The British Chambers of Commerce (BCC) has warned that a decade of domestic policy decisions has created a towering "cost stack" that is choking business growth, urging policymakers to stop adding to it ahead of October's Budget.

Writing for City AM, BCC director general Shevaun Haviland compared the pressure on firms to the summer's weather, noting that much of the UK has bounced from one unrelenting heatwave to another — and businesses know that unrelenting feeling all too well. A decade of constant cost pressures from domestic policy decisions has been "hugely damaging", she wrote, building a cost stack that is choking business growth.

Before a pound of profit is made, the list of costs facing businesses already mounts up. Over the last ten years there have been increases in the minimum wage, employer National Insurance, business rates, employment rights, the apprenticeship levy, climate levies, IR35 changes, VAT thresholds and packaging taxes — "to name just a few". Haviland stressed that this is not a party-political issue, arguing that policy choices from successive governments have piled cost after cost on British business.

During a visit to Lancashire last month to meet Chamber members, she said manufacturers, construction firms, retailers and hospitality businesses all told her the same story: cost pressures are damaging investment and recruitment. One business told her it took on 25 apprentices last year but is taking on just one this year — an experience she said is not unique in her travels across the UK. That matters because those decisions sit at the point where firms turn from simply covering overheads to hiring, training and buying equipment, leaving less room to make the investments that usually support growth and productivity.

Cost stack up more than 70 per cent for a typical SME

To be up front about the cost pressures, the BCC has launched a new Cost Stack Calculator, published in the pages of the newspaper in the run-up to the Budget. The online tool allows businesses to quickly find out how much domestic policy-driven costs have increased for them over the past decade, and the results are "stark".

The BCC's modelling shows that for a typical SME employing 50 people with turnover of £5m, the cost stack from government policies has risen by more than 70 per cent in the past ten years. Haviland said this is not about one tax rise or one policy decision, but the cumulative impact of them all: every pound spent absorbing higher costs is a pound that cannot go into buying a new machine, hiring a new recruit, investing in new technology or expanding into a new export market.

The group's latest survey of 4,700 businesses from across the UK shows that only 17 per cent of firms have increased investment in the last three months — the lowest level since the pandemic and, in Haviland's words, a clear sign of the cost stack's impact.

She acknowledged that Andy Burnham has made a start in reducing costs for firms with a welcome cut on business rates for pubs, clubs and music venues in England from January next year, but said urgent action is needed to reform business rates for all sectors, not just some.

Business resilience alone will not deliver the investment-led growth the country needs, she argued. More and more businesses she speaks to are asking whether it is all worth it, and government must give firms the confidence and capacity to carry on, invest and grow.

With October's Budget described as a pivotal moment, the BCC's message to policymakers is simple: stop adding to the cost stack and start taking layers away. "Back business. Cut costs. Deliver growth."

Businesses can use the BCC's calculator to see how the cost stack has increased for them at

Shevaun Haviland is director general of the British Chambers of Commerce.