Liz Truss's government just demonstrated, for all to see, its lack of interest in small business – Douglas Chapman MP

The new position of “minister for enterprise and markets” is a more junior role with small business now only one of 16 areas of responsibility, which hardly inspires confidence that the UK Government is putting the 5.5 million small businesses that are the heart and soul of our economy at the centre of their concerns.

Senior business leaders are rightly critical of this new move by the Liz Truss team. In the midst of a major recession, an energy crisis and the war in Ukraine, a cost-of-living crisis, recovery from the pandemic, and the big old elephant in the room that is Brexit and the damage it has done to small businesses the length and breadth of the country, it’s never been more important to put their concerns centre stage.

After all, the new Prime Minister has made a big song and dance about her preoccupation with growth – it’s hard to imagine any kind of boost to the economy to get us out of these major catastrophes that doesn’t help small businesses to thrive.

Just a few months ago, one of Truss’s major supporters, the Conservative MP for Southport, Damian Moore, declared that “the success of our nation’s small businesses is key to the success of our nation’s economy” and that “under Liz, they will thrive”.

Now it’s early days, right enough, but in that time the new Prime Minister has managed to tank the pound, terrify the markets, send international investors running for the hills and left citizens of the UK horrified at their mortgage repayments and rent increases as interest rates go up and up. Not so much “thriving” as “just about surviving” more like.

Because as Truss and her sidekick Kwasi Kwarteng play fast and loose with the UK economy, cushioned from the slings and arrows of our misfortune, small businesses fear market havoc and growing interest rates for very obvious reasons.

Many companies are looking for short-term loans to get them over rising price surges and a decrease in demand as consumers curb their spending. The Federation for Small Businesses (FSB) has pointed out that interest rate rises pile “financial pressure on thousands of small businesses who are mired in debt” as well as raising concerns about commercial mortgages, with the danger of more insolvencies as a result.

Small and medium-sized enterprises (SMEs) are already dealing with unpredictability in terms of their cash flows, where the issue of late payment of invoices continues to be a challenge as we recover slowly from Covid, with many reporting that this issue is getting even worse as inflation causes corporate customers to hold off paying to even later than before.

Late payment leads to a whole host of headaches for small businesses, including causing serious challenges with operating costs, issues paying their employees and paying their own suppliers, not to mention all the time wasted chasing payments and the ever-present danger of going out of business as a result.

Later this month, I am sponsoring a round table discussion at parliament on the issue of late payments, organised by the Association of Chartered and Certified Accountants (ACCA), which the Small Business Commissioner, Liz Barclay, will also attend. She has been a vocal advocate for SMEs on late payments, describing the current situation as “the cost-of-doing-business crisis” and late payments as the main cause of company failure.

After the Chancellor’s speech at the Conservative conference last week, the FSB’s national chair, Martin McTague, urged the UK Government to focus in on “delivering promptly its commitments to help small firms with soaring energy bills and to reverse the hike in National Insurance” at a time “when the cost of doing business is biting deep”.

McTague also highlighted the need for “strong, clear action” and more support “to tackle poor payment practices by bigger businesses towards their smaller suppliers and contractors".

We’re all at the edge of our seats to see if the UK Government will deliver – a precarious time indeed, and one you would hope a focussed minister for small business would be all over in terms of reassuring our SMEs up and down the country.

The absence of this focus and the fact that Truss and Kwarteng were excited to promise “shock and awe” at the start of their new jobs shows just how divorced they are from reality and the lived experience of small businesses, as well as citizens grappling with a tsunami of crises, exacerbated by a governing party in denial of the continuing negative effects of Brexit.

The business community wants some certainty, they want stability, they want to get back on their feet; citizens want stability and security because the situation is so terrifyingly dire for so many in terms of poverty and destitution, a world away from the silver spoon existence of those inhabiting Number 10.

So far, Truss’s movements do not inspire confidence that she gets any of this in her push for growth and disruption – it feels like a one-woman show (with or without Kwarteng) but she’s picked the wrong audience.

In the meantime, the new minister for enterprise and markets, Dean Russell MP, has promised that he “will continue to champion our innovative and hardworking small business community ensuring they have a voice at the heart of government”.

He’ll have his work cut out as many regard the removal of the dedicated ministerial role for small business as a “kick in the teeth” according to reports. Sometimes actions speak louder than words.

Douglas Chapman is SNP MP for Dunfermline and West Fife