Cameron gains business support as many call for tax holidays

The research reveals that as government measures are regarded as ineffective, David Cameron and The Conservative Party have gained a considerable lead over Labour among the SME community who also feel that their needs are being poorly represented by industry trade bodies – 45 per cent of SME owners support the Conservatives compared to 29 per cent who back Labour.
 
The Coverzones 2009 SME Healthcheck Report, which polled the views of 504 small business owners, shows that in spite of government hype the overwhelming majority (63 per cent) of UK SMEs feel that the Labour Government has not done enough to support their enterprises through the recession.  Just five per cent of SME owners would rate the government’s support for businesses as good, one in three (32 per cent) would describe it as average while two-thirds (63 per cent) see it as poor or non-existent.
 
Beyond the existing government schemes, the Coverzones research polled small businesses on what practical measures they would actually like to see from the state to support their enterprises. The majority called for holidays in PAYE/National Insurance (20 per cent) while 13 per cent demanded financial support that was readily accessible. Another 12 per cent demanded lower taxes for new businesses and one in ten (10 per cent) called for reduction in regulation and red tape.
 
These sentiments were even more pronounced among the most vulnerable SMEs, those with 2-3 employees, with one in three (33 per cent) calling for PAYE/National Insurance holidays followed by 19 per cent who called for lower taxes for new businesses.
 
Simon Ball, CEO of Coverzones commented: “Initiatives such as the government’s credit guarantee scheme need to form just one part of a wider-reaching economic stimulus. The existing schemes need to be backed up by longer-term measures to encourage and support small businesses and kick-start the economy. Specifically, tax holidays, incentives for employing people and strategies to stimulate those industries, such as tourism and export activity, in which SMEs are a major part. ”
 
The Coverzones report reflects research released by the Federation of Small Businesses (FSB) in February this year which showed that initiatives such as the government’s VAT cut was seen by 97 per cent of firms as having no impact at all and that just eight per cent of small businesses were able to access bank funding via the government’s credit guarantee scheme.
 
No help from SME trade bodies:
 
In spite of the public reports and noise made by organisations such as the FSB, British Chambers of Commerce (BCC) and Confederation of British Industry (CBI), 60 per cent of UK SMEs claim that trade bodies have failed to adequately represent their interests in the current economic climate. This sentiment is even stronger among sole traders where 71 per cent claim no trade body adequately represents their needs.
 
Simon Ball, CEO of Coverzones commented “SMEs generate half the UK’s turnover and employ half of its workforce, but despite this they simply have not been allowed a collective voice in public or political forums. The SME community is the country’s best chance of stimulating the economy to emerge from recession and it is vital that their voice and needs are heard. Too often trade bodies are unable to effectively lobby on behalf of SMEs and consequently, we are left with highly confusing messages from both Government and industry.”
 
Cameron leading Conservatives to SME landslide victory
 
When asked, if a general election was held tomorrow, which political party they were most confident could lead the country out of recession, 45 per cent of SME owners would vote Conservative, 29 per cent Labour and 13 per cent Liberal Democrat. This bias is strongest amongst owners of businesses employing four to five people where 70 per cent would vote Conservative, 17.5 per cent Labour and 7.5 per cent Liberal Democrat.
 
Beyond political parties, David Cameron is the politician that SMEs feel best understands their needs (23 per cent) followed by Vince Cable (13.7 per cent), Gordon Brown (13.5 per cent), Peter Mandleson (5.2 per cent) and Alistair Darling (4 per cent). In small businesses employing four to five people, these views are even more polarised with Cameron gaining even greater support (30 per cent) and Gordon Brown being supported by just 2.5 per cent of companies.
 
Simon Ball continued: “The current government has single-handedly failed to inspire confidence among the small business community and it can be no great surprise that support is with the opposition parties. The Labour government has always produced considerable rhetoric and little follow-through in its measures to support small businesses. The fact is that small businesses have absolutely no need or use for shallow, publicity-seeking measures which have no material impact.  They need decisive action at the root of the economies in which they operate.”

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