Election 2010: The parties' policies for business

As the 2010 general election campaign takes hold, helping companies through the recovery has been cited as a priority by all the major parties. This article lists the key business policies, promises and pledges of the Labour, Conservative, Liberal Democrat, Green and UK Independence parties.

Labour

• Reducing the deficit will come from a combination of tax, public spending cuts and economic growth. Taking these steps to cut the deficit in a fair way with 60% of tax rises being paid for by the top 5% of earners.
• Will cut business rates for one year from October.
• Double the annual investment tax allowance to £100,000.
• Double the value of capital gains that can be made under Entrepreneur’s Relief, meaning gains under £2 million are subject to Capital Gains Tax at the lower rate of 10%.
• Temporarily increase the level of small business rate relief, so eligible small businesses occupying properties with rateable values up to £6,000 will pay no business rates for one year from October 2010.
• Business Payment Support Scheme (aka “Time To Pay”) to be extended through the next parliamanet.
• Widen sources of finance available to growing businesses by extending the Enterprise Finance Guarantee Scheme until March 2011; an extra £500m of additional bank lending will be made available to SMEs.
• Provide guarantees on £41m of loans to businesses from major banks until March 2011.
• New small business credit adjudicator will ensure small businesses are fairly treated when applying for loans.
• £2bn Future Jobs Fund will create 200,000 jobs, of which at least 120,000 will be targeted at 18-24 year olds and 50,000 jobs will be targeted at unemployment hotspots.
• Will invest in low carbon, biotechnology, advanced bioscience industries and cutting edge advanced manufacturing.
• Will give earlier support to help unemployed people overcome the barriers to self employment. From early 2010, access to the Self-Employment Credit and to the provision of intensive advice and support will be available from week 13 of a Jobseeker’s Allowance (JSA) claim. 'Be the Boss' enterprise scheme will assist returning service personnel who wish to set up their own business by providing loans and grants.
• Give greater support for third-sector organisations in competing for public-sector contracts, ensuring there is a level playing field with the public and private sectors.
• Support community organisations, co-ops and social enterprises to provide energy services.
• Promote the creation of more social enterprise hubs in every community.
• Create a Social Investment Bank to make capital available to social enterprises with an initial endowment of £75 million funded by dormant accounts alongside existing funding streams.
• Expand Community Interest Companies and third sector mutual organisations that reinvest profits for the public good, promoting them through the Co-operative Party, Business Link, enterprise education and the Regional Development Agencies.
• Labour has announced a new goal to cut the cost of regulation by a further £6.5bn by 2015 - £1.5bn in unnecessary paperwork and record-keeping, and £5bn in the wider regulatory costs that impact upon business. Measures include:

1. Developing a single online process for incorporating and registering a company, aiming for delivery in April 2011.
2. New digital facilities at the Land Registry to enable businesses to submit and receive registration details electronically, aimed at making it quicker and easier for businesses to register commercial property.

Conservative

• Will deal with the deficit more quickly than Labour and build a more stable, balanced economy, reform public services to deliver better value for money and create new jobs to “make Britain open for business again”.
• Will stop the planned increases in National Insurance Contributions. Stopping Labour's “tax rise on jobs” will benefit 7 out of 10 working people and be funded by spending £6bn less in 2010-11 than Labour projections.
• Undertake a full and fundamental review of small business taxation, including IR35. The aim will be to provide a simpler, clearer and lasting tax regime, so businesses can plan with confidence. “For the last 13 years, Labour have constantly meddled with the tax rules for freelancers and self-employed. IR35 has especially proved to over-complex, uncertain and often unfair,” said shadow business minister Mark Prisk. The Tories claim IR35 has cost business £73m over 10 years, but has barely raised any revenue. Prisk criticised Gordon Brown for making it harder to be self-employed at a time when Britain should be open for business.
• Will reform regional business support to create business-led Local Economic Partnerships that will be more responsive to local business needs.
• Supporting new business: Any new business started in the first two years of a Conservative government will pay no Employer National Insurance on the first ten employees it hires during its first year. Will also:

1. Build a network of business mentors and provide loans to would-be entrepreneurs, supporting self-employment and franchising as a route back into work.
2. Reduce the number of forms needed to register a new business - moving towards a 'one-click' registration model - with the aim of making Britain the fastest place in the world to start a business.
3. End restrictions on people starting a business in social housing, to enable social tenants to become entrepreneurs.

