Budget Gets Mixed Reception From Business Organisations

Chancellor Tries To Create Wriggle Room As Economy Wobbles To Bring New Hope For The Future

UK Prime Minister Andy Burnham said after the Budget was announced on Wednesday that “John Healey delivered Labour’s Budget for breathing space today and fresh hope for the future.

“At our Conference this year, I made clear that hope comes from honesty.

“That’s why today’s Budget faces the real pressures people are living with head on.

“It provides help with energy bills, opens the door to home ownership and backs the businesses at the heart of our high streets.

“It invests in Britain’s future and puts more power in the hands of local communities.

“These are Labour choices, grounded in our mission to make Britain hope again.

“A Budget can help move our country in the right direction. But lasting change is built when people believe in it, feel part of it and know they have a voice in what comes next.

“That is the Labour movement we are building: open, rooted in every community and big enough to bring the country together behind a better future.”

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IoD: Budget meets the brief, but is no game changer for growth

Following the Institute of Directors’ initial response to the Chancellor’s Autumn Budget Statement, Anna Leach, Chief Economist at the Institute of Directors, said:

“In the short-term, this Budget fulfils its brief of delivering some relief for households and a chosen few in the business community, particularly high street businesses and pubs. Ongoing efforts to improve the ecosystem for entrepreneurs alongside capital reforms are welcome and should help more businesses form and scale in the UK.

The devolution agenda has considerable scope to improve the efficiency of the state, albeit the payoff is a fair way off and provided the risks are well managed. There’s tougher talk on tackling public spending, increasing the hope that fiscal risk will no longer fall so squarely on the shoulders of businesses and investors.

“But this Budget is also a missed opportunity. Business taxes go up again overall, as does borrowing. The £2.6 billion being spent on untargeted and small-scale reductions in household energy bills would have been better used to reduce the cost of employing young people or reducing business energy bills.

The surcharge on banks may be smaller and shorter lived than feared, but it still represents yet another attack on successful large businesses in the UK which will do little for the UK’s global investor appeal. Spending restraint is tomorrow’s problem and the need for wholesale reform of the tax system remains.

“All in all, there’s no game changer for growth here. Living standards remain under pressure, housebuilding targets will not be met, distortionary taxes remain unreformed and the UK’s capacity to meet further shocks continues to be eroded. All eyes will be on next year’s Spending Review as the big test of the Government’s resolve in tackling some of the hard choices needed.”

The full detail on the Chancellor’s Budget is available in the Red Book here.

 Economic confidence unchanged after Budget, as business leaders call for spending restraint

The IoD Directors’ Economic Confidence Index, which measures business leader optimism in prospects for the UK economy, rose to -45 in October 2026 in the run-up to the Budget, from -54 in September, the highest the index has been since May 2025.

The Chancellor’s Budget did not have a significant impact on the headline index. In a snap poll immediately following the Budget, the index was little changed at -43.

Business leader confidence in their own organisations rose ahead of the Budget to +19 in October, from +10 in September. However, the post-Budget snap poll showed organisational confidence dropped back to -1.

In the underlying data:

• Revenue expectations increased to +28 in October ahead of the Budget from +21 in September, the highest level since July 2024 (and just above the long run average of +27 since 2016). However post-Budget, this dropped to +8 – its lowest since December 2025.
• Costs expectations were little changed at +78, from +79 ahead of their Budget, well above the series average (+67). Post-Budget they edged up to +81.
• Investment intentions increased to +1 ahead of the Budget, from -8, their highest since August 2024 (long run average +5). Post-Budget, they dropped back down to -9.
• Headcount expectations rose to +2, from -2 ahead of the Budget, their highest since April 2025 (long run average +10). Post-Budget, they fell to -6.
• Export intentions rose to +13, from +8, the highest since June 2024 (long run average +9). Post-Budget, they dipped back to +8.

Anna Leach, Chief Economist at the Institute of Directors, said: “Our October survey, which closed just before the Chancellor’s Budget speech, showed an ongoing recovery in confidence in the wider UK economy, with our Decision Makers Economic Confidence Index at its highest level since May 2025. Encouragingly, businesses’ expectations for their

“around September 2024 levels, and investment and hiring intentions moving back into positive territory.

