BCC boss Shevaun Haviland says chancellor needs to think about business
BCC DIRECTOR GENERAL SHEVAUN HAVILAND: Chancellor Rishi Sunak must put business at the heart of his plan for the economy
Looking ahead: Chancellor Rishi Sunak is set to unveil his plan for the economy
On Wednesday, the Chancellor unveils her plan for the economy and we urge her to put business at the heart of it.
Earlier this week, a Cambridgeshire small business leader told us his energy bills would triple from £14,000 a year to £46,000. This small business is doing everything they can to weather the storm, but there are many who just can’t and are desperately hoping the Chancellor will do something, anything, to give them enough breathing room to get through the coming months.
There is a “cost of doing business” crisis and a business as usual approach is not going to fix it; however we are no longer in this world.
Businesses across the country are being crushed under the weight of skyrocketing energy bills, soaring prices for every conceivable commodity, and a tightly squeezed labor market. In January, 3 out of 4 companies we surveyed told us they were forced to raise prices, with a large proportion citing the price of materials, utilities and wage increases as driving factors.
Yet next month the government plans to scrap an increase in National Insurance contributions on top of that mountain of cost pressures. This tax hike will be a blow for some companies bruised by the ruinous effects of two years of Covid measures. Our latest data shows that for more than three-quarters of nearly 5,000 businesses, rising inflation is now their top concern. This is the highest level seen since we asked the question 13 years ago.
As the horrific events in Ukraine unfolded, they also brought huge economic consequences, from massive gas price spikes to the cost of metals like steel and nickel exploding.
While the causes of inflationary pressures may not be the fault of the government, it can still act now and find a way out of this “cost of doing business” crisis.
We know from speaking to our members that the Chancellor needs to do two things on Wednesday – he needs to postpone the National Insurance increase for a year and he needs to come up with a temporary energy price cap for SMEs to protect the smallest and most vulnerable businesses from the worst effects of soaring energy prices.
If these issues are not addressed, businesses will go to the wall, which in turn will lead to job losses, less choice for consumers and even greater pressure on the cost of living as prices continue to increase. Many businesses are the heart of their local communities, and losing them will only harm the government’s vital ambitions.
Companies do not ask the government to support them continuously. What these measures will do is give businesses a fighting chance to get through the tough months ahead so they can come back stronger once conditions ease.
Businesses are the engine of the economy, and if they get some protection now, they can pay it back many times over in the months to come by providing the growth needed to fill the Chancellor’s coffers.
The government has done a great job of being there for businesses throughout the worst ravages of the pandemic, so we urge them not to stop now.
With serious global issues at stake, no one expects the Chancellor to deliver miracles this week, but he can offer hope and give businesses the confidence to look forward to a brighter future.