‘This was not the right Budget for small businesses’, says FSB Wales chair
‘This was not the right Budget for small businesses’, says FSB Wales chair
Subscribe to the Businessin Wales daily newsletter for FREE here.
Business leaders say the UK Budget has fallen short of delivering the pro-growth agenda firms had hoped for, warning that rising costs, tax changes and uncertainty risk undermining already fragile confidence.
Speaking on the Businessin Wales podcast’s Budget Roundtable Special, hosted at Dragon Group HQ and sponsored by Sinclair Group, representatives from retail, small business and professional services described the policy package as a missed opportunity to boost investment and support struggling sectors.
John Hurst, Chair of the Federation of Small Businesses (FSB) Wales, said confidence among small firms had sunk to unprecedented levels even before the Budget. “Confidence amongst small businesses was at an all-time low, even lower than during COVID,” he said.
FSB members had hoped the Chancellor would outline “some pro-business, pro-growth news that would improve that confidence level,” but feedback since the announcement suggested the Budget hasn’t moved the dial.
Hurst warned rising employment costs, tax increases and tightening margins were continuing to weigh heavily on employers.
He said: “There will be tax rises. It is going to be harder to employ people because costs are rising. And so, I think for small businesses, I don’t think this was the right budget for business.”
For professional services firms, labour costs and compliance pressures are also mounting. Laura Selby, Equity Partner and Head of Wills and Probate at Harding Evans, said the wage increase alone would force difficult decisions.
“We will of course have to look at the costs that are going to come in for us in terms of wages and the wage increase,” she said, adding that regulatory demands were pushing smaller firms to build in-house finance and compliance capacity. She said: “Maybe the really small businesses, they may struggle a little bit more.”
High street businesses, meanwhile, say they saw little in the Budget that will ease pressure on retail and hospitality.
Emily Cottrill, Associate Director at FOR Cardiff, said she could not point to something that would say: “This is a great budget for high street businesses.” Employment costs, she said, remain the biggest challenge for many operators.
Attention now turns to the Welsh Government, which is set to receive more than £500 million in additional funding as a result of the Budget.
But business rates, devolved to Wales, continue to dominate the debate. Cardiff city centre businesses in particular, Cottrill said, are disadvantaged by a system that fails to recognise the wider economic and social value of supporting high streets.
The Welsh Government has announced a £116 million support package designed to cushion businesses from changes to their rates bills when the next national revaluation comes into force on 1 April 2026.
The update, which will reflect current property values, is expected to cut bills for many firms across Wales, while others will face increases.
Ministers say the new funding package is aimed at ensuring companies have time to adjust.
Hurst echoed the call for deeper reform. “Let’s encourage growth. Let’s go beyond tinkering with it,” he said, arguing that business rates should be used as a lever to encourage job creation.
Despite the disappointment, leaders believe Wales still has an opportunity to chart its own course. Hurst said: “The Welsh Government have a huge opportunity. Let’s make [their budget] pro-growth.”
Since the podcast recording, The Welsh Government announced it had reached an agreement with Plaid Cymru to pass the 2026–27 Budget, securing almost £300 million in additional investment for Wales’ public services and averting the risk of a budget failing to pass entirely.
Want more from Businessin Wales? Why not follow us on our socials
Listen to the Businessin Wales podcast
