79 per cent of SMEs believe government energy support package is insufficient

Following continued political turmoil, a “perfect storm of uncertainty” has been created for small businesses, leaving many in the dark on government support.

The latest edition of the ACCA UK (the Association of Chartered Certified Accountants) and The Corporate Finance Network (The CFN) SME Tracker contextualises this ongoing uncertainty and reveals the top issues SMEs want to see incorporated in the government’s new autumn statement on November 17.

The survey, which polls accountancy professionals on the financial outlook of their SMEs’ clients found, the top issue SMEs want addressed in the new autumn statement are measures to tackle inflation (71 per cent). Encouragingly, Prime Minister Rishi Sunak addressed this problem in his first speech.

Over half of SMEs (55 per cent) also are also calling for targeted energy support for both organisations and individuals, which is yet to be properly detailed. Despite the PM acknowledging that “difficult decisions” need to be made, the impact of these decisions remains unclear.

Based on responses, 79 per cent of SMEs believe the current energy support package for businesses is insufficient. A further 97 per cent of businesses feel that the support did not account for specific energy intensive sectors, with a number citing cutting back on trading hours to address rising energy costs.

Against the backdrop of high inflation, firms are reportedly struggling to secure working capital due to a number of factors including a rise in interest rates, with 57 per cent reporting borrowing to manage cash flow has been more difficult in the last quarter than over the previous 12 months.

47 per cent say that supplier credit is harder to access, while 27 per cent report accessing support from HMRC’s Time to Pay scheme is “more difficult”. ACCA UK and The CFN warn that as political uncertainty continues, more detailed and targeted support from the new government will be needed to help firms weather the storm.

Glenn Collins, head of technical and strategic engagement at London headquartered ACCA UK warns: “In the face of so much turmoil, it can be tempting to take a ‘wait and see’ approach.

“However it’s more urgent than ever for the new government to address the issues, such as providing certainty on energy support schemes from April, tackling inflation and improving access to finance for SMEs.

“With no end to volatility in sight, business owners and accountants need to work even closer together to forecast effectively without a clear plan set by the government at this current time.”

By Matthew Neville – Correspondent, Bdaily

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