FPB to Osborne: address SME cash flow to prolong recovery

The Forum of Private Business has called for chancellor George Osborne to take urgent action to address issues affecting small business cash flow to cement the UK’s growing recovery

National business group the Forum of Private Business has set out its regular wish-list ahead of chancellor George Osborne’s upcoming Autumn Statement, urging Number 11 to capitalise on recent signs of recovery in the UK.

The FPB’s headline recommendation is for Osborne to take urgent action to help SMEs tackle issues affecting cash flow, such as late payment, by strengthening enforcement of the Prompt Payment Code to prohibit companies that have extended their payment terms within the previous 12 months from joining, and making it compulsory for them to produce an annual declaration of payment time statistics.

As it has done in the past, the Forum also wants Osborne to investigate easing restrictions around alternate financing options, such as peer-to-peer lending, to make it easier for SMEs to fund their future growth.

In addition, the Forum is keen to see continued support in reducing businesses costs, including a freeze on business rates until 2014, as well as extension of Small Business Rate Relief until the end of the current parliament and an independent study to look at the current system of business rates.

FPB policy head Alexander Jackman said: “The Chancellor will be delighted to see quarter on quarter economic growth in the country. With the forthcoming Employment Allowance to support businesses next year and the recent pledge to freeze fuel duty if savings can be found across government, it’s clear he has his finger on the pulse of UK businesses. His task now is to try and cement the growth in the UK.

“An overwhelming number of businesses feel property taxation remains too high. At present business rates are linked to inflation and with previous years of quite high inflation those rates have soared. Now is the time for the Treasury to recognise that pressing issue and give businesses a break from over inflationary increases in their rates.”

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