Business News Round Up (04/09/2025)
Pressure on Reeves as borrowing this 27-year high
Chancellor Rachel Reeves may be forced to impose a bigger package of tax rises or spending cuts in the autumn budget as the pound slumped and borrowing costs soared to a 27-year high. After being forced into two big summer U-turns – on winter fuel payments and welfare reform – the Chancellor has a £40 billion hole to fill. Tax revenues are suffering from low growth while her hike in national insurance contributions last year has contributed to rising inflation. Today the pound fell by more than 1% against the dollar as the interest rate on 30-year government debt rose to 5.72%, the highest level since 1998. A rise in yields normally sees a rise in the pound. If it falls, it suggests investors are worried about government finances. The budget will be presented on 26 November, giving the Office for Budget Responsibility its ten-week notice period to prepare updated forecasts.
https://dailybusinessgroup.co.uk/2025/09/pressure-on-reeves-as-borrowing-hits-27-year-high
UK budget date will delay Scottish spending plans
The Scottish government says it is “highly unlikely” it will be able to present its budget before Christmas after it emerged that the UK budget will not be set out until late November. The Scottish budget is normally published in December. Finance Secretary Shona Robison said this would be “incredibly difficult” this year because of the need to analyse the Chancellor’s plans. Rachel Reeves will set out her UK budget on 26 November. Robison said it was “deeply disappointing” that Scottish ministers were not consulted in advance. She said: “This delay by the UK government makes it incredibly difficult for the Scottish government to undertake the detailed financial planning needed to bring forward our own budget in the usual timescale. Unless the UK government reconsiders this decision, it is highly unlikely that the Scottish government will be able to bring forward our budget and spending review before Christmas.”
https://www.bbc.co.uk/news/articles/cvg956p99ypo
SMEs hit by expensive loans and slow decisions
Accountancy firm Azets says many small businesses continue to face prohibitive borrowing costs and slow decision-making from lenders, despite the UK Government’s SME plan to boost access to finance. A range of measures, including the expansion of the Growth Guarantee Scheme, were announced by the government. However, firms are being frustrated by their inability to unlock the new funding. Greig McKnight, regional managing director in Scotland for Azets, said: “With interest rates still well above pre-pandemic levels, SMEs are finding that the capital they need to invest in growth remains expensive and slow to secure, particularly for those without extensive trading history.“ The government’s “Backing Your Business” strategy aims to strengthen SME access to finance, committing £25.6bn through the British Business Bank and supporting 69,000 Start-Up loans.
https://dailybusinessgroup.co.uk/2025/09/smes-hit-by-expensive-loans-and-slow-decisions
Glasgow businesses to vote on plan for city centre improvements
Businesses in Glasgow are set to vote on a plan which would see them pay a levy to fund improvements to the city centre. Let’s Go Glasgow, a city centre business improvement district (BID), could be formed to allow firms to invest in projects which “make our streets cleaner, safer and more vibrant”. An estimated £14.5m would be available over five years if the scheme goes ahead. A ballot is scheduled to run from 16 October-27 November. Investment through the BID would go beyond services provided by Glasgow City Council. It would focus on businesses’ priorities, from safety and cleanliness to economic vibrancy. Councillors are being asked to support the plans and give their permission for a yes ballot to be cast on behalf of council family properties in the city centre. Glasgow is the only major UK city without a city centre BID, the chamber of commerce said.
https://www.insider.co.uk/news/glasgow-businesses-vote-plan-city-35845023