Retail traders have been deterred from investing in the UK market due to October’s Budget, according to a poll from GraniteShares. The survey saw 26% of retail investors say they have cut their investment in the UK in response to the Budget, which introduced £40bn of new taxes including a capital gains tax hike. It was also shown that a fifth expect to cut their level of investment in UK markets in 2025. More than 1,000 British retail investors were surveyed and 61% expressed disappointment with the performance of UK markets over the past three years. A quarter (24%) have switched investments away as a result. While 23% of UK retail traders said the percentage of their portfolio invested in British stocks and funds has fallen in the past three years, a third estimate that it has increased.

Confidence among small business owners in London has dropped significantly, reaching a near two-year low, according to Novuna Business Finance’s Business Barometer. The percentage of owners predicting growth fell from 57% to 39% in just three months, marking the lowest level since Q2 2023. Key worries for these businesses include market volatility (41%), potential tax hikes (40%), and cash flow management (26%). The survey also revealed that 77% of small businesses are apprehensive about the impact of the new US administration on the UK economy.

Tim Levene, chief executive of Augmentum Fintech, has welcomed the Government’s focus on delivering growth but warned that “the pace of implementation is way too slow.” He said that he is optimistic that Government plans to boost growth and investment mean “money will flow to places where it hasn’t played before,” adding that this will “really create and stimulate innovation.” However, Mr Levene warned that he is less optimistic over “the pace of change and timeline,” adding: “I think that could be the biggest single barrier, and we can’t afford to wait.”

AIM-listed companies are under scrutiny for their lack of gender diversity, with new research indicating that the representation of women on boards has stagnated at one in six companies. According to the annual Gender Diversity Report from Addidat and Indigo Independent Governance, only 11% of AIM firms are on track to meet the FTSE 350’s voluntary target of 40% female board representation. Bernadette Young, founder of Indigo, described the findings as “disappointing,” urging AIM companies to adopt clearer diversity ambitions. Despite some firms having more than one woman on their boards, the percentage of all-male boards has risen to 38%. The report reveals that 72% of AIM companies still lack women in key leadership roles.

Chancellor Rachel Reeves has exhausted the £9.9bn fiscal headroom she previously had, raising concerns that she may need to increase income tax to manage future economic shocks. The National Institute of Economic and Social Research (NIESR) warned that “zero fiscal headroom remains as the current budget is exactly balanced,” leaving no buffer for potential economic downturns. Despite her commitment to only borrow for investment and reduce debt as a share of GDP, the pressure is mounting on Ms Reeves. Stephen Millard, NIESR’s interim director, emphasised that “there are circumstances in which taxes might have to go up.”

The Commons Public Accounts Committee (PAC) has warned that the cost of tax evasion in the UK is likely much higher than the £5.5bn estimated by HMRC. Sir Geoffrey Clifton-Brown, chairman of the PAC, suggested that the “many billions rightfully meant for the public purse could just be the tip of the iceberg.” The report criticises HMRC for being “not sufficiently curious” about the true scale of tax dodging and highlights significant loopholes in the current system, particularly in VAT registration processes. The PAC has urged the tax office to develop a clear strategy to combat tax evasion and called for better collaboration with Companies House and the Insolvency Service. The report also notes that between 5% and 20% of UK registered companies may be fraudulent. An investigation into fraud through online marketplaces found that a number of Chinese firms selling cheap goods in the UK were not paying VAT or import tax.

The Government is set to relax rules around maths and English requirements for apprentices, saying trainees aged 19 and over will not be forced to complete functional skills qualifications in order to qualify. The Department for Education says the reforms will enable 10,000 more apprentices to undertake on the job training each year. Meanwhile, the minimum length of an apprenticeship will be cut to from a year to eight months to ensure workers in occupations experiencing shortages can take up roles sooner. Craig Beaumont, director of the Federation of Small Businesses, said the reforms are “encouraging” and new flexibility “should help SME employers fill skills gaps faster.”

The governor of the Bank of England has warned that policymakers should “not forget the lasting damage” caused by the financial crisis as they look to drive growth. Andrew Bailey said there is a “reaction taking place against regulation, and the responses to the financial crisis.” This comes amid debate over whether looser regulation will help accelerate growth, with Chancellor Rachel Reeves having previously suggested that post-crisis regulation had gone “too far.” Ms Reeves has also told City watchdogs they must put forward strategies to boost competitiveness within their sectors. Stressing the importance of “a fully informed debate about the role of regulation,” Mr Bailey said officials “must not abandon or compromise our commitment to the surveillance of risks to financial stability.” He also suggested that while it is “critical that we have and develop tools of assessment and intervention,” these interventions “may not always need to be more regulation.”

Polling by EY-Parthenon reveals a significant increase in confidence in the economy among UK chief executives. A survey of 1,200 CEOs found that 82% are optimistic about the business landscape for the next year, a rise from 67% in September. Furthermore, 80% anticipate profit increases, with a similar percentage expecting income growth. Silvia Rindone, UK&I managing partner for strategy and transactions at EY-Parthenon, said the findings “reflect a resilient and forward-thinking mindset among UK CEOs.” Despite the Bank of England’s recent downgrade of its growth forecast for this year from 1.5% to 0.75%, the research suggests a resurgence in deal-making activity, with 99% of CEOs planning some form of transaction in the coming year.

International law firm Hill Dickinson has restricted general access to AI tools after noticing a sharp rise in staff usage. A senior director warned employees that much of the usage did not align with the firm’s AI policy, and staff must access the tools via a request process from now on. The firm reported over 32,000 hits to ChatGPT and 3,000 to DeepSeek in just a week, along with nearly 50,000 hits to Grammarly. The move highlights ongoing concerns about AI use in professional settings, particularly regarding security and compliance. A spokesperson from the Information Commissioner’s Office told BBC News that firms should “offer their staff AI tools that meet their organisational policies and data protection obligations.”