Politicians from both the Conservative and Labour party have spoken about the small business sector as the backbone of the UK’s economy since the recession began. With the announcement of this year’s budget it seems that the Labour party are putting their money where their mouth is, as it were.
In the new budget, Darling has committed to making more finance available to small business and recent company formation owners. Under the new measures, not only will banks be implored to give new businesses more credit, they will also be obligated to provide the reasons behind rejections and a robust complaints procedure will be made available for companies who have been denied credit and wish to dispute the bank’s decision.
The chancellor also announced that both Lloyds and RBS will be forced to lend ninety four billion pounds to companies over the next year and of this, over 50% has been allocated to go to small businesses.
Simon Marshall, founder of management consultancy firm Marshall Ltd, comments; “This budget has definitely been conceived with the objective supporting small businesses in mind. Obviously, making more finance available to the SME and company formation sector is definitely a step in the right direction.”
However, the Labour party’s budget has not received unprecedented support from the SME sector. Jack Sanderson, a business owner who signed the Federation of Small Business’s petition to get the government to rethink plans to increase National Insurance feels that the budget could have done more.
He comments: “Ostensibly, the budget does look very positive for the SME sector; the reduction in business rates is definitely a good move. However, I feel that the government could have done more to help small businesses in terms of reducing National Insurance.”