This week, I was asked what help I thought the UK government should be giving small businesses at this stage of the pandemic and beyond. This got me thinking about what I’d do if I was in charge! Here are some of my thoughts.
The overarching support that all businesses need is confidence:
confidence that the government will act early to prevent further lockdowns;
confidence that COVID support measures won’t disappear overnight; and
confidence that a longer-term support package for small businesses will be in place.
In the short-term, help is needed to prevent a tsunami of insolvencies. For the past year, UK insolvencies are actually below trend, and there are a few steps the government can take to help:
relax the legislation placing such an onerous burden on directors of potentially insolvency companies;
provide a gentle ‘off-ramp’ for businesses who have been dependent on government COVID support measures such as furlough and HMRC time to pay agreements;
put pressure on landlords to be pragmatic about rents and leases.
In the longer term, there are opportunities for the government to create a more sustainable environment for small businesses and an environment that incentivises regenerative business models. Whilst we’ve all been in the same COVID storm, we’ve been in different boats. In the post-pandemic world, there’s an opportunity to rebalance. A quick win would be to open up government tenders to small businesses and make it easier for them to win.
Data shows the pandemic has disproportionately negatively impacted women. Let’s put in place measures to make it easier for women to work in small businesses, such as improving work/life integration, increased job flexibility, subsidised childcare, etc.
Generally, we can do more to incentivise both employment and training. As a small business owner, you receive tax rebates for buying machines, but you’re heavily taxed for employing people. If we want more people in work, let’s offer tax credits for employing and continuing to employ people rather than for the machines that make people redundant. Training also would be easy and highly beneficial to subsidise, with hugely positive long-term rewards.
Finally, let’s try and use this moment to focus small businesses on helping to avoid the climate disaster: incentivise the use of green technologies, reduce the green premium for operating sustainably and involve small businesses in green infrastructure projects.
This is what I would do. I’d love to hear your thoughts on what you would do if you were running the UK government right now.