Move on everybody, nothing to interest you here. Yep, if you blinked you might have missed Alistair Darling’s brief mention of business in today’s 51 minute Budget speech. In more affluent times, no news almost always meant good news as business lay in fear of picking up the tab for public spending.
But in the midst of recession, with businesses facing rising costs, reduced consumer spending, record levels of unemployment and lending in decline, perhaps on this occasion some news for small businesses wouldn’t have gone amiss.
Sure, great, a £750m investment fund offering financial support for innovative technology and science firms is good, and doubling of capital allowance for investment is positive.
I’m also glad he’s not reversed the drop in VAT, and the ability for loss-making companies to reclaim tax on profits from the previous three years will help some – but exactly how many? Certainly not those new companies struggling to emerge.
And what for the majority of small and medium businesses that, let’s not forget, make up 99.9% of all UK enterprises, employ 59.2% of private sector workers and contributes 51.5% of private sector revenue to the UK economy?
If anything, Darling’s taken a series of swipes at the some of the most vulnerable small businesses. The decline of the pub trade is well documented with five closures a day, but won’t be helped by a 2% hike in alcohol duty.
A 2p rise in fuel duty will also have a serious impact on small businesses’ overheads – why bother scrapping your decade-old van for a new one if you can’t afford to fill it?
The decision to hit struggling companies by raising compulsory redundancy pay from £350 to £380 also fathoms belief – does the Chancellor not think redundancies, for the vast majority of companies, is a last resort? Are employers solely to blame for the plight of the 2.1m unemployed?
So what to make of it all? Today’s Budget offered little solace to small business, but no real nasty shocks either. Neither, perhaps most alarmingly, did it address the real indirect issues likely to affect small businesses most: freeing up of consumer spending and forcing banks to lend.
Just as the widely-loathed supporters of Millwall FC unite in rebellious indifference to sing, ‘no-one likes us we don’t care’, small business knows not to expect anything from the government. It’ll simply shrug and leave the micro-analysis over outlandish growth forecasts to the political press and get back to trying to turn a profit regardless of the economic climate. Like Millwall diehards, it has little choice, does it?