The UK’s Industrial Strategy must benefit all parts of the country, according to the British Chambers of Commerce (BCC).

The government says the Industrial Strategy will be published in Spring 2025, alongside the multi-year Spending Review.

The BCC is urging ministers to integrate each nation and region’s strengths into the plan, alongside a focus on sectors.

In a written submission, the business group says that for the strategy to succeed, foundation issues such as a competitive tax environment, skilled workforce and an enabling regulatory environment must be in place. It points out that achieving this will require collaboration across government departments and involvement from both the public and private sectors.

Jonny Haseldine, Policy Manager at the BCC, said:

‘The Industrial Strategy is a much-needed opportunity to boost economic growth and investment.

‘With millions of businesses now facing increased costs following last month’s Budget – even more is now riding on the government’s strategy. Firms in every corner of the UK need this plan to deliver at pace for their needs and their communities.

‘The strategy needs to identify priority sectors which will drive growth – building on the past but crucially looking forward.

‘But the industrial strategy will struggle unless other key obstacles to business investment are tackled. It must not be designed and implemented in isolation from other policy measures and strategies.’

Pension reforms announced by Chancellor Rachel Reeves must unlock growth, according to the British Chambers of Commerce (BCC).

Pension megafunds will be created as part of the biggest set of pension reforms in decades. The government says this will unlock billions of pounds of investment in exciting new businesses and infrastructure and local projects.

The reforms, which will be introduced through a new Pension Schemes Bill next year, will create megafunds through consolidating defined contribution schemes and pooling assets from the 86 separate Local Government Pension Scheme authorities.

These megafunds mirror set-ups in Australia and Canada, where pension funds take advantage of size to invest in assets that have higher growth potential, which could deliver around £80 billion in investment in exciting new businesses and critical infrastructure while boosting defined contribution savers’ pension pots.

Shevaun Haviland, Director General at the BCC, said:

‘Increased investment in the UK economy is crucial if businesses are to deliver the growth we all want to see.

‘And with firms facing into a wall of fresh costs after a tough Budget, it is important that the Chancellor looks at the options to unlock more funding.

‘UK pensions can be a crucial component in doing that. They can generate billions for investment in infrastructure projects and the businesses of the future.’

Over 400,000 customers have now used the Student Loan Company’s (SLC) digital refund service.

The SLC introduced a new service into the online account for repayment customers in May 2024 and has released data on the first six months of operation.

The SLC says its simple, digital service is an easy way for customers to self-serve, requesting a Below Threshold Refund, which is then paid directly into their bank account.

Under the repayment regulations, there are four refund scenarios, which the publication covers. These are ‘below threshold refunds’, ‘over-repayment refunds’, ‘early repayment refunds’ and ‘wrong plan type refunds’.

Steven Darling, Customer Experience Director at the SLC, said:

‘At the SLC, we want to provide the best possible customer experience, and from the feedback we receive from customers, they want to be able to self-serve in their online account.

‘With a below threshold refund being the most common reason why a customer might be eligible for a refund, we’ve made it quick and easy to request a refund through the online account. The figures in our latest report demonstrate the value of these improvements, with £61.6 million being paid to 248,000 customers since May 2024.

‘I would encourage customers to keep their contact and bank details up to date in their online account to ensure they don’t miss any key communication regarding refunds.’

The government has published draft legislation to permanently cut business rates for retail, hospitality and leisure properties from 2026.

The tax cut will be funded by a tax rise for the very largest business properties, such as online sales warehouses, the government added.

Until then, 250,000 retail, hospitality and leisure (RHL) properties will receive 40% relief off their business rates bills up to £110,000 per business to help smooth the transition to the new system.

This support is alongside the Budget announcement to freeze the small business multiplier, together with Small Business Rates Relief protecting over a million properties.

James Murray, Exchequer Secretary to the Treasury, said:

‘For too long the business rates system has been working against our high streets.

‘[This] is a major step towards our new system that will support retail, hospitality and leisure businesses on our high streets to succeed.

‘This Bill paves the way for a permanent cut to their tax rate, helping to level the playing field between them and online and out-of-town businesses.’

Import and export businesses are frustrated by the government’s decision to pause work on the digital trade platform, according to the Institute of Directors (IoD).

