Surveys show Government is failing small businesses, says business group
  
The Forum of Private Business (FPB), which represents 25,000 small and medium-sized businesses (SMEs) across the UK, says surveys carried out in 2005 show that the concerns of SMEs are not being addressed by the Government.
  
Quarterly reports published by the independent Small Business Research Trust (SBRT) for 2005 reveal that smaller businesses consistently report that taxation, national insurance and employment regulations are the main barriers to growth. In the report for the final quarter of last year, more than half of the businesses that responded cited these as the main challenges to business expansion.
  
"The Government should be worried about the surveys' findings," said Nick Goulding, Chief Executive of the FPB. "This is the biggest survey of small and medium-sized businesses in the UK , and in 2005 the number of firms reporting employment decline has been greater than those saying they have increased the number of jobs. What is more, expectations for jobs and investment in the future have declined, with more companies pessimistic than optimistic."
  
Mr Goulding pointed out that the Government was trying to get a million people on incapacity benefit back to work. "There are over 4 million SMEs in the UK . If one in four of them employed an extra worker, and employment in the rest remained balanced, this could solve the problem. But increased taxation and more employment regulation, together with recent rises in the price of gas, mean that it looks unlikely that small businesses will be able to do much to help reduce the incapacity bill."
  
Nick Goulding said the surveys also revealed that there had been a stable economy for the majority of SMEs in 2005 and "the Government deserves praise for achieving economic conditions that help small businesses plan for the future. But small firms are struggling to capitalise on this climate because of excessive tax and regulatory pressures."
  
  
 Small Business Factfile*
  
There are 4.3m small businesses in the UK
  
Small businesses employ 12.6m people more than half, 58 per cent, of employees in the private sector
  
Small firms contribution to the economy is £1,200bn which is 51 per of total turnover
  
At least 95 per cent of businesses in all industry sectors are Small to Medium sized Enterprises (SMEs)
  
Every day nearly 2000 businesses start up or close
  
  
  
Micro business: 0-9 employees, small business 10 - 50 employees, medium business: 50 - 249 employees
  
*source Department of Trade and Industry, small business service.
  
Surveys carried out by the FPB among its membership reinforce the concerns revealed by the SBRT surveys.
  
  
  
A selection of comments from FPB members:
  
Ann Manders, owner of the Bridgwater Trailer Centre in Bridgwater, Somerset said:
"We have seen a rise in NI contributions, the minimum wage and an increase in benefits for employees like paternity leave. An ever-increasing wage burden makes it more and more difficult to compete in the world market."
  
Andrew Purkis, owner of the Manor House Hotel in Swanage, Dorset said:
"The employer is like a sitting duck waiting to be financially skinned by anyone who has a grudge. Employers and businesses are the lifeblood of the economy. They should be respected as such and encouraged to grow. Not as at present whereby the tribunal process can be used and abused to destroy smaller businesses."
  
Alan Goymer, owner of A K Goymer And Co Ltd metalwork firm in Hertford said:
"Employment law needs to be simplified. Employers who exhibit general care for their employees should be given the benefit of the doubt if they slip up on a bit of paperwork. We are not ogres, we are trying to make a living for everyone. We have 12 employees and I need to put aside 20% of my time for employment law/personnel related issues."
  
A Coalville-based garage owner said:
"Small businesses are being driven out of business by hidden costs, tax and the burden of paying for a bloated public sector."
  
An Aylesford-based leisure business owner said:
"The current employment regulations are completely skewed against the employer. They are a disincentive for me to expand my business and to employ more than my existing 35 staff."
  
  
  
FPB BACKGROUND:
The Forum of Private Business (FPB) was formed in 1977 and is a pressure group fighting on behalf of private businesses. The FPB represents approximately 25,000 UK-based businesses employing in excess of 600,000 people, and is a powerful lobbying voice in both the UK and the European Union. The FPB, as the only full UK member of UEAPME - the organisation that represents small and medium-sized enterprises (SMEs) in Europe - is the most prominent advocate of UK SMEs in Brussels and has a track record of positively affecting legislation prior to its introduction in the UK .
  
(18/2/06)