One of Weybridge’s leading accountancy firms, MGI Midgley Snelling LLP, has voiced concern after Chancellor Rachel Reeves delivered a Spring Statement that included no direct support for businesses and made only limited reference to the potential economic impact of escalating global conflict.
The Office for Budget Responsibility (OBR) forecast suggests modest growth in the years ahead and a gradual fall in borrowing.
In more settled conditions, those projections and the Government’s decision not to change any policies might have provided reassurance.
However, current global tensions, particularly the risk of disruption to energy markets, cast doubt over how long those assumptions will hold.
Sarah Squires, Partner at MGI Midgley Snelling LLP, said: “The Chancellor’s Statement was framed as a quick update on the UK’s stability, though it delivered little that will materially improve the outlook for businesses, much to the disappointment of many entrepreneurs.
“There were no targeted measures to offset rising business costs, no new incentives to encourage investment and no contingency set out for firms if global instability worsens.
“Conflict in the Middle East carries significant economic consequences for the UK, especially with no clear ending in sight. We have already seen energy markets move dramatically in a matter of days.
“If wholesale prices remain at these levels, the impact will filter through supply chains quickly, including oil, food, manufacturing and transport, placing renewed upward pressure on inflation.”
For many businesses, concern is less about what economic growth looks like in 2028 and more about day-to-day viability.
Sarah said: “Many businesses have absorbed increases in employer National Insurance Contributions and higher wage costs over the past year.
“With further changes being implemented from April, margins are tight for a lot of UK businesses, especially SMEs. Another external shock, particularly through energy hikes, would test resilience across a range of sectors.
“While the Chancellor reiterated her commitment to fiscal discipline and highlighted falling borrowing forecasts, stability on paper does not remove the operational challenges firms are dealing with day to day.
“If there is one positive for employers, it is that the Chancellor did not introduce additional tax rises or fresh compliance requirements at this stage.”
With uncertainty likely to persist, the firm is urging clients to focus on financial resilience rather than wait for further policy announcements.
Sarah added: “Businesses cannot afford to assume that current forecasts will remain unchanged and should use this period of relative economic stability to revisit cash flow projections, review exposure to energy and supplier costs, undertake scenario planning and ensure funding arrangements remain in line with the economic climate.
“Clear financial reporting and early engagement with advisers will help management teams respond quickly if conditions change.”
For businesses seeking guidance on managing the challenges of rising taxes, compliance requirements and global economic uncertainty, contact MGI Midgley Snelling LLP by visiting www.midsnell.co.uk.
