Trade bodies have criticised Budget 2009 for paying lip service to struggling small businesses
Such firms are the economy's job-creators, said the Federation of Small Businesses (FSB), and they will be at the heart of creating the lion's share of jobs under the Chancellor's £250 million boost for job programmes and the new scheme to target under-25s.
The Government's move to set up a trade credit insurance scheme was applauded by the FSB, which suggested that the Chancellor should have gone far further to tackle late payments to small firms by giving Companies House authority to fully exploit censuring powers enshrined in the Companies Act.
The FSB was disappointed that Alistair Darling failed to announce automatic rate relief for small firms - and the body wanted to see an independent corporate mediator put in place to facilitate dialogue between banks and small businesses.
National chairman John Wright said: 'In what has been the most crucial Budget in decades, [we are] disappointed that small businesses have been largely ignored.
'We welcome moves to focus on jobs and job creation for young people, but we are very disappointed that this Budget will do nothing for those firms that are doing their best to hold on to their valued employees. A Government-funded wage subsidy for short-time working would have been a real help, but was totally ignored.
Mr Wright added: 'Small firms will also be disappointed not to have received the benefit of automatic rate relief. This will have boosted small businesses to the tune of £400m.
'We welcome [though] the fact that capital allowances for firms investing more than £50,000 will double to 40%'
But this change will have little benefit for the smallest of firms, said the Low Incomes Tax Reform Group (LITRG).
'It unlikely to be of much help to [organisations] whose annual expenditure on capital items may well be within the new annual investment allowance of £50,000 in any case,' said the LITRG.
Phil Orford, chief executive of the Forum of Private Business (FPB) warned that 'the Chancellor has missed a vital opportunity to produce a Budget for business survival and economic growth.
'While some of the measures will benefit low-carbon companies and new technology start-ups, they will do little to restore business and consumer confidence and stimulate economic activity.'
Mr Orford added: 'Although the long-term unemployed will benefit from investment in job creation and training from 2010, nothing has been done to help businesses retain their existing skilled workforce, which continues to be decimated as a result of the recession.
'While welcoming changes to capital allowances and loss relief, the reality is that these will have only provide limited benefit to smaller businesses. In addition, restrictions to the new credit insurance scheme and the failure to address business taxes remain considerable barriers to business survival and growth.'
Leading business lobbying group the CBI was similarly downbeat in its reaction to Budget 2009.
Director-general Richard Lambert said the key question for was 'whether it set out a credible and rigorous path for restoring the public finances to health. The CBI’s preliminary judgement must be that it does not.
'The Chancellor’s economic forecasts for next year and beyond look optimistic. By pushing out the horizon for balancing the books as far as 2018 the Government is running too much of a risk.'
Mr Lambert conceded, however, that 'on the fringes of this Budget, there are some worthwhile micro-measures, including support for businesses struggling to access trade credit insurance, and for carmakers through a time-limited scrappage scheme'.
