FSB welcomes small business measures in the Queen's Speech

Friday 10 May 2013

A number of the bills announced in the Queen's Speech promise to assist small and medium-sized businesses (SMBs), it has been suggested.

The Federation of Small Businesses (FSB) has welcomed the broad focus on creating a stronger economy and supporting SMBs in job creation.

It urged the government to implement the legislative proposals alongside work to develop the Business Bank.

This new instrument is to improve the flow of credit to SMBs, helping to ensure they have sufficient cashflow to remain viable businesses.

Legislative proposals affecting SMBs

John Allan, national chairman of the FSB, highlighted a number of the new bills which have particular relevance to UK small enterprises.

Among these is the national insurance contributions bill, which will fully exempt some SMB employers from paying national insurance.

Mr Allan said this will help SMBs wary of the cost of employment to take on staff and also assists those that currently employ to expand and grow.

In terms of red tape, the new deregulation bill may simplify matters for SMBS, he claimed.

"We have welcomed much of what the government has done so far in this area and look forward to further measures to make it easier for small businesses to be both compliant but also grow," Mr Allan stated.

He also welcomed efforts to reform the UK's intellectual property regime, by streamlining the patents system.

This measure - as recommended by the Hargreaves Review - will make it more cost-effective for SMBs to protect their inventions, Mr Allan claimed.

He said the government has taken "important first steps" in addressing concerns over copyright licensing by collecting societies, but more remains to be done to ensure small firms are treated fairly.

Bills carried over

Mr Allan also commented on some of the bills carried over from the last parliamentary session, including those related to energy and banking reform.

"The FSB will support an amendment to the energy bill to tackle the practice by energy companies of rolling over contracts and locking small firms into un-negotiated and often more expensive terms for a full 12 months," he stated.

"Such an amendment, originally tabled by Caroline Lucas MP in the last parliamentary session, would seek to limit this to 30 days, helping to deliver a fairer energy market for micro businesses."

Mr Allan highlighted FSB research which found that one in four SMBs had been subject to rollover contracts without their knowledge.

"An overwhelming 82 per cent of respondents said they would support the abolition of rollovers," he reported.

With regards to banking reform, Mr Allan claimed the government has an "important opportunity" to provide more stability for small businesses and to open up competition in the sector.

He proposed that more banks are needed on the high street, in order that SMBs have a "genuine choice".

"We want to see the Financial Conduct Authority look at the ways that competition can be opened up and entry to the banking sector made easier," Mr Allan stated.

Flexible working proposals

The FSB chair also commented on the children and families bill, which aims to reform maternity and paternity leave arrangements.

He said this is seen by SMBs as "a complicated area" of legislation, noting that the current system often acts as a barrier to mothers returning to work after childbirth.

"The FSB supports a more flexible arrangement, but is calling on the government to ensure that the new system of Shared Parental Leave is as light a touch as possible for employers," Mr Allan noted.

"Clear safeguards are also needed for employers that are unable to accommodate requests to take leave in irregular patterns."

He said that SMBs already offer their staff flexible working options, wherever possible, and recognise the business benefits of flexible working.

"Extending the right to request flexible working to all employees is therefore unnecessary, and will add to the administrative pressures on the smallest of businesses who lack dedicated HR functions," Mr Allan claimed.

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Posted by Sarah Parish