Ahead of George Osborne’s third March Budget speech, GrowthBusiness speaks with entrepreneurs from around the country in various sectors to find out what they would like to see come out of the annual announcement.
George Osborne’s last Budget speech was proclaimed to ‘unashamedly back business’ and set out a number of pro-business-boosting initiatives such as a cut in corporation tax, increased financial support for exporters and Tax relief for the video games, animation and high-end television production sectors.
One year on and it is time again for the chancellor to outline his plans for the coming year. We asked a range of entrepreneurs what they would like brought in.
Martin Rigby, CEO of music streaming platform Psonar and chairman of FSE Fund Managers, says:
‘My first wish would be for Osborne to preserve Entrepreneur’s Relief and the Enterprise Investment Scheme (EIS), and continue the Seed Enterprise Investment Scheme (SEIS) for the next tax year. A big improvement, however, would be to extend EIS to entrepreneurs investing in their own business, or create some other similar form of tax relief. Lastly, I would like him to maintain public deficit reduction through control of public expenditure.’
Nick Hungerford, CEO and founder of investment portfolio manager Nutmeg.com, says:
‘We would like to see the chancellor introduce a Super ISA with a subscription limit of £50,000 per annum; a savings vehicle that would encourage people to invest and make provision for their future.
‘We advocate a reduction or amnesty on inheritance tax laws that encourages a large transfer of wealth from older to younger generations. The budget is likely to be neutral for businesses as the chancellor fights to keep businesses based in the UK and preserve jobs.
‘We do not expect to see much movement on corporation tax or VAT. Legislation may well be favourable for small businesses and we hope to see changes to employment law (making it easier to hire and fire employees) and visa law (making it easier to import the greatest talent from all around the world).’
Arnold Ma, digital marketing director at digital marketing agency Qumin, says:
‘More investment is needed to help SMEs increase trade overseas. There is great emphasis on overseas trade, particularly with the weak pound, but as an Anglo-Chinese digital marketing company that works with UK companies operating in China, we know there is limited practical help for smaller organisations.
‘Tax benefits for those starting to trade overseas would offset set up costs. More investment in UKTI could provide hands on support rather the running expensive trade missions that are aimed primarily at larger companies. If we want to compete globally government needs to invest at least as much as competitor nations.’
Tony Robinson, co-founder of micro-business self-help service Enterprise Rockers, says:
‘We need to get the cash flowing. Borrowing often isn’t an issue if cash flow improves but the current average is 68 days for payment.
‘The Prompt Payment Code is no good if companies pay in 60 days plus! I would like the Budget to say that government will specify that all their suppliers or organisations they fund (e.g. training & employment subsidies like McDonalds, Morrisons etc) must pay all their suppliers within 30 days.
‘Also, the government needs to quit business support and training industry. This will save at least £15 billion a year in employer training, support and employment schemes and subsidies by letting the private sector look after itself.
‘What is needed instead is the creation of an enterprise supportive environment, adopting the cash flow proposal above. It should allow people not to pay tax for first year of starting up a business, including whilst in a job as well as a two-year employer NI holiday and employment legislation holiday for taking on your first employee.’
Doug Stewart, CEO of sustainable electricity company Green Energy UK, says:
‘We’d like to see the personal allowance increased to help households dealing with fuel poverty. An increase in capital allowances for companies investing in energy efficiency measures would be most welcome, as would infrastructural investment to support the use of electric vehicles, to help make us European leaders in the move to zero emission vehicles.
‘This year’s Budget is opportune for making a final decision on energy policy – it is clear that the country needs to invest in power generation. Continually delaying decisions is discouraging investment; here is a chance to fix it!’
Duncan Gillingwater, the director of sales software business WorksIQ, says:
‘As an entrepreneur in the Home Counties, I have been following the Budget for the past eight years. Unfortunately, I am not expecting the upcoming announcements to suddenly benefit my business.
‘With each new Budget there seems to be a new caveat as to why the new scheme suggested will not apply to our businesses. Despite our ambitions, you sometimes feel a bit overlooked because you are not in the right industry or location.’
Peter Alfred-Adekeye, CEO of cloud internet company Multiven, says:
‘An extension of the Seed Enterprise Investment Scheme (SEIS) would ensure a higher survival rate for early-stage businesses in today’s inhospitable economic climate.
