How Will the Enterprise Bill Help Britain’s Small Businesses?
A brighter future for small businesses is being promised, with the new Government unveiling a raft of measures which it says will address the main concerns of SMEs. In particular, it claims its Enterprise Bill will make the UK Europe’s number one location for launching a new business and help to create 2 million jobs by 2020. Here we look at what is in store and what the proposals will mean to your business.
There was uncertainty for small businesses in the run-up to the General Election, with different parties wooing the sector with a confusing range of promises. Many of the ideas sounded tempting, such as funding initiatives and access to government schemes. But it was hard for businesses to plan ahead without knowing which of these ideas would become a reality.
On the positive side, the pre-election period also gave small businesses a chance to campaign on the issues which were important to them. They were able to clearly state what they would expect from a new Government. The Federation of Small Businesses drew up a manifesto highlighting its desire for sustained economic growth and action to lower the cost of doing business.
Now that the Conservative government is in power, the period of uncertainty is over and it’s time for them to start delivering on the promises made. So what is planned to help SMEs and answer the concerns which have been raised?
Cuts to Red Tape
The Government has confirmed that it will be bringing in its Enterprise Bill, announced by new Business Secretary Sajid Javid and confirmed in the Queen’s Speech. It is claimed this will cut red tape by around £10 billion, easing a major bureaucratic burden on business.
It has been estimated that the time spent by each UK SME on administration tasks and paperwork is as high as 28 hours per week – time which is lost to the core work of the business. Experts claim the cost of this approaches an overall figure of £5 billion. Of course some admin is essential to running a business, but many entrepreneurs feel they are having to spend a lot of time on inessential and over-complicated tasks in areas such as tax and employment law.
The previous Coalition Government had already launched the ‘Red Tape Challenge’, which it claimed saved businesses billions during its term in office. Now this initiative will be taken further, aiming to cut the burden of regulation at Whitehall and also beyond. For the first time, the initiative will include independent regulators as well as Government departments.
Small Business Conciliation Service
As well as red tape cutting, another initiative being introduced under the Enterprise Bill is a conciliation service which aims to ensure faster payments. At present, too often small businesses suffer cashflow problems when larger businesses fail to pay on time.
It’s estimated that £32 billion is owed in late payments, yet SMEs are often reluctant to push too hard for their money. This is partly because of the fear that an important client might be offended and take their business elsewhere.
Another problem is the amount of time and trouble it can take to chase up payments, plus the fact that, if you end up having to take legal action, this will add further expense. The new conciliation service aims to make it easier and simpler to resolve these disputes and get payment through without damaging delays.
Primary Authority Scheme
At the moment small businesses often have to spend a lot of time consulting different authorities over regulations. You might have to contact both a district and a county council as well as your local fire service, which can become unnecessarily complicated and time-consuming.
However, extending Primary Authority means a company will only have to consult one regulatory authority, and all the other bodies will have to follow its advice. This could be especially helpful for start-ups, as they can be confident that they are complying with all relevant regulations without needing to carry out a whole succession of checks.
The Government has also promised a range of other measures which will help small businesses, including business rate reforms and extending the Start Up Loans programme.
Heartening as all this sounds, it can be difficult for small businesses to keep up with the range of new schemes and announcements from Government. There is a danger of missing out on important sources of help simply because you don’t know where to go for information.
Fortunately, Basepoint can help you to keep track of the help and support that is available. Our MiBase mentoring scheme offers licensees expert advice 24/7, and on top of this a whole raft of networking initiatives and seminars are available. Being part of the Basepoint community makes it easier to stay in touch with what is happening in the world of small business and to be ready to take advantage of schemes which could help you.