Civitas - Small business owners experience ‘a great disconnect’ from government – despite repeated claims they form the ‘backbone of the economy’
Politicians of all parties repeatedly declare that small businesses form the ‘backbone of the British economy’. Yet a new survey shows that those same politicians too often fail to provide the right level of support for small business, resulting in ‘a great disconnect’, a new Civitas book reveals.
Tim Knox finds in two surveys that many small business owners feel that government tend to listen to big business far more closely to that of small business – and that multi-national companies receive preferential treatment from government.
Micro-business owners (with five of employees or less) feel unenthusiastic about the support they get from government. About one in three business owners surveyed felt government support for their business had got worse over the last five years, while almost half said it was neither better or worse. Those trends are contributing towards a sense of neglect from government for small business. Knox writes:
‘With over two-thirds of respondents feeling that they receive no positive support from government, it is clear that the rhetoric of politicians claiming to support small businesses is not reflected on the ground.’
‘Another concern for government should be the extraordinary sense among the majority (60%) of micro-business owners that there are no business services provided by government which are intended to help small businesses, despite the fact that there are many such services.’
This marks the great disconnect. Several proposals are set out to help government reconnect with the small business sector, including:
- Government could reverse the easy inclination to listen to big business as if it were the voice of all;
- The government should undertake regular polling of small business owners to ensure that it has an accurate register of small business opinion, of how that opinion changes and of the reason for any such changes;
- It could develop communication strategies to ensure that initiatives intended to support small businesses are being heard and are having the desired effect;
- Government services could be better communicated by adopting the Charity Commission advice it sends to all charities as a template;
- The government could focus any attempt to support SMEs in those regions which have a relatively low number of businesses per head of the population.
Update: ‘Unleashing the potential’ of the regions
Following criticism of the government’s business Councils in this report, Boris Johnson last week announced plans to axe the ineffectual ‘Small Business, Scale ups and Entrepreneurs Business Council’ and the four other Councils in the business council network. Tim Knox comments:
‘It is excellent news that the government is now trying to reconnect small business and government. When doing so, it should also focus on the significant regional disparities in SME activity: for example, the North East of England has just 694 businesses per 10,000 people compared to 1,544 in London.
‘“Unleashing the potential” of the regions should be a priority. And a first step should be to engage better with small business owners by following through with the recommendations in my report.’
The Great Disconnect
Latest News from
Work Foundation - What does the Labour Party’s new deal campaign mean for working people?29/07/2021 10:35:00
With insecure work having increased over recent years, the nature of work and the delivery of ‘good work’ is shaping up to be a key political battleground, one that will undoubtedly be contested up to the next general election. This week, the Labour Party has launched a New Deal for Working People campaign in its first major policy announcement following the last election.
Civitas - Towards Strategic Coherence: Reform proposals following ‘Inadvertently Arming China?’28/07/2021 13:10:00
A Civitas report, Inadvertently Arming China? in February this year revealed the widespread sponsorship of scientific research centres in UK universities by Chinese military-linked conglomerates and universities. It found research at some of these centres is being sponsored by the British taxpayer.
JRF - UK heading for the biggest overnight cut to the basic rate of social security since World War II27/07/2021 12:35:00
JRF issues stark warning to MPs about the looming cut to Universal Credit at the start of the parliamentary summer recess.
Civitas - Curbing of free speech linked to universities with inflated diversity grievance bureaucracies – half of all universities have some form of anonymous reporting service27/07/2021 11:35:00
There is a strong connection between universities with inflated diversity bureaucracies and those that limit speech more generally on campus, researchers at Civitas find in a survey of academic freedom at universities.
'These results should not make for complacency': The King's Fund response to the Office for National Statistics report into ethnic differences in life expectancy27/07/2021 10:35:00
Veena Raleigh, Senior Fellow at The King’s Fund, commented on the Office for National Statistics report into ethnic differences in life expectancy and selected causes of death between 2011 and 2014
Pay is important, but it is not the only factor contributing to high staff turnover: The King's Fund response to the NHS staff 3 per cent pay rise22/07/2021 14:35:00
Richard Murray, Chief Executive of The King’s Fund, commented on the government’s decision this evening to offer NHS staff a 3 per cent pay rise, as recommended by the independent Pay Review Body
IFG - UK government's Shared Prosperity Fund risks damaging trust in union22/07/2021 14:20:00
A new Institute for Government paper warns that the UK government’s post-Brexit UK Shared Prosperity Fund (UKSPF) – replacing EU ‘structural funds’, to be launched in April 2022 – risks damaging trust between the UK and devolved administrations and undermining the UK government’s key objective of binding the four nations of the UK closer together.
IEA expert responds to ONS government borrowing figures21/07/2021 14:20:00
Julian Jessop, Economics Fellow at free market think tank the Institute of Economic Affairs, commented on the government borrowing figures for June published by the Office for National Statistics
IFS - No relief for Rishi Sunak as he prepares for Spending Review: lower-than-expected borrowing likely to prove only temporary21/07/2021 13:05:00
Despite improving public finances this year, the Chancellor is likely to have very little room for manoeuvre in his forthcoming Spending Review. That is because while the economy is recovering more quickly than expected at the March Budget, this may not translate into a permanent improvement in the economic outlook.