A hung parliament will save SMEs from the anti-business red tape in the Tory manifesto

Emma Jones
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The Conservative Party Launch Their Election Manifesto
The Conservative manifesto was clearly anti-enterprise (Source: Getty)

If you'd asked me on Thursday what would be the worst possible outcome of the snap election for small businesses, I’d probably have said a hung parliament and all the unhelpful paralysis that brings.

Of course, what we wanted to see was stability and a feeling that finally things were going to move forward, with the certainty that a decisive election in favour of the incumbents could bring to bear.

But as the dust settles on Westminster, small businesses are quite frankly counting their blessings that they may have escaped the clutches of a manifesto that threatened to make their enterprises less productive for UK PLC.

Early indications point to the possibility that Theresa May’s failure to command a majority could lead to a softer Brexit – which is in fact what our small business members were after in the first place.

We are currently hopeful the plans for a so-called hard Brexit will now have be to re-thought, re-scheduled and re-positioned, along with everything else.

From the outset of this snap election, it was very clear to us at Enterprise Nation that the small business community was incredibly nervous about the red tape detailed in the Conservative manifesto.

Its plans for the comprehensive expansion of statutory worker rights and an unhelpful increase in costs and bureaucracy promised to make running a business more time consuming, more expensive and less rewarding – and not just financially.

It was clearly anti-enterprise and demonstrated something that we’d all felt coming for a while – that there was very little understanding in the hallowed halls of power about what it actually takes to run a business.

There were reforms in the pipeline that could have led to piles of extra admin for founders who are already overworked, dealing with bumpy business rates and auto-enrolment. These include points like digital tax data requirements and extended leave to look after elderly parents.

It wasn’t what we expected to hear from the party of business.

To compound matters further, a debate we held ahead of the election, in front of an audience of small business founders and self-employed individuals, pointed to an unprecedented swing of support away from the Conservatives and their punitive red tape proposals from grass-roots business.

Voting before and after the debate, held at Chartered Accountants Hall in Moorgate last month in the heart of the City, saw the Tories move down to second place on just 25 per cent of the vote once the discussion was over.

If the Tories had listened to us then – and we shouted loudly about it – perhaps they could have avoided some of the damage we are seeing now. The fact that they didn’t demonstrates not just arrogance, but deafness to the genuine needs of small business.

Starting a new firm is hard work. From our experience, most founders spend months or even years ploughing every penny and every ounce of energy into their enterprise, and taking nothing out financially. What irritated these long-suffering individuals more than anything, was the suggestion they were somehow crooking the system, treating staff badly or generally not doing enough for society.

Thankfully, the outcome of the snap election could mean these reforms are now delayed at the very least. It gives the small business community a chance to take a breath – and ready themselves for whatever lies ahead.

The next government needs to recognise the important role these people play in the British economy and use this opportunity to reassess their approach.

There are some urgent issues that need addressing. We want to see small business supported and the funding gaps Brexit will bring given a thorough overhaul. Instead of talking about it, the government should go ahead and introduce more help for small firms looking to export, via schemes like export vouchers.

Most importantly, the incoming government needs to focus on building a Brexit plan that has the strength to make our amputation from the EU work for us all – not just the large firms that can afford to just open new offices in Germany or in mainland Europe.

A hung parliament isn’t ideal. But if there is any group that can move quickly to respond to rapidly changing conditions and help to get us out of this mess, it is Britain’s hard-working entrepreneurs.

City A.M.'s opinion pages are a place for thought-provoking views and debate. These views are not necessarily shared by City A.M.

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