''We're the lifeblood of the city" - National budget raises serious concerns for small businesses in Chichester

The Budget – the first from a Labour government in 14 years – was announced by Chancellor Rachel Reeves last week, with a raft of new policies set to have a pervasive effect on the British economy.

Alongside a 4.7 per cent increase on spending on the NHS, an extra £500 million for pothole repairs across the UK, and tax hikes worth a total of some £40 billion, the government also introduced plans which could see businesses paying more just to stay open.

As of April next year, businesses will pay National Insurance at 15 per cent on salaries above £5,000, up from the current rate, which is13.8 per cent on salaries above £9,100. Meanwhile, the minimum wage will increase to £12.21 per hour for over 21s and £10 for 18 to 20 year olds, up from £11.44 and £8.60 per hour respectively.

For bars, restaurants and cafes like Spires, which has been in Chichester since 2005, this could make hiring new employees more difficult, as owners evaluate where and how to cut costs in order to continue making a profit.

"The rent is always going up, the bills are always going up, food is going up, and now wages are going up too,” said Stephen Lee, who said the changes will have a much bigger impact on small businesses, then large chains.

"We’re the lifeblood of the town.We have to survive alongside the big boys, because that brings people into the town, but we’re known for small businesses. For us, this budget isn’t about promoting growth, it just makes things harder."

Joel Christian, who owns Crispins Cafe, on East Street, said he has many of the same concerns.

"It’s going to have a huge impact on small businesses like us, because it just makes it more expensive to operate. Small traders are struggling already, and now we have to cover this extra cost. You can only put prices up so much because, once you do, customers stop choosing to come to you.”

Some business owners are also concerned about changes to Business rates relief, which currently sits at 75 per cent, but will shrink to 40 per cent next March. The government is hoping to revamp the business rate system in 2026-2027, with an eye to making it fairer, and giving small to medium sized traders a better deal. But, for the time being, many of those same traders are anticipating a squeeze.

"The lack of clarity over what exactly is going to happen in the next few years doesn’t help,” said Julia Grant, owner of Winters Moon – a gift shop on North Street.

"If I were trying to maybe take on an extra premise, and with things like renewing leases – it will really impact those kind of decisions. You just want a bit of certainty."

Even so, for Ms Grant and other retailers, there’s ultimately a sense of rolling with the punches: “At some point you just have to go ‘oh okay,’ and cut your costs accordingly. I’ve got family who work in education, and the NHS; I can see what the government is trying to fix, and the need for what they’re doing.”