Sentiment appears to be shifting away from the government, unfortunately. The Labour government entered with a strong agenda for change and a significant majority, prioritising UK economic growth to boost tax revenues and enable long-term investment in sustainable public services, supporting its five missions. The question now is whether this vision can align with reality—and within what timeframe.
What we have observed in terms of actual outcomes experienced over the first 6 months in power, is not what was hoped for, all of which is going to make the government’s job that much harder going forward, and the impact on us all that much more challenging. Essentially, we’ve seen no growth, the budget has increased taxes on businesses, especially those employing the lower paid, so businesses are losing confidence, individuals are not feeling any benefit yet, and that is all impacting sentiment adversely.
Labour also appears to be bereft of ideas, as it has recently announced it is now asking the regulators what to do to boost economic growth. The regulators - those organisations that generally seek to place limits and constraints on what businesses are allowed to do, that limit risk-taking, are now being asked (like turkey’s voting for Christmas) to think differently and embrace risk-taking. Business owners are fully aware that the only way to grow your business is to take risks. Will the regulators truly embrace this opportunity, or will they baulk at this?
Business owners understand that success is built on making informed decisions, taking calculated risks supported by reliable data, and executing plans with excellence. So has the government made good decisions? Have they got access to good data and information? Has the government taken positive steps to give businesses the tools, skills, frameworks, policies and processes to execute their ambitions to support the government’s need to grow the economy, or is the government walking into the common mistakes of poor decision-making based on flawed data, deflection of responsibility, combined with inadequate tools, leading to failed execution?
Only time will tell, but sentiment is a key component, and the government does need to turn around that negative sentiment during 2025 if the UK economy is to grow and be the fastest growing economy of the G7 countries.
What can we do as businesses to help?
As businesses, we have to live with the reality. To live with the reality in today’s economic environment, businesses need good quality and reliable data, they need to make appropriate risk-based decisions, and then they need to follow through with tenacity and commitment to execute effectively on their business plans. That reality of higher taxes on business, coupled with a tough business environment, means we have to face tough decisions. If you’re unsure what your next steps should be, or how you should go about next steps, then do reach out to Brighter Consultancy, as we have years of experience helping businesses take stock, assess what could be achieved, and then executing for success.
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