With less than a month until the Budget, it looks likely that the independent forecaster, the Office for Budget Responsibility (OBR), will downgrade its forecast for UK productivity next month.
This adjustment will sharply increase the Budget gap, requiring an estimated £20–£30 billion in government borrowing by 2029–30. Fears are that this could force the government to reconsider its fiscal plans, including Labour’s pledges not to raise income tax, VAT, or national insurance. The nation is bracing itself for more pain before we see any gain.
The finger of blame has been pointed firmly at the past: Weak productivity has been a recurring theme for Britain since the 2009 financial crash, followed by Brexit. The result — lethargic investment growth.
Costs are rising, consumer and business confidence have taken more than a few knocks, and firms are being asked to do more with less. This picture was painted brilliantly by The Economist, who describe the UK government playing Buckaroo! with businesses - loading them up with tax burdens and levies until they can’t take any more and start to kick back.
“Business is treated as a beast able to carry whatever government heaps on its back. IT HAS reached a point where existing burdens mean a light addition can trigger a wild kick.” - ECONOMIST
The UK scaleup scene remains a bright spot in the picture
When we look past the economic insanity (and the need for strategic investment, not short-term austerity), scaleups remain a source of hope. It's time to look forwards, not back.
Scaleups are businesses that have moved past startup survival mode and are building something sustainable, often at pace. They create jobs faster, invest more in innovation, and drive regional growth.
At SCALE, we’re trying to lift weight off founders’ shoulders, not add to it, with tools, insights, connections and support to make the scaleup journey easier.
Scaling businesses are not just engines of productivity, they’re multipliers
Our community of founders, investors, and growth-oriented companies is driving innovation. Funds like SCALE Ventures are backing the next wave of game-changing founders to turn ambition into growth stories and sustainable jobs.
“When scaleups thrive, the UK economy benefits, and every founder who scales successfully becomes a mentor to the next generation.” - Sam north, SCALE CEO
To unlock that potential, scaleups need:
- Access to capital that matches their ambition.
- Access to markets and the skills to navigate new territories.
- Access to talent to attract (and retain) innovators that add value.
- Leadership development, coaching and mentoring that turns founders into thriving CEOs.
- Supportive communities where founders, investors, and SME leaders can share the journey from 1 to 10 to 100 employees.
Productivity isn’t just about output per hour worked
It’s about empowered people, purposeful leadership, and connected communities that know how to collaborate, not just compete.
It’s the founders who are innovating, hiring, and exporting who will help turn the economy around. We need the government to back off businesses generally, but we also need them back the scaleups who are already driving productivity - one bold decision at a time.
By Sam North, Co-founder and CEO of SCALE
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