AHEAD of the Autumn Budget, which will see Chancellor Rachel Reeves outline Labour’s key financial policies on the 30th October, specialist lender Simply Asset Finance has urged the Government to take decisive action to empower the growth of small businesses across the UK.
Accounting for 99.9% of the UK business population and approximately 61% of total employment across the country, the success of SMEs is a crucial factor for the UK’s economic stability and growth prospects. Now, as headline inflation continues to fall from its recent double-digit highs, there are hopes the UK is on the path to recovery, with the Organisation for Economic Co-operation and Development (OECD) updating its growth predictions for the UK to 1.1% – up from 0.4% in May.
To seize this opportunity, Simply Asset Finance emphasises the need for a pro-business agenda in the upcoming Autumn Statement to remove the barriers SMEs face to growth, and recognise their vital contribution to the economy. With this in mind, Simply’s key ‘asks’ ahead of the Autumn Budget include:
A recent report from the Federation of Small Businesses (FSB) finds that just over half (53%) of SME credit applications were successful in the final three months of 2023, highlighting ongoing issues small businesses face with access to finance. The rollout of business finance via the British Business Bank (BBB) from schemes such as the Recovery Loan Scheme (RLS) and the new Growth Guarantee Scheme (GGS), have been central to the successful growth of SMEs across the UK. We urge the Government to consider the continuity of such schemes, while fostering closer collaboration between SMEs and lenders to identify and eliminate any future funding gaps.
SMEs are eager to invest in the green transition, but without clear incentives it will become another cost businesses may struggle to meet amidst the current high cost of trading which has been borne out of a high-inflationary environment. Studies find that while 80% of SMEs say their organisation is committed to sustainability, a third (34%) say the high prices for sustainability services are a barrier. We call for the government to provide robust incentives and support structures that empower SMEs to invest in clean energy technologies.
The Home Builders Federation finds that 93% of SMEs cite delays in securing planning permission as being a major barrier to their growth. Meanwhile, infrastructure projects in the UK are poorly managed, with lengthy delays or cancellations putting SME builders and contractors on indefinite hold – severely impacting their cash flows. We call for the government to undertake comprehensive reviews of existing regulations and planning frameworks to foster a more conducive environment and roadmap for SME growth allowing them to effectively plan for the future.
The 2023 Small Business Survey finds that 32% of small businesses reported that issues with late payments had been an obstacle to growth, up from 29% in 2022 with the average time taken to settle invoices extending beyond 30 days. With trading costs now significantly higher as a result of surging inflation in recent years, maintaining cash flow has become a crucial priority for SMEs. The Government must continue its review of timely payments to SMEs to reduce burdens on cash flow hindering their ability to grow.
Mike Randall, CEO at Simply Asset Finance, commented: “As we approach the Autumn Budget, it is imperative that the government addresses these key areas in a pro-business agenda to unlock the full potential of SMEs in the UK. These are not new issues—they have been raised for a long time and are well-known levers that can make a significant difference by creating conditions that enable growth. But now is the time to really focus on SMEs. This is an opportunity the new government should not miss; it is time to act.
“By listening to the many voices of industry, we can create an environment where SMEs thrive, driving economic growth and innovation. We stand ready to support businesses across the country and help shape a brighter future. However, it is essential that barriers hampering growth and ambition are removed.
“SMEs need assurance that their interests are prioritised in policy-making, not just treated as an afterthought. By providing targeted support, reducing red tape, and offering meaningful financial incentives, the government can empower SMEs to innovate, grow, and compete locally, nationally, and even globally. It is crucial that policy decisions reflect the real challenges SMEs face, ensuring they are placed at the heart of economic recovery and progress.”
