Soaring inflation and high business costs overshadow the Chancellor's measures intended to grow the economy

After inflation soared to 3.6% in June and amid fragile confidence from the region’s businesses evident in its most recent Quarterly Economic Surveys, East Midlands Chamber has said plans outlined in the Chancellor’s Mansion House speech may do little to boost gro

Measures laid out in the Chancellor’s address included ‘rolling back regulation’ that blocks risk taking; ‘streamlining’ of the Senior Managers and Certification Regime to speed up recruitment of senior leaders and a ‘concierge service’ aimed at helping companies wanting to set up in the UK.

East Midlands Chamber Director of Policy and Insight Richard Blackmore said: “With inflation having dramatically risen to 3.6% in June – the highest since January last year  - coupled with the most recent findings from our Quarterly Economic Survey showing a significant drop in confidence from East Midlands businesses, where only 3 out of 10 firms expect an increase in profit over the next year, down 15% from three quarters back, the measures outlined by the Chancellor only touch the surface in helping growth.  

“While enabling greater risk-taking from businesses, softening regulations and encouraging investment are logical ingredients for growth in the financial sector, the economy is not in a strong position – inflation has shot up, GDP has shrunk – that’s not going to help raise the fragile confidence of businesses right now. With the additional costs of things like higher National Insurance contributions and higher national living wage that hit businesses this year, firms need the most support they can get from policy makers.

“The Chancellor’s speech was a welcome step but support for firms needs to be greater to get above the challenges faced right now. For one, businesses need assurance they won’t be hit by tax rises and the Autumn Budget must not harm businesses with hikes.”