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Posted: Tue 18th Aug 2026
4 min read
The government has opened consultation on Prime Minister Andy Burnham's first Budget.
That comes as new research reveals small business owners are absorbing unprecedented financial pressure by slashing their own pay, with three-quarters now taking home less than £20,000 a year.
Chancellor John Healey will deliver his fiscal statement on 28 October, the earliest autumn Budget since 2021.
Treasury has opened its representation portal until 9 September, inviting businesses and organisations to submit evidence that will shape the government's approach at a time when self-employed people are under acute strain.
The drop in salary finding has jumped sharply in the past year, with the squeeze most acute among businesses that employ staff.
The data, from Enterprise Nation's Small Business Barometer, suggests founders are prioritising staff wages and business costs over their own income, a pattern experts warn is unsustainable.
City AM analysts estimate Healey faces a £22 billion hole to plug, with most economists expecting tax rises. That's despite manifesto commitments ruling out increases to income tax, VAT and National Insurance contributions.
The Chancellor has promised a Budget "built on fiscal discipline" that offers stability, but the arithmetic leaves little room for manoeuvre.
Appetite for external funding has hit its lowest point on record, while late payments have become markedly more widespread.
The Small Business Commissioner estimates £26 billion remains tied up in unpaid invoices at any given time.
The Commercial Payments Bill, announced in the King's Speech, aims to cap large companies' payment terms at 60 days and make interest on overdue invoices mandatory.
Confidence in expansion has fallen to its lowest level in years, though technology businesses are bucking the trend. Food and drink and general retail have seen particularly sharp declines.
The government has already signalled its direction as pubs, clubs and live music venues will receive a 20% cut in business rates from April 2027.
That's described as "a first step" before wider reform at the Budget, including a 2p cap on bus fares and a VAT cut to electricity bills.
Mayors will also retain a share of taxes generated in their regions, starting with business rates, with income tax to follow.
For sole traders, Burnham has promised to revisit the Personal Allowance, though he warned change would be difficult given the fiscal constraints. The review touches the first pound of profit for people who are self-employed.
Across age groups, lowering the tax burden emerges as the top priority for founders.
Enterprise Nation will submit a comprehensive representation on behalf of its 240,000-strong community, pressing for:
completion and enforcement of the late payment Bill
rates reform extending beyond single sectors
action on energy costs
delivery of the government's Small Business Plan in full
Treasury guidance asks for rationale, costs, benefits and evidence.
Businesses have until 11.59pm on 9 September to submit through the official portal or feed into sector representations before Healey stands at the dispatch box on 28 October.
Image credit: Lauren Hurley / No 10 Downing Street
