For another year we sat around the television hoping that the chancellor would announce some changes which would lift the spirits and, crucially, help Britain’s five million SMEs. I have been discussing this in detail with my business partners, clients and friends over the last week and most of them were convinced that this had to be the Budget for small businesses.
What did we get? Very little change or help.
I was hoping for an “Entrepreneurs’ Budget” which would introduce initiatives that would get the phones ringing for businesses. Billed by George Osborne in his first ever tweet as “a Budget that tackles the economy’s problems head on helping those who want to work hard and get on.”
I don’t think so.
SMEs have been working hard for years and have seen numerous initiatives introduced without any helpful detail on to how to access them. Today is no exception.
To be fair, the £2,000 Employers National Insurance Contribution is a good initiative that may encourage micro businesses to employ more staff, but it doesn’t come into effect until 2014.
Couldn’t the chancellor have extended to London, South East and the East of England the previously introduced National Insurance Holiday? Also, this scheme has previously only applied to start-ups, so why not bring in established businesses as well?
The cut in corporation tax may be welcomed by larger businesses but it is of no help to the smallest companies with profits of less than £300,000.
The Funding for Lending Scheme may have been of some help for those trying to get mortgages but small businesses remain apathetic about the benefit of this scheme because they don’t feel it is being passed on to them. Growth Vouchers were also mentioned, with no detail on how or what benefit these will bring.
In addition, the proposed changes to R&D Tax Credits will only benefit large companies. Why were small business left out of the government handout?
We all know that the big issues of today for SMEs include obtaining finance and the costs of employing staff. Where were the initiatives that would make a difference now?
If I were to ask the owners of SMEs about how much today’s Budget will make a difference to their business today, I am fairly confident that the resounding answer will be “not a lot.”
Bobby Lane is a partner at Shelley Stock Hutter.
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