On 2 November, Laura and Jo took part in a Roundtable Meeting with Kevin Hollinrake MP, the Minister for Enterprise, Markets & Small Business. Hosted by Anthony Mangnall MP, the meeting was due to take place at The Dart Marina Hotel, but Storm Ciaran had other plans so the meeting took place on Zoom instead. Attended by a small group of local South Hams hospitality businesses and Food Drink Devon Chair Greg Parsons, the meeting was an opportunity to hear from the Minister and also to feedback to him the pressures local independent businesses are feeling.
In the UK 5.5 million businesses are SMEs (Small and Medium Enterprise). The size definition of SMEs are: micro businesses have 1-9 employees; small businesses have 10-49 employees; and medium-sized businesses have 50-249 employees. Some 4.1 million of these businesses have no employees. The Government’s Business Population Statistics show that SME make up 99.9% of UK businesses and small businesses alone employing 13.1million people and contributing £1.6trillion to the UK economy. In South Devon this equates to a £100m economy. The minister described small business as “the lifeblood of British culture”. In the current ‘cost of doing business crisis’ it is these businesses that are particularly vulnerable having suffered the effects of COVID and Brexit, high inflation rates, and soaring energy costs. The government is consequently under pressure to take steps to help small business.
There are two key business costs that small businesses are anticipating news of in the Autumn Statement on 22 November: VAT and Business Rates. With a background of a £131bn deficit, the Minister said it is unlikely that the VAT rate will be cut as it was during COVID times. Business Rate relief for 23/24 tax year has been 75% for retail hospitality and leisure sectors and the multiplier used to calculate rates, linked to inflation, has been frozen for this current year. There is growing demand in the press, from businesses of all sizes, to hold the multiplier rate and continue with business rate relief. With some businesses already not able to make the books balance after a difficult trading year of increased cost of product, staff and energy. Although income may appear on the surface to be higher than in previous years this is largely down to businesses charging higher prices and the bottom line continues to be squeezed ever tighter. As one participant in the meeting said “there is no profit at the moment, it is a case of survival”.
To read the follow-up letter from Kevin Hollinrake MP, the Minister for Enterprise, Markets & Small Business, click here