The Chancellor of the Exchequer, Rachel Reeves, will address Parliament next week with her economic plan, which she will present to policymakers. The Spring Statement is expected to include numerous policy changes aiming to boost economic growth while cutting government costs and associated red tape, which undermines economic activity.
CI has received a comment from DECTA CEO Scott Dawson, who shares his opinion about what must be addressed. DECTA is a Fintech in the payments sector.
Dawson says that small businesses in the UK do not need more austerity but better solutions for today’s problems.
“It’s disappointing to see Labour once again contradict their original manifesto and the reason that so many people voted for them, but with the rate of change we’re witnessing in the world right now, what was relevant and sensible a year ago may not be possible now,” stated Dawson. “As with the previous budget, the first of Kier Starmer’s Prime Ministership, the focus is going to be cutting the budget (possibly through a new Elon Musk-inspired ‘Project Chainsaw’ that cut civil service jobs) while increasing defence spending as part of a Europe-wide rearmament push. Balancing the budget is always a good thing, there are undoubtedly efficiency savings that can be made in government and we should do our part for Europe’s defence, but all of the above could very easily be used as a pretext for more austerity and more upward transfers of wealth.”
Dawson shared that if the Spring Statement includes a belt-tightening policy, then one of the economy’s most impacted sectors will be the UK’s 5.5 million small businesses.
“We know from working with them that they are under more pressure than ever, with less access to the funding that they need to expand or stay afloat. Our own research into what UK consumers feel about SMEs, soon to be published, echoes this pessimistic view: a sizable majority don’t believe that the UK is a good place to do business as SMEs, and many are deeply concerned about price inflation and fraud.”
Dawson notes that SMEs are the most vital part of the UK economy, and they are starting to crack underneath the strain, as most people simply do not have enough money to spend on the services and products they need.