TechnologyAccounting SoftwareComment – Can little ones trust Big Daddy?

Comment - Can little ones trust Big Daddy?

The government needs to sharpen up its parenting skills if small businesses are to grow up profitably and reasonably free of red tape, writes Peter Williams.

In his famous – or should that be infamous? – poem ‘This be the verse’ Philip Larkin suggests that parents ruin children’s lives, adding almost wistfully: ‘They may not mean to but they do.’

If this Labour administration isn’t careful Larkin’s lines may become a suitable comment on its policy towards small businesses. The positive parenting comes in the form of the Small Business Service, for which consultation closes on 30 September. When the initiative was announced earlier this summer, the then small-firms minister Michael Wills said: ‘Small firms have never been treated by government with the priority they deserve.

This government is fully committed to the small-firms sector and recognises the vital role small businesses play in the economy.’

The idea of the SBS – due to start work from April next year – will be to represent the interest and concerns of small companies. Great idea but the honeyed words sit oddly with the day-to-day experience of small businesses.

At the same time that the government was releasing its SBS ideas, the Small Business Research Trust, sponsored by NatWest, was unearthing the government’s negative parenting. In its latest research into the state of the nation’s small companies it found the second biggest complaint of small businesses was about government regulation and paperwork. This was the second SBRT survey in a row that had this issue in number two slot. Worryingly for the government, the small companies most vociferous in their cries against government-inspired paperwork are those with between ten and 50 employees. One man bands and partners working on their own don’t face as much red tape because most of it relates to employment issues.

So the lesson from that statistic is simple: if you want government off your back, don’t hire people – which is presumably not the message the government really wants to send.

And remember this is before small companies start dealing with the administration of the Working Family Tax Credit which – to quote one small-business expert – will turn many companies into the outposts of benefit offices.

Wills said there would be no two-tier system of regulation but added: ‘We can help by assisting small firms to understand their obligations and other practical help.’ That is crucial and should be at the centre of the SBS remit.

There can be no doubt about the government’s good intentions to all parts of private enterprise both large and small. But, as Philip Larkin pointed out, good intentions are simply not enough.

Peter Williams is a freelance writer and director of Kato Publishing.

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