“However, our post-Budget snap poll suggests the Budget has done little to encourage business leaders to take their investment and recruitment plans out of mothballs. While confidence in the wider economy held up, revenue expectations fell sharply to their weakest in ten months, while investment and hiring intentions also deteriorated.

“Ahead of the Budget, business leaders were clear that they wanted the Chancellor to address the deterioration in the public finances. Three-quarters favoured reducing welfare spending, nearly six in ten supported reducing departmental spending, and four in ten wanted reforms to make the pensions triple lock less expensive.

“Instead, the Chancellor has allowed fiscal headroom to fall substantially, leaving the public finances with relatively little protection against further shocks. With the Milburn and Timms reviews due shortly, there is an opportunity to develop welfare reforms that both improve employment outcomes and put spending on a more sustainable footing. But the Chancellor has not committed to bringing the welfare bill down within this Parliament.

“With difficult decisions on spending still ahead and limited fiscal headroom, businesses will be concerned that the risk of further tax increases has not gone away. After two years of weak business confidence, the priority remains to provide a more stable and supportive environment in which firms can invest, recruit and grow.”

The IoD Directors’ Economic Confidence Index measures the net % positive answers from members of the Institute of Directors to the question ‘How optimistic are you about the wider UK economy over the next 12 months?’ on a five-point scale from ‘very optimistic’ to ‘very pessimistic’.

Full Results

Pre-Budget poll: 452 responses from across the UK, conducted between 16-28 October. 13% ran large businesses (250+ people), 21% medium (50-249), 20% small (10-49 people), 33% micro (2-9 people) and 13% sole trader and self-employed business entities (0-1 people).

Post-Budget snap poll: 278 responses from across the UK, conducted in the 24 hours after the Chancellor’s Budget Statement. 14% ran large businesses (250+ people), 19% medium (50-249), 25% small (10-49 people), 30% micro (2-9 people) and 11% sole trader and self-employed business entities (0-1 people).

How optimistic are you about both the wider UK economy and also your organisation over the next 12 months?

Pre-Budget: Comparing the next 12 months with the last 12 months, what do you believe the outlook for your organisation will be in terms of:

Post-Budget: Comparing the next 12 months with the last 12 months, what do you believe the outlook for your organisation will be in terms of:

Pre-Budget: The Chancellor’s “headroom” against the fiscal rules is expected to have fallen due to a rise in UK Government borrowing costs. How do you think the Chancellor should plug the gap? 

Retail NI Reaction to Chancellor’s Budget

Responding to the Chancellor’s Budget, Retail NI Chief Executive Glyn Roberts said:

“At first glance, it is difficult to see how this Budget will address the immediate challenges facing our local economy and high streets.

“We welcome the Chancellor’s announcement that around 70,000 small retail, hospitality and leisure businesses in England will be taken out of paying business rates altogether.

“The Barnett consequential funding that the Northern Ireland Executive receives as a result of this announcement must be used to deliver meaningful rates relief for small businesses here in Northern Ireland.

“Why should our members and other local small businesses, who already face the highest business rates burden in the UK, be denied the same support as their counterparts in England?

“Our high streets have the highest vacancy rates in the UK, at 25%. This is a clear indication of the pressure facing our town and city centres and the urgent need for action.

“The Executive now has an opportunity to use this additional funding to make a real difference. It must prioritise small business rates relief, support independent retailers and help tackle the growing high street vacancy crisis.

“Northern Ireland’s small businesses cannot afford to be left behind. The Executive must ensure that this Budget delivers tangible benefits for our local economy and the businesses at the heart of our communities.”

Countryside Alliance Comments On Budget

“This Budget offered the Chancellor the opportunity to reset its relationship with the countryside. Today, however, he showed little interest in seizing that chance.

“Extending small business rates relief could help rural businesses, but coupled with hikes in employment costs it remains to be seen whether hardworking rural business owners will see any real benefit. Additionally, while temporarily extending the red diesel duty cut and suspending tariffs on kerosene heating oil and fertiliser are welcome moves, it will come as little solace to farmers still facing enormous threats to their livelihoods.

