Monday, August 15, 2005

Government failing small businesses

A BBC report highlights the failure of the government to help small businesses, despite assurances to the contrary.
Of the government targets, four have not been met, it said. These are building an enterprise culture; encouraging entrepreneurs in disadvantaged areas and among under-represented groups; improving regulation; and creating a positive environment for small-business growth.
But it does give the government credit for meeting three targets: improving access to funding, making it easier to start a business and making government more accessible and helpful.

The rest makes depressing reading. Instead of rising to 14%, the number going into business has fallen from 12 to 11%, and fewer adults would now consider starting a business. The report shows red tape has increased in the past five years and small businesses are increasingly reluctant to take on staff. While the number of small firms has grown from 3.7m to 4.1m since 1999, those employing staff has dropped from 1.35m to 1.23m.

CBI head Sir Digby Jones says the government presides over "stifling red tape, a discredited planning regime and a society that becomes more politically correct and risk-averse by the day."
One solution might be to create a category of small businesses to which most of the rules and regulations devised for large firms would not apply. Entrepreneurs are the key to the economy.