Author - Robin Bowman, Senior Business Editor
The Chancellor’s growth plans for the UK economy have been praised AND attacked as the economy falters and the number of jobless rises.
But, as everyone now realises, what will be the real saviour of the economy will be the ability of small and medium-sized businesses to survive, prosper and create new jobs. And that means more people paying taxes and boosting consumer spending. 
So, how does Chancellor George Osborne’s autumn statement stack up?
And will it really help small businesses to battle the stormy headwinds of a looming recession?
You be the judge.
Here are the key initiatives that directly affect small businesses:
The most significant announcement was the huge drive to boost lending to small and expanding businesses - £40 billion worth of help, in fact.
This has been a key area of complaint for hundreds of businesses all over the UK – the difficulty in getting bank credit on affordable terms. And, without credit, businesses simply can’t grow.
The so-called National Loan Guarantee Scheme has widely been described as the government underwriting loans by banks to smaller businesses.
But this is wrong.
It is actually the government guaranteeing loans that banks take out on the wholesale money markets. With the government backing the loans, it means the banks will be able to borrow for less and then in theory, under the scheme, they will pass on this lower rate when they lend to businesses.
The Chancellor claimed this move would lead to savings of as much as one per cent for businesses borrowing between £50,000 and £5 million.
The government is now ready to underwrite up to £40 billion in this way – aimed at boosting lending to businesses with a turnover of up to £50 million. £20 billion will be made available to start with and a further £20 billion over the next two years. The government has promised the scheme will be operational in the next few months.
- Extension of the rate relief holiday for small businesses until April 2013. This relief was due to have come to an end in April next year. The extension means more manageable bills for more than 500,000 smaller businesses, says the government.
- From April next year, any investor who puts up to £100,000 into the Seed Enterprise Investment Scheme will get rate relief at the rate of 50 per cent. On top of this, they will also qualify for capital gains exemption. The aim is clearly to encourage wealthy investors to finance small businesses aand get them off the ground and growing.
- A huge £30 billion spend on new infrastructure. These are massive projects that may not affect smaller businesses directly, but certainly will have an indirect affect. Over 500 projects will be announced around the country and each one will be an opportunity for ancillary services: everything from sandwich bars and coffee shops to taxis and cleaning services. 40 projects have already been unveiled.
- There will be help to pay for jobs of up to six months for up to 160,000 young people who have been out of work for a minimum of nine months. Businesses will get a £2,275 subsidy to take someone on under the scheme. This will start next April.
- The three pence rise in petrol, which was planned for January 2012, has been scrapped and the proposed five pence rise in August next year has been cut to three pence. Good news for any small business that needs to be mobile.
The intention is clearly there, as far as small businesses are concerned, to make life easier. Whether we’ll see that £40 billion pumped into the small business sector remains to be seen. We must all hope so.
Robin has been a journalist for more than 20 years, during which time he has held several senior media management positions in both Fleet Street and Hong Kong. Robin recently returned to the UK after being based in Italy for six years. He has a passion for business innovation.
The content of this article reflects the views of the author and may not necessarily reflect the views of Premierline Direct
