Britain’s top business lobby groups, collectively known as the “B5,” have faced criticism for failing to prevent a significant rise in employer national insurance contributions, announced in Rachel Reeves’ October budget.
The £25 billion increase has drawn widespread backlash from businesses, with some questioning the effectiveness of the Confederation of British Industry (CBI), British Chambers of Commerce, and others in representing the interests of companies, particularly small to medium-sized enterprises (SMEs).
Steve Morley, president of the Confederation of British Metalforming, accused the B5 of being “far too cosy” with government officials and “naive” in their advocacy. “Given their direct access to Whitehall, their failure to deliver for businesses leaves them looking hoodwinked at best,” he said.
The budget has been widely criticised for undermining employment and investment plans, especially in manufacturing sectors already struggling with challenges such as falling electric vehicle sales and emissions targets. Morley warned the “additional burden” on SMEs could stifle optimism around Labour’s proposed industrial strategy.
The government’s consultation on an industrial strategy, focusing on eight high-productivity sectors, has raised hopes for long-term support, but Morley called for SMEs’ voices to be better represented in shaping future policies.
While the B5 declined to comment, Roger Barker, director of policy at the Institute of Directors, defended his organisation’s efforts, saying it had been “deeply critical” of the budget’s impact on businesses. Rupert Soames, chairman of the CBI, recently described the government’s treatment of businesses as akin to viewing them as “a cow to be milked.”
As the government begins to assess responses to its industrial strategy proposals, the pressure is mounting on business groups to prove their value in advocating for industries facing rising costs and regulatory challenges.
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Business lobby groups criticised for failing to block national insurance hike
