Ministers need to speak out to reassure micro-businesses, the Forum of Private Business (FPB) has said.
It is urging senior ministers, including Prime Minister Gordon Brown, to pledge their support for the UK’s smallest firms.
And it said they should give the needs of small businesses more thought when making legislation.
The FPB wrote to members of the cabinet and shadow cabinet, looking for support for a campaign calling on them to go one step further than the recently-published Small Business Act for Europe, which encourages EU legislators to “think small first”.
“It is widely acknowledged that small businesses across the UK are struggling to cope with the increasing burden of red tape and other barriers to growth, such as the UK’s disproportionate tax system,” said FPB chief executive, Phil Orford.
“The key issue is that businesses at the lower end of the size scale most often lack the resources to overcome these barriers. Considering the smallest, most vulnerable firms has to be the number one priority of all politicians when it comes to legislating on enterprise.”
More than 99 per cent of the UK’s 4.5 million businesses are classed as small, with fewer than 50 employees, but the majority employ fewer than 10. The FPB said that by prioritising the concerns of these companies, the ability of all small businesses to be competitive would be significantly improved.
The Small Business Act for Europe echoes many of points the FPB is looking to introduce in the UK, including improving access to public contracts for smaller firms, reducing rates of VAT and tackling the late payment of suppliers. But the Act is not binding on EU Member States, so there is no guarantee that its provisions will become real policies.
Mr Orford added: “More than ever, given the current economic slowdown, it is a important that Parliamentarians in the UK take the lead – and the responsibility – for the nation’s smallest firms. Promoting the growth of these businesses will have a positive effect for the economy as a whole.”
