Businesses call on chancellor for direct help over rising prices and surging energy costs
Businesses are calling for the chancellor to announce new measures to help with rising costs ahead of his Spring Statement on 23rd March, according to a recent survey from Lloyds Bank.
As inflation hits the highest levels seen since 1992, almost four in ten (38%) businesses said that direct help with energy bills and rising costs tops their wish list for the chancellor. This was followed closely by calls for a reduction in VAT, cited by three in ten companies (31%). Funding to help create new jobs and develop skills was top of the list for a fifth of firms (21%).
Rising prices remain a key challenge for business. More than a quarter (28%) of respondents said they are concerned about having to increase the costs of goods and services and one in five (21%) stated that inflation is reducing profitability. One in ten (10%) said rising prices had caused them to worry about having to scale back their operations and a further one in ten (10%) were concerned about how to cover overheads.
To help specifically with rising prices businesses are asking the Chancellor for tax holidays or tax-incentives (36%) grants to cover rising energy costs (28%) and measures to support investment in energy saving measures to help tackle increasing costs (25%).
The data comes as businesses face continuing supply chain challenges, which are reducing the availability of stock (40%), causing hikes in freight costs (39%) and disruption through increased border controls and custom regulations (27%).
Paul Gordon, managing director, SME & Mid Corporates at Lloyds Bank Commercial Banking, said: “Rising prices are causing multiple challenges for businesses and the pressure from inflation shows no sign of abating in the near-term. The ongoing war in Ukraine and imposition of sanctions on Russia will undoubtedly have increasing economic impact on businesses here in the UK and across the world, exacerbating an already complex operating environment for companies.
“Firms need help now with the cost of running their operations, to preserve their ability to grow and support Britain’s ongoing economic recovery from the pandemic.”