National chair of the Federation of Small Businesses (FSB), Martin McTague, said the challenge now is to deliver action that is big and bold enough to match the scale of the crisis threatening the existence of many small firms and the jobs, livelihoods and communities that depend upon them.
“Small firms, not protected by an energy price cap, are seeing bills soaring out of control. This is at a time of sky-high taxes, rampant inflation and supply chain disruption, creating a toxic mix which must be addressed urgently,” he said.
“Small businesses are crying out for a comprehensive response which cuts taxes, limits spiralling bills, and provides direct cash support for the smallest businesses.
“During the leadership campaign we were pleased that Liz Truss listened to our calls to reverse the recent hike in National Insurance and to look at lifting more small firms out of business rates.
“As she prepares her full package of emergency plans, we are ready and willing to work with the new Prime Minister and her team to protect the UK’s 5.5 million small businesses and the 16 million jobs within them, in communities in all parts of the UK.”
Sarah Howard, chair of the BCC, said Ms Truss must now take immediate steps to support the economy.
“The last few months have been difficult for everyone, time is running out and urgent action is needed to deal with the costs’ crisis,” she said.
“We believe the country has already entered a recession and that inflation will hit at least 14 per cent in the months ahead.
“Like households, firms have been telling us of unsustainable rises in their energy bills and how difficult it is to find new fixed term contracts to buffer against further price hikes.
“Unless the new Prime Minister addresses these problems head-on then the economy will drift further into dangerous waters and the outlook for both businesses and consumers will be bleak indeed.
“The BCC set out a five-point action plan to support businesses at the end of August and sent it to the Treasury and Liz Truss’s team. It is now imperative that we see movement on our proposals.
“The plan is not just about ensuring support for businesses. It is also about protecting jobs, securing livelihoods, and creating a vibrant and prosperous society.”
The BCC five-point plan to support businesses includes the following measures:
- Ofgem to be given more power to strengthen regulation of the energy market for businesses
- Temporary cut in VAT to 5 per cent to reduce energy costs for businesses
- COVID-style support by introducing Government Emergency Energy Grant for SMEs
- Temporarily reverse NICs and put money back into the pockets of businesses and workers
- Government to immediately review and reform the Shortage Occupation List (SOL) to help bring down wage pressures and fill staffing vacancies