When fully operational, the Single Trade Window will provide a gateway between businesses and UK border processes and systems, allowing users to meet their import, export and transit obligations by submitting information once and in one place.

However, the government now says that in the context of financial challenges, it is pausing delivery of the UK Single Trade Window in 2025/26.

Emma Rowland, Trade Policy Advisor at the IoD, said:

‘It is frustrating to see the government’s decision to halt the development of the Single Trade Window due to financial constraints following the Budget, particularly given extensive industry engagement and the project’s proximity to completion.

‘According to our own data, paperwork remains the largest obstacle for organisations involved in international exports. The Single Trade Window, designed to streamline border processes through a unified platform, has the potential to significantly ease this administrative burden on firms, making

importing and exporting more efficient. Additionally, it could enhance data collection to better monitor and understand UK trade flows.

‘We urge the government to prioritise the Single Trade Window in the upcoming Spring Spending Review to facilitate trade for all UK companies.’

HMRC has warned landlords to disclose their earnings on self assessment tax returns.

The tax authority has clarified the guidance on who can participate in the Let Property Campaign, which is targeted at landlords who owe tax through letting out residential property in the UK or abroad.

Landlords can report previously undisclosed taxes on rental income to HMRC under the Let Property Campaign if they are an individual landlord renting out residential property.

The campaign covers landlords who rent out single or multiple properties, rent out a room in their main home that exceeds the Rent a Room Scheme threshold and holiday lettings.

It is also important to note that, for those living abroad or intending to live abroad for more than six months and renting out a property in the UK, those earnings may still be liable to UK taxes.

Tax must be paid on any profit made from renting out property. The profit is calculated based on the amount left once claims for expenses or allowances have been deducted.

HMRC warned:

‘If you’re a landlord and have undisclosed income, you must tell HMRC about any unpaid tax now. You’ll then have 90 days to work out and pay what you owe. If you do not do this now, and HMRC finds out later, you could get higher penalties or face criminal prosecution.’

Business groups have reacted to Chancellor Rachel Reeves’ Autumn Budget speech.

The Confederation of British Industry (CBI) said that the Chancellor ‘had difficult choices to make to deliver stability for the economy’.

Rain Newton-Smith, Chief Executive of the CBI, commented:

‘A more balanced approach to our fiscal rules which prioritises capital investment should help to unlock private sector investment in our infrastructure and net zero transition over the long-term.

‘While the Corporation Tax Roadmap will help create much needed stability, the hike in National Insurance contributions (NICs) alongside other increases to the employer cost base will increase the burden on business and hit the ability to invest and ultimately make it more expensive to hire people or give pay rises.’

Meanwhile, Shevaun Haviland, Director General of the British Chambers of Commerce (BCC), labelled the fiscal event a ‘tough Budget for business’. She continued:

‘While some protection for smaller firms is welcome, the increase in employer NICs will place a further cost burden on business. This, coupled with a 6.7% increase in the National Living Wage (NLW) means many firms will find it more challenging to invest and recruit in the short-term.

‘But the Chancellor has looked to offset the upfront hit on firms by outlining a longer-term framework to provide stability for the economy.’

The Institute of Directors (IoD) branded the Autumn Budget as offering ‘short-term pain for the business community’.

Roger Barker, Director of Policy at the IoD, said:

‘The government has chosen to impose a significant new tax burden on business as a means of achieving an immediate boost to its public sector spending priorities. The risk is that this will exert a negative impact on business confidence, with worrying implications for the economy’s future growth trajectory.’

Chancellor Rachel Reeves pledged to ‘invest, invest, invest’ to drive growth and ‘restore economic stability’ in the Autumn Budget.

The Budget, which was Labour’s first in over 14 years and the first ever delivered by a female Chancellor, saw £40 billion in tax announcements.

Ms Reeves repeated her claims that the government had inherited a £22 billion ‘black hole’ in the public finances from the Conservatives.

Pre-Budget speculation had centred on the likelihood of increases to employers’ National Insurance contributions (NICs), Capital Gains Tax (CGT) and Inheritance Tax (IHT).

The Chancellor announced an increase to the rate of employer NICs by 1.2 percentage points to 15% from 6 April 2025. However, the Secondary Threshold – the level at which employers become liable to pay NICs on each employee’s salary – will reduce from £9,100 per year to £5,000 per year.

