Small business updates from the King’s speech

Late payments. One of the initiatives could help to make sure small businesses receive payments promptly. It’s estimated that late payments currently cost the UK economy £11billion a year. The Small Business Protections Bill will create a duty for larger businesses to pay their smaller suppliers on time. 

 

The Small Business Commissioner will have powers to impose financial penalties and to settle late payment disputes out of court. Big businesses could face investigation if suspected of poor payment practices or inaccurately reporting payment performance. 

 

A 60-day cap on payment terms for smaller suppliers will help to improve cashflow. Mandatory interest on late payments will also apply at 8% above the Bank of England base rate. 

 

Supporting growth. The government also intends to introduce a new Bill to support growth and innovation. This could include ensuring regulators consider business growth in their decision-making about issues like safety or the environment, for example. Other factors may cover risk aversion and support for investment, infrastructure and market creation. The Bill may also support businesses testing cutting-edge new products and technologies, helping them scale up concept delivery more quickly. 

 

European trade. The government wants to improve the UK’s trade and investments with the European Union (EU). This will include new deals with the EU on matters such as electricity, emissions trading, food and drink. 

 

Financial Services. Modernising regulation in the financial services sector could improve business lending. It should also enhance consumer protection in a digital environment. One of the proposed measures would allow major banks more flexibility when separating retail and investment banking. It’s suggested this could unlock financing opportunities for small and medium-sized companies. 

 

Tourist taxes. Another option may give mayors in England power to introduce an overnight visitor levy. This could apply to overnight stays in hotels, bed and breakfasts, guest houses and other accommodation. The money raised could contribute to transport, infrastructure and other local projects. 

 

Energy. Pressure is on to deliver clean energy solutions more quickly and to scale up ‘homegrown renewable energy’. The government says it wants to make sure Ofgem acts as a champion for consumers. It proposes new powers to protect families and businesses and stop unfair practices. 

 

Addressing late payments could certainly help small business owners who currently spend up to 86 hours per year chasing unpaid invoices. Maximum 60-day payment terms and mandatory interest on late payments could also improve cashflow. 

 

Improved access to business funding could also give many businesses a boost in uncertain times. 

 

New regulations for third-party energy brokers and consultants may reduce hidden commissions and costs, helping to bring down overheads. However, improving the country’s energy network remains a major concern when looking at clean energy goals. 

 

Visitor levies in England could help to support tourism and hospitality but may also become a deterrent to visitors. 

 

While we wait to see the progress of these measures, we’ll be happy to discuss how you can keep track of your business’s progress. 

 

Please get in touch to find out more about useful financial reports.