The UK’s largest business group has laid bare the impact of spiralling utility and fuel bills on small businesses ahead of the Chancellor’s Spring Statement this week.
Illustrative analysis from the Federation of Small Businesses (FSB) shows an electricity and gas bill increasing from £4,724.73 to £11,589.89 (+145%) and from £1,345.07 to £4,815.36 (+258%) respectively for a small business in London with a commercial premises between February 2021 and February 2022*.
The dramatic movement in cost has coincided with petrol and diesel prices hitting all-time highs in the first few months of this year, according to RAC’s Fuel Watch.
FSB National Chair Martin McTague said, “Now is the moment for the Chancellor to deliver on his pledge to create a low-tax economy and new culture of enterprise.
“Unless the Government intervenes, soaring fuel and utility bills will spell the end for many of the quarter of a million firms that say they are on the brink of collapse.
“When small businesses go under, that sends shockwaves through local communities in the form of lost jobs, reduced investment and damaged consumer confidence.
“Whether it’s the care home bracing for an even higher tax bill because of the so-called health and social care levy, the electrician facing higher and higher charges to fill up to complete urgent jobs, or the restaurant which, after two years of trading restrictions, is trying to rebound as energy and food prices rocket, small firms right across the piece are in urgent need of support.
“As things stand, firms have no choice but to raise prices to cover overheads – by tackling the cost-of-doing-business crisis, the Chancellor can help end the cost-of-living crisis.
“He can’t control the wholesale cost of gas and oil, but he can control tax policy.
“Cutting fuel duty, assisting micro-businesses with energy bills, increasing the Employment Allowance to £5,000 and reforming business rates to take more small firms out of the system in levelling up target areas – all measures that would help small businesses to keep their heads above water, and support the millions they employ.”