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Election 2017: What’s On Offer For SMEs?

The snap election called by Prime Minister Theresa May means Britons will be heading to the ballot box for the third time in as many years. You’ll be forgiven for having had enough of politics and all the division that comes with it. However, this election is another key vote that will have major ramifactions for Britain.

Voters have a big decision to make. Whoever is the governing party on June 9th will be in charge of the Brexit EU negotiations and shaping the country during these transitional and – likely – difficult years. What’s more, both the main parties are moving in very different directions. After many years of broad consensus in the 90s and 00s, there is a clear difference in the positions of Conservatives and Labour on Brexit, the economy, NHS, welfare and foreign policy. 

We know from our poll earlier in the month that small businesses are worried about their prospects over the next few years. So, what are the parties offering to support and safeguard small businesses during these testing times?

 

Conservative Party logo

Conservatives

The pitch: Strong and stable leadership in the national interest

What are they offering small businesses?

  • Continue to support small businesses through business rate relief and low taxation, and by reducing the bureaucracy and regulation that prevents small businesses from flourishing.
  • Consult on how to extend the safeguard tariff cap to micro-businesses.
  • Ensure that 33 per cent of central government purchasing will come from SMEs by the end of the parliament.
  • As part of the industrial strategy, explore how government can do even more to support innovation by small and start-up firms.

Read the full manifesto

 

 

Key tweet:

“Many business owners are in favour of reducing bureaucracy and regulation, which can mean hours of lost time, something that is especially difficult and costly to manage for the smallest businesses. Therefore, many will view the Conservative pledge to reduce regulation positively.

The pledge to ensure that 33 per cent of central government purchasing will come from SMEs by the end of the parliament is one which the Conservatives made in 2015, so not really a new pledge, although it would positive to see them sticking to it, and give smaller businesses more opportunities to bid for government contracts.

It will also be interesting to see what any industrial strategy will have to say about small and start-up firms; with SMEs making up 99 per cent of businesses in the UK it is essential that they are a big part of the strategy.”

 

Labour Party logo

Labour

The pitch: For the many, not the few

What are they offering small businesses?

  • Mandate the new National Investment Bank and regional development banks to identify where other lenders fail to meet the needs of SMEs and prioritise lending to improve the funding gap.
  • Reinstate the lower small business corporation tax rate.
  • Introduce a package of reforms to business rates – including switching from RPI to CPI indexation, exempting new investment in plant and machinery from valuations, and ensuring that businesses have access to a proper appeals process – while reviewing the entire business rates system in the longer run.
  • Scrap quarterly reporting for businesses with a turnover of under £85,000.
  • Declare war on late payments by:
    • Using government procurement to ensure that anyone bidding for a government contract pays its own suppliers within 30 days
    • Developing a version of the Australian system of binding arbitration and fines for persistent late-payers for the private and public sectors.
  • Bring forward legislation to create a proper legal definition for co-operative ownership. The National Investment Bank and regional development banks will be charged with helping support our co-operative sector. Aim to double the size of the co-operative sector in the UK, putting it on a par with those in leading economies like Germany or the US.

Read the full Labour manifesto

 

 

Key tweet:

“Many small business owners and those with ambitions to start their own businesses often find it hard to gain funding when starting out, so a National Investment Bank could give them a much-needed boost.

The pledge to scrap quarterly reporting for businesses with less than £85,000 of turnover could be seen as similar to the Conservative pledge to reduce bureaucracy for small businesses, and could help reduce the workload for those smaller businesses.

Introducing methods to decrease late payments could also be a popular measure, with research showing that many small businesses struggle with clients who miss payment dates.”

The pitch: Imagine a brighter future

What are they offering small businesses?

  • Expand the activities of the state-owned British Business Bank, enabling it to perform a more central role in the economy by tackling the shortage of equity capital for growing firms and providing long-term capital for medium sized businesses.
  • Create a new ‘start-up allowance’ to help those starting a new business with their living costs in the crucial first weeks of their business.
  • Support fast-growing businesses seeking to scale up, through the provision of mentoring support.
  • Review Business Rates to reduce burdens on small firms, and make them the priority for any future business tax cuts.
  • Reform the Regulatory Policy Committee to remove unnecessary regulation, reduce regulatory uncertainty, and support new markets and investment, particularly in low-carbon and resource-efficient innovation.
  • Aim to double the number of SMEs participating in the digital economy by supporting ICT capital expenditure by businesses in non-digital sectors.

Read the full manifesto

 

 

“The expansion of the activities of the British Business Bank is the Lib Dems’ answer to low SME funding that the Labour manifesto aims to tackle with a National Investment Bank.

The new ‘start-up allowance’ would also help people who have just started out with their businesses, as would providing mentoring support, which is something which may benefit many owners because even after you’ve had an idea for a business, you may still need advice from someone with experience on how to take your idea to the next stage.

Reviewing business rates is something that many small business owners might welcome, in the wake of the difficulties seen after the rate re-evaluation.

The Lib Dem manifesto also seems to be offering help to ensure businesses are ready for the 21st Century, with its aims to support investment, particularly in low-carbon and resource-efficient innovation, and to double the number of SMEs participating in the digital economy.”

Huw Moxon is the Digital Marketing Manager for Informi.

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