CGT on non-residential assets will increase from 10% to 18% for those paying the lower rate, and 20% to 24% for those paying the higher rate for disposals from 30 October 2024. These new rates will match the residential property rates. The CGT rates applicable to assets qualifying for Business Asset Disposal Relief (BADR) and Investors’ Relief will remain at 10% this year, before rising to 14% from April 2025 and 18% from April 2026.

The IHT nil rate band remains unchanged at £325,000 although from April 2027 inherited pension pots will be brought into the IHT net. The government says this will remove a distortion which has led to pensions being used as a tax planning vehicle to transfer wealth rather than their original purpose to fund retirement.

From April 2026, agricultural property relief and business property relief will be reformed. The highest rate of relief will continue at 100% for the first £1 million of combined business and agricultural assets on top of the existing nil rate bands, fully protecting the majority of businesses and farms. The rate of relief will reduce to 50% after the first £1 million. 

The Chancellor also confirmed that VAT will be in on private school fees and abolishment of the non-dom tax regime.

Ms Reeves said she would protect living standards by unfreezing the thresholds on Income Tax and NICs from 2028 while she extended the cut in Fuel Duty for another year.

Reeves said:

‘The choices I have made today are the right choices to restore stability to our public finances, to protect working people, to fix our NHS and to rebuild Britain.

‘That does not mean that these choices are easy, but they are responsible.’

New company car advisory fuel rates have been published and took effect from 1 September 2024.
The guidance states: ‘you can use the previous rates for up to one month from the date the new rates apply’. The rates only apply to employees using a company car.
The advisory fuel rates for journeys undertaken on or after 1 September 2024 are:
Engine size Petrol
1400cc or less 13p
1401cc – 2000cc 15p
Over 2000cc 24p
Engine size Diesel
1600cc or less 12p
1601cc – 2000cc 14p
Over 2000cc 18p
Engine size LPG
1400cc or less 11p
1401cc – 2000cc 13p
Over 2000cc 21p
HMRC guidance states that the rates only apply when you either:
• reimburse employees for business travel in their company cars
• require employees to repay the cost of fuel used for private travel.
You must not use these rates in any other circumstances.
The Advisory Electricity Rate for fully electric cars is 7p per mile.
If you would like to discuss your company car policy, please contact us.

The number of self-employed people aged 60 or over has reached a record level, according to analysis by Rest Less.
These numbers have increased by over a third in the past decade, totalling 991,432 self-employed people aged 60 or over in 2023.
The analysis found that while the number of self-employed workers in their 50s and older has grown since 2021, it is those in their 60s who have set the new high.
The total number of workers who are self-employed is about 4.3 million, after a two-year recovery following a sharp fall during the pandemic, according to the research.
Stuart Lewis, Chief Executive of Rest Less, said:
‘With the state pension age soon to be 67 and set to go higher still, many people are choosing to work beyond the point of traditional retirement.
‘For many, self-employment is a great option as it allows people to remain active and engaged in the community and workforce whilst also providing greater flexibility – leveraging their skills, experience and network to make an impact.
‘The decision to go self-employed can be driven by wildly different sets of circumstances from people living comfortably and pursuing an entrepreneurial passion to those who are forced to generate an income and have not been able to find a permanent solution in the mainstream workforce.’

Freelancers want to see Chancellor Rachel Reeves use the Autumn Budget to move towards a fairer, simpler tax system, according to the Association of Independent Professionals and the Self-Employed (IPSE).
IPSE’s research found that 80% of freelancers believe that government tax policies, such as IR35, are harming their businesses.
Meanwhile, just under half of freelancers reported having less confidence in the UK’s economic outlook for the coming year compared to the past 12 months – down from 63% in findings from Q1 2024.
IPSE’s Director of Policy, Andy Chamberlain, said:
‘For the past two years, the impact of record high inflation has been the main story in the business world. But for millions of freelancers, who are our very smallest businesses, the biggest barrier to growth has always been the tax system.
‘This is about more than just rates of tax. Convoluted tax rules like IR35 are crushing freelancers and the businesses they’ve worked so hard to build.
‘Rachel Reeves faces her first big test as Chancellor with a Budget in October and has made no secret of the need to raise money. But freelancers will be hoping that the Chancellor is also open to building a fairer, simpler tax system for millions of sole proprietors going it alone.’

