Barclays: UK businesses delay investment plans but eight in 10 ready to invest if Budget delivers long-term certainty
New Barclays Business Prosperity research from over 1,000 business leaders, alongside research from 2,000 consumers, reveals UK businesses and consumers remain ready to invest and spend, but for the third year running, uncertainty ahead of a major fiscal decision is holding that activity back.
Business ambition is being held back by uncertainty
More than six in 10 (64%) businesses are currently delaying investment decisions until after the Budget, up from 55% ahead of last year’s fiscal event. Meanwhile, more than a quarter (27%) of consumers are postponing major purchases and important financial decisions as they wait for greater clarity.
While many businesses are adopting a wait-and-see approach, Barclays’ research suggests a significant pipeline of investment could be unlocked if firms are given greater confidence. More than eight in 10 businesses (81%) say they would be likely to increase investment if the government provides a clearer long-term economic policy framework.
Among those currently delaying investments, the most postponed decisions are technology, AI and automation projects (29%), new products and services (29%), new facilities or premises (26%), marketing expenditure (26%) and workforce training and skills programmes (26%).
Despite the pause in investment decision-making, businesses appear increasingly optimistic about the economic outlook in their regions, amid the government’s focus on regional devolution. Half (50%) of UK businesses say they are more confident in their region’s economy than a year ago, rising to 57% among medium-sized businesses and 58% among large businesses.
Businesses call for action on investment barriers
Business leaders are looking to the Budget for clarity on the factors they deem to be holding back investment. The most commonly cited reasons for delaying decisions are uncertainty around UK economic growth and high energy costs (both 34%), future tax policy (29%) and government spending priorities (26%).
Lower business taxes are viewed as the measure most likely to encourage investment (39%. This is especially important for small businesses (42%) and micro businesses (47%). Employment cost support (37%) and energy cost support (35%) are also seen as important levers to unlock growth.
If businesses increase investment following the Budget, their leading priorities over the next year will be technology, AI and automation (37%), workforce training and skills (31%) and new products and services (30%). Machinery and equipment (21%) and cybersecurity (20%) are also key priorities.
Consumers remain confident but delay decisions amid uncertainty
The cost of uncertainty is not confined to business investment. Almost seven in 10 consumers (68%) are concerned about the potential impact of the Budget on their household finances, while three in five (61%) are concerned about potential tax changes. Reflecting this uncertainty, close to four in 10 (38%) feel less sure than in previous years about the implications of the announcements that may be made.
Reassuringly, 61% feel confident in their ability to make good financial decisions in uncertain times and 53% feel in control of their finances, even in times of volatility.
The uncertainty appears to be influencing household decision-making, with a quarter (25%) building up a savings buffer and 30% reducing non-essential spending. Meanwhile, 27% say they’re delaying both major purchases and important financial decisions until after the Budget, indicating that many households are choosing to preserve flexibility until they have a clearer picture of what the announcements could mean for their finances.
Matt Hammerstein, chief executive of Barclays UK Corporate Bank, said: “Businesses do not lack confidence or ambition. Yet many businesses and consumers are delaying important decisions as they await clarity around another major fiscal event.
“The opportunity for this Budget is to provide the stable, long-term framework that gives businesses the confidence to commit capital and consumers the confidence to spend. Greater certainty beyond the immediate fiscal moment will be vital if this pause is not to become a recurring feature of business planning, and instead unlock pent up investment, productivity and growth across the UK.”
Barclays Business Prosperity Fund
To support businesses to invest in resilience and growth, The Barclays Business Prosperity Fund is available for new and existing Business Banking customers and UK Corporate Banking clients across the UK to apply for lending and refinancing on existing projects. Businesses can find out more at:home.barclays/businessprosperity.
£22bn is the total amount of lending Barclays has available to lend and support business growth among Business Banking and UK Corporate Banking clients in 2026. Subject to normal lending assessment, status and application. Terms and conditions apply.