The Federation of Small Businesses (FSB) has asked the government to extend the National Insurance Contributions (NIC) holiday to existing firms.
While welcoming the government’s commitment for a National Insurance holiday for startups, the FSB believes this doesn’t go far enough and should be extended to include existing businesses.
“We know that small firms would take on more staff if National Insurance was cut, so to really help boost employment in small businesses, the government must extend the National Insurance Contributions holiday to existing small firms,” says John Walker, national chairman of the FSB.
Research by the FSB shows that businesses looking to take on new staff fell from 12.2 per cent in Q3 to 8.7 per cent in Q4. In fact – and this is more worrying – 12.4 per cent expect to decrease headcount in Q1 of this year, up from 10.4 per cent in Q4 last year.
Extending the NIC holiday to existing small businesses, would help fight these trends and boost employment. Some 44 per cent of small firms would be likely to take on more staff if NICs were cut.
“As we’ve heard time and again, the government is looking to the private sector to lead the recovery, but without the right measures in place, small firms are left without the tools they need for the job at hand,” adds John Walker.