Entrepreneur Tony Robinson, co-founder of micro-business support group Enterprise Rockers, says this year's Budget announcement shows that politicians have no real understanding about real enterprise.
I was appalled by the poor behaviour and lack of humility shown by all political parties in the House of Commons during the Budget announcement. They didn't seem to understand the effect their proposals and counter proposals have on the UK population, not just business owners.
Although people put a brave face on it, and pretend to be fine underneath, they are finding it very, very hard to make ends meet. My feeling was that all voters deserve more respect shown by our politicians and they should have conducted themselves better in the House. Just the expenses allowance claimed by most MPs is 3-5 times the current annual income of most micro business owners in the UK. On Budget day, this difference in wealth made our politicians appear elitist.
My points aren't political as they relate to all the MPs in the House of Commons and their lack of understanding about real enterprise and real people struggling to get by, through no fault of their own. It is not because they don't work long hours or because they don't have the know-how to do business - after three years they know how to run their business better than anyone else - it is because it is a tough trading environment.
There are many like me who were tweeting in despair that, in my case, after 20 years of being on government small business committees, MPs are still standing up and saying things like 'We have a lot of SMEs in my constituency' (99.9% of business are SMEs!) and political credit being claimed for 'record levels of new business creation' and 'Start-Up Loans', which provide very lucrative commissions to the sellers, creating 'the next generation of 'entrepreneurs'.
The main driver for the continuing high level of start ups over the last 10 years, is just that it's the best available way of earning a living. Big companies have been in melt down regarding the number of jobs they provide for 15 years. 6% of all the startups will go on to become substantial employing businesses (over 10 employees) and 2% will become the 'entrepreneurs' that the politicians in all parties describe.
This lack of understanding causes great ideas to be dangerously skewed in policy implementation. I was one of a number of people that has lobbied consistently, over many years, for improved business support to startups because over 80% of will survive longer than three years with the right support. I asked for the return of the business volunteer mentor scheme and business support vouchers (now being introduced) so that the private sector business support professionals sich as accountants and business coaches would be accessed by prospective business owners in their first few, vulnerable years of trading.
So you could say I have been given all I wanted. Not quite.
Te government's lack of enterprise understanding and pursuit of eye catching targets, means that they water down the idea. So 'business experience' replaces 'enterprise competence' in the implementation. This is not good enough. Startups should be helped by business owners that have at least three years experience of starting and running their own business. Government still don't get that enterprise is different from business studies and an ex-bank manager often doesn't have a clue how to help a new business owner with the vital first task of test trading.
For the last 15 years I've recommended that there should be no National Insurance as an incentive for a startup to take on their first employee. I also backed Julie Meyer's recommendation that micro businesses (she said less than a £1m profit) should not pay NI. So it was churlish of me not to be grateful for the £2,000 off NI bills. To put the record straight; I am grateful.
However, I was more upset by the amount given out (and it was the same when Labour were in power) to big businesses. At a time when we have the 'bedroom tax' and worsening health and social care it just seems wrong to me that 95% of the £60bn, cumulative, of the Department for Business budget over the last three years has gone to big companies. This is on top of the bail out billions and the employment subsidies billions from DWP to big business.
So, it just seemed wrong that in an austerity budget £50-6bns more would be going to big business, including the financial services Sector. This, alongside the arrogant behaviour on both sides of the House, I found upsetting.
It made a large sum of £800m on NI to micro-businesses look insignificant in the wider scheme of things. I admit that it is in fact the best thing a government has done in the 26 years I've been running my businesses. It is unfortunate that it has come at a time when I'd prefer it if government stopped all of its business support and training schemes and let the private sector look after itself.
I just don't believe that major contractors (Capita, A4e etc) and all their sub contractors are the answer. Re-allocate BIS and its civil servants to help with health, social care, primary and secondary education. As long as we have a Department like BIS then government will create an ever more unlevel playing field because the lobbying power is with big business.
Having made a fabulous start on an enterprise friendly infrastructure with the £2,000 annoucement, I'd now love government to, instead of the plethora of business support/training schemes, use its influence on its big business contractors and funding beneficiaries. All these companies should be persuaded to pay all their suppliers within 30 days. The energy companies can slash energy costs to micro-businesses and still make a whacking profit. Comms companies can provide free wifi in all public places, like Malta. The passenger transport industry can reduce fares. Government should use its influence on regional and local government to reduce business rates and reform the employment law advice, inspection and tribunal system to make it as informal, time and cost effective as other countries.
This tax specialist presents the big business handout at the Budget far better than I can.
BusinessZone.co.uk questioned Conservative MP Rob Wilson about the claims made in this article. To read his response, click here.