“As expected, there was not much in terms of new announcements in the Chancellor’s Spring Statement today. The OBR forecasts highlight economic concerns already familiar to most businesses in Wales. Inflation concerns have not yet disappeared and there are worries about business and consumer confidence.

“Infrastructure and housing falls within the remit of the Welsh Government and like the rest of the UK, Welsh businesses support the prioritisation of simplifying the planning system but are keen to see the proof of this with spades in the ground. The industrial strategy and increased defence spending we hope will have a positive impact in Wales where the manufacturing and defence industries have a significant presence. Infrastructure investments are proven to boost economic investment, and channelling more spending out of the civil service and directly into infrastructure and increasing the amount of funding available to Wales is also welcome, providing the right projects are chosen.

“It is difficult to see any significant improvement in confidence and investment driving economic growth without capital investment led by the government. The government remains bound by fiscal rules that I would argue ignore the economic impact of borrowing to fund capital investments. Part of the problem has been the lack of any robust return on investment analysis on government spending.

“Consumer confidence remains hamstrung by a two-tier economy. The success of healthcare, welfare, and employment reforms will hang on whether they manage to improve overall employment and wage growth; this will be a big test over the next 12 months. The government has been clear that this is how it expects to be judged in the long term.

“Business owners are facing significant headwinds, the full impact of which we are yet to see. The economy could break out of these headwinds but the government will need to lead the way – just cutting spending will not change much, reform needs to achieve change.

“Global trade remains the government’s other major challenge. At the moment the government is trying to balance its relationship with the US and EU and whether events will force them off the fence one way or another remains to be seen. With domestic demand static, growth may be dependent on how the global trade environment now evolves.”

“Today the Chancellor saw a small dip in inflation, however her statement was made against a backdrop of downgraded economic growth for 2025. It all paints a challenging spring landscape as businesses struggle to bloom.

“The government must focus on reducing the cost pressures for businesses, boosting investment and exports.

“Firms are realistic, but they are also hurting. Within days they will be faced with higher national insurance (NI) contributions and a rise in the national living wage. Our research shows 82% of businesses will be impacted by the NI hike – with firms forced to raise prices, postpone investment and cut back on recruitment.

“That’s why we need a wider tax roadmap for business. The financial impact of the Employment Rights Bill has yet to be assessed by the OBR, but they expect it to be negative. The threat of US tariffs also looms large.

“The government is right to prioritise increased defence spending. It is an opportunity for the UK’s world-leading defence industry and their supply chains to grow, while protecting wider global interests. We particularly welcome plans to make it easier for SMEs to bid for defence contracts.

“Investment in construction training to get the country building is encouraging. Removing planning barriers is fundamental to getting economic growth, but businesses need confidence to build.

“It is right that the Chancellor is thinking about government efficiency and productivity. That’s what businesses have to do daily.

“For the economy to grow, businesses need to thrive.  Ahead of the Comprehensive Spending Review we’ll be working closely with ministers to ensure that they create the right environment for firms.”