What do SMEs need to know about the Autumn Statement 2022?

What is the Autumn Statement?

The Autumn Statement is designed to highlight a financial forecast of what is to come for households and businesses large and small. The statement follows the Spring Statement as one of two biannual statements made by the Chancellor of Exchequer.

This year, the announcement of the Autumn Statement was pushed back from its original date 31st October due to the formation of a new government. It is the first statement from Rishi Sunak’s new government.

It comes at a crucial time as the UK’s economy has been hit by Putin’s illegal war in Ukraine which caused a huge spike in the rise of energy prices, and high inflation around the world and as the UK emerges from the impacts of the global pandemic. And the newly confirmed recession after speculation that the UK was on the brink of one.

Businesses have already suffered setbacks due to the huge spike in energy prices, which has seen many close their doors earlier this year.

Who is the current Chancellor of Exchequer?

Confused about who’s who in UK Politics? You are not alone.

Jeremy Hunt is just one month into his new role as the Chancellor of Exchequer.

He replaced ex-Chancellor Kwasi Kwarteng who was under former Prime Minister Liz Truss’ cabinet to bring some calm after a chaotic storm of mini-budget U-turns which led to the UK witnessing 3 Prime Ministers so far this year. A first in British politics.

Hunt is currently the first Chancellor of Exchequer under new Prime Minister Rishi Sunak, who was a former Chancellor of Exchequer himself.

Just earlier this year in March, Sunak was delivering his Spring Statement under ex-Prime Minister Boris Johnson, whom Truss succeeded against her then rival, Sunak.

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What does the Autumn Statement 2022 mean for small businesses?

There’s a lot on the agenda. As the UK enters its first recession in over 13 years, British businesses are about to face their biggest challenge yet. Keeping employees engaged and present during tough times.

With worries about the rise in the cost of living on everyone’s mind and job security, employee wellbeing will no doubt be put to the test. But the best thing to do is to walk, not run. Avoid communicating the wrong message in haste and adding to that uncertainty accidentally.

Instead, you may want to start planning how you address the recession, and communicate any plans or certainty you have to your team. Whether it is plans to stop hiring for next year, or asking your team to review and reshuffle business priorities to align with your goals to make sure that you come out of this recession stronger.

It is also important to make sure you have a solid employee wellbeing programme put in place. Keep track of how engaged your team is and how you can help as their employer to clarify any worries they may have.

Implementing things such as a flexible working policy may also help your team remain present. Especially as a rise in the cost of child care is expected.

You may also want to be prepared to negotiate with your team in the face of a rise in income tax. But be prepared for hard conversations. In some cases, it will be likely that a pay rise may seem like a pay rise – but not the case in practical terms so employees may be disgruntled. Ensure that any dispute policies are clear, and prepared ahead of time.

As you plan ahead for some heavy conversations, make sure that you communicate clearly and leave no room for uncertainty. Don’t forget to ensure that you are as approachable as possible. Many might be keen to have these conversations, but unsure of how to go about them or the repercussions they may face.

Eager to learn more about how you can manage your team through uncertainty? Download our free Dealing with Downturn leadership guide now.

Reactions to the Autumn Statement

At the time of writing, Sir Keir Starmer, the leader of the Labour party is yet to comment on the Tory’s latest efforts to mend the economy.

Meanwhile, Sir Ed Davey, the leader of the Liberal Democrats tweeted his concern for the British public.

Shevaun Haviland, Director General of the British Chambers of Commerce has described how she questions the Autumn Statement’s wider impact. “In the teeth of a recession, this statement will not increase business confidence,” she tells the BBC.

Although she believes firms would welcome help with business rates, she called for more clarity on what support they will get with energy bills in the future.

She said that half of businesses the organisation recently surveyed said they would find it difficult to pay their energy bills once the current support comes to an end on 31 March.

It’s not been long since the reveal of what’s to come from the Autumn Statement.

But initial market reactions are grim as the British pound falls. Perhaps unsurprisingly with the tax increases and tight public spending to come in the toughest budget plan yet.

As Jeremy Hunt finished his speech, the pound was reported to have fallen to $1.178.

The wrap up

UK households and businesses are about to face one of their biggest challenges since the global pandemic; the first recession in 13 years.

All eyes are on employers to ensure the wellbeing of their team as they figure out how to navigate the hurdles ahead of them, together.

Keep up to date with the latest news affecting British SMEs with Employment Hero. Follow us on Twitter, LinkedIn, Instagram and Facebook, and keep an eye on our Resources page for more.

Looking for more resources about issues relevant to British SMEs? Download our free Brexit and the Talent Market whitepaper.

Useful resources

• Economic and Financial Outlook by the UK’s Office for Budget Responsibility (OBR)
• The Autumn Statement 2022 speech by Chancellor Jeremy Hunt
• The full Autumn Statement 2022 as documented
• Energy Bill Relief Scheme for small businesses (running until 31 March 2023)

Disclaimer: The information in this article is current as at 17 November 2022, and has been prepared by Employment Hero Pty Ltd (ABN 11 160 047 709) and its related bodies corporate (Employment Hero). The views expressed in this article are general information only, are provided in good faith to assist employers and their employees, and should not be relied on as professional advice. The Information is based on data supplied by third parties. While such data is believed to be accurate, it has not been independently verified and no warranties are given that it is complete, accurate, up to date or fit for the purpose for which it is required. Employment Hero does not accept responsibility for any inaccuracy in such data and is not liable for any loss or damages arising either directly or indirectly as a result of reliance on, use of or inability to use any information provided in this article.You should undertake your own research and to seek professional advice before making any decisions or relying on the information in this factsheet.

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