'Don't cut small business support', Government urged

The Government must maintain its support for small businesses in the face of any public spending cuts, the Forum of Private Business (FPB) has said.

And, ahead of a 'crucial' 18 months for the economy, the group is urging the Government to expand its support for small firms, with additional breaks for micro businesses.

The call anticipates the annual pre-Budget report, expected in November. The FPB is concerned that, with public sector borrowing forecast to have risen to £185 billion by the end of the year, the chancellor will be forced to make far-reaching cuts that could undermine important support for the smallest firms.

Among the areas of concern are programmes such as the Enterprise Finance Guarantee (EFG) and the Trade Credit Insurance top-up scheme, which address the unavailability of both finance and credit insurance encountered by small firms during the recession.

"Government cuts should not include those programmes that are making a real difference for struggling firms," said FPB policy representative Matt Goodman.

"As the main drivers of growth, small businesses need to be placed at the heart of plans for economic recovery so they can make the most of future opportunities."

The group wants to see work prioritised on the successor to EFG, and the funding set aside for TCI - take up of which it describes as 'disappointing' - to be put into more effective initiatives.

"The Government will have to consider the impact of recession on public finances," Goodman acknowledged.

"We believe our proposals are a cost effective path to responsible growth."

IMAGE Peter Byrne/PA Wire