“Before becoming Prime Minister, Andy Burnham pledged to revisit the hated Family Farm Tax. He has failed to do so. This tax continues to tarnish the government’s rural record. It is preventing farmers from making important decisions about their livelihoods, hampering the government’s own mission of creating good growth in every postcode. Working with the custodians of our countryside, we will continue to vocally oppose this tax and call for its abolition.

“Additionally, farmers have been encouraged for years to diversify their businesses by creating holiday lets, among other measures; but anyone who has done so is now being punished by yet another increase to the property income tax paid on such lets, further threatening the viability of their business.

“At a time when the government should be increasing support for farmers and in the wake of last month’s Sustainable Farming Incentive fiasco, it has slashed DEFRA’s funding for 2027-28 by £100m.

“This Budget does little to give “breathing space” or fresh hope for the countryside. If this government is serious about growth in every postcode, including in the countryside, it must urgently address the plethora of problems facing rural businesses. Scrapping the Family Farm Tax is the only way to turn a new leaf.

Armstrong: Labour’s red hand strikes farmers again

Ulster Unionist Deputy Leader and Agriculture Spokesperson Diana Armstrong MLA has said the Chancellor’s Budget leaves farm families exactly where they were, with no change to the Family Farm Tax and a cliff edge on red diesel coming next summer.

Diana Armstrong said: “This was the first Budget since Labour’s Family Farm Tax actually came into force in April, and the Chancellor had every opportunity to put it right. He has not touched it. There is not a line in this Budget on Agricultural or Business Property Relief.

“When the Government confirmed last year that it was pressing ahead, my colleague Robbie Butler said Labour’s red hand had slapped farmers in the face. Today it struck them again, and this time the tax is already law and already biting.

“Almost nine in ten farmers responding to a survey last month said these changes had increased stress or worry in their families. Nearly half said the young person who was meant to take over the farm is now less willing or less able to do it. That is what this policy is doing in farmhouses across Northern Ireland, and the Government said nothing to any of them today.

“Robin Swann MP has been fighting this at Westminster from the very first day, alongside farming families who took their own case to Parliament.

“There is worse in the detail. The cut to red diesel runs only until the first of July next year. After that the duty returns to where it was before 2022 and rises with inflation. That is a cliff edge in front of every farm business that depends on it, and it should have been made permanent.

“Anyone letting land in conacre will pay more as well, with tax on that income going from 20p in the pound to 24p from April 2027. A farmer selling up on retirement will find the lifetime limit on Business Asset Disposal Relief halved to £500,000, which can mean up to £30,000 more in tax.

“I will give credit where it is due. Suspending tariffs on fertiliser until the end of 2027 and on kerosene until the end of 2028 will help, and the kerosene decision matters to the many rural households here heating their homes with oil. Extending the fuel duty cut helps too.

“But there is nothing on index-linking our ring-fenced agriculture budget, and the Government is pressing ahead with expanding the Carbon Border Adjustment Mechanism, which will add further cost and paperwork for our producers.

“Farmers wanted a Budget that backed farming. They got one that gives with one hand and takes with the other, while the thing doing the most damage to family farms was left untouched.”

Pat McGreevy Workers Party Representative Comments On Budget

Pat Mr McGreevy commenting on the first announcements in the chancellor’s budget said while many people will be glad of the relief on energy bills and the £100 winter payment the Government has clearly missed an opportunity the to fund many more issues that would help the working-class people who are suffering the consequences of the cost-of-living crisis.

They have balked at the notion of introducing a higher rate of windfall tax on banks who were the initial cause of the financial crisis by their greed and irresponsible practices, yet the chancellor talks about government being fiscally responsible when it comes to public spending.

Mr McGreevy added while the chancellor is lifting the tariffs on a number of  essential food items he again ignored the calls for a windfall tax on the obscene profits made by large supermarkets which would have helped create and bolster more public services.

The Workers Party is reiterating our call for the government to cancel the Palantir contract as part of the review of the health service system’s and to rescind the deal signed by the previous health minister to satisfy the Trump administration and cost the taxpayers billions more in drug charges resulting in national health service patients not receiving some life saving drugs due to costs.

Mr McGreevy said many people will have been looking for a sign that a labour government would put the interests of their constituents and communities first they are still paying homage to those who are thirsting to go to war and spend billions killing working class people in other countries. The government should be putting welfare not warfare as their priority, stop trying to please America, the European Union and NATO