Ahead of the much-anticipated Autumn Budget, the mood music appears to have changed. Hopes for more certainty and stability following the general election have morphed into speculation and worry over what the Chancellor may announce on 30 October. 

Throughout September, ICAEW members have continued to share their challenges and insights on business conditions with the business team, captured through our regional, national and international networks. 

The principal theme to emerge centred on expectations for the Autumn Budget and what rumoured announcements might mean for business prospects and personal finances. 

While the Chancellor’s speech at this week’s Labour Party Conference aimed to quell concerns, ICAEW members have shared how policy rumour is translating to business decisions now.

Impact of the Autumn Budget

Practice members have reported a knee-jerk reaction and an uptick in enquiries in response to speculation about the contents of the upcoming Budget. “Clients are rushing to sell due to concern over rising capital gains tax (CGT) and other threats. Those who are internationally mobile may leave.” 

Members from the farming sector reported “gifting of property and land, which is keeping solicitors busy on conveyancing and valuations”. Others working in healthcare noted an increase in business asset disposal, noting that achieving a sale ahead of 30 October “could prove unrealistic”. 

A view from one member in the East of England sums up the challenge: “Whatever happens with CGT at the Autumn Budget, the horse will already be halfway down the road. Even if CGT rules don’t change, the Chancellor will have collected more tax in the lead up based on expectations of policy change.”

Nonetheless, renewed uncertainty is taking its toll on investment. ‘Wait and see’ appears to be the consensus despite the growth agenda being at the centre of government policy. “Doom mongering is driving behaviour in the wrong direction. Government needs to be more positive if it wants to stimulate growth,” one member warned.

Industrial strategy 

A recent cross-sector discussion with members on UK industrial strategy highlighted the scale of the challenge but also the opportunity. A recurring theme is that infrastructure investment is key to growth with members repeatedly calling for “a long-term policy that doesn’t change every five minutes”. 

While infrastructure is often thought of as roads, rail and real estate, ICAEW members also stress the importance of innovation infrastructure, with members challenging government to better understand the importance of a national policy that reduces silos to cross-pollinate ideas across sectors. 

At the same time, members continue to highlight the challenges in securing the necessary skills for the future. “Breaking down barriers to opportunity and encouraging social mobility” are highlighted as critical to ensuring a talent pipeline of workers with ideas and the ability to drive UK growth sectors. 

As one member put it: “A major concern is labour supply and the ability to fill vacancies. A shortage of engineering skills makes delivery of projects a challenge and has the potential to drive inflationary pressures.”

With the green agenda identified as a major opportunity for the UK, the state of public finances is a source of concern: “Lots of our business is determined by government expenditure – will the money be available to drive the green agenda?”

Employment Rights Bill

There is concern that new laws could be difficult to implement, particularly for smaller businesses where, as noted by a member who works in manufacturing in the South West, “resource cost to comply becomes a huge part of expenditure”. Another cautioned: “More legislation is detrimental to the health of start-up businesses.”

To navigate changes, some businesses report looking at outsourcing to agency workers, particularly for low-skilled labour, as a means to inject more workforce flexibility. “Hiring is always a bit of a gamble and we want to be able to get out of it.”

One unintended consequence of policy might impact training: “We all want to invest in people, but if pushed to hire on a temporary basis by legislation then this could be reduced.”

ICAEW’s Autumn Budget 2024 representation to HM Treasury calls on government to establish a framework to give companies stability and opportunities for growth. Meanwhile, ICAEW’s Tax Faculty has previewed the range of measures that might be included in the 30 October announcements. 

On the topic of growth, ICAEW’s scale-up series of webinars starting on 25 September are free to members and will cover a range of subjects including building a culture to attract the right people, raising finance and networking skills.

• To share your thoughts on business conditions or to highlight any issues or opportunities with the ICAEW business team, please visit the ICAEW Member Insights page.