SMEs give big thumbs-down to Budget

The vast majority of UK small firms are still feeling distinctly gloomy after last week's Budget.

by
Last Updated: 31 Aug 2010

Just 7% of small firms think last week’s Budget will have a positive impact, according to a new survey by the Federation of Small Businesses – a pretty damning indictment of the Government’s efforts. And business owners aren’t expecting things to improve any time soon. In fact, the Budget has left them feeling decidedly glum (and not just because of Alistair Darling’s deathly delivery style): over 80% said they were feeling negative about the UK economy, with a mere 3% expressing any kind of optimism. That’s not ideal, with an Election looming…

The FSB found that owner/ managers were distinctly underwhelmed by Darling’s display (as were most of us, to be fair) – 68% said it wasn’t a Budget to support small firms, despite coming at a time when they’ve rarely needed it more. One big gripe was the hike in fuel duty, which 79% thought would have a negative impact on their business. Some even suggested this would cost them at least £50 per week – that’s more than £2,500 off the bottom line this year. The rise in alcohol duty also went down badly, although we couldn’t work out whether that was for professional reasons or because it’s become more expensive to drown your sorrows.

What small firms really wanted and needed, of course, were measures that would help boost their cashflow. As such, almost half said the extension of carry-back rules on loss relief was a positive step – but unfortunately, there wasn’t much else to shout about along these lines (presumably because the Government is too skint to finance them). The only other highlights were the extra investment in building projects and tax breaks on capital investment over £50,000, which also went down well – although only the bigger SMEs will be in any position to take advantage.

The Prime Minister and the Chancellor have been trying hard to persuade us that this is a global problem that’s afflicting Britain; that they bear no responsibility for the financial mess that we’re in. Unfortunately for them, surveys like this appear to show that business owners aren’t buying this (according to the Forum for Private Business, 94% of their members also felt the Budget didn’t address the issues threatening the survival of their businesses). The Government is clearly losing friends very rapidly in this particular constituency – and since small businesses employ such a large proportion of the UK workforce, it may live to regret that...

 

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SMEs give big thumbs-down to Budget

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