Anticipation Builds for the UK Budget 2024

By Betsy Jane Williamson, Core-Asset Consulting CEO

The upcoming UK budget, set to be announced on 30 October 2024, has generated significant anticipation. Chancellor Rachel Reeves is expected to introduce measures aimed at stimulating economic growth, managing public finances, and supporting key sectors. However, some concerns are emerging from employers in the financial and professional services sectors regarding the potential impact of specific policies.

Flexible Working and Probation Periods

One of the most discussed topics is the government's stance on flexible working. The new Employment Rights Bill proposes making flexible working a default right from the first day of employment. While this move is welcomed by many employees for its potential to improve work-life balance and retention, some employers have raised concerns about the increased administrative burden and potential impacts on productivity. This is particularly relevant for financial and professional services firms, where maintaining efficiency is crucial. Smaller companies, in particular, worry that increased regulation may reduce their agility.

Employers are also seeking clearer guidance on how to manage probation periods effectively, especially during times of market uncertainty. Without more explicit direction, there is a risk that recruitment processes may slow down, potentially impacting business efficiency. Employers are looking for clarification on how probation periods can be structured without adding unnecessary complexity.

Support for Small Businesses and Entrepreneurs

While flexible working has attracted much attention, there is an opportunity for the budget to offer more targeted support for small businesses and entrepreneurs in the financial and professional services sectors. Some industry voices suggest that without new tax incentives and reductions in regulatory burdens, smaller businesses might face challenges in scaling and competing. For example, initiatives like the Enterprise Investment Scheme (EIS) have been vital in fostering investment in smaller firms, and there is potential to expand or enhance these measures.

Reducing red tape and offering targeted tax relief could significantly lower operational costs, foster innovation, and encourage entrepreneurship. This, in turn, would enable small businesses to contribute more effectively to the UK's economic goals.

Impact on the Scottish Marketplace

The budget’s impact on the Scottish marketplace will be closely monitored, with opportunities to stimulate further growth in the region’s financial and professional services sectors. These sectors have shown strong growth in recent years, contributing significantly to the national economy. However, they rely heavily on a supportive regulatory environment and access to investment opportunities. Ensuring that Scotland’s financial sector continues to receive the backing it needs will be essential in maintaining its momentum and helping to realise its full economic potential.

Conclusion

As the UK prepares for the 2024 Budget, the government’s approach to flexible working, probation periods, and support for small businesses will be closely watched. Financial and professional services firms will need policies that balance the need for flexibility with operational efficiency, while also providing tangible support for smaller businesses looking to scale.

In my perspective, informed by regular discussions with senior management in these sectors, it is imperative that the upcoming Budget has clear and actionable policies that would not only boost confidence in the sector, but also ensure that the UK remains competitive in an increasingly dynamic global economy.