We round up May’s small business news, from the Queen’s Speech and Brexit to job concerns…
Business news – The Queen’s Speech, Brexit and Enterprise Act
Several Bills were announced in the Queen’s Speech that could affect SMEs and their ability to grow. Moves have been made to tackle the UK skills shortage and ensure fast broadband reaches all corners of the country. Local authorities will also be allowed to retain 100% of business rates to put back into the community.
While Federation of Small Businesses chairman Mike Cherry welcomed the package of policy proposals in principle, he argued that the pledge to get high-speed broadband in all homes should cover business premises too.
This month’s headlines were also dominated by Brexit. With the referendum date of June 23 getting ever closer, the campaign stepped up a gear.
Credit rating agency Moody’s said a vote to leave will hit the entire European economy and have a “significant impact on confidence”, while former Labour Chancellor Alistair Darling warned that the UK economy could plunge back into recession, telling the annual CBI dinner in London that Brexit would be “disastrous” for the living standards of working people.
He said that if economic experts such as IMF chief Christine Lagarde and Governor of the Bank of England Mark Carney are warning of recession if the UK votes to leave Europe, people should “sit up and take notice” of the scale of the risks faced.
In the Commons, questions were raised about whether the Government is doing enough to help smaller firms after it was accused of “losing momentum” in efforts to give them more business.
The Public Accounts Committee said that while the Government reported progress had been made on targets to spend more with SMEs, larger companies are still dominating orders.
Around 5.4 million firms are set to benefit from the Enterprise Act, which also aims to improve the quality and increase the number of apprenticeships, as well as establish a Small Business Commissioner.
Business Minister Anna Soubry believes the measures will give a big boost to British enterprise. The Small Business Commissioner will help tackle the problem of late payments, while the steps taken to reduce the burden of regulation and give more young people the opportunity to do an apprenticeship will benefit millions of businesses across the country, she says.
Business Trends – Jobs, Scottish independence and pay transparency
Job fears have been making the news again. More than 1.8 million jobs could be at risk as 370,000 small businesses plan to cease trading over the next five years.
Research for Bizdaq showed that a further 424,000 business owners plan to exit their business by selling within the next five years, which is more likely to protect jobs. Of the 1.8 million jobs that could be affected, 370,000 of those will be within the next 12 months.
In Scotland, almost 60% of small business owners do not want the new minority SNP Government to pursue a second vote on independence in the next five years. An FSB poll showed that they would rather see ministers put a stronger emphasis on supporting the country’s 330,000 micro businesses and self-employed.
Other research, from Aldermore, showed that more than a third of SMEs do not know what interest rate their business is currently receiving on their surplus funds, while 14% admit their business receives 0% interest.
The poll also revealed that 81% of SMEs that have a business savings account hold it with the same provider as their business current account. Firms are also not reviewing their savings as regularly as they did last year.
This year’s survey found that 55% review their accounts at least once a year, compared with 62% in 2015. Almost half feel the potential returns are not worth the effort, meaning many SMEs are not shopping around to get the best deal.
Pay transparency has also been in the news again. A survey has found that one in three men are willing to go outside the official channels to find out a colleague’s salary, including looking at payslips, having off-the-record conversations and trying to get co-workers into revealing their salary.
It is against the law for employers to prevent employees from discussing their pay to uncover or identify discrimination. The Government recently announced that companies with 250 or more employees will need to report on the gender pay gap by April 2018.