FSB’s Greater Manchester team said today’s Budget will provide little cheer for most small firms, with some big omissions around support on energy and nothing on tax reform to help inflation hit small firms struggling to stay under VAT thresholds.
FSB had urged the Chancellor to revisit plans announced in January to brutally curtail support for small businesses around energy costs, and had campaigned for VAT thresholds to be lifted from £85k to over a £100k to boost growth.
Today’s Budget addressed neither, but offered a slew of measures to help larger firms. The few sweeteners were around freezing fuel duty, and some big changes for help with childcare costs to encourage younger workers back in to the jobs market – although the full help won’t be in place until 2026.
There was also some good news for the larger Metro areas, like GM, that will get more devolution powers from Government affecting local decision making around transport – particularly bus and rail – skills and employment, and housing and regeneration, including retrofitting homes to be more energy efficient.
Responding to the Chancellor's Spring Budget, FSB Area Leader for Greater Manchester, David Sudworth, said: “Today’s Budget will leave many feeling short-changed. Budgets are about tough choices, and with today’s £billions being allocated to big businesses and households, 5.5 million small businesses and the 16 million people who work for them will be wondering why the choice has been made to overlook them.
“We’ve got a Budget that on energy helps households, but not small firms. On business taxes, it spends £27bn extra on big businesses, arguing that small businesses are already catered for. Trickledown economics won’t cut it.
He added: “The principle of what’s been announced on childcare is positive – but this Government’s Achilles heel is in delivery and practicalities, so there needs to be more work with providers to make sure it can work. Providers will also be worried funding will not meet expectations set out, and the new scheme must not pitch public versus private sector. The key test for providers will be whether the funding still allows them to cover their costs. We know 30 hours of ‘free’ has cause huge problems for many smaller care settings, let’s not compound the problem.
“Some of the smaller measures announced will also benefit certain sectors of the economy. The increase in draught relief will also go a long way to helping pubs. The fuel duty freeze is a result of FSB’s campaigning and the springboard small firms need to help navigate the difficult roads ahead. This will save them money and provide some breathing space, allowing them to focus on growth. Our trades type businesses will welcome this.
“While there are some positives in today’s Budget, the Government’s lack of support for small firms in critical areas is glaring. The Chancellor stressed the UK is one of the best places to do business and we’ll avoid a technical recession this year – but small businesses need more ambition and more focus.
“It’s high time the Government put small firms at the top of the agenda and lend them the necessary support on the path to economic recovery.”
