Small firms see export gap narrow in September

The trade deficit narrowed in the three months leading up to September, according to the latest government figures.

The Office for National Statistics has reported that overall, industrial production went up by 0.4 per cent.

Exporters benefitted from a narrowing gap between exports and imports, with the deficit falling to £8.2 billion in the third quarter to £8.4 billion in the second.

However, manufacturing output growth fell sharply to 0.1 per cent in September, reversing the annual trend of 6.1 per cent in August to 4.8 per cent.

Critics believe that the conditions that have boosted small manufacturing firms in the first nine months of the year may be coming to an end.

Marc Ostwald, an analyst at Monument Securities, told Reuters: "We still have to rebalance the UK economy internally to really get a big boost.

"There may be a boost from foreign trade, but it's going to be a long slow process, and nothing that will reap rewards in the very short-term, in a one to two year time horizon."


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IP laws to come under review

Web entrepreneurs are set to benefit from an overhaul of existing intellectual property laws.

The government has announced a six-month review that will aim to reduce disputes and legal challenges for businesses operating online.

Baroness Wilcox, minister of intellectual property, commented: "The future of the economy lies in the highly skilled, technology sectors.

"For many of those companies their intellectual property is their most valuable asset." 

An innovative peer-to-patent project will also be trialled in order cut down on the number of patents that are not sufficiently "new or inventive".

Other inventers and web businesses will be able to comment on patent applications and rate contributions.

It is hoped that the move will make the UK more competitive and attractive to investors.

Some of the other concerns addressed in the paper include how costly and expensive it is to small and medium-sized enterprises to protect and capitalise on their intellectual property.
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LEPs could drive superfast broadband connections

Local Enterprise Partnerships (LEPs) could help rural businesses get connected to superfast broadband, a new government report has claimed.

The Local Growth White Paper states that the newly created agencies have an essential role in providing "leadership of projects and interventions".

It called on the bodies to collaborate closely with the private sector, local authorities and communities, while allowing Broadband Delivery UK to guide the process.

However, the LEPs do not have guaranteed finance, as they will have to instead be funded through applications to a Regional Development Fund, worth £1.4 billion.

The money is separate from the current £530 million set aside from funding for the BBC.

The funds are to be used to help businesses and homes in what has been dubbed "the final third" of the country.

Nick Clegg, the deputy prime minister, said recently that the partnerships are crucial in developing less London-centric sectors.

 

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New local enterprises get go-ahead

The government has green-lighted proposals for 24 local enterprise partnerships.

Ministers have said that the plans demonstrate the coalition's commitment to small businesses and communities.

The announcement came at the same time as the official launch of the £1.4 billion Regional Growth Fund.

It is part of a series of proposals in the newly published White Paper on Local Growth, which focuses on boosting what has been dubbed 'focused' investment.

'Focused' investment will help create both job opportunities and private enterprise growth.

Commenting on the initiatives, business secretary Vince Cable said: "The knowledge and expertise of the private sector, local authorities and their local communities will be crucial as we work to create a better environment for business and ensure that everyone has access to the opportunities that growth brings."

The government's Local Growth Plan aims to create conditions for growth and investment by handing back more power to local authorities.

This includes enabling local authorities to retain a bigger share of business rates.

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Social entrepreneur firms to rise?

The government's spending cuts could result in more social entrepreneurial activity, according to a new survey.

Research from UnLtd found that more than eight in ten (83 per cent) of 352 figures in the sector saw a bigger role for such organisations.

In addition, four-fifths of this group thought social entrepreneurs could come up with innovative solutions for societal problems created by the budget-slashing of services.

Social entrepreneurs believe that demand for their work will also increase on the back of the cuts.

Despite the impact of the spending review, more than half (58 per cent) were in favour of the Big Society agenda.

Commenting on the findings, the chief executive of UnLtd Cliff Prior said: "This is a typically real world response from social entrepreneurs.

"They know their ventures will be hit, but are seizing the opportunities to innovate, to galvanise citizen action, and to meet the needs of their communities."
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Comprehensive spending review ‘misses opportunity for growth’

The Comprehensive Spending Review has not created new opportunities for growth, one industry body has warned.

