Inflation rise to 3.1% adds to need to cut business costs at Budget

Richard Blackmore from The East Midlands Chamber

The Chancellor must ensure the Autumn Budget on 28th October reduces the cost burden on business, East Midlands Chamber has said, after inflation rose for the second month in a row to 3.1%

The latest estimated inflation figure from the Office for National Statistics for the 12 months to August is up from 2.9% in the 12 months to July.

East Midlands Chamber Director of External Affairs Richard Blackmore said: “Another month, another inflation rise, primarily due to fuel cost increases, further exacerbating the crisis in the cost of doing business, and a major fiscal announcement – the Autumn Budget – only a month away. On 28th October the Chancellor must not miss the opportunity to ease pressure on business and incentivise firms to invest.

“Inflation has continually topped the concerns of East Midlands firms in our Quarterly Economic Survey, so for it to rise for a second month, moving further away from Government’s 2% target, is not news business wants to hear, especially given the weight of pressure from corporate taxation, business rates and high energy costs.

“With an interest rate announcement just around the corner, firms looking to borrow, to invest to grow, will have added anxiety from rising inflation as it adds to the possibility of an increase to the interest rate, although economists are generally expecting it to hold at 3.75%.

“Corporate taxation must be reduced, energy support for business must be widened and there must be a full root and branch review of business rates among measures announced in the Autumn Budget. The Chancellor can improve the conditions for business and 28th October is an opportunity that must be taken to do that.”