How Government policies are impacting Gloucestershire businesses
We hear what Gloucestershire business owners really thought of the Spring Statement, and just what Government policies are doing to their companies and the county’s economy.
Dear reader,
Today we deliver our report on the Spring Statement, or rather what Gloucestershire business leaders thought of it and the impact it’s having on their companies.
You’ll have read the bits Chancellor Rachel Reeves said, but perhaps not heard how her statement, and her Budget before Christmas, is really impacting here in the county. Now’s your chance. It’s not all bad, but perhaps brace yourself.
Raikes was lucky enough to be able to sit among a cross section of businesspeople and experts in matters of finance, tax and investment as the detail unfolded, and they then shared their thoughts.
The bits we’re allowed to report are below. Just possibly there are a few pointers in their for the occupants of Number 10 and Number 11 Downing Street, should they ever subscribe to The Raikes Journal!
In the absence of a Local Enterprise Partnership and with the Western Gateway Partnership now counting down the days, to find a voice for business in the region we turned to Business West.
Phil Smith, MD, Business West, which represents chambers of commerce across Gloucestershire and beyond, said: “The Chancellor outlined some improved long-term growth forecasts from next year, thanks in part to the Government’s planning reform and increased defence spending.
“These measures are positive for our regional economy, which has a pressing need for new housing, and has a strong defence and advanced manufacturing industry.
“We were encouraged to hear the Chancellor’s plans to tackle the construction skills gap which is hampering the ability to build the homes that we need.
“This is in line with the recommendations from the Local Skills Improvement Plan, which Business West leads for the West of England and North Somerset, Gloucestershire, Swindon and Wiltshire.
“It is vital that the focus on business and economic growth continues, and we welcome the Chancellor’s commitment to helping drive this.”
Gloucestershire’s reaction is below.
Have a great weekend.
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Your briefing notes…
🏆 Gloucestershire-headquartered accountants Hazlewoods has been shortlisted again in the prestigious Tolley’s Taxation Awards 2025 for the Best Tax Practice in a Regional Firm award for the 10th year in a row. The award recognises exceptional achievements in a region and provides an opportunity for these to be acknowledged by an esteemed audience. Here’s wishing them luck.
🤦🏽♂️A spat has broken out between leader at Gloucestershire County Council and Reform UK’s Nigel Farage. Shire hall bosses has accused him of posting “misleading” party propaganda to voters. Farage sent a letter to postal workers claiming that the Tory-run council had “wasted vast amounts of taxpayer money, run up huge debts and keeps cuting services”. He said residents’ bins were not being collected frequently enough either, a service not actually provided by the county council but the six district authorities. Conservative Cllr Lynden Stowe called Farage “clearly wrong”.
👩🏽🎓👨🏽🎓 Hartpury University has announced that its undergraduate and postgraduate business management degrees have received Dual Accreditation from the Chartered Management Institute (CMI). Students enrolled on the BSc (Hons) Business Management will now also gain the CMI Level 5 Diploma in Management and Leadership, while those studying the MSc Business Management and Enterprise will receive the CMI Level 7 Diploma in Strategic Management and Leadership Practice as part of their programme. The professional diplomas are recognised by industry across the UK and beyond. Find out more here.
📅 Friday:
⚽ Gloucester City AFC play Tiverton Town at home at 7.45pm.
⚽ Cheltenham Town play Tranmere Rovers away at 7.45pm.
🎭 In the Mouth of the Wolf, based on Michael Morpurgo’s book and adapted by Simon Reade, is due to play at Barn Theatre, Cirencester, tonight from 7.30pm.
Saturday:
🏉Gloucester Rugby play Bristol Bears at Kingsholm at 5.30pm.
🎸Band The Wedding Present, with special guests Evy Frearson, play Stroud Sub Rooms from 7.30pm.
⚽ Forest Green Rovers FC play Soligull Moors at home at 12.30pm.
Sunday: Mother’s Day (a gently reminder, just in case you had forgotten!).
* The Raikes Journal is a community interest company. Everything you read by us is made possible by our incredible Founding Partners: QuoLux, Willans LLP, Gloucestershire College, Merrell People and Randall & Payne, our sponsors Hartpury University and Hartpury College, our Founding Members and wonderful paying subscribers.
