The Spring Statement - reaction - March 2025

Introduction

So we’ve just had the Spring Statement from the Chancellor - and there is not too much to talk about for the hospitality and retail sectors.To be fair, the Spring Statement shouldn’t be very exciting - it’s not supposed to be another budget, it’s an update on how the economy is going.

And the economy is not going that well.  

Or its going really well.  Depends on which side of the political fence you sit on.  

That’s the joy of statistics, forecasts and polictical statements.

What is actually happening?

There has been quite a big downgrade on the economic forecasts since the autumn budget and this causes everyone a bit of a problem.

So the Chancellor is cutting spending, boosting building, increasing employment (somehow) and adding 20% to defence spending to balance out the downgrade.  

I was about to go into some detail on the actual policies here but I’m even boring myself at this stage.

So what do I need to know?

Three bits of information, which whilst not really new, are at least relevant.

1. Inflation is going to keep coming down according to the OBR to 2% at the end of 2027

2. The average household will have £500 more to spend this year

3. The economy should continue to grow

So if the forecasts are correct, we should be getting back to an economy which is more stable and people have more money in the next couple of years, which can only be a good thing.

A missed opportunity?

It is a shame that the Chancellor didn’t soften some of the impact of the NI increases announced in the Autumn budget - business confidence has been falling in pretty much all polls and something to offset this would have been welcome (although in the current climate, pretty much impossible to give).

On to next week!

April is round the corner and with it comes pretty big NI and National Minimum Wage increases.   I know most people on this list have already been reviewing pricing with this in mind, but if you have not yet, you should - costs are going up and there is no avoiding it.