Will the general election stifle improving business confidence?
Nicholas Baker - Director & Head of Business Mortgages
The general election campaign starts officially on 30th March but the early hustings, particularly around the much maligned TV debates, are likely to make some feel that we are already deep into the battle. Despite incessant media coverage and high levels of interest in new and emerging political parties, it is estimated that nearly 9 million women and 8.1 million men didn’t vote in the last election. Not a clear sign of everyone being actively involved in this process or indeed overly concerned as to the outcome.
All parties are now looking to create policies to appeal to undecided voters. This could potentially mark trouble for UK Small to Medium Enterprises (SMEs) that already have to plan for increased overheads, not least due to the rise in minimum wage which begins in October.
The Labour Party is regularly accused of anti-business rhetoric but is trying to break this trend by promising cuts to business rates for small firms and the establishment of a new investment bank. The Conservative Party has outlined similar policies to support SMEs, but their pledge for a public referendum to continued EU membership will create uncertainty for businesses. Meanwhile the Liberal Democrats have focused their business policies on growing the number of new jobs and apprenticeship opportunities.
Should businesses be concerned? Are UK SMEs and the commercial property market likely to have a quiet time leading up to the general election, as plans to buy, finance or further develop are potentially put on hold? Or are UK SMEs robust enough to continue to take advantage of the increasing opportunities that an improving market presents to them?
Whoever comes into government will need a clear and unwavering focus on small businesses, including how they are financed and supported in growing. How they will play a key role in reducing the deficit, which is the incoming government’s biggest challenge, will also be a focus. With 99.3% of the UK’s 4.9m businesses being SMEs, generating revenues of £3.3bn and employing 24.3m people, this is not something that can be ignored.
Our view is that UK SMEs, the commercial finance market and the wider commercial property market will closely monitor developments but these markets will continue to remain increasingly active during and immediately after the general election.
Christie Finance continues to receive increasing levels of interest from new and existing clients looking to purchase, refinance and further develop their own businesses and we predict this will continue, during and after the election campaign. The continued improvement in the UK economy and lending landscape is strong enough to see off any short-term challenges brought to bear by any of the political parties.