What does the election mean for small business?
Yesterday, Prime Minister Theresa May made the shock announcement from the steps of Downing Street that she will be calling a General Election on 8th June 2017.
With the election just around the corner, the parties will soon launch into full campaigning mode, and this is likely to dominate the news for the next few cycles. All eyes will of course now be on what the candidates have to say on Brexit, the NHS and housing in particular – but what does the election mean for small, medium and micro enterprises (SMMEs)?
There seems to be some good news for business even before the votes are cast, especially as the pound sprung back to a four-month high as the City seemed to welcome the news of an imminent election. However, the uncertainty created by the election, as well as the distraction from all-important Brexit negotiations, could spell trouble for start-ups who seek to navigate an already-uncertain business and borrowing climate.
In the longer-term however, both the main parties have made big promises on what they will do to support the small business economy. The Chancellor, Philip Hammond, has already faced fierce criticism for the planned shake-up of business rates which could hit London SMMEs particularly hard. This could prove to be a somewhat thorny issue as the government defends its record as we approach polling day.
On the other hand, a good result for the Conservatives will leave them with a renewed mandate to carry out their Small Business Manifesto. A hallmark of the party’s 2015 election campaign, the manifesto promised to increase the number of start-ups through loans and its flagship ‘Help to Grow’ scheme, which was launched last year.
Labour has also been courting the support of the small business community, with a number of policies announced in a speech delivered at the Federation of Small Businesses last week. Leader of the Opposition Jeremy Corbyn promised that a Labour government would cut red tape for companies with a turnover of less than £83,000, crack down on late payments and scrap quarterly tax reporting for SMMEs.
As ever, what the party leaders have to say on the state of the UK economy is likely to be the deciding factor for voters. All the parties agree that more needs to be done to support the small business community – what remains to be seen is whose vision for the economy will convince the electorate.
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