Devon Chamber warns ‘more is needed’ as Budget leaves key challenges unresolved

Devon Chamber of Commerce has welcomed the Chancellor’s focus on developing young people’s skills in the Autumn Budget, but warned that wider tax measures may increase pressure on businesses in Exeter already struggling with rising costs.

Devon Chamber CEO Helen Wylde-Archibald said the Budget contained “significant steps forward” on skills, but warned that the county must not be overlooked when it comes to wider investment.

“We welcome the Chancellor’s commitment to developing the skills of young people… However, much more is needed to address the longstanding challenges facing businesses in Devon,” she said.

“Without modern infrastructure, businesses risk being held back at a time when they need to be moving forward.”

The Chamber said it would continue working with the Government, regional partners and the business community to “ensure our region gets the support it needs to thrive”.

The Budget included a £1.5 billion national skills package, with training for under-25 apprenticeships to become fully funded for SMEs, a move expected to be worth up to £725 million across the UK. 

READ NEXT: University of Exeter plans major change to nursing training

The Chamber said the policy could help strengthen Devon’s future workforce, with priority sectors such as engineering, construction, health and AI set to benefit from more flexible, modular training options.

From 2026, the apprenticeship levy will be replaced by a new Growth and Skills Levy, enabling shorter courses designed to plug urgent skills gaps. 

The Chamber said it plans to work with local employers, colleges and training providers to ensure the investment creates real opportunities for young people in Exeter and across the county.

However, several tax measures announced alongside the investment are likely to add to business costs. 

These include a freeze on income tax thresholds until 2030–31, a new 3p-per-mile mileage charge for electric vehicles from 2028, and a £2,000 annual cap on salary sacrifice schemes from 2029. 

Minimum wage increases coming into effect in 2026 (rising to £12.71 for over-21s) are expected to hit hospitality, care and service-sector employers hardest. 

The Chamber also noted the lack of targeted VAT support for sectors such as hospitality and construction.

The organisation said these combined pressures could leave many SMEs facing tighter margins.

Infrastructure remains a major concern for the region, with leaders repeating calls for long-overdue investment in Devon’s transport network, digital connectivity and wider infrastructure. 

There was a boost for Plymouth, named a Growth Industry Hub following the £250 million Defence Growth Deal earlier this year. 

The Chamber said the designation should drive further investment and create high-value jobs with benefits across wider Devon.

Exeter MP Steve Race said the Budget would help build “a stronger, more sustainable economy”, citing measures to reduce bills, support high streets and expand tax incentives for start-ups and fast-growing companies.

“This is a budget that will help us to build a stronger, more sustainable economy, putting more money into people’s pockets and bringing down bills to help with the cost of living crisis, while bringing the national debt down,” he said.

Steve added that permanently lower business rates for retail and hospitality would be a boost for Exeter’s high streets, while new incentives for entrepreneurs would help scale-up companies “that will be our major employers of the near-future”.

Opposition parties challenged the Chancellor’s claims, warning that the Budget leaves key pressures facing Exeter residents and businesses unresolved.

A Liberal Democrat spokesperson for the South West said the plans amounted to “another missed opportunity for meaningful cost-of-living support”, arguing that freezing tax thresholds would “quietly push more working people into higher tax bands while public services remain under strain”.

The Green Party said the Budget “fails to address the climate and energy crisis hitting households across Devon”, criticising the lack of investment in public transport and home insulation, both of which they say would “directly benefit Exeter residents facing rising bills”.

Reform UK described the Budget as “more of the same”, claiming it “offers little relief for small businesses drowning in tax and regulation” and does nothing to “restore economic confidence in regions outside London”.

The Autumn Budget is now being reviewed by local authorities, business groups and employers across Exeter as they assess what the announcements will mean for the year ahead.