New small business initiatives 'help firms achieve ambitions'

Monday 9 December 2013

New initiatives launched to support small businesses go some way to helping them achieve their ambitions, according to one industry expert.

Commenting on the government's long-term economic plan, John Allan, national chairman of the Federation of Small Businesses (FSB), explained that chancellor George Osborne's latest plans will give the sector a boost.

"With 54 per cent of our members saying they want to grow in the next 12 months, today's announcements will help them achieve their ambitions through access to faster broadband, improved cash-flow through tackling late payments and fairer energy deals, while giving more opportunity to win public sector contracts," he said.

Indeed, with the private sector and smaller firms playing a vital role in creating jobs and boosting the economic recovery, making doing business easier for small companies, contractors and sole traders will be important.

To do this, the government has announced the Broadband Connection Voucher Scheme, which will provide businesses with £3,000 towards the cost of faster and better broadband.

It has pledged to bring superfast broadband to 95 per cent of UK premises by 2017 and the latest scheme will be rolled out to 22 UK cities through the Super Connected Cities Programme.

"More small firms must exploit the use of faster broadband if they are to expand their businesses, but there are also thousands of firms around the UK who struggle to even get a broadband signal and the government must not forget this," Mr Allan said.

"Broadband vouchers should help those in the 22 cities, however the FSB still wants to see a greater push for universal connectivity to help those firms in rural areas that won't benefit from the scheme."

Small businesses will also have access to an industry-led programme of digital skills advice to help them make the most of online opportunities.

Meanwhile, the government will look to give small businesses and those setting up as a sole trader better access to fair energy deals. It will limit back-billing and end rollover energy contracts - something the FSB claims is a "significant triumph for small firms".

Mr Allan explained that energy costs are one of the major challenges facing small businesses and searching for new deals can be time consuming. The changes should make things simpler for firms and more transparent.

Of course, arguably the greatest barrier to a healthy bottom line for small companies is late payments and the government has vowed to tackle this.

In its Small Business:Great Ambition report, the coalition explained that the average small and medium-sized company that offers trade credit is owed £31,000 and 85 per cent admit they have received a late payment in the last two years.

To address this, the government will implement major procurement reforms in 2013, making sure small firms get treated fairly by mandating prompt payment terms all the way down a public procurement supply chain.

Public bodies will also have to report on their prompt payment, improving the transparency of contracts.

Small businesses will have better access to public sector contracts too, with the government opening up £230 billion worth of deals to small firms.

By Victoria McDonnell

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