‘The tax relief for individuals willing to provide these investments should also continue well beyond this tax year, helping ensure that such businesses which have been slow to realise the benefits of the scheme get another opportunity to do so.
‘A cut in corporation tax would help make the UK an attractive destination for foreign investments, whilst a reduced rate of tax on entrepreneurship would incentivise new businesses, create jobs and transform the UK into Europe’s leading incubator.’
Paul Aitken, CEO and founder of online personal asset lender borro, says:
‘The subject of SME growth has got to be on the agenda – it’s been a hot topic for many months.
‘There have been moves made to stimulate business growth, although the Funding for Lending initiative has yet to have a positive effect. Millions of small businesses have no confidence in the banks and have already turned to alternative forms of financing.
‘However, we hope the 2013 Budget will mark the year of change, with more business lending schemes becoming available through a variety of channels, including startup and mentoring schemes. If it’s going to encourage businesses to grow, the government needs to pull out all the stops. This will increase confidence which in turn will lead to business owners seizing opportunities, stimulating growth.’
More on announcements from the Budget 2012:
- Patent box will ‘keep businesses in the UK’
- Corporation tax drop accelerated
- 50p tax rate scrapped
- National Loan Guarantee Scheme
Arnab Dutt, managing director of wheel manufacturer and exporter Texane, says:
‘I want a Budget that will enable business growth. Lowering the small company tax rate to 15 per cent will help millions of small businesses.
‘Also, lowering normal corporation tax rate to 20 per cent will help UK businesses and attract overseas companies to set up here.’
Simon Hill, MD and founder of idea management firm Wazoku, says:
‘I’d love a Budget that rewards innovative thinking by helping ambitious start-ups with their cash flow. Getting off the ground is one thing but staying in business is another entirely, so start-up relief from NI or other tax relief would be a huge help.
‘We struggle to offer salaries to attract people then get walloped with a significant tax bill each month. Entrepreneurs are providing jobs, paying taxes on sales and services and it would be great for Osborne to help us help him. I’m more optimistic about this Budget than previous ones, but that is a relative term!’
Rob Cotton, CEO at global information assurance firm and cyber security business NCC Group, says:
‘This is likely to be another low-key Budget but brave moves are needed.
‘As past policies have led to increased inflation but no significant or sustainable growth, along with the loss of our triple A credit rating, it is time for all barriers to enterprise to be lowered to properly stimulate the economy.
‘Lower taxes must come into play and more brutal reform must continue through other areas including more targeted infrastructure spend.
‘For Britain to remain competitive, this has to be a time of change. The chancellor has limited funds to play with and needs to show real imagination, otherwise we might be left behind by the more radical reform taking place in the Eurozone.’
Anmol Sood, CEO of mobile monitoring systems manufacturer Hidalgo, says:
‘I’d like to see Jeremy Hunt’s claim that the UK will become a “world leader” in health technology to become a reality in 2013. The potential for relevant, actionable data being used to transform the healthcare ecosystem is colossal and the UK needs to change its perspective from disease management to wellness management.
‘Healthcare needs to harness the power of technology as a solution, and to do that the government needs to invest in the growth of mobile health tech and the companies that will fuel innovation within this field.’
Charlie Mullins, MD of plumbing service business Pimlico Plumbers, says:
‘What’s needed is stimulation, and since spending in the public sector has to come down, the answer lies with private businesses. I’m looking for more corporate tax reform.
‘Anything the chancellor can do to ease the burden on businesses, particularly smaller businesses, will be welcomed with cheers of joy.
‘Traditionally recessions are broken by large infrastructure building, but with financial constraints restricting the government from pumping cash into such projects, I’m hoping for something a bit revolutionary that can somehow better harness the power of the country’s private businesses so that we can get money circulating and create wealth without massive public borrowing.’
Jerry Brand, managing director at food and beverage management and e-procurement system Caternet, says:
‘What business in this country needs from the government is the confidence to move forward with capital projects.
‘Take the way we are stacking up the M20 for the Channel Tunnel at the moment as an example; there’s lots of business opportunities but no-one has the confidence to say go, because they are worried about what’s around the corner.
‘What I want to hear from this Budget is a real commitment to invest in entrepreneurs – something that is crucial for the growth of the UK economy. I also want to hear that we are building a support structure for the hundreds of thousands of people who are made redundant by the globalisation of larger businesses.