Following the chancellor's announcements, the Federation of Small Businesses (FSB) has urged the government to put a 'Programme for Growth' in place.

It has said that while its members support the extensive budget slashing, around one in ten will have to hold back on expansion in the next year.

According to the FSB, the package of growth measures should concentrate on developing a "fully operational web portal".

The funding for this could come from cutting back spending on the business support budget and reducing it to £500 million.

Despite concerns about missing growth initiatives, the FSB praised the £530 million investment into superfast broadband pilots in the UK.

The organisation also called on the government to help small firms take on new workers.

John Walker, the FSB's national chairman, said: "The small business community continues to have a vital part to play in driving a credible recovery and taking on new members of staff to help tackle unemployment, so it is now vital the government puts a small business Programme for Growth into action immediately."
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Public sector cuts ‘could devastate half of all small firms’

Public sector spending reductions could have a serious impact on almost half of small businesses, one industry figure has claimed.

Research from the insolvency trade body R3 has found that some 30 per cent of small firms in the UK are "very reliant" or "fairly reliant" on contracts with the public sector.

In addition, around ten per cent of small enterprises admit they would sink without their business with the public sector.

R3 has predicted that there will be a strong impact on existing levels of corporate insolvency, which reached 26,000 in 2009.

It estimates that there will be around 27,540 corporate insolvencies in 2011, with almost half (45 per cent) of R3 members expecting wind-ups to peak in the next year.

Commenting on the survey findings, the organisation's president Steven Law said: "Businesses with a diversified customer base will clearly be better able to weather the storm."


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Small firms ‘will be hit hard by cuts’

Smaller enterprises in the UK will feel the brunt of the cuts made in this week's Comprehensive Spending Review, economists have claimed.

KPMG predicts businesses that service the public sector will be most impacted by budget slashing and the need for large institutions to reduce overheads.

The sectors most likely to be affected include property companies, business support services and hotels, which will see a significant decline in custom from public organisations.

Commenting on the likely repercussions, the UK head of restructuring at KPMG, Richard Fleming, said: "Service to the public sector has a long and dependable history and for many businesses it will be very difficult for them to adapt to a sudden change in market dynamics."

He added that there are a huge number of businesses that could be affected by the failure of one large company, citing the case of the social homes builder Connaught.

According to Mr Fleming, around 1,500 sub-contractors had worked with the company before it went into administration.


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Small firms ‘cannot afford maternity leave’

Smaller enterprises in the UK could end up paying an additional £7,000 annually if maternity leave is extended under new plans, according to one industry organisation.

The Federation of Small Businesses (FSB) has said that the proposals from the European Parliament to extend maternity leave to up to 20 weeks could leave some firms struggling.

Tina Sommer, the organisation’s EU and international affairs chairperson, said: “The FSB fears that that these changes will result in an increase in the cost of maternity and paternity leave and will mean these costs have to be shared between government and the employer.”

A UK Independence Party MEP told the European Parliament this week that the legislative body was full of people that had little business experience and did not realise the impact of such decision making on finances.

Godfrey Bloom MEP’s maiden speech to the body in 2004 had also highlighted the “madness” of employers hiring women of child-bearing age.ADNFCR-2811-ID-800124879-ADNFCR

UK falling behind in broadband provision

Britain is falling behind other saturated broadband markets when it comes to delivering quality, according to new research.

Oxford University has reported that the UK is only in 18th place internationally.

The league, prepared by the Said Business School at Oxford University, was led by South Korea, Hong Kong and Japan taking the first three places respectively.

However, only one in five countries out of 72 surveyed is prepared for internet "applications of tomorrow".

The findings also show that there are fewer disparities within countries than before, with a 58 per cent improvement in the quality of broadband inside and outside of countries.

It also suggested that the average household now needs more than 2Mbps – which is the UK government target for all UK households by 2015.

On the UK's broadband commitment, the secretary of state for culture, media and sport Jeremy Hunt said: "Our goal is simple: within this parliament we want Britain to have the best superfast broadband network in Europe."

 

 


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