Small and Medium Enterprises (SMEs), small business to you
and me, are the true creators of real, productive jobs in the United
Kingdom. They provide more jobs than do the PLCs.
David Cameron has promised to create 2 million jobs – promised
– that word again. Hard to believe particularly as the only jobs
government creates are those in the public tax payer funded sector.
That is not entirely nugatory of course, we sell medical training to overseas
student through NHS teaching hospitals, for example, and employing armed forces
leads to creation of jobs in industry, manufacturing equipment and building
ships. That said, it is really the private sector which has the potential
to create jobs.
The business environment, however, can kill small
business. We now have EU procurement rules that makes selling to
the public sector a game for the multi-nationals, we have all too tight
restrictions, often unnecessary, in the work place and restrictions like the
working time directive.
But I consider that the biggest problems for Small Business
to overcome are rates and slow or late payers. We can tackle both.
Business Rates need to be simplified, and divided into two
bands; a band for PLCs, which the chancellor can see as a reasonable source of
revenue, and a band for SMEs. Given that we have a large SME sector, it
is acceptable for them to pay rates as a resource for the common good, but the
system must not weigh against them in favour of PLCss as now. A corner shop
pays more in proportion than does a supermarket. Those hit thus, will
know that.
I propose a simpler system based on a straight forward levy
per square foot for both PLCs and SMEs, regardless of location. That will help
city centre businesses and encourage revitalising small traders in town centre
etc. Secondly, the rate set for SMEs would be in a band factors lower
than the PLC band. I support local responsibility local
authorities should be the rate setters for their areas.
Now the big one – dealing with late payers, by whom I mean
PLCs, and even local authorities, who keep SMEs waiting for payment.
Indeed, bigger SMEs might well be guilty too.
The man with the power and tools to sort this out is our
dear friend the VAT man. VAT registered businesses have to render their
dues to the VAT man on a regular basis and can be hammered if they do not
pay. All the VAT mand needs to do, is to require VAT payers to include in
their returns on VAT , the additional information of how much they owe their
creditors beyond a 30 day limit. There would be an automatic fine by the
VAT man on that figure (helping his public pot) and inducing the slow payers to
pay on time. Being a slow payer would be highly uneconomic, and
would probably dry up.
