Virtualstock powered by Logicbroker, said:

‘‘Today’s Spring Budget announcement arrives amidst a backdrop of low consumer confidence and high operating costs for retailers. Retailers are navigating a volatile economy: purses are tightening due to rising cost of living pressures, yet recent relief from inflation creates the possibility for spending bursts. With the right tools, retailers can turn this uncertainty into an opportunity to stand out against competitors.

What retailers need most right now is flexibility: the ability to source merchandise faster, respond to demand in real time, and safeguard margins. Those that stay agile will be prepared for whatever the shifting market brings.

As agentic commerce continues to transform how customers search, discover, and purchase, UK retailers cannot afford to compromise on their operational foundations. Forecasts may look bleak, but the retailers that combine scale with control – and experience with flawless execution - will secure the customer confidence they need to stay competitive.’’

British Retail Consortium

Responding to the Spring Forecast, Helen Dickinson, Chief Executive at the British Retail Consortium, said:
 
“Today’s figures underline the scale of the economic challenge: growth is fragile, unemployment has climbed to 5.2% and is expected to rise, and businesses are cutting back. While household finances may improve later in the Parliament, the immediate risk is to jobs, especially in retail. At a time when job vacancies are falling and confidence is weak, the priority should be protecting employment and strengthening living standards.
 
“Instead, retailers face a cost of doing business crisis. Employment costs rose by more than £5bn last year, and poorly implemented reforms in the Employment Rights Act risk adding further cost and complexity at the worst possible moment. Reforms must raise standards without deterring hiring.
 
“The Chancellor spoke about boosting investment in communities. Our high streets are the backbone of local economies, yet business rates continue to undermine their viability. While Government has taken some steps to fix the current system, it is broken and must be overhauled entirely to reduce the burden on the high street once and for all.
 
“Retail has unparalleled reach across the country, and stands ready to work with the Government to ‘spread’ and ‘unlock’ opportunity in every part of Britain. But to do so, Government must get a grip on the cost of doing business so retailers can invest confidently in people, places and prices.” 

Confederation of British Industry (CBI)

Louise Hellem, CBI Chief Economist, said:

“In a period of geopolitical upheaval, a Spring Forecast that prioritises certainty over chasing headlines is the right approach for the Chancellor.

“Reducing the cost of living, cutting borrowing and growing the economy are the right priorities, but they can’t be achieved without clear efforts to tackle the high cost of doing business. That’s what will give firms the headroom they need to invest in the technology, trade and training that drive jobs and wage growth.

“That requires government and business to work in partnership to lower industrial energy costs, find practical solutions to implementing the Employment Rights Act, and design a tax system that rewards, rather than penalises, employment, investment and risk-taking.

“Businesses back the growth mission and want to see delivery at pace. Delays in planning consents, skills approvals, grid connections or access to innovation funding translate directly into lost investment, higher costs and greater operational uncertainty.

“Modern business needs a UK that can move at speed where government and industry work together to remove bottlenecks, build capability and deliver major projects. Now is the moment to turn stability into momentum and give firms the confidence to invest, grow and deliver for communities across the country.”

Horticultural Trades Association

The Horticultural Trades Association (HTA) is disappointed by the Chancellor Rachel Reeves’ Spring Statement.

Fran Barnes, the HTA's Chief Executive, commented:

“We made a clear call ahead of this Spring forecast for action on the mounting costs facing horticultural businesses, curbing their ability to invest, recruit and grow. We were looking for the Chancellor to use this opportunity to give our sector and customers the confidence and certainty they so critically need. What we heard today on near-term unemployment and growth prospects is disappointing.

“Faced with a multitude of bill hikes and bureaucracy – business rates, employment law changes, wage hikes, energy costs, extended producer responsibility bills and requirements – we need action to stop stifling SMEs. These businesses are the driving force of the economy, and many are family-owned businesses. These are also working people whom the government so readily references. It is vital that they can work and operate in conditions which support their growth and give certainty. We continue to call on the government to act on business costs and put a spring in their step to boost our chances of real green growth.

“We will look at the detail that comes from the OBR, including the first official assessment of the costs of recent policy changes, such as on inheritance tax. We also welcome the confirmation in the Chancellor’s speech that this Government will go further in strengthening global relationships, breaking down trade barriers and deepening alliances with European partners. For us, this is the swift delivery of an SPS agreement to unlock the costs and barriers for our plant imports and exports.” 

Source : Virtualstock powered by Logicbroker; BRC; CBI; HTA

Image : claudiodivizia / iStock / 1178304624

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