By Stephen McLoughlin, Senior Public Affairs and Policy Manager, ukactive
This Wednesday (26 November) the Chancellor, Rachel Reeves, will make the short journey from Number 11 Downing Street to deliver her 2025 Autumn Budget for the next financial year. Although she has declined the traditional opportunity to accompany her speech with a stiff drink, as she stands at 12:30, she may feel she needs it.
The Government is operating within difficult financial constraints, with high levels of debt and consistently stagnant economic growth. The previous Budget’s combination of tax rises and squeezed spending was described as a ‘one-off’, but the economic picture is little better this time around. For the past few months, there have been a series of leaks all along the same lines – what taxes will rise, and who will pay them?
At last year’s Budget, the Government’s attempts to raise money by increasing employer National Insurance Contributions only served to increase the pressure on businesses, including those in the physical activity sector, further hamstringing the sector’s ability to drive much-needed economic growth.
And, driving economic growth is exactly what the sector has been doing, through its own growth and driving the importance of physical activity to help get people back into the workforce. As the UK Health and Fitness Market 2025 report showed, the sector has achieved a population penetration rate of 16.9%, achieving a record 11.5 million members and a total income of £5.7bn – an increase of 6.1% and 8.8% respectively on the previous year.
The strength of the sector’s growth (despite these difficult economic conditions) stands in contrast to many other industries and is testament to the value of these services to more and more people who are prioritising their physical and mental health. However, despite this relative success, the sector cannot afford another tax rise.
Parts of our sector are still struggling following the successive crises of the Covid pandemic, energy price rises and ultimately, higher operating costs. The independent sector, less able to absorb those shocks and often operating with tighter margins, has found recovery harder and its growth less stable.
On the public leisure side, we have seen the difficulties facing operators of swimming pools in particular. The recent discussions around the Government’s £400m funding announcement involving ukactive continue and must consider the long-term sustainability for these facilities, as well as the growth of the wider sector.
One area we know will be addressed in next week’s Budget will be business rates, with the Government confirming it will announce the levels for the revised multipliers, including the higher rate multiplier for larger properties. With the plan to remove the legacy rate relief from the Covid pandemic (currently set at 40% for the 2025/26 financial year), it is essential these changes don’t increase the burden on our members and instead, recognise the essential role of the sector on the nation’s high street and communities.
The recent Get Britain Working report further illustrated the value the physical activity sector has in supporting the wider economy, with an over-representation of our members listed within the report as Vanguards – exemplar employers who will implement the Government’s strategy.
This Budget needs to harness the potential of the physical activity sector to support economic growth, not damage a growing industry with an opportunistic cash grab. For a long-term successful economy, built on a foundation of health and wellbeing, the Chancellor must not whack us, but back us.
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