Election views: Business

Stakeholder Response: Federation of Small Businesses

FSB national chairman Carol Undy said: "All of the main parties have made overtures to small businesses. They must be waking up to the fact that there are 6,000 small firms in each constituency.

"The Liberal Democrats made an impact with their manifesto promises to extend small business rates relief to include firms with a rateable value of up to £25,000, employ sunset clauses so ineffective legislation can wither on the vine and improve skills in schools.

"Conservative manifesto pledges to streamline the DTI, send officials on business secondments, impose regulatory budgets, introduce a deregulation bill and fight crime against businesses have also struck a chord with small firms.

"Labour has focused on locking in economic stability and is committed to reducing the number of inspectors and speeding up cheque clearance times – moves which small businesses welcome."

She added that politicians must address a number of key concerns however:

"Small businesses want a commitment to fairer and simpler taxation. A £10,000 tax free allowance for all small businesses, irrespective of their legal status would be a start.

"Much has been said about support for hard working families, but with 34 pieces of employment legislation on the statute book it is time parties promised to help hard working small firms.

"Small businesses want a reduction in the administrative headache posed by maternity leave, the abolition of the overwhelmingly complex discipline and grievance procedure and the retention of the 48 hour week opt out for the UK."

"Practical solutions" the FSB's general election manifesto calls on the parties to commit to simple steps to ensure that the small business sector thrives: 

• Make taxes simpler and fairer
• Free business from red tape
• Ensure that employment policies are business-friendly as well as family-friendly
• Combat crime
• Invest in skills to boost productivity
• Create a better business environment, both nationally and locally
• Support environmentally friendly business practices

Stakeholder Response: Forum of Private Business

The Forum of Private Business lobbies on behalf of small and medium-sized enterprises to create a better political and economic environment for business. Its election priorities are to: 

1. Make it easier and cheaper for small businesses to employ people, by reducing the unfairness and uncertainty of employment tribunals, reducing the cost of maternity laws and linking increases in the minimum wage to average prices. 

2. Make it easier for businesses to fund their growth, by allowing monthly payments of tax, reviewing the recent money laundering regulations and cutting back the red tape that makes it hard to raise equity finance. 

3. Help small businesses to cope with regulation, by providing compensation for the costs of compliance and simplifying tax rules, for example by merging PAYE and national insurance. 

4. Encourage the creation and survival of small businesses by encouraging entrepreneurship. Introduce positive measures to encourage under-represented groups to start businesses. 

5. Create a fair business environment. Close the VAT loopholes that big businesses are allowed to exploit, outlaw upward-only rent reviews, and develop a usable transport and communication infrastructure.

To view the FPB manifesto click here. 

Stakeholder Response: Institute of Directors

The Institute of Directors spelled out their calls for the next government in their business manifesto:

1. Business is taxed enough already. The IoD opposes the introduction of windfall taxes or a general tax raid on business after the general election. The IoD calls for the introduction of a third fiscal rule – a commitment to reduce the tax burden, as a proportion of GDP, over the course of the economic cycle.

2. The IoD calls for a reduction in the growth of public spending. Future growth in public spending should be conditional on reform of the public services and affordability. The business way to improve both the public finances and the productivity and efficiency of the public services, is via greater choice and competition.

3. A key priority for the next government should be reform of the pension system. There should be a move away from means testing. The IoD's guiding principles for pension reform include radical simplification, lower taxes, tax incentives, higher employer and employee contributions and an element of compulsion.

4. The next government must set two clear priorities for transport policy: extra capacity for road and air, in particular; and a much greater sense of urgency in developing the policies to provide it. We also need more rail capacity in the most congested areas of the network. The next government must make a clear commitment that revenues raised from road pricing will be returned to motorists through reduced road tax and/or the provision of more investment in the transport system.

5. Reform of incapacity benefit must be continued and accelerated.

6. GCSEs and A Levels should be retained. English and mathematics GCSEs should incorporate functional literacy and numeracy. The next government should focus on increasing the proportion of pupils gaining grades A*-C in these subjects.

7. University funding is inadequate. The cap on tuition fees should be lifted. The current cap on top-up fees means that universities cannot cover the cost of courses. The government should facilitate a generous bursary scheme for poorer students.

8. School league tables, a national curriculum and short-notice inspections by Ofsted should be central features of education policy.

9. The system of apprenticeships should be improved by incorporating technical certificates in all frameworks and by introducing a minimum entry requirement of GCSEs at A*-C in English and mathematics. The Adult Learning Inspectorate should be retained.

10. The Department of Trade and Industry should be retained, whilst giving it a greater focus on science and the dissemination of information and advice to businesses. The role of regional development agencies needs clarification.

11. Energy policy needs to incorporate an early decision – post-election – as to whether or not to commission new nuclear power capacity in the UK. There needs to be greater realism about the potential for renewable energy sources.

12. Statutory Maternity Pay and Statutory Paternity Pay should be paid by the government directly to employees, in order to lighten the regulatory and cash flow burden on employers.

13. The better regulation measures outlined in the Hampton review should be implemented in full. Regulatory impact assessments are too narrowly defined because they fail to capture the full knock-on effects of red tape. There should be greater use of sunset clauses in regulations and post-implementation reviews.

14. The IoD wants the next government to continue to oppose the proposed agency workers' directive and to protect the UK's opt-out from the Working Time Directive.

