Government reaffirms commitment to small businesses

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The government has stressed its commitment to improving operating conditions for small business owners.

According to Margot James, the small business minister, the UK is home to a record number of smaller ventures - somewhere in the region of 5.5 million.

Writing in the Telegraph, she noted that they encompass all sorts of sectors, from high-tech manufacturing and plumbing to graphic design and catering, while many high-street shops provide "life's essentials".

This, she said, makes small businesses the "lifeblood of our communities" and major contributors to the UK economy.

"These businesses might be small but their impact is huge; providing 60 per cent of private sector employment and accounting for 47 per cent of turnover," Ms James said.

However, she acknowledged that conditions have been difficult for companies of all sizes over the last few years.

Ms James flagged up unfair payment practices, including late payments, as a particular issue for small businesses in recent times, as it has hampered their ability to invest and grow.

She therefore stressed that the government is "working hard to deliver a package of initiatives to drive a real change in payment culture".

The minister also confirmed that the government is getting ready to appoint a Small Business Commissioner to help smaller firms resolve payment disputes.

Ms James noted that this model has already proven to be successful in the US and Australia and will therefore be adopted in the UK next year.

Also in 2017, new rules will be introduced that require large companies to provide public reports on their payment practices and performance.

Ms James said this transparency will help to empower smaller firms and make late payment a "reputational issue" for big businesses.

She argued that support for small businesses is "best delivered at a local level, by those who know the area best".

This, she said, is why the government is preparing to deliver an industrial strategy that recognises the "differences and unique strengths that exist across the country" and enables regions to "take advantage of them".

Ms James went on to acknowledge that the UK's upcoming exit from the European Union (EU) is one of the biggest concerns for small businesses at the moment.

"The government is listening to business and is intent on getting the best deal for businesses of all sizes to make sure we are prepared for the opportunities presented by a future outside of the EU," she commented.

Ms James said the Autumn Statement last week demonstrated the government's commitment to small businesses, as it saw the announcement of a further £400 million for the British Business Bank to invest into venture capital funds.

However, she stated that while government plays an important role, it is "even better when grassroots organisations inspire and get behind small businesses".