CBI responds to draft Welsh Government Budget 2025-26

Alison Orrells, Chair, CBI Wales, said: 

“Businesses were looking to the draft Welsh Budget to inject momentum into the economy after a tough UK Budget.

“Despite the UK administration’s £1.7 billion real terms funding increase - the largest since devolution – the Welsh Government still face limited fiscal headroom to shore up public sector finances and support struggling households.

“The First Minister’s recent announcement of £157 million to be invested in transport, the economy, planning reform, business and infrastructure measures - along with the new economic forum and next year’s investment summit - shows the government’s commitment to economic growth.

“However, Welsh businesses still face multiple challenges in 2025, in the form of higher employer National Insurance contributions and other rising costs like the National Minimum Wage.

“The commitment to emulate the business rate reliefs available to hospitality, retail and leisure sectors based in England is very welcome. This will provide much-needed support for hard-pressed Welsh businesses and means they are not being put at a disadvantage to companies operating just across the border.

“While the announcement of some reliefs is helpful, the lack of clarity on the Non-Domestic Rates multiplier and sector-specific reliefs creates uncertainty for firms. The ending of transitional reliefs could also lead to additional costs for some companies.

“The promise of streamlined and digital planning processes will cut red-tape, but will not happen overnight. High-growth businesses have complex needs, and the government must invest heavily in strategic planning authorities and local authority planning departments to see short-term benefits.

“The additional £6.5 million investment in the Flexible Skills Programme, prioritising growth sectors like decarbonisation, aligns with business’ net zero ambitions. But firms want further measures in a rapidly changing labour market.

“Ultimately, the only way to support the Welsh Government’s mission to improve public services and raise living standards is to help firms thrive and deliver growth. We need business and government to work together to co-create policy that protects competitiveness and avoids short-changing Wales’ long-term growth ambitions.”