ge2015 Impact on Small Businesses

Looking forward, if manifesto commitments come to fruition, there will be some definite winners and losers in the business world.

After weeks of canvasing, campaigning and commentary, the general election juggernaut came to an abrupt and rather unexpected halt last week at its final destination of a majority Tory government. David Cameron may be thanking his lucky stars but who are the real winners in the business world?

If we take a look back to what we were promised under the Coalition, there have been some major changes to employment legislation over the past five years. The focus was primarily to make it easier and quicker for businesses to resolve employee relations issues (early conciliation, reduced consultation periods, changes to settlement agreements and unfair dismissal regulations) and to respond to the changing needs of the workforce; the extension of the right to request flexible working to include parents of children up to the age of 18 and the introduction of shared parental leave.

There were some impressive results, such as the introduction of fees for Tribunal applications, which reduced the number of employment tribunal applications by more than half after just one month (The Guardian, 23/12/13.)

Looking forward, if manifesto commitments come to fruition, there will be some definite winners and losers in the business world.

The winners

Young People: the battle to combat youth unemployment continues with the launch of 3 million new apprenticeships to add to the 2 million already in place. The National Minimum Wage is also set to increase to £6.70 this year and be at £8.00 per hour by 2020, a boost for low skilled and younger workers who are more likely to earn NMW (although those under 21 will continue to receive less). We must, however, acknowledge that the ‘living wage’ in London is already £9.15 per hour (Living Wage Foundation) so the impact of this is somewhat muted. There are also further tax breaks planned for those earning NMW.

Women in Business: with a focus on reducing the pay gap, a new policy will require all companies with more than 250 employees to publish the difference between average pay of male and female colleagues. There will also be a continued focus on increasing the number of women at board level.

Zero Hours Contractors: these kind of contracts will not be outlawed (as was the plan from the opposition) and exclusivity clauses will be eradicated, offering greater flexibility for workers looking to boost their income with second jobs.

Philanthropists: with the news of a new workplace entitlement to 3 days volunteering leave for those working in the public sector and large private sector companies.

Entrepreneurs: the Start-Up Loans programme which offers loans to people starting their own businesses is set to treble.

The losers

Pro-Europe supporters: with an increased emphasis on Britain taking back legislative power from the EU and the all important in-out referendum

Trade Unions: stricter regulation will considerably limit their ability to stage industrial action

Brand GB: with the unprecedented success of the SNP in Scotland, a further referendum could be called and the future of Great Britain’s business strength called into question once more

Migrant workers: a Conservative government was definitely preferable to some of the alternatives for migrant workers looking to come to the UK but strict limits on numbers will continue to apply to non-EU workers, including even the most highly skilled

And what of Anna Soubry?

Our newly appointed Minister for Small Business. Outside of political life, she is a trained barrister by profession, albeit that she took a hiatus from the bar to pursue a career in journalism (presenting, for a time, on ITV's This Morning). As a former SDP member and a former shop steward (National Union of Journalists), she has not been plucked from the right of the Conservative party. Since joining the Tory back benches many years ago, she was elected MP for Broxtowe in the 2010 General Election, where she campaigns for the strengthening of independent traders associations for local enterprises and small businesses. The past five years have seen her rise through the political ranks as Junior Health Minister, and latterly Minister of State for Defence Personnel, Welfare & Veterans. As initiatives such as the Growth Voucher Scheme (launched by the Coalition government) come to a close, small businesses across Britain will be wondering what is next on the horizon.  Let's hope that Anna's voice at the Cabinet table will be one to sit up and listen to.  

Of course, in terms of timescale, we are very much in the early days of this government and as to what will actually transpire, well time will tell.

In the words of David Cameron himself, “I truly believe we are on the brink of something special in our country”. Let’s hope so. 

Claire Healy and Naomi Scoffham, HR Consultants