Back to News

How will SMEs fare in the elections?

Here are some of the major factors:Pro or anti-business?Due to their commitment to cap energy prices and other measures, Labour is seen as more anti-business than the Conservatives – who have attracted support from many SMEs in recent days for their economic policy [link: http://www.bmmagazine.co.uk/newswire/5000-smes-urge-electorate-to-allow-cameron-to-finish-recovery/]. However, there is an ongoing debate about how harmful further austerity might be for the UK’s economy, versus the risks of greater borrowing from Labour. SNPIt is unclear how either the Conservatives or Labour will be able to form a workable government, since neither is set to win a majority. If the SNP win 50 seats and the two main parties around 280 each, as currently expected, then a majority is impossible without the SNP’s support. With an anti-austerity approach and a nationalist agenda, this will have serious implications for the future of the UK’s businesses.EuropeEurope is another major issue. The Conservatives have promised a referendum on EU membership by 2017, raising the prospect of the UK leaving. Some smaller businesses have expressed frustration with the amount of red tape they endure from Brussels, but larger ones are typically warier about leaving Europe – a major trading partner. Ending the free movement of labour enshrined in EU law also has implications for the ability to remain competitive in hiring new employees.UncertaintyUltimately, uncertainty is likely to prevail for some weeks, even after the election, as a government is formed. This is always bad for investment and will probably lead to a weaker pound, in the short term – something that will affect companies that do a lot of business abroad.
 
Are you a small or medium-sized business owner? Talk to us. We are experienced in commercial law and can give you the expert advice you need. Call 01302 320621 or email business@athertongodfrey.co.uk

Get in touch today