Infrastructure investment can support small business growth, says FSB

Monday 1 July 2013

The government needs to act quickly to invest in UK infrastructure, in order to support business growth and a sustainable economic recovery, it has been suggested.

John Allan, national chairman of the Federation of Small Businesses (FSB), has called for the Con-Lib coalition to commit to major road, rail, energy and utilities projects.

He said there is an urgency to get these projects off the ground, so that businesses see action and not just rhetoric on delivery.

Mr Allan said two-thirds of FSB members think the state of UK roads has a negative impact on their business, while 61 per cent say the same about congestion.

"Making roads fit for purpose and able to cope with traffic levels will help all businesses," he stated.

"We hope that plans to reform the Highways Agency will put an end to the stop-start investment cycle that has marred road transport investment and delayed many worthwhile projects."

On rail, Mr Allan welcomed the government's recent decision to commit £30 billion in funding to the HS2 project and other modernisation schemes.

He claimed this is "long overdue", and will help small businesses better connect with their customers and suppliers.

"The government must ensure that all modes of transport are taken into consideration when making decisions on infrastructure investment to ensure smooth transitions between road, rail and public transport as well as air travel and ports, where relevant," Mr Allan contended.

The FSB chief also welcomed the Con-Lib coalition's decision to set aside additional funds for broadband investment.

"Small firms want to be able to access the internet so universal connectivity is needed now," he stated.

However, Mr Allan expressed concerns about the way the government's rural broadband rollout is being managed - in particular the distribution of public money to local authority infrastructure schemes.

"The FSB believes it is imperative that there is more competition and transparency in the BDUK framework," he stated.

"This would allow more providers to join the race to deliver 100 per cent connectivity across the UK to all 4.8 million small businesses to give them the best chance to prosper and grow."

Where energy is concerned, Mr Allan said the government pledge of further investment in production will hopefully lead to more stability in energy bills for businesses.

Capacity Markets and Renewable Strike Prices seem to be a way of using the market to meet the gap in generating energy, he noted.

And Mr Allan said the Levy Control Framework seems to be a good mechanism to restrict energy companies from passing on unreasonable costs to customers.

"To make sure costs are not passed onto businesses is ultimately reliant on reforming energy markets," he claimed.

"It is clear that more needs to be done in that area, for example to encourage switching between suppliers and addressing the issue of roll-over contracts."

Microsoft solutions can help small businesses make the most of their resources and ensure they are as competitive as possible. To find out more, click here.

Posted by Dan Smith