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How Government policies are impacting Gloucestershire businesses
What Gloucestershire business owners really thought of the Spring Statement, and just what Government policies are doing to their companies; an honest snapshot of the county’s economy.
By Andrew Merrell.
“There is good stuff going on. We need to talk about that too and make sure we do not get dragged into just focusing on the negatives”, said Tim Watkins, the managing partner of Randall & Payne.
Watkins was drawing to a close a debate by the businesspeople who gathered at the firm’s Shurdington Road offices for a joint event with wealth management firm Rathbones, to watch the Spring Statement and then discuss.
The closed room policy created the perfect environment for some honest and informed feedback, and Raikes was lucky enough to be invited inside to try to capture just what those who help drive our county’s economy really think.
Watkins was not denying the challenging undercurrents already acknowledged by everyone in the room - some verging on riptides, especially those triggered by the impact of the Chancellor’s last Budget.
The headline bombshells from that Autumn statement being the much-reported rise in National Insurance contributions from 13.8 per cent to 15 per cent and the National Living Wage rising by 6.7 per cent, meaning three million people will see their pay rise from £11.44 to £12.21 an hour.
Where that money will come from, is the anxiety inducing part for many business owners. Both increases kick in next month (April).
According to some reports 82 per cent of businesses will be impacted by the NI hike.
Along with those announcements came news that inheritance tax relief for business and for agricultural assets would be capped at £1 million, with a new reduced rate of 20 per cent being charged above that (rather than the standard inheritance tax rate of 40 per cent).
And no one in the room at Randall & Payne was ignoring the gravity of those fast-approaching changes.
Watkins was picking up on the positive energy that had emerged after his guests had voiced their thoughts on the impact of the various policies and what they thought were the missed opportunities of the Spring Statement they’d just heard.
What emerged was how diverse the picture is of how Gloucestershire plc is now faring, with many business leaders reaching for expert help in order to understand, to reassess and recalibrate.
“We are certainly very busy,” Watkins told Raikes afterwards.
“I think one of the reasons we have become more important is because of how we can now use information.
“People have much more access to their numbers and that allows them to think much more about where they would like to be going in the future.
“We have the ability to help them do that. I think that is driving a lot of the work. It is no longer a traditional role where you only know what happened in the last 12 months.
“The emphasis now is on what will happen in the next 12 months and after that.”
Since the Autumn Budget business owners have been working hard to mitigate the potential impact of those pending April changes.
Some have decided now is the time to sell their businesses, others to buy them, with the wise ones taking the time to understand the new opportunities around tax for their private and business estates.
And as that debate in the room at Chargrove House tipped towards the positive, Rob Case, of Randall & Payne, orchestrated proceedings to ensure those with good stories to tell also got their moment.
Patricia Hay, of First Base Employment, based in Stroud, was one of those.
“February and March as been among the strongest in our history. We have helped place a lot of permanent staff.
“We did expect people to have less confidence, but it is not filtering through in what we are seeing,” said Hay.
Demand for staff, she said, had been ‘across the board’ in terms of sectors.
“HR, finance, administration, CNC machinists, forklift truck drivers. It has been really positive,” she added.
Willam Sheppard, of Staverton-based Weston Aviation, which handles charter flights, cargo, and even ground support for military training flights and exercises, had a similar line from a very different sector.
“Yes,” there have been changes,” said Sheppard. “A lot of people are using us for pleasure trips, some for business. But we are still busy.
“It is not one-way doom and gloom. There might be a foreboding about the future, but to say it is all one way or another is not a fair characterisation.”
Case put it to the room that policies seemed to show a “disconnect between the Government and business”. No one contradicted him.
“The Chancellor put a lot of value on the OBR figures, yet they actually show that the growth forecast has halved.
“So, the policies are not necessarily working yet,” Tim Hurst, of Rathbones, observed dryly.
The Office for Budget Responsibility (OBR) downgraded predicted growth for 2025 from two per cent to one per cent, but upgraded estimated growth for the next four years to 1.9 per cent next year, 1.8 per cent in 2027, 1.7 per cent in 2028 and 1.8 per cent in 2029.
There was plenty of scepticism around just how valuable the OBR figures were.
