Skip to main content
Become a member
  • Register
  • Login

Register Login


Press Releases Global Business

A Chancellor pulled in many directions still can’t afford to overlook business

02 Oct 2017

HM Treasury buildingAmidst widespread reports that the Conservative Party is being urged on all sides to increase public spending, business leaders today warned that vital efforts to boost investment by the private sector could not be allowed to fall by the wayside. The Institute of Directors called on the Chancellor to prioritise tax changes to boost entrepreneurial companies when drawing up his forthcoming Budget, including raising the Annual Investment Allowance cap to £1m, and relieving restrictions on reliefs for investing in start-ups and growing companies.

Alongside its Budget submission, the IoD published its latest economic confidence statistics, revealing how much political turbulence is weighing on business. IoD surveys show that pessimism about the economy as a whole had been growing since the beginning of the year, worsening since the General Election. While there is more optimism to be found in how firms view their own prospects, investment planning has fallen into negative territory for the first time, indicating that companies’ spending decisions are affected by their expectations for the economy. It is therefore vital, the IoD said, that other pressures on the Exchequer are not allowed to crowd-out measures to boost investment at the Budget in November.

Net Optimism: Jul 2016 – Aug 2017

Net optimism graph


Jul '16

Sep '16

Oct '16

Nov '16

Dec '16

Jan '17

Feb '17

Mar '17

Apr '17

May '17
































number of respondents vary from 750-1000

Comparing the next 12 months with the last 12 months, what do you believe the outlook for your organisation to be in terms of:


Much higher


Somewhat higher


No change


Somewhat lower


Much lower


Don’t know


Net (August)


*figures may not total 100% due to rounding

Among a raft of policy proposals, the business group called on the Government to:

  • Increase the Annual Investment Allowance (AIA) cap to £1 million per annum, in order to boost investment, productivity and growth within mid-sized companies, as well as employment opportunities.
  • Simplify and liberalise Enterprise Investment Scheme, Seed Enterprise Investment Scheme and Venture Capital Trusts reliefs to encourage investment in start-ups and scale-ups, including relaxing the restrictive criteria for these tax reliefs and simplifying the relevant investor protection legislation so that the key over-arching risks are highlighted, but this is achieved at a lower compliance cost for such businesses.
  • Significantly expand the business rates reliefs already available to microbusinesses in premises with a rateable value below £15,000. The Government must substantially alleviate the impact of the business rates increases affecting SMEs occupying business properties with rateable values up to £100,000.

Stephen Martin, Director General of the Institute of Directors, said:

“As party conference season continues to highlight deep tensions in British politics over the future direction of the UK economy, not least over Brexit, it has never been more important to remember that our collective success as a nation will be built on competitive markets and risk-taking, innovative businesses.

“We know the Chancellor has a difficult balancing act to perform, but amongst all of the loud voices crying out for more help, we urge him not to ignore the businesses feeling hesitant about their investment decisions. Our surveys show that businesses are not immune to their political surroundings and confidence cannot be taken for granted.

“It is not all doom and gloom, business leaders are optimistic by nature, and will take every opportunity they can find to grow their companies. But the Government has a responsibility to help develop the right environment. Brexit is not an excuse for domestic inaction, but a jolt to make politicians enact reforms to boost the UK’s economic competitiveness.

“The Treasury naturally looks at one side of the equation, what tax reliefs will look like in the Budget book. Businesses are not asking for a big splurge, but for specific and targeted reliefs to encourage firms and individuals to invest. Ultimately, if business investment dries up, the challenges we face in areas like skills and infrastructure will become much more difficult to address.”

Autumn Budget Submission 2017
An error has occurred. Error: Related articles is currently unavailable.

Contact our press office

Press office

IoD Professional Development Brochure

Knowledge, skills and mindset for a challenging world

IoD courses are designed to tackle the core competencies needed to thrive at board-level.

Download course brochure