Lancashire-based small business group says confidence needs a new pick-me-up

The recommendations come amid signs that the UK’s nascent economic recovery is stalling and ahead of an incredibly difficult trading period in the run-up to Christmas and the end of the transition period.

The UK’s largest business group welcomed the Chancellor’s enhancement of existing schemes last week and is now calling for fresh interventions to help those that have received no income support to date, reduce the costs of hiring, further alleviate the business rates burden and provide more resources for those looking to start-up for the first time.

A record one in four small firms say they have reduced headcounts last quarter. An even higher proportion (29 per cent) expect to make redundancies in the coming three months.

Covid-linked disruption has caused revenue growth to fall to its lowest recorded ebb, with more than half (56 per cent) of those surveyed reporting a drop. A similar share (50 per cent) expect revenues to fall next quarter.

FSB National Chairman Mike Cherry said: “Short memories are common in a crisis but we must not forget that small firms were already under the cosh thanks to political uncertainty, rising costs and creaking infrastructure well before Spring.

"The Chancellor made some very welcome adjustments to support measures last week, and it’s critical that the new Job Support Scheme is straightforward to use, the self-employed can access the help they require, and local authority cash grants reach those in need as swiftly as possible.

“However, too many are still without the help they need to weather current disruption – not least company directors, the newly self-employed, those without premises and those further down supply chains in the retail, leisure and hospitality sectors. An ambitious rescue package for these groups is urgently needed. Local authorities should use the new discretionary funds being allocated this week to assist them wherever possible.

“With the unemployment rate rising, we’ll need to encourage more of those who are out of work to strike out on their own over the months ahead. A Kickstart Start-Up programme, inspired by the Kickstart employment initiative and building on the success of the Start-Up Loans and the New Enterprise Allowance programmes, could mark a way forward.

With this weekend held as the final deadline for a breakthrough in UK-EU trade talks, more than half (53%) of exporters surveyed for the Q3 SBI report that international sales are falling.

Mike Cherry added: “More than four years on from the EU referendum, small firms need clarity around what the end of the transition period will mean now more than ever.

"Negotiators on both sides must pull out all the stops to secure a deal, one that includes a substantial small business chapter outlining how the new agreement will help the firms that make-up 99 per cent of the UK business community."