Government not doing enough for small businesses, FSB and Bira say after Spring Statement

Business representatives have warned that the Government is not providing the High Street with enough support after Chancellor Rachel Reeves attempted to lay out a positive message around cost of living and the economy during her Spring Statement yesterday (Tuesday 3 March).

The Federation of Small Businesses (FSB) said that the Spring Statement has done little to address the “cost stack” that the UK’s 5.7 million small businesses and self-employed people will face from April.

Meanwhile, Andrew Goodacre, chief executive of the British Independent Retailers Association (Bira), noted that independent retail is under “significant pressure” and that the Chancellor’s “words need to be backed by action.”

Reeves began her speech by offering reassurance that she would meet with industry leaders on Wednesday 4 March to discuss the implications of the recent conflict in the Middle East as the Government attempts to “manage this uncertain period.”

The Government’s aim is to “build growth and economic certainty in an uncertain world,” Reeves emphasised.

Her commitment to only having one fiscal event per year – the Autumn Statement, given last year on 26 November – is a rule designed to provide businesses with the certainty that they need, she told the House of Commons.

Reeves noted during her speech that inflation and borrowing are down and that the economy is growing, but acknowledged that many people’s only question will be: “are me and my family better off?”

Interest rates have been cut six times since the General Election in July 2024, Reeves said, adding that discounts on business energy costs and schemes backing entrepreneurs will come into effect over the next year.

Her party is investing in working people – “the builders, not the blockers,” Reeves said, and is backing innovation and developments in artificial intelligence.

Reeves also referenced recent healthcare investment, noting the “record cash settlement” that the Government has invested in the NHS.

Debt interest will cost the country £4 billion less next year than was projected in the autumn, Reeves said, adding that if the economy stays on course this will yield an extra £15 billion per year that can be spent on “working people.”

However, she also revealed that the Office for Budget Responsibility has downgraded the country’s growth forecast for 2026.

“Cost stack” for small businesses from April

The Spring Statement does not do enough to support small businesses, the FSB said on Tuesday.

“We’re a month away from employment costs going up, business rates going up and energy bills going up. The Chancellor missed the chance today to address the costs stack about to hit small firms,” policy chair of the FSB, Tina McKenzie, said.

She added: “The downgrading of the growth forecast for this year will be no surprise to small businesses, where cost burdens have already started reducing growth plans, cashflow and job creation in our local communities.”

McKenzie also provided a warning on energy prices as the conflict in the Middle East continues.

“Given the heightened global tensions of recent days, if there is another energy price crisis the Government must stand ready to bring forward a package of help for small business energy consumers, akin to during the last huge price spike,” she said.

McKenzie added: “As the April costs stack bites, the Chancellor must give assurance that she’ll take decisive action to ease the taxes and costs imperilling small firms and the self-employed, and in turn imperilling the jobs, opportunities and local prosperity they could otherwise bring.”

Energy prices and consumer confidence

Bira’s Goodacre raised concerns around the challenges already facing the High Street, which are likely to be exacerbated by the increase in oil and gas prices due to the conflict in the Middle East.

“The Chancellor spoke about building growth in every part of Britain and more money in consumers’ pockets to spend on the High Street, but independent retail has been more challenging than ever over the past few months,” Goodacre said.

He added: “We were caught off guard by the impact of the Ukraine conflict on energy costs, and we are calling on the Government to act now to protect businesses before history repeats itself.

“Our biggest concern is what this uncertainty does to consumer confidence and therefore consumer spending – and that is the last thing our members needed right now.”

Bira is calling on the Government to extend business rates relief, which iscurrently in place for pubs, to all independent High Street retailers.