The 5p cut in fuel duty to be scrapped in the upcoming Autumn Budget, according to the RAC
The motoring organisation says that motorists in the UK are ‘not gaining any benefit’ and retailers have failed to pass on lower petrol and diesel prices to drivers.
Prime Minister Keir Starmer recently refused to rule out a rise in fuel duty and warned that the Autumn Budget will be ‘painful’.
The RAC suggested that average petrol prices should be reduced from 142p per litre to 136p per litre and diesel prices from 147p per litre to 139p per litre.
Simon Williams, Head of Policy at the RAC, said:
‘We’d normally be against any increase in duty. But we’ve long been saying drivers haven’t been benefitting from the current discount due to much higher-than-average retailer margins.
‘As more and more EVs come on to the roads the government will need to tax drivers differently. We think replacing fuel duty with a pay-per-mile system as soon as possible is the way forward as then the only tax levied on fuel would be VAT. This would give retailers nowhere to hide.’

HMRC has reduced late payment and repayment interest rates following the cut to the base rate.
The Bank of England cut the base rate to 5.0% on 1 August, the first reduction for over four years.
This has triggered a cut in HMRC interest rates which are pegged to the base rate.
From 20 August, the late payment interest rate was cut to 7.5% from 7.75%, where it had been for 12 months. The repayment interest rate was also reduced to 4.0% from 4.25% from 20 August.
HMRC late payment interest is set at base rate plus 2.5%. Repayment interest is set at base rate minus 1%, with a lower limit – or ‘minimum floor’ – of 0.5%.
Corporation tax self assessment interest rates relating to interest charged on underpaid quarterly instalment payments dropped to 6.0% from 6.25% from 12 August.
The interest paid on overpaid quarterly instalment payments and on early payments of corporation tax not due by instalments is down by 0.25% to 4.75% from 5% from 12 August.

HMRC has ‘sent nudge’ letters to crypto investors who it suspects have failed to pay the correct tax on their gains, according to the Chartered Institute of Taxation (CIOT).
Many crypto investors are unaware of their tax obligations due to uncertainty over tax rules and limited understanding of the nature of crypto assets.
A chargeable disposal occurs when individual:
• Sells crypto assets for fiat currency.
• Exchanges one crypto asset for another.
• Uses crypto assets to buy goods or services.
• Gives away crypto assets to someone other than spouse or civil partner (in this instance, the individual is deemed to receive the value of the asset even if they do not actually receive anything).
Gary Ashford, Chair of the CIOT’s Crypto Assets Working Group, said:
‘Many investors may be unaware that profits from crypto assets are subject to income tax or Capital Gains Tax (CGT) like any other asset, depending on how they’re held.
‘If you receive a ‘nudge letter’ from HMRC, it’s important to take it seriously. Even those who don’t receive a letter should review their crypto activity and file a tax return or use the capital gains real time transaction service if necessary.
‘Sometimes tax can be due even where the investor does not think his or her investments have been profitable. Selling, lending or ‘staking’ crypto assets – or potentially even just transferring assets between crypto sites and portfolios – will usually trigger a disposal in the tax year in question.’

HMRC is failing on the key metrics of responsiveness, ease and accuracy, according to the annual HMRC Charter report.
The report reviewed HMRC’s performance against its Charter from April 2023 to March 2024.
The survey received over 1,600 responses, with complaints about service levels a recurring theme.
• ‘Being responsive’ scored the lowest of the Charter standards, with an average score of just 2.4 out of 10.
• ‘Making things easy’ and ‘getting things right’ also scored poorly, at 2.8 and 3.5 respectively.
• The remaining standards – ‘being aware of your personal situation’, ‘treating you fairly’, “recognising that someone can represent you’, ‘mutual respect’ and ‘keeping your data secure’ – scored higher at 4.1, 5.0, 5.7, 5.6 and 6.8 respectively.
Richard Wild, the Chartered Institute of Taxation’s (CIOT) Head of Tax Technical, said:
‘Significant time is lost every day for members, their clients, and indeed HMRC themselves, due to delays and inefficiencies in dealing with HMRC.
‘The three standards on responsiveness, ease and accuracy were by far the lowest scoring, which is disappointing as between them they represent the health of the tax system.
‘Businesses are prevented from operating effectively due to the inability to obtain timely registrations or responses. Taxpayers’ legitimate refunds are withheld or delayed. Guidance and correspondence from HMRC is misleading or incorrect. All these things are inhibitors on growth and investment.’

