The UK government has recently unveiled a revamped Board of Trade aimed at bolstering the export capabilities and growth of small and medium-sized enterprises (SMEs). This initiative is part of the broader ‘Plan for Change’ strategy, which seeks to empower the nation’s 5.5 million SMEs to expand their reach in global markets.

Composition and Objectives of the New Board

The restructured Board comprises a diverse group of CEOs and business leaders, each selected for their expertise in various sectors. Notable members include:

• Mike Soutar: Entrepreneur and former star of ‘The Apprentice’.
• Allison Kirkby: Chief Executive of BT Group.
• Michelle Ovens CBE: Founder of Small Business Britain.

These advisors will function as ambassadors for their respective sectors, providing guidance and support to businesses, particularly SMEs, to enhance their trading activities and foster growth.

Government’s Commitment to SMEs

Business and Trade Secretary Jonathan Reynolds emphasized the pivotal role of small businesses in the UK’s economy, both locally and nationally. He stated that the government is committed to equipping all SMEs with the necessary tools to thrive. The Board of Trade is envisioned as a proactive entity focused on increasing the number of SMEs engaging in international trade, leveraging the UK’s free trade agreements (FTAs). The underlying belief is that a higher number of exporting small firms will lead to job creation, increased wages, and overall economic growth.

SME Summit and Call for Evidence

In conjunction with the Board’s launch, a three-day summit at Wilton Park has been organized, bringing together government officials, trade bodies, small business representatives, and experts. The summit aims to address common challenges faced by SMEs and to contribute to the development of the forthcoming Small Business Strategy. Key discussion topics include:

• Encouraging entrepreneurship and the adoption of digital technologies among SMEs.
• Enhancing access to finance.
• Increasing the number of SMEs exporting overseas.

A significant aspect of this initiative is the ‘Call for Evidence’ focusing on SME access to finance. This effort seeks to gather insights into current financial demands, identify measures to boost funding, and understand barriers faced by underrepresented groups, including those with disabilities and ethnic minorities.

Additional Government Support

The government has also announced plans to tackle late payments, protect small firms from National Insurance increases, extend business rates relief, and introduce a new Business Growth Service. These measures aim to simplify and expedite access to government advice and support for businesses.

In summary, the establishment of the new Board of Trade and the associated initiatives underscore the government’s dedication to supporting SMEs. By providing expert guidance, addressing financial challenges, and fostering an environment conducive to growth, these efforts aim to enhance the global competitiveness of UK small businesses.

The Charity Commission has recently issued a warning about fraudulent letters being sent to charities and their trustees, impersonating the Commission to deceive recipients.

These deceptive communications often request actions such as:

• Removing a trustee or chief executive from their position.
• Releasing funds as part of a supposed grant.
• Supplying sensitive documents like passports or utility bills.

The letters may be signed as coming from ‘the Commission,’ it’s Chief Executive Officer, or its Directors.

To help identify genuine correspondence from the Charity Commission, consider the following guidelines:

• Mode of Communication: The Commission will only send letters by post if they do not have your current email address. It’s advisable to check and update your contact details to ensure accurate communication.
• Addressing: Authentic letters are rarely addressed generically (e.g., ‘to whom it may concern’).
• Certification Requests: The Commission does not issue letters or emails of certification on behalf of UK charities regarding tax exemption or other matters.
• Personal Information: They will not ask you to authenticate an account online by supplying personal identity documents or banking information.

When receiving letters by post from the Charity Commission, note that they will:

• Be franked, not stamped.
• Typically include a case number or reference.
• Unlikely be marked as ‘Strictly Private and Confidential’.
• Come from the Charity Commission of ‘England and Wales’, not the ‘UK’ or ‘England’.

Serious allegations against individuals are unlikely to be detailed in a letter, nor would individuals be named without clear evidence of wrongdoing. Matters related to casework or investigations would usually come from a specific caseworker or team at the Commission.

If you receive suspicious correspondence, verify its authenticity by contacting the Charity Commission directly. Reporting such incidents to Action Fraud helps in monitoring and addressing these fraudulent activities.

By staying vigilant and informed, charities can protect themselves from potential fraud and continue their vital work without disruption.

What to Expect

As we move further into 2025, the direction of UK interest rates remains a key focus for businesses, homeowners, and investors alike. The Bank of England (BoE) has already adjusted rates, and speculation is rife about what comes next.

Current State of Interest Rates

The BoE recently reduced the base interest rate from 4.75% to 4.5%, marking the third cut in six months. This move reflects the central bank’s efforts to support economic growth while balancing inflationary pressures.

Economic Growth and Inflation

Economic growth forecasts for the UK have improved, with estimates suggesting a 1.5% expansion in 2025. This growth is partly driven by increased public spending and fiscal stimulus. However, inflation remains a concern, with projections indicating a rise to around 3.7% later in the year due to higher energy costs and regulated prices.

Diverging Opinions on Rate Cuts

Economists remain divided on how far interest rates will fall. Some analysts predict that the BoE will cut rates at least four more times in 2025, potentially bringing the base rate down to 3.75%. Others argue that the scope for further reductions is limited, with expectations that rates will only fall to around 4% by year-end. This more conservative view stems from fears that inflationary pressures will persist, making aggressive rate cuts unlikely.

