British business groups are pressing Chancellor John Healey to ease cost and cash-flow pressures on small and midsize enterprises (SMEs) and widen access to public contracts as he prepares his first Budget.
Shevaun Haviland, director general at the British Chambers of Commerce, said policy-related expenses for a typical SME have climbed by more than 70% over the past decade. She urged Healey to avoid further tax increases and cut some costs, citing pressure from employment, energy and business rates.
Bibby Financial Services’ latest SME Confidence Tracker found that 32% of surveyed UK SMEs want stronger late-payment legislation by the end of the current Parliament. Six in 10 respondents said customers were taking longer to pay than a year earlier. Average unpaid invoices exceeded £72,000 per SME and reached £143,000 at mid-size businesses.
The Independent reported that late receipts can constrain cash flow. Some firms shorten the time customers have to pay to protect their finances, but that approach may cost them work from larger organizations that pay more slowly.
Haviland said smaller companies should have a fair chance to compete for government contracts. She cited £6 billion for British shipyards and said timely delivery, backed by a clear pipeline of projects, would help companies invest in staffing and capacity. The Independent cautioned that changes to procurement could raise taxpayer costs if they narrow competition or reduce contract quality.
The Independent also linked recent business cost pressures to higher employer National Insurance rates, packaging taxes and high business-rates bills. It said some expenses are shaped by supply and demand, limiting the government’s control over them.
The Independent reported that youth unemployment has risen over several years while smaller businesses often have trouble finding suitable staff. Michelle Ovens, chief executive of Small Business Britain, said apprenticeships should reach more young people and that businesses and government should coordinate to prepare them for work.
Healey was due to present the Budget on Wednesday, Oct. 28.