HMRC has published the latest issue of the Employer Bulletin. The July issue has information on various topics, including:
• PAYE Settlement Agreement calculations 2023 to 2024
• paying Class 1A National Insurance contributions
• improving the Self-Serve Time to Pay service for PAYE and VAT customers
• self assessment threshold change
• Spotlight 64 – warning for employment agencies using umbrella companies
• employment-related securities — end of year return deadline for employee share schemes.
Please contact us for help with tax matters.

The UK’s economic recovery is finally putting ‘down roots’ after GDP grew faster than expected in May, says the Confederation of British Industry (CBI).
The UK economy expanded by 0.4% in May, rebounding from zero growth in April, according to the Office for National Statistics (ONS).
The growth figures were helped by a strong performance from retailers and the construction industry, added the ONS.
Ben Jones, CBI Lead Economist, said:
‘The latest data shows that the UK’s economic recovery is starting to put down roots. While growth in May was driven by a rebound in sectors such as retail and construction, which were hit by poor weather earlier in the spring, recent months have seen activity creeping up across a wide range of sectors.
‘The new Labour government will benefit from some economic tailwinds going forward, with consumer confidence rising as lower inflation and strong wage gains support household incomes. However, many firms remain cautious about the near-term outlook.
‘While the outcome of the election will help dispel some of the recent uncertainty, it could take a turning of the interest rate cycle for the recovery to really bed in.
‘The new government’s focus on making growth a priority is welcome. However, to put the economy on a pathway to long-term, sustainable growth, we need to see concrete actions to deliver that vision within the next 100 days.’

HMRC will send Simple Assessment tax statements to pensioners in the next few weeks.
The combination of frozen tax thresholds and a substantial increase to the state pension has led to many more pensioners being dragged into paying income tax for the first time.
The last government froze the personal allowance at £12,570 until 2028.
The full new state pension saw a 10% increase in April 2023 to over £10,600 annually, followed by another 8.5% rise in April 2024, taking it to more than £11,500 per year.
HMRC says that pensioners will receive a Simple Assessment where there is an underpayment of income tax for a tax year that cannot be collected automatically via PAYE and they are not subject to income tax self assessment.
An underpayment of income tax can result from:
• pensioners who receive income from the State Pension, occupational pensions, employment pensions, and most taxable state benefits
• pensioners with up to £10,000 of untaxed income (for example, from savings or investments).
HMRC will use the information it already holds and information supplied from banks and building societies about people’s income and tax situation.
The tax authority will calculate any tax owed or refund due and the Simple Assessment tax statement will show the calculation.
HMRC says taxpayers will need to check that their Simple Assessment statements are correct before paying any tax due.
Please contact us for advice on Simple Assessment matters.

The British Business Bank has launched the Growth Guarantee Scheme to help smaller businesses access finance.
The Growth Guarantee Scheme is the successor to the Recovery Loan Scheme and is expected to support around 11,000 smaller businesses.
The British Business Bank has so far accredited 41 lenders for the scheme which will run until March 2026.
The scheme supports term loans, overdrafts, asset finance, invoice finance and asset-based lending facilities. Not all lenders will be able to offer all products.
Minimum facility sizes start at £1,000 for asset finance, invoice finance and asset-based lending and £25,001 for term loans and overdrafts. The maximum facility sizes are up to £2 million per business.
Martin McTague, National Chair of the Federation of Small Businesses (FSB) said:
‘We are delighted that the British Business Bank has officially launched the Growth Guarantee Scheme, to get much-needed finance to start-ups and scale-ups, so they can grow.
‘The new scheme will help small firms get the funding they require to be able to achieve their dreams.
‘The Growth Guarantee Scheme will be an important part of the funding landscape for small firms, whose growth will be an indispensable ingredient in overall economic recovery in the UK.’