Global Influences and Fiscal Policy Considerations

UK interest rate decisions are not made in isolation. Government spending, taxation policies, and borrowing levels will all impact how much room the BoE has to manoeuvre. A boost in public spending could stimulate growth but may also contribute to inflation, which could make further rate cuts less feasible. Additionally, global economic conditions, trade tensions, and financial market trends will influence the central bank’s policy stance.

Market Expectations

At the start of 2024, financial markets had expected a series of BoE rate cuts throughout the year. However, fewer cuts than anticipated materialised, leading analysts to reassess their outlook. As of early 2025, markets are pricing in one more cut, with some speculation over a second. This suggests that rate reductions may be more gradual than previously expected.

Conclusion

Looking ahead, any reduction or increase in interest rates will depend on how inflation evolves and how resilient the UK economy proves to be. While the BoE has already lowered rates, further cuts may be measured rather than rapid. A balanced approach is likely, ensuring that inflation remains controlled while supporting economic recovery.

Interest rates remain a crucial factor for households, businesses, and investors, and keeping an eye on future BoE announcements will be essential in navigating the financial landscape in the year ahead.

Many UK small businesses rely on imported goods, materials, and components. Trade disruptions-whether due to geopolitical tensions, shipping crises, pandemics, or regulatory changes-can lead to:

• Delays and shortages, making it harder to meet customer demand.
• Increased costs, as businesses may need to source alternative, often more expensive, suppliers.
• Stockpiling and cash flow pressure, where businesses tie up funds in securing inventory.

Rising Costs and Inflation

Disruptions in trade can push up the price of raw materials, fuel, and transport. This inflationary pressure forces small businesses to either absorb costs (reducing profits) or pass them on to customers, potentially losing business to larger competitors with better pricing power.

Export and Market Access Challenges

For small businesses that export goods, global trade disruptions can result in:

• Tariffs and trade barriers, limiting access to key markets.
• Currency fluctuations, affecting competitiveness.
• Delays at borders, impacting delivery times and customer trust.

Consumer Behaviour Shifts

Uncertainty in global trade can influence domestic spending habits. If costs rise, consumers may cut back on non-essential purchases, affecting retail, hospitality, and other small businesses reliant on discretionary spending.

Digital and Local Opportunities

Despite these challenges, some businesses may benefit from shifting strategies, such as:

• Sourcing locally, reducing reliance on international supply chains.
• Digital transformation, selling online to a broader audience.
• Agility and diversification, offering alternative products or services to offset losses in disrupted areas.

Conclusion

While global trade disruptions pose risks, small UK businesses that adapt-by diversifying suppliers, embracing digital solutions, and exploring local alternatives-can navigate challenges and even find new growth opportunities. However, long-term uncertainty may still pressure those with narrow margins and limited flexibility.

As we approach the end of March 2025, anticipation builds around Chancellor Rachel Reeves’s upcoming Spring Statement. Given the current economic landscape, it’s insightful to consider the potential measures she might introduce and their implications for businesses and individuals alike.

Economic Context

The UK economy faces several challenges: sluggish growth, elevated borrowing costs, and persistent inflationary pressures. The British Chambers of Commerce recently downgraded the 2025 growth forecast from 1.3% to 0.9%, highlighting a “long and challenging year” ahead for UK firms. Additionally, global economic uncertainties, such as potential trade tensions, add to the complexity of the fiscal environment.  

Potential Measures in the Spring Statement

1. Spending Cuts
2. Taxation Adjustments
3. Support for Small Businesses
4. Infrastructure and Growth Initiatives
5. Regulatory Reforms

To address the fiscal deficit, Chancellor Reeves is reportedly considering significant spending cuts, particularly in welfare. The Institute for Fiscal Studies warns that without explicit benefit cuts, achieving the desired savings is uncertain. These measures aim to reduce the welfare bill and reallocate resources to other pressing needs.

While Reeves has pledged not to introduce extensive tax hikes, fiscal realities might necessitate subtle adjustments. One possibility is extending the freeze on income tax thresholds beyond 2028, effectively increasing tax liabilities as incomes rise with inflation. Additionally, there might be revisions to existing levies, such as those on agricultural and business assets, to enhance revenue without overtly increasing tax rates.

Recognizing the pivotal role of small businesses in economic growth, the Chancellor may introduce measures to bolster this sector. This could include simplifying procurement processes, especially in defence contracts, to enable smaller firms to compete more effectively. Such initiatives would aim to stimulate innovation and job creation at the grassroots level.

To rejuvenate the economy, Reeves might emphasize infrastructure projects, particularly in regions like the Oxford-Cambridge corridor, aiming to transform it into “Europe’s Silicon Valley.” Investments in transportation, technology hubs, and housing could be on the agenda to spur regional development and attract private investments.

The Chancellor has expressed intentions to dismantle regulatory barriers hindering economic expansion. This could involve overhauling planning processes, expediting approvals for significant projects, and revising ESG financing rules that currently constrain certain industries, such as defence. Such reforms aim to create a more conducive environment for business operations and growth.

It’s hard to see a glimmer of light at the end of this fiscal tunnel. We will be reporting on the actual plans laid before Parliament following the Chancellor’s presentation on 26th March.