Business leaders in the United Kingdom have expressed mixed reactions to Chancellor John Healey’s recent budget announcement, with many criticizing it for lacking decisive measures to address key economic challenges while others acknowledge some positive steps for innovation and defence spending.

Healey presented the budget as a plan “for British businesses, big and small,” aimed at supporting enterprise, innovation, and growth across the country. However, several industry representatives argue the budget falls short of meeting the scale of the government’s ambitions amid ongoing global economic uncertainty and domestic concerns.

Rain Newton-Smith, chief executive of the Confederation of British Industry (CBI), commented that the budget lacks the bold interventions necessary to encourage firms to invest, hire, and expand. Similarly, Shevaun Haviland, director-general of the British Chambers of Commerce, described the budget as “steady as you go,” acknowledging it avoided new taxes for most sectors but offered little to significantly shift economic momentum. She noted that businesses had hoped for broader energy support measures, business rates reform, and action to address youth unemployment.

The Federation of Small Businesses (FSB) was particularly critical. Tina McKenzie, its national chair, stated that the budget missed a crucial opportunity to relieve small businesses from rising energy costs and high taxes that limit job creation. She also expressed disappointment that the extension of business rates relief did not cover enough sectors, especially retail, hospitality, leisure, manufacturing, nurseries, and office-based firms. McKenzie emphasized that support should reach a wider range of businesses affected by the current economic environment.

In contrast, the Institute of Directors offered a more positive perspective, highlighting measures aimed at start-ups and scale-ups as potentially valuable for future entrepreneurial growth. Jonathan Geldart, the institute’s director-general, warned, however, that more progress is needed to rebuild business confidence in government policies.

In the manufacturing sector, Make UK welcomed the chancellor’s firm commitment to defence spending targets, viewing it as a necessary step for industry clarity and stability. Kelly Maddison, interim director-general of Make UK Defence, acknowledged the importance of a fully funded defence investment plan while urging further collaboration with the government on managing industrial energy costs and meeting ambitious military budget goals for 2030 and 2035.

The banking and housing sectors reacted less favorably to specific budget elements. Banks criticized the increase in their tax burden, with JP Morgan describing the tax rise as lacking principle given the sector’s role in employment. UK bank shares rose modestly, reflecting relief that the tax measures were less severe than anticipated. Conversely, shares of housebuilding companies declined following the announcement of a new first-time buyer support scheme, which some regarded as insufficient.

Overall, while Chancellor Healey’s budget introduced initiatives supporting innovation and defence, many business leaders believe it falls short of delivering the bold policy changes necessary to tackle the UK’s economic challenges and drive stronger growth. The government’s stated ambition for prosperity “in every postcode” remains a target that industry groups feel will require more comprehensive and targeted measures in future fiscal plans.