The UK government is planning a National Wealth Fund to stimulate private sector investment backed by £7.3 billion in funding through the UK Infrastructure Bank (UKIB).
Chancellor Rachel Reeves and Business Secretary Jonathan Reynolds have instructed officials to immediately begin work to create the new National Wealth Fund by bringing together the work of the UK Infrastructure Bank and the British Business Bank to unlock private sector investment to drive growth.
Under the plans, the National Wealth Fund will bring together key institutions and will target investors in a bid to ‘mobilise billions more in private investment and generate a return for taxpayers’.
An additional £7.3 billion of funding will be allocated through the UKIB so investments can start being made immediately focusing on priority sectors, including green and growth industries, and catalysing private investment. This funding is in addition to existing UKIB funding.
The Chancellor said:
‘This new government is getting on with the job of delivering economic growth. I have been clear that there is no time to waste.
‘I have previously committed to establishing a National Wealth Fund. I am now going further by bringing together key institutions.
‘We need to go further and faster if we are to fix the foundations of our economy to rebuild Britain and make every part of our country better off.
‘That is why in less than a week we are establishing a new National Wealth Fund and bringing together the key institutions that will help unlock investment in new and growing industries.
‘Britain is open for business – and the work of change has begun.’

HMRC has launched a digital tool to help businesses estimate what registering for VAT may mean for them.
The VAT Registration Estimator helps to show businesses when their turnover could require them to register for VAT and its effect on profits.
A business must register for VAT if:
• Total VAT taxable turnover for the previous 12 months is more than £90,000.
• Turnover is expected to go over the £90,000 VAT threshold in the next 30 days.
• They are an overseas business not based in the UK and supply goods or services to the UK (or expect to in the next 30 days) – regardless of VAT taxable turnover.
A VAT-registered business must charge VAT on eligible sales and can usually reclaim it on eligible purchases.
Jonathan Athow, HMRC Director General for Customer Strategy and Tax Design, said:
‘We know that the majority of our customers want to get their tax right. We have listened to what businesses have said and the new tool is designed to help them understand VAT registration, including when they might be required to register.’

Chancellor of the Exchequer Rachel Reeves said she was taking difficult decisions after a Treasury spending audit revealed £22 billion of unfunded pledges.
Ms Reeves confirmed that the Autumn Budget will take place on 30 October.
In a statement to Parliament, the Chancellor made a number of announcements but said there would be more to come on tax and spending plans at the Budget.
The Chancellor said that she has inherited a £22 billion hole in the public finances and said urgent work is required to reduce the pressure on finances by £5.5 billion this year and over £8 billion next year.
Ms Reeves announced that the government will cut Winter Fuel Payments to those not in receipt of pension credits or other benefits.
The Chancellor announced a number of immediate savings, including:
• £800 million this year and £1.4 billion next year from scrapping the Rwanda migration partnership and scrapping retrospection of the Illegal Migration Act.
• £70 million this year by cancelling the Investment Opportunity Fund and other small projects.
• £185 million next year from cancelling the Advanced British Standard.
• £785 million next year from stopping unaffordable road and railway schemes.
Ms Reeves also outlined the next steps in delivering tax commitments from Labour’s election manifesto.
This includes ending the VAT tax breaks for private schools from 1 January 2025 to help recruit 6,500 new teachers, as well as replacing the non-domicile regime with a new internationally competitive residence-based regime.
The Chancellor said:
‘This is not the statement I wanted to give today, and these are not the decisions I wanted to make. But they are the right decisions in difficult circumstances.’

UK savers are dangerously underestimating the minimum amount needed to retire, according to research from pension provider PensionBee.

A survey of 1,000 working-age UK adults showed that 23% were unsure of the total pension pot size needed to achieve the retirement income they desire.

Pension Bee said that, according to the Pensions and Lifetime Savings Association’s (PLSA) Retirement Living Standards, a pension pot of £150,000 would only fund an individual’s minimum retirement standard for ten years. Pension Bee suggested that working-age adults could be underestimating the true cost of retirement.

49% of those polled estimated that they would require a pension pot of around £250,000 or more. However, Pension Bee found that there was a lack of clear consensus in regard to desired annual income in retirement.

Becky O’Connor, Director of Public Affairs at Pension Bee, said:

‘It’s hard to plan for retirement without an idea of how much you might need, yet most Brits seem to be unaware of – or worse, dangerously underestimate – the true cost of retirement.