• Helping small businesses: Will reduce the burden of red tape on business with a 'one in one out' rule for new regulations, mandatory sunset clauses and regulatory budgets for departments. Will also:

1. Open up government procurement to small and medium-sized businesses by reducing administrative requirements, with an ambition that 25% of government contracts go to SMEs.
2. Use government guarantees to create more diverse sources of affordable credit for SMEs, building on our proposals for a big, bold and simple National Loan Guarantee Scheme.

• Will re-establish clear national policy leadership for key sectors such as aerospace, pharmaceuticals, IT, the creative industries, high value manufacturing and hi tech engineering that generate high-quality jobs around the whole country.
• As part of its public sector efficiencies and reforms, the Conservatives vowed to improve financial discipline by introducing a fiduciary obligation to taxpayers in civil service employment contracts. It will also strengthen the role of finance directors within government and implement clear financial performance targets for senior civil servants. The Treasury will return to its core role of ensuring value for money for taxpayers.
• Enable social enterprises, charities and voluntary groups to play a leading role in delivering public services and tackling deep-rooted social problems.
• Provide social enterprises with the start-up funding and support they need to bid for government contracts or work towards delivering services under a payment by results model.
• Strengthen and support social enterprises to help deliver public service reforms by creating a Big Society Bank, funded from unclaimed bank assets, to provide new finance for neighbourhood groups, charities, social enterprises and other nongovernmental bodies.

Liberal Democrats

• Will consult with businesses to identify regulations for repeal, reduction or simplification.
• End gold-plating of European Directives. Will ensure independent checks are carried out on the costs and benefits of new legislation and introduce sunset clauses so that regulations are time limited.
• Will put a stop to unfair bank charges and make sure energy companies charge people fairly so those who use the least pay the least.
• Will introduce Local Enterprise Funds to ensure businesses in every part of the country get a fair chance to grow - not just those in London. Regional Stock Exchanges will also be introduced to offer smaller businesses access to equity without the huge risks and costs of a London listing.
• Will split the post office network from Royal Mail so they operate as two separate organisations; 49% of the shares in Royal Mail will be sold and capital raised will be invested in the postal network for branch modernisation, and to build new services. Royal Mail workers will get a stake by splitting the remaining 51% between a staff trust and the government.
• Will increase the number of apprenticeships, and places on university and vocational higher education courses so young people can improve their skills and get qualifications that will help them capitalise when the job market recovers.

Green Party

• Set up a People's Bank with initial funding of £2.5bn to assist a community-based network to support green start-ups and small, rural businesses.
• Wants National Minimum Wage to be 60% of net national average earnings (this would mean a minimum wage of £8.10 per hour at current rates). 
• Replace the unified business rate by a tax on land values paid to the local authority rather than central government
• Proposes a £44bn package of measures investing in renewables, public transport, insulation, social housing and waste management; £5bn would be invested in 350,000 workforce training places for jobs in energy conservation and renewable energy, with grant-funded conversion courses for skilled engineers from other industries.
• Help small businesses cope with regulation
• Introduce legislation to outlaw late payment
• Ensure that occupational pension schemes are organised for and by the workers and pensioners concerned instead of being used primarily to make money for banks and insurance companies. End tax relief on contributions that mainly benefit the more wealthy would simply the system.

UK Independence Party

• Phase out employers’ NI contributions over five years
• Save up to £120bn a year by leaving the EU. No British jobs or trade will be lost
• Axe Britain’s gigantic quango mountain and public sector non-jobs to reduce UK national debt
• Release businesses from 120,000 EU laws
• Create one million new skilled jobs with public and private investment in a public works programme to provide defence equipment, nuclear power stations, flood and coastal protection, transport infrastructure including high-speed rail lines, and new prisons
• Abolish EU carbon capping, emissions trading and landfill tax schemes
• Amend the UK Takeover Code to prevent foreign interests from gaining control of strategic British companies.
   

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