The British Chambers of Commerce is urging Prime Minister Andy Burnham to make the country’s business community a central part of his first autumn Budget, arguing that devolution will deliver little unless it helps firms invest, recruit and expand.
Its warning arrives as the Government prepares to hand more fiscal authority to local leaders, but business confidence remains subdued. Just 17% of companies surveyed in the second quarter of 2026 said they intended to increase investment over the following months, the BCC says, marking a post-pandemic low.
Shevaun Haviland, the chamber’s director general, said devolution could become a powerful engine for growth across individual regions and the UK as a whole, provided local decision-makers work closely with the private sector.
“Business want and need devolution to be a powerful engine for local and nationwide growth. They are ready to be at the heart of the journey ahead.”
A business test for the Budget
The BCC’s request is particularly significant because the Budget is expected to be more than a routine annual fiscal event. Mr Burnham has acknowledged that he will need to take “difficult decisions” to keep the economy “on track”, while Chancellor John Healey has promised a “road map to fiscal devolution”.
That road map is likely to determine how much influence local and regional leaders have over the funding available to them. The chamber wants the Government to ensure those powers are used in ways that support productivity, job creation and higher living standards, rather than simply relocating responsibilities from Whitehall.
According to the BCC, business should be involved at every stage. Local authorities may understand regional needs, but companies possess first-hand knowledge of the obstacles that prevent them from committing capital, hiring workers or developing new markets.
That means devolution should be judged less by the number of powers transferred and more by the practical effect on firms. Haviland said the crucial question for ministers and local leaders is whether decisions made closer to communities make it easier for businesses to operate and grow.
“Devolution can be a powerful driver of economic growth, but only if businesses are at the heart of the decisions. As more powers are pushed out from Whitehall to regions of England, the test of success is simple.”
Devolution must include fiscal power
The chamber is asking ministers to finish its proposed devolution plan by the end of the 2027-28 financial year. That timetable would give regional leaders a clearer route to the spending and revenue powers needed to pursue long-term economic strategies.
For many areas, the issue is not simply receiving additional funding from Whitehall. It is gaining control over enough taxation and investment decisions to respond quickly to local strengths, from advanced manufacturing and clean energy to digital services and export industries.
The BCC also wants local communities to receive a direct stake in the economic gains produced by those decisions. It argues that residents should see the benefits of growth reflected in better services, stronger wages and improved living standards before the end of this Parliament.
This approach could reshape the relationship between central and local government. Fiscal devolution would give regional leaders greater freedom, but also place them under closer scrutiny for the results of their choices. Businesses, meanwhile, would have a stronger opportunity to influence policies that affect their costs, workforce and prospects.
Haviland said the ultimate test is straightforward.
“Does it make it easier for companies to invest, recruit, trade and grow?”
If the answer is yes, she said, devolution has the potential to raise living standards and broaden opportunity beyond the country’s economic centres.
Weak investment sharpens the challenge
The BCC’s call for a more business-led approach comes at a cautious moment for the economy. Its survey of 5,000 firms found that only 17% planned to increase investment in the coming months during the second quarter of 2026.
That figure does not mean every other company intends to cut spending. It does, however, reveal a notable reluctance to commit money to new projects, equipment or expansion when uncertainty remains high.
For the Government, low investment creates a difficult backdrop for its devolution ambitions. New regional powers will have limited impact if firms are unwilling to use them as a signal to expand. Local growth strategies therefore need to address the immediate concerns of business, including access to skilled labour, infrastructure, finance and predictable regulation.
The BCC argues that the Budget should provide a clear framework for doing so. A credible timetable, combined with closer consultation and meaningful fiscal authority, could give companies the confidence to turn regional potential into tangible economic activity.
The chamber’s preferred outcome is devolution that produces visible local results rather than administrative change for its own sake. Haviland said successful reform would help regions raise living standards and “spread opportunity in every postcode”.
Why it Matters
The Budget could determine whether devolution becomes a genuine engine of regional growth or remains a transfer of responsibility without the tools to generate lasting change. With investment intentions at a post-pandemic low, the Government’s challenge is to pair new powers with policies that persuade businesses to commit money and create jobs now. If devolution succeeds on that test, its benefits could be felt far beyond Westminster, shaping wages, services and economic opportunity across the UK.
