UK Accountants Call for Economic Boost as Confidence Hits New Low: ACCA Survey Insights

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A recent survey from the Association of Chartered Certified Accountants (ACCA), a leading global accountancy body, has revealed a concerning trend among UK accountants: only 14% have a positive outlook on the UK economy. This strikingly low level of confidence highlights the pressing need for impactful economic measures in the upcoming Budget to restore business and investment optimism. With the majority of accountants—86%—holding either a neutral or negative view, the results shed light on a growing disconnect between economic policy and the needs of the business and finance sectors.

In a climate marked by uncertainty around policy direction, tax reforms, and impending fiscal decisions, ACCA is calling on the UK government to announce clear, business-friendly measures. The organisation aims to address the underlying issues eroding economic confidence, from skills shortages to management costs and inadequate public sector support. Below, we explore the survey’s findings, ACCA’s calls to action, and the broader implications for the UK economy and its business landscape.

An Alarming Lack of Economic Confidence Among UK Accountants

ACCA’s survey shows that only 14% of UK accountants feel positive about the current economic state, reflecting a sense of frustration among professionals who work closely with businesses and have a nuanced understanding of the economy. The remaining 86% have expressed either a neutral or outright negative outlook, with many citing uncertainties in policy and taxation as primary concerns. These sentiments highlight a critical issue: a pervasive lack of economic confidence that can undermine business activity, investment, and growth at a time when the UK government has declared economic recovery as a top priority.

Key Findings from the ACCA Survey

The ACCA survey data underscores several critical issues affecting accountants’ outlook:

Low Economic Confidence: Only 14% of accountants express a positive view, while the overwhelming majority feel either uncertain or pessimistic about the economy’s current direction.
Top Challenges for Businesses: Economic confidence (71%), skills shortages (59%), and rising management costs (49%) are cited as the greatest challenges facing businesses.
Falling SME Confidence: Small and medium-sized enterprises (SMEs) in particular have experienced a sharp decline in business confidence, with levels now at their lowest since the second quarter of 2023.

These findings signal an urgent need for the UK government to re-evaluate its economic strategy, particularly concerning SMEs, which are the backbone of the economy and a significant driver of employment and innovation.

The Role of the Upcoming Budget in Restoring Confidence

As the Budget approaches, the ACCA has underscored the high stakes involved in the Chancellor’s decisions. Business owners and finance professionals are eagerly awaiting measures that will provide clarity and stability, particularly in light of recent economic fluctuations. ACCA’s Head of Strategic Engagement for England, Gemma Gathercole, voiced the pressing need for Budget announcements that prioritise growth and productivity.

According to Gathercole, recent initiatives to address issues like late payments and corporate governance are steps in the right direction, but they must be supplemented with incentives for investment. “The fact that less than a fifth of ACCA members have a positive view of the UK economy shows the stakes are high for the upcoming Budget, with businesses needing to get clarity and confidence from the announcements,” she said. This appeal reflects a growing call for policies that support sustained investment in the economy, ensuring that businesses have the resources and regulatory support needed to thrive.

Addressing Key Challenges: Skills Shortages, Management Costs, and HMRC Service

The ACCA survey identified three primary challenges that are impacting UK businesses, and these align closely with the broader economic concerns accountants are witnessing daily. The following issues are most frequently cited by accountants as barriers to growth and productivity:

Economic Confidence: A staggering 71% of respondents pointed to low economic confidence as a top issue, driven by factors like policy uncertainty, inflation, and concerns about public spending.
Skills and Labour Shortages: The UK’s chronic shortage of skilled workers continues to impact business productivity and growth, with 59% of survey participants citing this as a major concern. As businesses struggle to find qualified talent, particularly in key sectors such as finance, tech, and healthcare, the cost of hiring has increased and the recruitment process has become lengthier and more complex.
Management Costs: Rising management costs, identified by 49% of accountants as a critical issue, are squeezing profit margins and limiting the funds available for investment in growth. These costs range from increased regulatory compliance expenses to higher wages and energy prices.

The ACCA is calling for the Budget to address these concerns directly, advocating for policies that alleviate the pressures of compliance, labour shortages, and financial uncertainty. Notably, the organisation has pointed to the failures of HMRC as a significant hindrance to effective business operations.