Whether trust has been broken entirely yet between the Government and the business community en masse is unsure, but some in the room had tales of the very real impact of government policy so far that wouldn’t help.
Sarah Cook, founder and managing director of Cheltenham-based HR People Support, provides HR services for clients from across the region, but predominantly in Gloucestershire.
“I would say for the last three to four weeks we have been helping companies through more redundancy processes, not one or two, but 20 at a time. This is all ahead of April,” said Cook.
“I believe there was a survey recently by the CIPD which said that 30 per cent of small businesses were planning to make members of their workforce redundant.
“Small businesses are very worried.”
Tristan George, of Rathbones, said: “I don’t think the Government is making it any easier for small businesses to take people on, and until that changes I think we are going to struggle.
“Costs in hospitality have almost trembled in the last 18 months. It is staggeringly short-sighted.”
Chris Wills, of Willans LLP solicitors, picked up the theme.
“That one in eight young people are out of work is quite shocking. But there are very few incentives for businesses to taking a punt on new staff,” said Wills, a partner in the Cheltenham firm’s corporate team.
“I think people will be far more reluctant to do that currently. The next generation will be there, with plenty of university debt to pay off and no opportunity to do so.”
He added: “We need to work out how we can give them those opportunities, otherwise they will be left with none – no matter how wonderful their qualifications.”
George Seatter, of Howden, (formerly Aston Lark) a specialist private client insurance broker, said there was even evidence of a ‘brain drain’ in recent months, with some businesspeople already relocating abroad.
“We have done a number of significant sales in the last six months and every owner has moved to Dubai. It is a worrying trend.
“If there are no entrepreneurs creating businesses where are the jobs going to come from?
“They can’t all be in defence or the housebuilding sector,” said Seatter, referring to the Government’s repeated ambition to ‘get the nation building’ and deliver one and a half million new homes across the country within five years.
Rachel Reeves’s statement also announced an extra £2.2bn in defence spending with the Chancellor expressing a desire to make the UK a “defence industrial superpower”.
It was one of the many references to the ‘changing world’ that she peppered her statement, a reference to an American Government insisting European countries do more to take the responsibility for defence off its shoulders.
It also brought a smile to some in the room just how often Reeves repeated the state of the finances her Government had inherited from the Conservative Party.
Generally, those present seemed to welcome news of investment, but made the point that extra spending needed to benefit UK firms and that many firms in the sector - such as BAE and Raytheon - were not actually British.
Roger White, of White House IT Solutions, said if small and medium-sized British firms were to benefit, the procurement process had to change.
“We have had a pop at IT procurement on three occasions but it was a waste of our time,” said White, whose firm is headquartered on Waterwells Business Park, Gloucester.
“It became very clear to us that no matter how good your solution, big business always wins.
“And then if you follow what happens with defence spending, many of those projects go over budget and come to nothing.
“If we are going to put more money into defence, we need to do it more efficiently and in a way that can also benefit SMEs too.”
As the Randall & Payne event wrapped up, perhaps it was Tristan George’s comment that delivered the clearest message to Government what was perplexing many in business.
George said: “Speaking to people in the room before the Statement it was apparent how much anxiety there was around the Government’s emphasis on growth, yet its decisions are making it harder for business every step of the way.”
James Geary, corporate tax partner at Randall & Payne, dug into the detail post event to find a shortlist of consultations triggered by Rachel Reeves’ statement worthy of mention.
Among them an attempt to understand how the HMRC could improve the advance clearance process to help businesses gain certainty on their R&D claim eligibility, as well as to help deter “bad agent” activity.
Another consultation will look into potential reforms to what HMRC calls “behavioural penalties” for individuals, businesses and other organisations relating to penalties it can charge for underpaid tax, or failure to make required notifications.
“Ahead of the Autumn Budget, we (also) have the Tax Administration and Maintenance (TAM) day in April and a full spending review in June.
“The TAM day is usually where consultations and policy papers are published, along with draft legislation,” said Geary, whose own thoughts neatly underlined everything we mention above.
“There was definitely some positivity in the room. Local businesses and people are making the changes necessary to continue to be successful, and the hope is that the Government can do the same albeit on a larger scale,” said Geary.
You can find out more about what Geary mentions above on the Randall & Payne website.