Economic growth picked up in the final quarter of 2015 despite continuing problems for manufacturers, according to a survey of more than 750 private companies by the CBI.
The survey revealed a strong end of year for business and professional services and an improving picture for retail and wholesale sectors despite continuing problems for exporters struggling with the strength of sterling.
The UK economy has finished the year strongly, with business services acting as a lightning rod for growth.
Nonetheless, there is no room for complacency in 2016 as significant challenges to global growth remain.
Ultimately, employers want relief from the cumulative burden that could harm the UK's competitiveness, as the combined effect of the introduction of the apprenticeship levy and the national living wage begins to bite against the backdrop of unreformed business rates and the administrative challenge of pensions enrolment.
The balance of firms reporting rising output in the past three months was 20%, well up on the long run average of 5%, with a similar pace of growth expected in the next quarter, said the CBI.
George Osborne has set out his plans to help restore Britain's economy by staging the biggest ever sell-off of government and public owned corporate and financial assets this year.
The Chancellor will create a new government-owned company who will be in charge of the sales, which are expected to be worth £23 billion.
UK Government Investments (UKGI) will sell shares in Lloyds Banking Group, UK Asset Resolution assets, Eurostar and the pre-2012 income contingent repayment student loan book.
ITV News Political Editor Tom Bradby reports:
It is part of plans to cut spending by £13 billion by 2017/18.
Speaking at the Confederation of British Industry (CBI), Osborne said: "If we want a more productive economy, let's get the government out of the business of owning great chunks of our banking system - and indeed other assets that should be in the private sector."
A "plan to make Britain work better" will be published over the next few weeks, setting out proposals to improve transport, broadband, planning, skills, ownership, childcare, red tape, science and innovation.
Osborne also addressed the issue of the EU referendum saying he will be "fighting to be in Europe but not run by Europe".
A leading independent employers' organisation has called for the Prime Minister to be "ambitious with business".
The Confederation of British Industry urged the new Government to set out clear plans for the country's economic growth and to take action within the first 100 days.
It said that business will take an active role in "arguing the case for the UK to remain inside a reformed EU" and argued that it is "vital" for the Government to set the bar for that EU reform at an "ambitious and achievable" level.
The new Government must get into its stride quickly. It should set out clear plans for the next parliament within the first 100 days, and have a laser-like focus on delivery.
The Prime Minister should prioritise building on the progress made to get the deficit down, finding more innovative ways to deliver public services and backing the final decision from the Airports Commission so we get diggers in the ground by 2020.
The CBI issued an action plan for the first 100 days of the new administration which it said would help keep economic growth on track.Read the full story ›
Business leaders have said political uncertainty about the outcome of the next General Election remains a "major risk to the recovery".
The Confederation of British Industry (CBI) urged politicians to push ahead with boosting the supply of homes and taking decisions on major infrastructure projects.
The major parties need to show they would "stick with what is working" after next year's election, the CBI's chief policy director Katja Hall said, urging them against costly "political positioning".
She added: "(Positioning) must not be allowed to stifle investment, whether it's an unrealistic immigration target, unjustified interventions into specific markets, flirting with leaving the European Union, delaying vital long-term infrastructure projects or restricting labour market flexibility."
Business leaders have predicted interest rates will need to rise early next year as they issued a warning about "unsustainable" house prices.
The Confederation of British Industry (CBI) expects a rise of 0.25 per cent in the first three months of 2015, from 0.5% to 0.75%.
The business lobby group previously predicted the Bank of England would have to start raising rates in the third quarter of next year - but has now brought that forward to the first quarter.
The CBI also raised its forecast for the UK's gross domestic product forecast for this year from 2.6% to 3%.
Director-general John Cridland said property values were expected to rise by 8.2% this year, and 5.1% next.
But he warned: "We have to remain alert to the risks posed by unsustainable house price inflation, and the (Bank's) Financial Policy Committee is poised to act when necessary."
The CBI said:
Our conclusion is that the White Paper does not offer a coherent vision for how or why an independent Scotland would be better off from erecting barriers between itself and its biggest export market.
The loss of many of the strengths of the union would open the nation to a higher risk from economic shocks.
Independence would be a major economic upheaval with uncertain consequences.
For this reason, we believe that the best way to deliver jobs and prosperity for the people of Scotland is for Scotland to remain a part of the UK.
In short, Scotland and the UK are stronger together.
The Scottish Government blueprint for independence "does not add up", with Nationalists ignoring the need for deficit reduction while promising at least £670 million of "unfunded" spending commitments, a business leader claimed.
John Cridland, director-general of the CBI, said the "lack of clarity" in the White Paper could put an independent Scotland's future success in jeopardy.
He hit out as the business organisation - which represents 240,000 firms across the UK - published its response to the independence White Paper launched by First Minister Alex Salmond last November.
The business community's reaction to today's Budget was broadly positive, with the Confederation of British Industry (CBI) and the British Chambers of Commerce offering strong endorsements.
Business wanted disciplined Budget that was geared towards jobs+wealth creation - that’s what Chancellor delivered http://t.co/HUSlhct5o6
The head of the CBI, John Cridland, said: “This was a make or break budget coming at a critical time in the recovery and the Chancellor has focused his firepower on areas that have the potential to lock in growth.”
The Federation of Small Businesses also hailed the Government's business-friendly approach.
Business group the CBI has said the UK is starting to see "the right kind of growth" as it lifted it predictions for expansion in the economy this year from 2.4% to 2.6%.
It said business investment would make a positive contribution this year, rising at the fastest rates since 2007, while increasing exports would help net trade play a small role in supporting the recovery.
The upgraded forecast for 2014 reflects a stronger than expected performance at the end of last year. However, the CBI has downgraded growth expectations for next year from 2.6% to 2.5%.
The CBI expects that unemployment reached the Bank of England's 7% "forward guidance" threshold in the final quarter of last year - for which labour market figures have not yet been published.
The guidance pledges that policy makers will not begin to consider a rise in interest rates until the threshold has been reached.
But the CBI predicts that despite having fallen to this level, continued low inflation and spare capacity in the economy mean that interest rates will not go up until the third quarter of 2015.