IoD press release Chancellor must restore business confidence and unlock investment in Autumn Budget
The Institute of Directors has today published its submission ahead of the Autumn Budget on 28 October, calling on the Chancellor to focus on restoring business confidence, encouraging private investment and creating the conditions for stronger long-term economic growth.
The IoD argues that while the UK economy has delivered stronger growth than many comparable advanced economies in recent years, persistent weaknesses in investment, productivity and business confidence risk undermining future prosperity.
The submission identifies five priority areas where the Budget can help strengthen the UK’s growth prospects:
- Create a competitive and predictable tax environment
- Mitigate the employment and investment consequences of the Employment Rights Act
- Sequence devolution to support productivity across the UK
- Protect and deliver economically productive infrastructure
- Accelerate responsible AI adoption across the business population
Anna Leach, Chief Economist at the Institute of Directors, said:
“The UK has achieved respectable headline growth in recent years, but the fundamental challenge facing the economy remains unchanged: we do not invest enough. Business leaders consistently tell us that uncertainty, rising costs and doubts about policy delivery are holding back investment decisions.
“This Budget must restore confidence and provide a clear signal that the UK is committed to being one of the most attractive places in the world to invest, grow a business and create jobs. With fiscal headroom limited, the UK’s growth challenge cannot be solved by public spending alone: government must create the conditions for businesses to invest. That means no further increases to the overall tax burden on businesses, investors and employment, alongside greater policy stability, proportionate regulation, effective infrastructure delivery, well-sequenced devolution and wider responsible adoption of AI – all focused on raising productivity, crowding in private capital and improving living standards.
“The overriding test for this Budget is whether it helps move businesses from postponing investment to pursuing growth. If the government can rebuild confidence and demonstrate clear delivery, the private sector can play its full role in driving the next phase of economic growth.”
The IoD’s submission highlights concerns that confidence has remained subdued since 2024 amid uncertainty over taxation, rising employment costs and questions around policy coherence. The Institute argues that a successful Budget should restore predictability, reduce the risks associated with investing and hiring, and demonstrate a stronger focus on growth across government decision-making.
The IoD is urging the government to expand its existing corporate tax roadmap into a broader long-term framework covering the entire business tax system. The organisation says firms and investors need greater certainty about the future direction of tax policy and warns against further increases in taxes on business, investment and employment.
The submission also calls on ministers to use the implementation process for the Employment Rights Act to reduce risks to hiring, particularly for smaller firms and those offering entry-level opportunities. Recommendations include proportionate adjustments to trade union access provisions, guaranteed-hours rules, shift notification requirements and unfair dismissal reforms, alongside additional resources for Acas and employment tribunals.
On devolution, the IoD supports the government’s ambition to devolve power but argues that responsibilities should only be transferred where there is sufficient institutional capacity, stable funding and robust accountability. The organisation is calling for a cross-government Devolution Data and Statistics Delivery Plan and a shared performance dashboard to support effective local growth policy.
The submission further urges ministers to protect high-productivity infrastructure investment and maintain momentum towards the delivery of a third runway at Heathrow. The IoD argues that major infrastructure programmes need clear milestones, accountable leadership and transparent measures of success to improve delivery and attract private investment.
Finally, the organisation says the government should simplify support for technology adoption by bringing together existing AI and digital-adoption initiatives into a single national offer for SMEs through the Business Growth Service. It also recommends a new ‘Responsible AI Essentials’ programme to help smaller businesses adopt artificial intelligence securely and effectively.
