The BCC’s Global Annual Conference is a key policy forming moment. With so many experts, stakeholders, Chambers, businesses and politicians in the same room it is an amazing opportunity to road-test ideas and get valuable feedback.
Discussions on our Local Economy of the Future work were wide-ranging but focused on devolution and the opportunities for businesses in local communities.
A core component of this was the role of government strategies. Last week the government published its SME Strategy, which includes announcements responding directly to long-standing challenges faced by small and medium sized enterprises (SMEs). This is a timely intervention, with business sentiment remaining subdued following tax and other cost increases for businesses. Today’s reality is that businesses are operating in an increasingly unpredictable environment and have limited capacity to absorb further pressures.
Late payments are a persistent and damaging issue for firms of all sizes. The commitment to legislate against late payments – including stricter payment terms, fines for persistent offenders, and stronger powers for the Small Business Commissioner – is a much-needed step forward. With three-quarters of firms having experienced late payments and 28% reporting operational impacts, this reform could be transformative if implemented effectively.
The launch of the Business Growth Service is another welcome move. A streamlined, digital-first platform that connects SMEs to advice, finance, and local support – including, importantly, their local Chamber of Commerce – has the potential to simplify a fragmented landscape. This will help businesses access the help they need to grow.
Accessing finance also remains a major issue for SMEs. A 2024 BCC survey showed that for firms seeking finance, 49% felt it had become more difficult compared with three years ago, while only 13% thought it was easier. The expansion of Start-Up Loans, the Growth Guarantee Scheme, and the ENABLE programme are all encouraging. With the British Business Bank’s remit and funding having been broadened in another recent government announcement, it’s crucial that businesses who want and need to access finance, have the resources and opportunities to do so.
However, for this plan to truly succeed, we need to see longer-term reforms that go beyond short-term fixes. The BCC is calling for several longer-term measures, including:
- A lower business rates multiplier for all sectors, not just retail, hospitality and leisure.
- A skills system that delivers the right people with the right skills in the right jobs.
- A robust export support scheme that lets SMEs trade confidently and competitively on the global stage.
The Government’s new plan is a strong signal that small and medium sized businesses are finally being recognised as the backbone of the UK economy. However, it is important to recognise that SMEs are not one homogenous group. The categorisation is so broad that it has become almost meaningless. Instead of trying to fit many businesses into one box, we need to see real-world delivery, funding, and follow-through to reduce the cost of doing business and unlock the growth potential of our nation’s entrepreneurs.