15. The government should ensure that negotiations over the proposed EU services directive do not remove the central principles on which the directive is based. This legislation will be essential if we are to liberalise the market in services across the EU. The government should continue to campaign for the liberalisation of trade external to the EU as well."

Stakeholder Response: Finance & Leasing Association

The FLA set out its priorities during the election campaign for the asset, consumer and motor finance sectors:

1. Consumer credit reforms

Lenders should be granted a period of stability in order to allow them to undergo changes to their internal systems.

The "half rule" should be reformed in order to diminish significant losses for HP providers.

2. Data sharing

Government should pass legislation that would allow lenders to disclose data on the records that have been open longer than 'fair processing' notices have referred to data sharing. Government should agree to allow the sharing of data on student loans.

3. Fraud

Improvements must be made to lessen the ease with which data held at the Companies House can be manipulated. Fraud law should be reformed as proposed by the Home Office in order to convince law enforcement agencies to view fraud as criminal activity which deserves police time for a full investigation.

4. Corporate tax reform

A tax system must be put into place that supports the growth of asset finance.

Government should follow through with its proposals for corporate tax reform so that cross-border leasing is treated more equitably. 

Government should revise its proposal for a new leasing scheme so that it targets only those leases that are financing transactions; this will prevent the areas of business not specifically targeted by the proposals from experiencing a lack of access to asset finance.

Stakeholder Response: The Institute of Chartered Accountants in England and Wales

The ICAEW is Europe's largest professional accountancy body. Its 2005 manifesto proposals include:

1. Reducing regulatory burdens  

• Establish an independent small business regulation commission.
• Adopt a method of measuring the real business cost of new regulation including that of the EU.
• Ensure that regulatory impact assessments are integrated earlier in the policy-making process.

2. A simple and transparent tax system  

• Introduce a sustained and measurable programme of tax simplification with the objective of tackling the regressive nature of the cost of tax administration.
• Conduct regulatory impact assessment and cost-benefit analysis of new tax policies before introduction.
• Resolve the uncertainty over the tax treatment of partner/spouse involvement in owner managed businesses.

3. Supporting business growth 

• Encourage greater links between universities and the SME community to promote entrepreneurship.
• Regional Development Agencies (RDAs) should refocus business links towards increased standards of delivery, integrating skills support for enterprises and working with the private sector.
• Concentrate schemes to boost the number of start-up companies on high growth sectors.
• Government-funded business support should provide companies with subsidised access to private sector advice and support, which will help to ensure that growing businesses receive the appropriate level of assistance at the time when they need it most.
• Mandate HM Revenue and Customs to identify potential causes of business failure before those in difficulty reach crisis point.

Stakeholder Response: The British Retail Consortium

The British Retail Consortium outlined its aims for the next government:

Working for a fairer National Minimum Wage: To ensure that future increases take into account the current economic climate and put an end to unjustified above-inflation increases.

Retailers provide one in nine of the UK workforce with a job.

Battling the rate burden: To prevent both the introduction of a local sales tax and the costly relocalisation of business rates and protect retailers against unmanageable increases in rates bills in 2005.

Estimated to cost retailers £14bn.

Ending unfair leases: By introducing legislation to abolish unfair leasing practices such as upward only rent reviews and deliver greater flexibility in the commercial property market for retail occupiers.

Retail occupies 111 million sqm of floor space in England and Wales.

Challenging MasterCard's retail "levy": By securing a final decision from the Office of Fair Trading on MasterCard's infringement of the Competition Act 1998 and seeking a reduction in the fees which act as a levy on retail transactions.

Providing incentives for environmental improvement and best practice:

While avoiding burdensome environmental regulation and taxation. Retailers' attempts to use renewable energy are being thwarted by the taxation and planning systems. Promoting the responsible retailing of alcohol while resisting any attempt to impose extra taxes on well-conducted off-licensed stores

Retailers are now including alcohol units on own brand packaging.

Protecting our staff, customers and businesses: By shifting retail crime higher up the government's agenda, and continuing to play a substantial role in a wide range of initiatives to fight crime, protect employees and make our communities safer places to work and live.

Physical violence against staff rose from 36 to 43 incidents per 100 outlets in 2003.

Promoting healthier eating: Offering our customers the widest possible choice of clearly labelled healthier foods, while resisting attempts to impose unnecessary prescriptive regulation.

Retailers now sell over 4,500 healthier eating product lines.

Maintaining a competitive sector:

The sector has made an extremely important contribution to economic growth in recent years, but in 2005, with an ever increasing regulatory burden and a slowdown in consumer spending, retailers face tougher trading conditions as demand weakens but costs continue to increase. Under these challenging conditions the retail sector requires a European and UK policy and legislative framework, which will encourage enterprise and growth, not stifle it in red tape.

Stakeholder Response: Which?

Consumers body Which? set out its priorities for the new government in retail and finance:

• Customers' interests to be at the heart of the financial services industry and an end to unfair products
• A ban on unsolicited credit card cheques
• An end to the credit card industry's deceptive practices, ensuring customers are properly able to compare credit cards
• Responsible lending practices
• A national finance advice network to help people make informed decisions
• Real redress for home movers by amending the Estate Agents Act to require all estate agents to be members of a redress scheme
• A legal service reform bill to give people more choice in legal services and a new legal service board to oversee the work of the legal professions
• Mechanics to be trained to do their job

To view the Which? manifesto in full click here.