A new report has suggested that there are signs of growing optimism among small businesses, ahead of the forthcoming Budget.
The Federation of Small Businesses’ (FSB) first economic report of 2013, ‘Voice of Small Business Index’, surveyed over 2,500 people and found that confidence has most definitely increased among SMEs, although 54% of respondents do not expect to grow this year.
According to the findings, eight regions have seen confidence increase year-on-year, with the north east recording the largest annual increase in their confidence reading of +15, while businesses in the southern regions retain strong optimism levels.
John Walker, National Chairman, Federation of Small Businesses, said, “It is great news that confidence is beginning to edge up and is back in positive territory. This bodes well for GDP figures for Q1 and we would expect them to be better than the -0.3 per cent recorded in Q4 2012. However, we know that inflationary pressures are likely to persist in 2013, especially through rising energy bills and fuel costs and this will affect disposable incomes.
The FSB also have concerns when it comes to the falling number of firms approaching the banks for finance; according to the organisation, this is an issue that must be addressed in the Budget.
Mr Walker explains, “Two separate reports last week showed that lending to small firms remains constrained. This is something which must be addressed at the Budget. A clear plan for the Business Bank must be put in place to increase help ease access to finance and to boost competition in the sector, both through encouraging non-bank lenders such as peer-to-peer lenders to join the market and through new ‘challenger’ banks entering the arena.
“Regulation has a key part to play. Measures must also be put in place to ensure that smaller banks can access the funding available on an equal footing so they can pass on the benefits to their small firms customers.”