Recent research by Evelyn Partners reveals that nearly one in three business owners (31%) anticipate making redundancies in the coming year, with 30% fearing they may default on debts. The study, which surveyed 500 UK business owners with turnovers exceeding £5m, highlights the pressures from rising costs, including increased taxation and the cost of living crisis. Claire Burden, head of the advisory consulting team at Evelyn Partners, stated: “The cumulative impact of inflation over recent years is still hitting businesses hard.” She emphasised the urgent need for business owners to reassess their operating models to navigate the challenging environment. The findings come in the wake of a Budget announcement that raised National Insurance contributions and minimum wage, further straining businesses.

The GfK consumer confidence index increased by three points this month, now standing at minus 18, indicating a slight recovery despite remaining in negative territory. Neil Bellamy, GfK consumer insights director, noted: “There was evidence of nervousness in recent months as consumers contemplated the potentially worrying impact of the UK Budget.” Confidence in personal finances improved to minus one, while expectations for the general economic situation rose to minus 26. Linda Ellett, UK head of consumer, retail and leisure markets at KPMG, highlighted that consumer confidence remains variable, influenced by inflation and interest rates. She stated: “Early indications are positive on the impact the Black Friday and Cyber Monday period could have.” Retailers are hopeful for increased spending as the festive season approaches.

October’s inflation rate of 2.3% has raised alarms within the hospitality sector, which is already grappling with various challenges. Sophie Michael, head of retail and wholesale at BDO, noted that businesses are facing “inflationary pressures as a result of their own supply chain.” UK Hospitality predicts a £3.4bn cost increase due to rising national employer contributions, with chief executive Kate Nicholls warning that this will “impact jobs and push up prices.” The situation is exacerbated by geopolitical tensions and potential tariffs, leading to increased operational costs. Consumer confidence has also dipped, further complicating the landscape for hospitality firms.

Inheritance tax (IHT) receipts in the UK have surged to £5bn between April and October this year, marking a £500m increase from the previous year. This rise follows significant changes introduced in the Autumn Budget, including a flat rate of 40% on estates exceeding £325,000 and new rules affecting inherited pension pots from April 2027. Alex Davies, chief executive of Wealth Club, stated that the tax “was already an absolute cash cow” and warned that the recent changes would exacerbate the situation, particularly impacting farmers and business owners. Critics, including Sir James Dyson, have condemned the Budget as “ignorant” and detrimental to family businesses. Rachael Griffin from Quilter noted that the upward trend in IHT receipts highlights the urgency for individuals to reassess their estate planning strategies in light of the new regulations.

Nish Kankiwala, the outgoing boss of John Lewis, has called for a “radical” overhaul of Britain’s business rates system, citing a “two-handed grab” from private enterprise by the Chancellor. He warned that the group, which includes Waitrose, faces “tens of millions” in additional costs due to the recent Budget, which introduced a £25bn National Insurance tax increase and higher business rates. Kankiwala stated: “If they could delay the national insurance… and fundamentally bring forward a radical reshaping of business rates, I think that will make a massive difference.” Retailers are bracing for a £140m rise in business rates in April, with over 80 leading retailers warning that the tax hike could lead to store closures and job losses.

The Labour Government met with BlackRock chief executive Larry Fink at Downing Street on Thursday as the Prime Minister sought insights into making the UK more investible.

Commercial finance brokers are advocating for a more innovative approach from funders, as highlighted in the latest survey by Asset Advantage. A significant 33% of brokers desire funders to adopt a more open-minded perspective on deals, while 13% are seeking increased flexibility in loan terms. Transparency in lending criteria is also a priority for 16% of brokers. One broker noted: “The main thing we struggle with is consistency of credit decision,” emphasising the need for clearer underwriting standards. Philip Knight, credit and risk director at Asset Advantage, stated: “A different credit appetite is different to a proposal appetite,” underscoring the importance of niche lenders in the B2B lending ecosystem.

The Telegraph reports on how UK financial firms are sticking with DEI initiatives despite being forced to cut costs. This contrasts with US companies, which have been ditching diversity schemes at a rate which is only set to increase under Donald Trump’s administration. Linklaters predicts that Labour’s overhaul of worker’s rights “could spark a renewed wave of enthusiasm for DEI” as new laws will allow unionised staff to take part in diversity programmes during working hours. The paper notes a UK study raising concerns over the effectiveness of DEI initiatives. A report led by diversity campaigner Simon Fanshawe warned that companies are “suffering from a dominant EDI ideology that silences opposing perspectives” with bosses noting “deep divisions and resentment as a result of staff being separated into identity-based groups”.

UK Government borrowing reached £17.4bn in October, the second highest for the month since records began in 1993. This figure exceeded economists’ expectations of £12.3bn and marked a £1.6bn increase from the previous year. Central government debt interest payments also surged to a record £9.1bn, exacerbating the fiscal challenges for Chancellor Rachel Reeves. Alex Kerr from Capital Economics remarked that the “disappointing” figures highlight the fiscal hurdles ahead, suggesting that tax increases may be necessary to support future spending.