The Budget can bring stability, but it’s efficiency that must drive public spending

Coming slightly later than usual, it feels as though this year’s autumn Budget has been a long time in the making – even more so than usual. With Rachel Reeves faced with the need to make some difficult decisions, speculation and apprehension have only intensified. As a result, day-to-day decision making has stalled while the public and private sectors await a clearer picture of what the future holds.

It was a similar situation in 2024 ahead of the new government’s first autumn Budget in power. The backdrop is different this time around, however, and there was some momentum earlier this year following positive announcements such as the new 10-year infrastructure plan. As important as these fiscal events are, we cannot let them come in the way of continued growth and ambition.

While Reeves appears to have U-turned on increasing personal tax contributions, we cannot be certain of this until she actually delivers her speech tomorrow The taxation route would have been better than targeting fringe taxes,  as the government did last year. Fringe taxation impacts a broad range of people and reduces confidence because nobody knows where the government will target next – and planning ahead becomes more challenging.

Ultimately, I don’t think greater taxation is the answer to reducing national debt, but targeting taxes that have clearer outcomes and leave everyone knowing where they stand goes help create a level of stability, which is what many industries have been crying out for in recent months. With a clear, long-term commitment to infrastructure investment and a predictable tax policy, cost pressures can be eased and fiscal stability can be formed.

The long-term challenge is not the level of investment; it is the effectiveness with which that investment is deployed

Through increased clarity and confidence, we should see greater outside investment and growth – and history shows that stability drives sustainable growth – which is potentially within reach.

However, the long-term challenge is not the level of investment; it is the effectiveness with which that investment is deployed. Currently, too many sectors are slow, cumbersome and reactive.

You don’t need to look hard to find high-profile projects that have not been delivered as planned – HS2, for instance. What could and should have been a major infrastructure investment to improve regional connectivity, placemaking and opportunity will be remembered for none of those things.

I like to use a football analogy when referring to the damage that poor investment decisions can cause. It’s not always the teams spending heavily that are winning; it’s the teams that best deploy their investments in players, coaches and facilities – aligned with a clear strategy and effective management.

The UK is not short on government investment; rather it is lacking in successful conversion and meaningful outcomes. Looking at healthcare, defence and transport in particular at the moment, a huge amount of money is being pumped in.

If it is not used effectively, we risk further borrowing and higher taxes again in the future. It is a circular situation and we all have to take collective responsibility to improve our own story.

Procurement, one of our core areas within the Pagabo Group, can make a significant difference. Instead of taking a short-term view and prioritising price, there needs to be a greater focus on speed and quality. Because, buying cheap rarely means delivering cheap – once the heightened whole-life cost is taken into consideration.

Tomorrow’s Budget is important; there’s no doubt about that – but it can’t be allowed to define our future. By working together, the government, public and private sectors all have an essential role to play in using the clearer landscape to make the right decisions and drive growth.

Our mentality should be focused on a return on investment, not on further investment.

Amman Boughan is deputy chief executive officer at Pagabo Group