FSB responds to the Queen’s Speech

Thursday May 28th 2015

Federation of Small Businesses Headline

Following the Queen’s Speech the Federation of Small Businesses (FSB) has welcomed a series of measures to back small businesses including those in the Enterprise Bill.

John Allan, National Chairman, Federation of Small Businesses said: “The economy is on the right track to create jobs and growth in the UK. The Government must maintain its course, strengthening the enterprise landscape to support ambitious businesses to boost productivity and jobs. However, Ministers must stick to the path of fiscal discipline and continue to drive down the deficit. We want to continue to see a stronger economy while the cost of doing business must be lower and easier, ensuring growth in every nation and region of the UK, not just London and the South East.”

Commenting on the Enterprise Bill, John Allan said: “We are pleased the Government is maintaining focus on small businesses. Our members have been very clear on the need to cut burdensome red tape and on addressing issues like the billions owed to small businesses in overdue payments. The Enterprise Bill is a real opportunity to make progress on these issues. “When setting out to tackle the burden of red tape, it’s important not only to identify obstructive regulations, but also look at how regulation is enforced. Poor enforcement or excessive monitoring requirements can turn straightforward regulations into costly and disruptive burdens. “We look forward to seeing the details of the proposed Small Business Conciliation
Service and how it will address issues like late payments. Small businesses often have the law on their side, but find accessing the legal system complex, time consuming and expensive. A properly constituted conciliation service should help with this and go some way to addressing major problems like the UK’s poor payment culture.”

Commenting on the European Union Referendum Bill, John Allan said: “With the UK set to debate its relationship with Europe, it is vital we truly understand the business case for staying in or leaving the European Union. The Single Market is important for many businesses in the UK – however, some are concerned about the EU’s approach in a number of areas, especially regulation. “The referendum will inevitably bring a period of uncertainty
, which should be resolved as soon as possible. However, we must also ensure there is adequate time allotted to fully explore the options on the table. Small businesses must be able to fully understand and participate in the debate – discussing the economic case and what meaningful
reforms are achievable before deciding how to cast their vote.”

Commenting on the Cities and Local Government Devolution Bill, John Allan said: “The move to give cities greater power to shape their local economic environment is the right one. Local decision makers are best placed to understand local economic needs and if managed carefully, greater decentralisation has the potential to deliver the economic rebalancing which is so clearly needed. We must also be careful not to bypass rural areas when power and resources are reallocated. “One issue which will be particularly important to get right is localising taxes. Although we agree with the principle of local areas retaining more of the rewards of success, we do not think it wise to allow local variation in business rates. There is a big risk this would fragment the tax system, leading to confusion and either increase costs for businesses or lead to a race to the bottom, which could harm the economic vitality of cities in the long term.”

Commenting on the Full Employment and Welfare Benefits Bill, John Allan said: “As we approach full employment the task of finding staff with the skills a small business needs will become more of a challenge. The measures in the Employment Bill to support more apprentices will help. But the issue is not only about the number of apprentices. The aim must be to make our apprentice system the world’s best, matching in quality to that offered in Germany, and offering a rewarding vocational alternative to academic routes. “The only way to significantly increase the number of apprentices is to improve take – up among the UK’s 5.2 million small businesses. This requires Government to make it crystal clear what the benefits are, and what support is available. They must be affordable, have standards based on current industry practice, and the quality of training must give confidence to employers that apprenticeships will produce the skills they need for the long term.”

On the announcement of the Scotland Bill, Andy Willox, the FSB’s Scottish policy convenor, said: “The Smith Agreement, to which we and many others contributed, made it clear that the Scottish Parliament is set to become a more powerful actor in the Scottish economy. It will be critical to small businesses in Scotland that parliament get right the legislation that turns that agreement into law.”

“Further, we must see any administrative burden of further devolution borne by the tax authorities and not taxpayers and enterprise. We’ll need our parliamentarians to understand and thoroughly test how every clause will work in practice – not just on paper. Devolution should give different authorities the powers to boost their local economies however difference itself can’t become a barrier to trade.”

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