Nine in 10 people want government to do more to back small businesses
As the UK welcomes a new prime minister and leadership team, 9 in 10 adults (90%) would like to see the government do more to support small businesses in the UK – a rise on 87% two years ago, when Labour won the General Election in July 2024.
The new research comes at a time when tracking data from Novuna Business Finance reveals that the percentage of small businesses predicting growth this month has fallen to its lowest level since the month when the UK went into the first Covid lockdown in spring 2020. The poll of a representative sample of 1,000 small business owners revealed that only 24% predict growth for the next three-months – down from 28% last quarter and 35% in the months following the Labour government winning the General Election in July 2024. With growth forecasts falling this month, 39% of small business owners said they are prioritising managing fixed costs (39%) in an attempt to secure future growth. Only 10% are looking to expand into new markets and just 9% plan to hire new staff.
With small business owner sentiment cautious, Novuna Business Finance also polled 2,000 adults in the last week to get their sense on how important they thought it was for the government to support small businesses in their community. With a new prime minister taking office, the poll asked members of the public what would they like to see the government do more of to support small businesses.
- · Tackling the financial pressures that directly affect small businesses were seen to be an immediate priority. More than one in four respondents (27%) called for a reduction in business rates, while 25% said they would like to see a reduction of corporation tax for small businesses. More than one in five called for a reduction in National Insurance (22%) – following the hike, which 49% of small business owners said would negatively impact their finances and growth outlook.
- · Energy costs were another concern. With the government announcing on Tuesday that VAT will be scrapped from household electricity bills in October, more than one in five people (23%) are calling on the government to give small businesses a cap on energy costs, like consumers receive. The UK’s declining high streets were of equal concern, with a further 23% of those surveyed wanting to see major investment from the government in re-generating the high street.
- · The international business landscape was also an area where the public wanted to see substantial change to benefit the small business sector. Just under one in five respondents (19%) wanted to see the government overturn Brexit and allow the UK to re-join the EU, and 16% of those surveyed called on the government to reduce the red tape small businesses face doing business overseas.
- · Looking to the future, one in five survey respondents (20%) wanted more investment in apprenticeships from the government, plus a wider rollout of apprenticeship schemes – while 18% thought more training and development programmes would help many small business owners and employees.
Jo Morris, head of insight at Novuna Business Finance comments: “What stands out from our recent research is that small businesses matter to everyone. While our Business Barometer tracks the confidence and growth ambitions of small business owners, our survey of the general public shows just how connected people are to the sector. People deal with small businesses most days, a strong small business sector helps communities work well – and many consumers themselves either run or work for a small business – a sector that accounts for around 47% of total private sector employment.
“There have been a lot of positive messages of hope in recent weeks, on what is possible. We share the view that small businesses are key to UK economic growth, that high streets need investment and that reducing the tax and cost-of-living burden on small businesses will help them to invest in long-term growth, modernisation of equipment and to invest in job creation. Our Business Barometer data reveals a low-point for small business growth forecasts this month, but set against these challenges, 66% of small businesses are still committed to exploring new ways to secure future growth. With the right help from government on tackling rising costs and the tax burden, there is hope for the future – and at Novuna Business Finance, we remain committed to supporting established businesses as they plan for the future, helping them invest in long-term opportunities that can drive growth, improve operational efficiency and strengthen cashflow.”