BUSINESS groups gave a guarded welcome to measures unveiled by Chancellor Philip Hammond in his last Budget before Brexit - while insisting that only a deal with Brussels will give companies in the UK the certainty they crave.

Scottish Chambers of Commerce, the Confederation of British Industry and the Institute of Directors (IoD) signalled a positive response to a range of measures unveiled yesterday, including moves to enhance productivity and stimulate business investment.

But business groups stressed the terms of the UK’s departure from the European Union (EU) will be the ultimate arbiter of success.

Carolyn Fairbairn, director-general of the CBI, declared “there is no hiding place from the dark clouds of Brexit uncertainty”.

Ms Fairbairn added: “The Chancellor has made clear that this Budget will need urgent attention in the event of no-deal, showing yet again the seriousness of the situation and the need to get a good deal over the line.”

Scottish Chambers of Commerce offered a similar response. While welcoming measures such as the freeze on spirits duty – a significant result for the Scotch Whisky Association following a long lobbying campaign – and the intention to establish Scotland as a decommissioning hub for the oil and gas sector, it emphasised the need for the UK to strike a “clear Brexit deal, which enables businesses to plan and prepare”.

Chambers chief executive Liz Cameron said: “Ultimately, today’s Budget will only deliver certainty and economic opportunities if a Brexit deal can be reached and clearly charts our future relationship with the European Union and trading partners beyond March 2019.”

Building on the theme, Stephen Martin, director general of the Institute of Directors (IoD), praised Hammond for delivering a “shot in the arm” to UK productivity by raising the Annual Investment Allowance cap to £1 million from £200,000, stating that this was a measure it had been demanding for several years.

But he too emphasised the need for a Brexit deal. Mr Martin said: “It is not enough to simply announce a potential “no-deal Brexit budget”, businesses need to get ready now.

“While we hope the Chancellor’s confidence that there will be [a] Brexit deal is well placed, firms have to look at all possible scenarios and will be deeply disappointed to see no funds have been allocated to helping them map out potential outcomes.”

Meanwhile, Ms Cameron said it was disappointing Hammond had elected to not cut Air Passenger Duty (APD). The Chancellor said that APD would rise in line with inflation from 2020 for long haul flights.

Ms Cameron said Hammond had missed a “clear opportunity to signal that the UK is open to the world.” Ms Cameron said: “We urge the Chancellor to review this position at the earliest opportunity.

“Ultimately, reducing APD will enable the aviation sector to maintain and expand vital connections and will incentivise more businesses to consider exporting, increasing opportunities for trade and investment.”