JOHN Cridland, head of business organisation the CBI, wants more support for the Ms of SMEs – the medium sized firms.
Pointing to Germany where medium sized businesses are the powerhouse of the German economy – known as the ‘Mittelstand’ – Cridland wants the Chancellor to use his final Budget before the General Election to prioritise measures which will create more growth opportunities for medium-sized firms – ‘The UK Mittelstand’, the backbone of the UK economy – as he puts it, while staying the course on the current fiscal reduction plans.
Supporting the expansion of medium sized businesses
“We need to encourage innovation and boost exports. Promoting the availability of alternative sources of growth capital, such as private placements and equity finance, is essential to equip growing firms with the finance they need to expand and invest.
“The R&D Tax Credit is a key feature of the UK’s attractive business environment and of importance to investment in innovation across a whole range of sectors.
“Broadening the definition of the R&D Tax Credit to cover high-value development would also help to make the UK an attractive location for development in addition to research.
“Tackling the burden of Air Passenger Duty will encourage the development of business links from all regions and nations which are essential for improving the UK’s export performance.
Extract from John Cridland’s CBI submission to the Chancellor
Speaking on Radio 5 Live’s ‘Wake up to money’ this morning, Cridland said there was a big difference in the needs of those businesses covered by the SME tag, as they ranged from small lifestyle companies to significant sized businesses.
Cridland is urging the Chancellor to take action that will help support business investment and exports, providing long-term stability, certainty and simplifying the tax system – all to support ambitious UK firms.
The CBI’s proposals for its Budget Submission include:
- Making the Annual Investment Allowance permanent from 2016 at £250,000 – to provide stability that will in turn promote investment
- Boosting the availability of long-term growth capital, by promoting a market for privately placed debt
- Encourage the full spectrum of Research and Development (R&D) activity to take place in the UK, by enhancing the R&D tax credit to include the final manufacturing of prototypes
- Fully committing to reduce the Supplementary Charge on North Sea oil producers – to boost investment plans and create jobs
- If funds are available free childcare (currently 15 hours) should be extended to 1 and 2 year-olds.
John Cridland, CBI Director-General, said:
“Although the economic recovery is well-rooted and bearing fruit, we still need a Budget that locks-in the successes from this Parliament and spends funds wisely on those areas which will keep growth on track.
“This is a good opportunity for the Chancellor before the election to support growth and investment well beyond the Election, providing stability, certainty and simplicity for the UK’s ‘Mittelstand’ to get themselves on the front foot.
“So the Chancellor must reward growing, ambitious firms with the tools to get on with the job of rebalancing the economy and lift productivity. There has been good progress on this front from the Government, and the Chancellor can now take further action to boost investment and innovation.
“If recent tax receipts have provided a bit more breathing space in public finances, the Chancellor may also want to make progress on bolder reforms, including steps to boost the provision of universal childcare.”