‘A good pension pot is one that can provide enough money for the duration of retirement. As this exact amount will vary based on individual circumstances, pension calculators can be a helpful tool in setting financial goals and adjusting behaviours to achieve them.

‘However, one rule is broadly true: the earlier individuals start paying into a pension, the more likely they are to be able to afford their desired lifestyle, as their pension has longer to grow and the amount they’re required to save each month reduces.’

The UK has the lowest rates of investment of any other country in the G7, according to analysis by the Institute for Public Policy Research (IPPR).

It found that, compared to the USA, Germany, France, Italy, Canada and Japan, the UK was in last place for business investment in 2022.

The IPPR also revealed that the UK has been bottom of the G7 league for investment in 24 out of the last 30 years. It said that the UK has the lowest rates of investment of any G7 economy, and that it ranks 28th out of 31 Organisation for Economic Co-operation and Development (OECD) countries for business investment.

According to the IPPR, countries such as Hungary, Slovenia and Latvia attract higher levels of private sector investment than the UK as a percentage of GDP.

Dr George Dibb, Associate Director for Economic Policy at the IPPR, said:

‘If the economy is an engine, then investment is its fuel. The UK’s dire productivity performance is the single biggest driver of our dire living standards. Without resources flowing into new investment, it’s hard to see how UK economic performance can improve.’

The UK government must stop ‘walking on eggshells’ around improving EU trade ties, the British Chambers of Commerce (BCC) has warned.

The new government must improve the current EU-UK trade and co-operation deal in order to boost economic growth, adds the BCC.

Businesses have criticised the additional red tape and increased costs that Brexit has placed on firms importing and exporting goods to and from the continent.

Importers of food and plants have been hit by charges associated with new Brexit border checks brought in at the end of April.

Other businesses have complained that the increasing divergence on standards, such as those around construction products, has made it more expensive for UK companies to get their products certified for sale on the continent.

Shevaun Haviland, Director General of the BCC said:

‘I’m not here to look backwards, I’m here to help build a better future for our business leaders and entrepreneurs. We must stop walking on eggshells and start saying it how it is. The current plan isn’t working for our members.

‘The EU is the UK’s largest market, accounting for 42% of all our exports. Leaving the EU has made it more expensive and bureaucratic to sell our goods and services across the Channel. But better trading terms are possible if the UK government and the EU reach agreement in areas of mutual benefit for business on both sides.

‘A better deal is best for everyone.’

Real average earnings are just £16 a week higher than they were 14 years ago, according to research conducted by the Resolution Foundation.

The think tank said that the UK’s labour market backdrop to the General Election is a prolonged pay squeeze that has left real average wages today just £16 a week higher than in 2010. It stated that this has been caused by three shocks to pay packets in little over a decade, including the financial crisis, the Brexit referendum and the cost-of-living crisis.

According to the Resolution Foundation, in the 14 years prior to the 2010 election, average real wages grew by £145 a week in total.

Hannah Slaughter, Senior Economist at the Resolution Foundation, said:

‘Britain’s prolonged pay depression has left average earnings just £16 a week higher than they were back in 2010, despite the welcome return of rising real wages in recent months.

‘Worryingly, Britain’s decade-long jobs boom during the 2010s has also gone bust, with the UK one of only a handful of countries where employment has yet to return to pre-pandemic levels.’

The UK economy grew by more than initially estimated at the start of this year, according to figures from the Office for National Statistics (ONS).

The economy grew by 0.7% between January and March 2024, up from the previous figure of 0.6%. Growth in the UK services sector helped to push it even higher, the ONS said.

The positive news on growth followed the UK inflation rate falling to its lowest level in almost three years.

According to the ONS, the Consumer Prices Index (CPI) rose by 2% in the year to May 2024, down from 2.3% in April.

The data showed that whilst prices are still rising, they’re increasing at their slowest pace since July 2021.

David Bharier, Head of Research at the British Chambers of Commerce (BCC), said the data is ‘a further sign that the UK is exiting the inflation crisis which began in late 2020’.

He continued: ‘It provides additional weight for an interest rate cut in the coming months, something which will be welcomed by firms of all shapes and sizes.

‘Our research has shown that a steadily declining number of businesses are concerned about inflation, from a record peak of 84% in mid 2022. This is positive news, but prices are not falling, just rising more slowly, and the economic outlook remains challenging.’