UK-based small and medium sized businesses are the most confident in Europe, according to new figures which also suggest they are due a spending splurge.

GE Capital’s European SME Capex Barometer, which quizzes 2,250 businesses in seven European countries, revealed that UK firms plan to increase capital investment by 12 per cent in the next 12 months.

It implies total investment of £58.6 billion, or an average of £58,200 per business.

The spending pledge is fuelled by growing business confidence across the country. Some 63 per cent of firms said they were confident about the future, compared with nine per cent who said the opposite.

It’s a significant leap from last year’s figures, which were 52 per cent and 19 per cent respectively.

Ilaria del Beato, chief executive of GE Capital UK, said: “UK SMEs appear to have reached a crucial tipping point in their willingness to invest for growth and hire new staff.

“This is a true measure of economic recovery and points to promising future growth potential as greater investment should help boost productivity.”

The barometer had good news for employees too, with 660,000 new hires planned – up 26 per cent on last year.