Budget Pressures Raise Questions for Business

Chancellor Rachel Reeves has triggered fresh uncertainty after cancelling a planned welfare reform expected to save £5.5 billion, leaving a significant hole in the Treasury’s accounts and raising the prospect of tax increases later this year.

Markets reacted swiftly: sterling dipped and government borrowing costs rose, reflecting investor concerns over how a growing £40 billion fiscal shortfall will be addressed. A revised budget is due this autumn, with attention turning to how the burden might be shared.

While no measures have been formally proposed, the freight industry is on alert. Possible changes include:

– Higher fuel duty, which would increase transport and delivery costs
– Stricter customs enforcement, potentially adding friction and delay
– Corporate tax rises, squeezing already tight logistics margins

The British International Freight Association (BIFA) has urged the government to consult with the sector before taking action, stressing the need for stability and recognising logistics as vital to UK trade.

Offering a broader view, the Bank of England’s latest financial stability report suggests most UK companies remain resilient. Even under pressure from global shocks, including tariff hikes, rising interest rates, and a 10% fall in earnings, most are expected to meet their debt obligations.

For business, the message is clear: policy uncertainty may be unavoidable, but financial agility and early engagement will be key to overcoming what comes next.

EMAIL Laurence Burford, Chief Financial Officer, today to explore how Metro can support your business through ongoing global disruption.