Every new demand placed on the private sector reduces our ability to invest, grow and create jobs, and that has a knock-on effect to the economy as whole. As a business, VEKA has absorbed the National Insurance increase across both our businesses – which is not an insignificant amount – because we believe in protecting our people. We still plan to deliver salary increases. We see this as a reflection of our commitment to employees, their welfare and maintaining morale as they too are feeling the struggle of these challenging economic times.

But continuing to do this isn’ t sustainable without growth. Without growth, it gets harder and harder to keep making those kinds of decisions. This is part of a bigger message we’ d like the government to hear. Every new demand placed on the private sector reduces our ability to invest, grow and create jobs, and that has a knock-on effect to the economy as whole.

If the government is truly a government on the side of working people, and if it wants to make good on its promise to get more people into secure work, then it needs to recognise this pressure on their employers.

Any budget measure should aim to restore confidence, not further erode it. And now the Office for Budget Responsibility cuts growth forecasts in half to 1 %.

The state of the market

Generally, I’ d describe the current performance of our market as‘ unspectacular’ and I know that this sentiment is reflected across our, and many other industries too. At the moment, we’ re not seeing immediate

growth, we’ re holding steady.

One of the key areas the government is insisting will drive growth is the changes to planning reforms and announcements like the ambition of 1.5 million new homes. On the surface, this sounded like a big growth opportunity for our sector. But, no one in our space really believed that target was realistic without tackling the severe skills shortages in construction. The Government has pledged £ 600m to train 60,000 more engineers, construction workers, electricians and carpenters by 2029. But, looking at previous data on the volumes of people who have left the sector in recent years, and the challenge of an aging workforce – meaning that we anticipate more to leave as they hit retirement – this move may only have limited impact in filling the gaping skills gap.

What can the private sector do?

We entered this year with a much sharper focus on who we are and how we intend to operate, and this has helped us to navigate the additional costs imposed on us during the Autumn Budget. Speaking from our own experience, I genuinely believe that at nearly every level of our organisation, we now have much greater understading about our purpose and how we aim to drive the business forward.

To support that alignment, we hold quarterly briefings for all employees. These sessions are complemented by a cascade of communication through the senior leadership team, ensuring consistent messaging and action throughout our business. One of the key lessons we’ ve learned, is the importance of keeping things simple.

Across our sector, we’ re also encouraging a more open conversation about the value of what we provide. I believe that businesses in the private sector need to price responsibly to stay healthy. We’ ve always aimed to be fair, to give our customers plenty of notice of any increases and to be transparent. But we also have to be brave and we have to believe in profit as fuel for future investment. A‘ race to the bottom’ in pricing helps no one.

What do we need to see from government?

Our sector has long called for targeted VAT adjustments to incentivise home improvement. There’ s a real opportunity to stimulate home improvements

by adjusting VAT which would have the biggest direct knock-on effect on demand in our sector. But every year it’ s ignored, and it continues to be a missed opportunity.

Stimulating activity here would bring a multiplier effect, job creation, manufacturing growth, and improving living standards.

We need to see what the outcome of the rise in National Insurance will deliver. Any solid business understands that forecasting is key. It would be far more reassuring to have a clearer picture of the actual impact this measure will have. There was some criticism at the time suggesting it hadn’ t been fully thought through, so now it’ s important to understand what our investment – because that’ s

essentially what it is – will do for the economy.

We would also like to see acknowledgement from the government that private sector businesses like ours are playing a major role in keeping the economy moving. We’ re absorbing costs, protecting our people and pushing for growth. But we are not endless sponges able to absorb it all and we can’ t do it alone.

Ultimately, if the private sector is to do the heavy lifting of recovery and resilience, it needs clarity, consistency and a partnership approach from government. Only this will create the promised‘ jobs in every corner of the economy’ and deliver security for working people.

www. veka. co. uk