Small business lobby group relaxed on prospect of EU exit

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Britain’s small businesses are not concerned at the possibility of the UK leaving the EU, their main lobby group has said.

“Currency union or membership of the European Union are not the issues which keep our members awake at night,” said Colin Borland, the Scotland head of external affairs for the Federation of Small Businesses. “They are much more worried about bread-and-butter issues, and keeping their heads above water.”

Many large UK businesses, and the CBI employers’ group, are campaigning against a possible exit from the EU.

“British business is unequivocal,” John Cridland, director-general of the CBI, said in November. “We are better off in a reformed EU than outside with no influence.”

The FSB, which has 200,000 members in 33 regions of the UK, will launch its manifesto for the 2014 European parliamentary elections in Brussels on Wednesday. It calls for MEPs to reduce red tape and improve access to finance for small companies.

“The European Commission understands our concerns but MEPs need to have a better understanding of them,” said Mike Cherry, the FSB’s national policy chairman. “The European Parliament often stymies measures that would help smaller businesses.”

Mr Cherry said the EU’s working time directive, which gives workers rights on holidays and working hours, needed to be more flexible, and that it was important for the UK to safeguard its “opt-out” from the 48-hour working week.

“Legislation must be proportionate to the resources that small companies have,” Mr Cherry said.

Improving small companies’ access to finance was a high priority, as well as clamping down on late payment by both public and private organisations. Mr Borland said effective implementation of the EU directive on late payments, brought into UK legislation in March, would be of great help to small businesses.

“At the beginning of the credit crunch big companies said, ‘Why not use our small suppliers as a free overdraft [by extending payment terms]?’, he said. “But there’s been no reversal even though the economy has picked up.”

Mr Cherry said it was difficult to get suppliers to “name and shame” companies that imposed lengthy payment periods on them, as this risked jeopardising trading relationships.

“We are still finding that large companies are abusing their supply chain by extending payment terms to 90 or even 120 days,” he said.

Mr Borland said small businesses in Scotland had not raised any concerns with the FSB about Scotland’s forthcoming independence referendum.

“The debate on Scottish independence hasn’t arrived at the level where it’s relevant for our businesses,” he said. “I’ve not had a single call or email about this issue.”

Over 99 per cent of the UK’s 4.9m businesses employ fewer than 50 people. They account for almost half of private sector turnover, according to the FSB.

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SMEs have all to play for in the EU / From Mr Simon Walker

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