Spending review impacts on small businesses

Prior to the unveiling of the long awaited spending review today, almost a fifth of small businesses said they were pessimistic about the future due to the feared impact of the spending cuts.

The Forum of Private Business (FPB) released a survey of its members showing that many of them were extremely concerned about the review's impact on their businesses – a rise from 10 per cent who reported the same feelings in July.

FPB’s chief executive Phil Orford said, “But small businesses must be given the freedom and confidence to become the catalyst for private sector led recovery, and constraints on their growth should be removed.”

Now, following the review being made public, the FPB have admitted that there are some plus points for small businesses, namely 'positive developments on export, inward investment from oversees and also education – including creating many more apprenticeships a new ‘work programme’ with private sector involvement.

But, said Jane Bennett, head of campaigns at the FPB,“These measures alone will not be enough to allow small businesses to substantially create employment in order to replace the 490 000 jobs that will be lost in the public sector.”

One crucial area that was seen to be a positive thing for small businesses was tax. Reforms to the UK's tax system look set to 'save money for both the government and small businesses, which we have found spend £1.8 billion every year on tax administration.'