NHS funding welcome but small businesses concerned

Chancellor Rachel Reeves delivered the new Labour government's first budget on Wednesday

Plans to increase spending in the NHS and on education outlined in Wednesday's budget have been welcomed in the South East.

But increases to employers' national insurance contributions and the national minimum wage have sparked concern from small business owners.

The measures were among those outlined by Chancellor of the Exchequer Rachel Reeves, in the new Labour government's first budget on Wednesday.

BBC South East has been hearing reaction from taxpayers, business owners and politicians across the area.

For Peter and Deborah Bishop in Littlehampton, West Sussex, extra money for the NHS is good news.

"That's got to be their first priority," said Ms Bishop, "that's good for everybody".

Adele Hibbert, here with her partner Stuart Foster, used to work for the NHS

Adele Hibbert from Worthing, West Sussex, worked for the NHS and said the extra money was long overdue.

She said the challenges she had faced included being "short staffed constantly, instead of having six patients you'd be looking after 12".

The Chancellor announced £1.3 billion of extra grant money for councils, providing what she called a "significant real-terms funding increase" for local government.

Tim Oliver, leader of Conservative-controlled Surrey County Council and chairman of the County Councils Network, said the money "does not eradicate councils' funding gap" as local authorities would also incur "significant additional expense due to the increase in the National Living Wage".

He added: "Therefore, councils will have little choice but to raise council tax and still will need to take difficult decisions over services to balance their budgets."

But Bella Sankey, leader of Labour-run Brighton & Hove City Council, said: “The measures will not solve all our problems overnight, but it does signify an important change in approach from the new government to addressing the root causes of problems such as housing supply."

Liz Arnold, owner of All Sorts Airsoft Fantasy Games in Littlehampton, was concerned about increases to employers' national insurance contributions and the national minimum wage.

She said: "I think it's going to be quite damaging for smaller businesses.

"I'm sure some will have to lay staff off because they can't afford it."

Rupert Thompson, managing director of the Hogs Back Brewery in Tongham, Surrey, said: "It puts a brake on our ability to invest and so create more jobs.”

Shop owner Liz Arnold is concerned about the effects of extra costs on small businesses

Emily Eyre of Cucumber Catering in Sittingbourne, Kent, said she would have to raise prices and would be deterred from hiring staff, but the budget was "not as bad as expected".

She said: "The employment allowance increase will offset the increase in national insurance. I was really pleased to see the business rate relief for catering and hospitality."

Tim Aker from the Federation of Small Business in Kent said: "Businesses grow best when they can see the direction of travel and know what we are dealing with.

"My hope is today we start to see where the country is moving and a positive message about the economy starts to emerge."

Spending on education will include £1bn for special educational needs, a move partially welcomed by Esher and Walton's Liberal Democrat MP Monica Harding, who said the figure should have been £4bn.

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