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2h ago

UK CFOs Report Record Competitiveness Fears as Costs Climb Ahead of Reeves’s Budget

The findings intensify pressure on Chancellor Rachel Reeves to consider further tax measures in the November 26 budget.

Skyscrapers of the Canary Wharf commercial district are seen in the City of London financial district, in London, Britain, September 23, 2025. REUTERS/Toby Melville

Overview

  • Deloitte’s Q3 survey of 68 finance chiefs, including leaders from FTSE 100 and FTSE 250 firms, shows the highest concern about UK competitiveness and productivity since the question was introduced in 2014.
  • A net 84% of CFOs expect operating costs to rise over the next year, the strongest reading in more than four years, with the Bank of England estimating September inflation at 4% and wage growth near 5%.
  • Executives are tightening balance sheets through cost control, building cash reserves, and reducing debt, and nearly half (47%) expect operating margins to fall.
  • BDO reports firms delayed hiring in September due to rising costs and budget uncertainty, with employment at a 13‑month low and output slipping below long‑term trends.
  • Businesses remain wary after last year’s increase in employers’ national insurance contributions, and investors widely expect Reeves to raise taxes again on November 26 to support the public finances.