6 December 2012
Notwithstanding the Chancellor's Autumn statement, and the undoubted noise that will follow, I'd instead like to reflect on a couple of reports I've read recently.
The first is the SME Finance Monitor (Q3 - 2012) produced for BIS that was published last week. I was struck by a couple of things. Only 46% of SMEs were aware of any of the Business Finance Taskforce initiatives with 22% aware of the Enterprise Finance Guarantee Scheme, 18% aware of the National Loan Guarantee Scheme, and 21% aware of the network of business mentors. Given the amount of publicity and airtime generated during their launch in 2010, these statistics are disappointing. Even more interesting was the lack of confidence SMEs have in availability of finance. Overall, only 33% were confident that their bank would agree to their request for finance (the lowest level seen in the six surveys to date), and yet the outcomes are markedly better. The success rates for renewal applications are c90%, compared to 53% who were confident ahead of the application and, for new applications, the success rates are c56% against a confidence level of 21%. Both of these aspects show how much more needs to be done in raising awareness.
The second is a report written by Duncan Cheatle, who I've met through my involvement on the Board of the Start-Up Loans Company. Duncan is CEO of Prelude Group and has authored 'The Unsung Heroes of Business'. This report tells the story of seven entrepreneurial businesses and analyses their tax accounts. It shares the views of their owners about taxation, their attitude to it, and their recognition of the value they add to the economy and society through the contributions of their businesses. The foreword talks about 'the perpetuated myth that successful business owners are the sole and selfish beneficiaries of the fruits of their business's output' and delivers the message 'that we need to do all that we can to encourage and support the relatively small cohort of business innovators who drive value into our economy and make such a significant and mostly overlooked contribution to public finances in the UK.
It's a refreshing read at a time when Starbucks, Amazon, Google and others are in the headlines for all the wrong tax reasons.