JEREMY Hunt has been accused of devising “a recipe for a longer and deeper recession” after delivering an autumn statement containing spending cuts and tax rises.

The chancellor froze income tax thresholds, meaning millions of people will pay more tax as their wages rise.

But benefits will rise next year in line with inflation at 10.1 per cent, while state pensions will rise by a similar amount and continue to be protected by the “triple lock”.

Schools and the NHS were spared spending cuts and will see their budgets rise for two years.

Nicky Kildunne, development manager for the Federation of Small Businesses in Dorset and Hampshire, said the chancellor was “piling more pressure on the UK’s 5.5million small businesses, their employers and customers”.

“While tackling inflation is essential, so are measures to create conditions for prosperity, growth and support enterprise. Today is a missed opportunity to avoid further economic slowdown,” she said.

“Small businesses, which account for more than 16 million jobs in the UK, were already facing an acute cost-of-doing-business crisis through soaring costs, falling revenues, shrinking availability of affordable finance, and a rise in invoices being paid late.

“On top of all that, they now face even higher taxes, cuts to innovation, and a recipe for a longer and deeper recession."

Ian Girling, chief executive of Dorset Chamber, said: “The chancellor’s autumn statement was unsurprising yet remained disappointing.

“Many businesses will remain treading water while they struggle to make it through stormy economic seas ahead, as it is confirmed that we are officially in recession.”

He added: “The £13.6billion pledge for business rate support was encouraging although we will have to wait and see how this eases the burden at street level for the many shops, pubs, restaurants and offices in Dorset.”

Neil Andrews, managing partner of Dorset law firm Coles Miller, referred to the former chancellor Kwasi Kwarteng's mini-budget in September, which prompted a crisis that ended with the downfall of Liz Truss.

“Markets matter, inflation matters and interest rates matter – Kwasi Kwarteng’s gamble on growth made us all poorer. Now control of UK plc has been handed over to Jeremy Hunt and we’re being prescribed harsh medicine to cure Kwarteng’s mistakes and the country’s economic ills," he said.

“Increased personal taxes across the board – with allowances frozen or reduced – and decreased public spending are a bitter pill for us all but hopefully credibility has returned.

“However, with full employment and no easy answers for the higher levels of productivity required, growing the economy will be challenging.”

David Chismon, partner at the Bournemouth office of chartered accountants Saffery Champness, said the budget would mean many more people started to pay tax at new thresholds as their income rises.

He added: “Overall, there were few surprises in the announcement from a tax perspective for the majority of people given the advance warning, but as the next year or two come around, it is very clear that a lot of people will be suffering a much high tax burden in a time when the economy is in a difficult position.”

David Stevens, retirement director at the County Gates-based life insurance, savings and pensions business LV=, said: “Millions of retired people will be relieved that the pensions triple lock has been maintained. LV=’s research shows that 41 per cent (five million) of over-65s can only just, or can’t, afford their day to day costs.

“The state pension is a crucial part of retirement planning and LV’s previous research indicated that 3.6m over-65s were worried that it would be abolished permanently."

He said the decision to further increase inheritance tax thresholds means rising numbers of estates will be taxed.

“The large rise in value of housing and other assets over the past 10 years means inheritance tax is potentially a problem for many estates when it was once only a problem for the wealthy,” he added.

Mid-Dorset and North Poole MP Michael Tomlinson, the government’s solicitor general, welcomed the rise in the education budget.

He added: "Both Dorset and Poole have some brilliant businesses and it is good news that research and development funding is protected alongside business rate support to help our high streets and the much needed support for energy bills.


"One other measure that is important to highlight is about pensions. The triple lock will remain in place and this will provide the biggest cash increase ever in the state pension for our local pensioners. "