Business forum urges Chancellor to act over cash flow concerns

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CHANCELLOR George Osborne must act to reduce entrepreneurs’ cash flow worries and lower business costs, according to the Forum of Private Business.

Ahead of the Chancellor’s Autumn Statement next month, the forum has written to Mr Osborne with a ‘wish list’ of policy recommendations.

The forum is calling on the Chancellor to take significant steps to tackle issues affecting cash flow for small firms.

In particular, the forum wants action to tackle late payment. The group is calling for a strengthening of the rules around the enforcement of the Prompt Payment Code to prohibit companies that have extended their payment terms within the previous 12 months from joining, and making it compulsory for them to produce an annual declaration of payment time statistics.

The forum is also calling on the Chancellor to look at ways to make it easier for small businesses to gain access to alternative forms of finance, in particular peer-to-peer lending.

The forum is keen to see continued support in reducing businesses costs, including a freeze on business rates until 2014. The forum is asking for an extension of Small Business Rate Relief until the end of the current parliament and an independent study to look at the current system of business rates.

The forum is also calling for a commitment to maintain a freeze on fuel duty until 2015.

Alexander Jackman, head of policy at the Forum of Private Business, said: “The Chancellor will be delighted to see quarter on quarter economic growth in the country.

“With the forthcoming Employment Allowance to support businesses next year and the recent pledge to freeze fuel duty if savings can be found across government, it’s clear he has his finger on the pulse of UK businesses.

“His task now is to try and cement the growth in the UK. An overwhelming number of businesses feel property taxation remains too high. At present, business rates are linked to inflation and with previous years of quite high inflation those rates have soared.

“Now is the time for the Treasury to recognise that pressing issue, and give businesses a break from over-inflationary increases in their rates.”