And the organisation is asking for the government to outline exactly how it is going to help them survive.
Despite assurances that support will be rolled out to the sector by October, FSB chair Alan Lowry said “extraordinary times call for extraordinary measures”.
He said the FSB is calling for more detail on how the energy support plan is to be rolled out and what it will include so small businesses can plan ahead.
“Nearly two weeks ago, the Prime Minister declared that it was the ‘moment to be bold’ however, the lack of detail on how any assistance scheme will be implemented is causing business owners increasing distress,” he said.
“Without clarification on the practicalities of the plan, there is a grave risk that there may not be enough time left to protect many firms from eye-watering winter bills.
“Small firms, whether the local grocery store, café, restaurant, or car dealership, are often high-energy users and so are most exposed to soaring prices.”
Mr Lowry said the government needs to answer a number of questions small businesses have such as:
- What level prices will be capped?
- Will those who have recently signed up to fixed-rate contracts benefit from it?
- How can businesses check their bills to ensure they are not being overcharged?
- Will small businesses continue to be eligible for support beyond the initial six-month period?
“We need clarity from Government — or hundreds or even thousands of small businesses will be disincentivised to keep going,” he said.
“They can’t plan their businesses on a wing and a prayer.”
The FSB said many small firms have 1 October as their start date for new contracts and if energy help comes into effect next month, or even November with backdating, at least businesses can plan around that.
“We’re writing to energy companies in this regard and encourage them to promise not to disconnect any small business in this difficult period,” Mr Lowry said.
Small businesses face eye-watering energy price hikes with the cost of gas and electricity skyrocketing since 2021.
In its most recent report, Out in the Cold, the FSB found that the overwhelming majority (96 per cent) of small firms are concerned about rising energy bills.
“Whilst the commitment to cap business energy costs is welcome, the proposed six months simply won’t be enough,” Mr Lowry said.
“We need much, much more than short term relief. With so many firms at serious risk, sustainable long-term solutions which address underlying problems of supply and affordability is where the focus should be. To support businesses to a point where they will just face the same issues at a cliff edge in the new year is not only illogical but dangerous.”
