Small Business Advice | Banks join forces to lend to businesses

The British Banking Association (BBA) has announced plans to form a new taskforce in a bid to stimulate lending to UK businesses. The group, lead by Stephen Green, head of the BBA, has sent a letter to George Osbourne outlining plans to form a group to discuss how the banks can improve businesses’ access to funds. The group will also investigate what changes can be made to create a stronger financial market for business. To read the full story, visit the Growing Business website.


Small Business News | Government to protect SME workers

The coalition government has launched a pilot scheme to try and crack down on the bosses of small and medium-sized enterprises (SME’s) who treat their staff poorly.

Alistair Darling, trade and industry secretary, has recently outlined government plans to protect vulnerable workers and reveal employers who fail to meet the minimum health and safety standards. In London and Manchester, two pilot schemes have been set up which will bring together industry gurus from unions, businesses, enforcement and advice bodies. The panels shall be working with an eye to strengthening enforcement procedures, secure fairer working conditions, give employees the chance to develop skills and ensure that bosses can understand and comply with UK employment law.

To read the article in full, please visit Business High Street.

Small Business News | SME’s plan own spending cuts

An article recently published by SME Web suggests that VAT increases and National Insurance measures could force a spending decrease and inhibit expansion for the UK’s small and medium enterprises.

The coalition government has been relying on a boom in the private sector in order to support the UK economy, particularly as large public sector cuts are implemented. However a study conducted by YouGov and Safestore reveals that with the increase in VAT from 17.5% to 20%, a third of UK small and medium enterprises believe that this rise will be detrimental to their business. A further 19% of SME’s say they plan to either freeze or lower salaries in order to survive new measures. When questioned about the NI measure, 31% did not believe that the raise would encourage expansion of their business. With over 12 million people employed by SME’s in the UK, this could strike quite a blow on both a personal and wider economical level. Moreover any negative effects from the VAT increase may affect small firms who will have to pass the increase on to their customers, unlike big businesses who can absorb the cost.

To read the full article, please visit SME Web

Small Business News | EC to help small businesses in Europe

An article in The Register has just announced that the European Commission has pledged €6.4bn for research investments across Europe for both academics and small businesses.

Following a ‘call for proposals’ later on today, an approximate 3,000 small businesses will end up benefitting out of a total 16,000 organisations. In order to qualify for the funds, organisations must meet the criteria working with economic and societal challenges: climate change, energy and food security, health and an ageing population. The hope is that provided funds will help kick start new businesses and create much needed jobs. €1.2bn will be allocated to technology and communications projects to support the Digital Agenda for Europe. Environmental research gets €205m and money for small and medium businesses must equal 35% of total spending – or €800m.

To read the full article, follow this link. Alternatively to read the official European Commission statement, go to the Europa website.

Small Business News | Business Minister starts ‘work experience’ week

Business and Enterprise Minister Mark Prisk has this morning kicked off an initiative to spend a week working with small businesses to gain better insight into the experiences of companies on the ground. Mr Prisk is spending today with a small Bethnal Green based company.

The ‘Week in Small Business’ initiative was introduced by the Department for Business, Innovation and Skills (BIS) to gain an in-depth understanding of the specific needs of small and medium sized businesses (SMEs).

Mr Prisk is also actively encouraging employees working on enterprise policy at the Department to participate in the initiative over the next year to help boost their understanding of the real-life issues faced by smaller firms, and bring SMEs and Government closer together.

More information on the initiative is available on the NDS website.

Small Business News | Budget – Corporate Tax Cut

Chancellor George Osborne finally announced plans to help the recovery of the UK at lunchtime today. Top of the bill was an increase in VAT. He commented the tough measures announced were “unavoidable” because of the country’s debts.

Aside from the bad news about VAT, there was some good news for business and small business in particular. The chancellor wants to slash corporation tax as part of a move to show companies around the world that Britain is “open for business”. Corporation tax will be cut from 28% to 27% next year, and by 1% annually for the following three years. The rate for small companies will also be cut from 21% to 20%.

In addition, guarantee schemes for small business financing will be extended.

We’ve pulled together a brief summary of the Chancellor’s new measures:
1. VAT to rise from 17.5% to 20% from 4 January next year
2. Income tax allowance to rise by £1,000
3. No rise in alcohol, tobacco or fuel duties
4. Link between basic state pension and earnings to be restored
5. Capital gains tax for higher rate tax payers to rise to 28%
6. Two-year pay freeze for public sector workers earning more than £21,000
7. Levy imposed on banks
8. Corporation tax to be cut from 28% to 24%
9. 25% budget cuts across all government departments (education and defense are protected)
10. Public sector pay frozen for two years, those earning less than £21,000 will be protected

The BBC has details of the full outcome of the budget on its website.

Small Business News | Budget: How Would You Cut the Debt?

The BBC Online website this morning features a neat tool that allows visitors to the site to play Chancellor and make ‘virtual’ changes to the UK economy. Go on, it’s really quite interesting:

Today on Business Heroes we’ll be sure to cover any news from the budget that directly affects small business – stay tuned for the latest information and be sure to follow us on Twitter @customerkings