Calls for HMRC Reform: Improving Service for Accountants and Businesses

A recurrent theme in the ACCA survey is frustration with HMRC (Her Majesty’s Revenue and Customs) service levels. In fact, 89% of ACCA accountants believe that HMRC’s poor service is hampering their ability to work effectively. Issues with delayed responses, complex processes, and inadequate support have become a recurring obstacle for businesses trying to meet compliance requirements and manage their finances efficiently.

The ACCA is urging the government to prioritise HMRC reform, advocating for improvements in digital service delivery, quicker response times, and streamlined processes. For accountants and business owners alike, an efficient and reliable tax authority is essential for maintaining compliance and freeing up resources to focus on growth.

Falling SME Confidence: A Red Flag for Economic Stability

One of the most concerning findings in the ACCA survey is the sharp drop in confidence among SMEs, with the current level being the lowest since Q2 2023. This decline reflects not only uncertainty about the upcoming Budget but also a broader fear of rising costs and policy changes that may add new pressures to already stretched resources.

For SMEs, which represent the majority of businesses in the UK, confidence levels are often directly tied to the wider economic outlook. When these businesses feel uncertain or pessimistic, they are less likely to invest in growth initiatives, hire new staff, or expand their operations—all of which can stymie economic recovery.

Glenn Collins, ACCA UK’s Head of Technical and Strategic Engagement, pointed out the negative implications of this declining confidence. “The Chancellor has rightly warned about the tough decisions ahead, but the Government should be concerned about the impact this is having on economic confidence,” he noted, emphasising the need for a positive, business-friendly approach in the Budget. Collins suggests that a strategy focused on growth and investment is crucial for re-energising SMEs and boosting overall economic resilience.

Proposed Solutions: Incentives, Investment, and a Positive Business Approach

As accountants look to the government to support the business sector, the ACCA has outlined several recommendations for the upcoming Budget that could restore confidence and stimulate economic growth:

Investment Incentives: Introducing or expanding tax incentives for businesses that invest in productivity-boosting measures could encourage companies to commit resources to areas such as digital transformation, equipment upgrades, and training. Such incentives would not only drive immediate growth but also enhance the long-term resilience of the UK economy.
Skills Development: Addressing the skills gap is essential for both businesses and the economy at large. The ACCA has called for more initiatives to support skills development, including targeted training programmes, apprenticeships, and partnerships with educational institutions. This approach could help mitigate the labour shortage, equip businesses with the skilled talent they need, and reduce hiring costs.
Improved HMRC Services: Enhancing HMRC’s efficiency is a high priority for accountants. The ACCA has urged the government to invest in digital services, customer support, and faster processing times to ensure that businesses can navigate the tax system effectively. These improvements would relieve some of the compliance pressures accountants currently face and enable them to deliver better service to their clients.
Support for SMEs: Given the drop in SME confidence, the ACCA is advocating for policies that specifically support small and medium-sized enterprises. This could include targeted grants, simplified regulations, and relief from rising costs, helping these businesses overcome the challenges of a turbulent economic climate.

Looking Ahead: High Expectations for the Chancellor’s Response

The ACCA’s survey results indicate that UK accountants are closely watching the upcoming Budget, hoping for substantial and effective changes. By addressing key challenges such as low economic confidence, skills shortages, and inefficient public services, the government has an opportunity to demonstrate its commitment to revitalising the economy and supporting the UK’s businesses.

Gemma Gathercole, Strategic Engagement lead for ACCA UK, highlighted the importance of a “business-first” approach in the Budget. “We know our members want to do the best job possible for their clients and organisations,” she said. “ACCA hopes that the Chancellor takes the opportunity to outline business-first ways of working that will help power up the economy and encourage confidence in investment.”

Conclusion: Bridging the Confidence Gap for a Stronger UK Economy

The ACCA’s latest survey reflects a lack of confidence among UK accountants and businesses that poses significant risks to the nation’s economic future. The government’s decisions in the upcoming Budget will play a crucial role in addressing these issues, with a pressing need to restore confidence, foster investment, and eliminate barriers to growth.

With only 14% of accountants holding a positive view of the economy, the stakes are high. The calls for investment incentives, skills development, HMRC reform, and SME support resonate as a roadmap to rekindle economic optimism. For accountants, businesses, and policymakers, working collaboratively to implement these solutions will be vital in fostering a more stable and prosperous economic landscape in the years to come.