‘The mobilisation of those people, plus the millions who are out of work, would not only reduce the welfare/benefits costs but would also fill the government’s tax coffers and create extra turnover for the UK economy. Whether it will be a good budget for business of course, remains to be seen.’
Jason Yeoman, founder and managing director of mobile managed services provider PMGC, says:
‘The government must commit and invest money that is needed to support smaller and typically more innovative companies as well as entrepreneurs. Innovative ideas will come from small companies who have to look for the competitive advantage, whilst many of the larger companies can be stagnated by red tape and regulation which suffocates a truly open and competitive market.
‘From my experience, most government lending schemes operate with good intentions but are often risk-averse, meaning that it can be hard for someone such as an entrepreneur to secure approval for funding. At the end of the day, nothing new or innovative will come from doing things in the same way.
‘The government must capitalise on this in the Budget and truly re-examine how we can best compete with the best technology hubs around the world by freeing up resources, knowledge and creativity and cutting the red tape for providers to create an open, competitive and fast-paced market.’
Dave Chaplin, CEO and founder of freelancing and contracting website ContractorCalculator, says:
‘Top of my list is slashing taxes. Entrepreneurs and the private sector not only generate more wealth and growth than government, but also do it more efficiently. In the process, they pay more tax – directly and indirectly.
‘Cutting public sector spending is next. Increasing borrowing to fuel growth is no solution; it’s why we are in this mess now. And government is shockingly inefficient at spending our money.
“But can we expect bold moves? Unlikely, as George Osborne has missed the opportunity, so there’s little government can do. That’s why we badly need to unleash the growth potential of entrepreneurs.’
Jason Woodford, CEO at digital marketing agency SiteVisibility, says:
‘Hopefully some measures will be announced in the Budget which will support UK business growth and reduce the tax burden. I personally would like to see more success with reducing wasteful public spending and beating corporation and personal tax avoidance. Osborne needs to show that “Britain is open for business”.
‘Some other things on my Budget wish-list would be to see a tax rebate on investments in training, apprenticeships and work placements, maybe building on the R&D tax credit model. There also needs to be a strong push and a commitment to prompt payments by larger businesses in particular. Personally I think it’s outrageous that the big supermarket chains take 60+ days to make payments to suppliers. One final issue on my wish-list would be to encourage positive discrimination to buy British in public sector procurement – we have got to help ourselves.
‘2012 had the fillip of the Olympic Games and the Jubilee therefore 2013 could be a long, difficult year without these distractions but maybe it will allow us all to concentrate on real business issues. I hope the Budget does the same.’
Mandy Robinson, creative director at digital agency Digital Delight, says:
‘I would like to see the chancellor announce more support for growing businesses to help ambitious companies, like ourselves, create sustainable jobs by providing better access to finance and incentives to employ people with disabilities or in long-term unemployment. We’ve received support from Keele University Science and Business Park’s Nova Centre so it would be great to see more funding for schemes like this.
‘Schemes such as the European Regional Development Fund make it easier for small businesses to increase their workforce, through funded internships and employer grants for apprenticeships, so it would be detrimental if the chancellor makes cuts in these areas.
‘Hopefully there will be tangible benefits in the chancellor’s Budget for small growing businesses who are battling under difficult conditions to create wealth and new jobs.’
Richard Britton, CEO of cloud computing services company CloudSense, says:
‘The government has to grow its way out of the current deficit and to do this it needs to create the right business environment. I would like to see the government intervene directly to get the banks lending to fund innovation in the British economy.
‘This should be combined with tax breaks for research and development that will allow UK businesses to become a hub for industry and invention once again. I would also like to see further investment in the nation’s digital infrastructure, laying the groundwork for sustained growth.
Chris Futcher, CEO of contract workers service The Pulse Umbrella Group, says:
‘I would like to see the government reducing employment costs by increasing the Employers National Insurance (ENI)allowances. In Umbrella payroll, the ENI contribution is paid from the gross contract income, which is collected from the client. The effect of reducing this liability, or increasing the allowance, would have a positive impact on the net salary we could pay back to the contractor.
‘Secondly, making it cheaper for businesses to increase permanent headcount is critical to supporting economic growth. Recruitment is ultimately such an expensive undertaking as to be a deterrent for some. On several occasions recently we have avoided recruiting because of these costs.’