11 Jun Spending Review lacked business focus, say small firms
Responding to today’s Spending Review, Tina McKenzie, Policy Chair of the Federation of Small Businesses (FSB), said:
“Small businesses will be wondering when they will feel the benefits of today’s Spending Review. It was not the business-focused day they had hoped for.
“As spending allocations were announced, decisions over how that money would support small businesses were not included. Increased Statutory Sick Pay came without help for small businesses to afford it; extra money for housing and defence came without a commitment to include small firms in the supply chain; new energy efficiency funding for households came without equivalent help for small business premises.
“The one major bright spot for small firms today was the significant increase in resources to the British Business Bank, which FSB campaigned for in advance of today’s statement and which we welcome. This should see far more finance flowing to local businesses up and down the country.
“With headline departmental funding allocated, the challenge now passes to each and every government department to be strategic with their spending over the next three years – using every taxpayer pound to get the most value, stimulate the economy, and spread jobs and growth. SMEs should get a far greater share of public contracts, and big businesses which treat their smaller suppliers poorly should be banned from winning them.
“Small business confidence is already languishing at levels comparable to the energy bills crisis, while job numbers in small businesses are falling fast, so bold, concerted action is needed. You can’t grow the economy and tax revenues without growing small businesses.
“Small firms were not the focus today, but the second half of 2025 now becomes a crunch period for SME-focused growth reforms. Ministers must buckle down on this over the summer and through to the autumn, putting small businesses at the heart of the Industrial, Trade and Small Business Strategies. This includes addressing business rates, Employment Allowance expansion and Statutory Sick Pay in the autumn Budget, and proper legislative reform in the King’s Speech.
“The benefits will only come if the Government takes these challenges seriously through to the autumn.”
Ann Scott, Development Manager (Essex) at FSB, added: “Small firms are not just the fabric of our communities. They are the backbone of the UK economy, accounting for three-fifths of private sector employment and around half of total turnover.
“Yet confidence among small businesses is now at its lowest point since the height of the pandemic. The lack of targeted support in the recent Spending Review risks undermining that confidence even further.
“As we look to the second half of 2025, the Government must act decisively through policy, investment, and legislative reform to deliver the bold, SME-focused action needed to drive economic growth and recovery”.
