By The Telegraph (Business) | Created at 2024-10-30 06:32:34 | Updated at 2024-10-30 09:17:56
2 hours ago
Rachel Reeves has been urged by bosses to take the “opportunity to boost confidence” after uncertainty about tax rises meant growth ground to a halt in the lead up to the Budget.
Private sector activity fell by 4pc in the three months to October, according to the CBI’s latest growth indicator, amid concerns about potential increases in National Insurance contributions for employers, which is among a host of potential tax rises expected in the Chancellor’s speech.
Companies said they expect there to be no growth over the next three months, marking the second consecutive quarter when businesses have not expected any growth over the near-term.
The CBI urged Ms Reeves to take the “opportunity to boost confidence” in her speech later today, amid accusations that the Government’s gloomy messaging on the economy has hurt Britain’s prospects.
Alpesh Paleja, an economist at the lobbying group, said: “Our latest surveys paint a picture of an economy shifting down a gear as we head into the final quarter of 2024.
“Weaker growth expectations are weighing on firms’ hiring intentions, which have treaded water since the beginning of the summer.
“In the budget, the Chancellor has an opportunity to boost confidence despite the difficult fiscal picture.
“Business will want to see messages of hard choices balanced with interventions that deliver a vision of optimism.
He added: “Giving firms certainty over future tax plans in the form of a business tax roadmap, measures to enhance productivity, and the country’s net zero trajectory can all help cement the path to long-term growth.”
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