East Midlands Chamber has said measures outlined in the government’s Small Business Strategy to address late payment and ease regulation are a positive step forward but supportive policies are still needed to tackle the high cost of doing business.
Key measures in the Small Business Strategy include:
- Addressing late payment – stricter maximum payment terms, mandatory interest payments on late invoices and fines for companies that persistently pay late
- Access to finance – £3bn boost to the British Business Bank and 69, 000 start-up loans to be given
- Overseas trade – UK Export Finance’s capacity expanded by £20bn
- Business Growth Service – to help firms find support and advice
- Regulation – admin costs reduced by 25%
- Skills – £1.2bn more to be spent each year and “digital adoption pilots” to increase tech skill in firms
- Modernisation of tax and customs system – with AI tools to reduce mistakes
- Planning and infrastructure – streamlining planning rules for smaller sites
East Midlands Chamber Director of Policy and Insight Richard Blackmore said: “Nearly a third of East Midlands firms have seen cashflow worsen, according to the findings of our Quarterly Economic Survey, so addressing late payment and reducing the wasted time in chasing a late payer is a step forward.
“When it comes to export, the East Midlands has great potential so it’s good to see expansion of UK Export Finance, while for startups, the focus on provision from the British Bank gives a clearer pathway in getting access to the right type of funding, which can ordinarily be difficult to get.
“While there are welcome steps forward in the strategy, there are plenty of other headaches that persist for firms right now like the skills gap, inflation and higher staffing costs. To fully enable growth, these should also be addressed. Our research showed 6 out of 10 businesses in the region have struggled to find suitable staff, while corporate taxation and inflation top concerns. Add to that the fact that 3 out of 10 businesses reported they expect their profitability to fall over the next year and you get a picture of the sheer scale of challenge.
“I welcome the fact the government’s strategy goes some way to address skills and the additional investment outlined but firms will want to see results – that means the right candidates applying for roles. Likewise, more specific detail is needed on planning and regulation reduction and how it might work in practice.
“Given the high cost of doing business is one of the greatest barriers right now – and let’s not forget that staffing cost sheets have risen substantially this year thanks to higher National Insurance contributions and a higher national living wage, it’s essential that the government consult, listen to and fully support small and medium sized businesses. They must ensure firms are not hit with tax hikes in the Autumn Budget or anything that could hinder growth.”
