Confidence among small businesses in Wales has fallen back into negative territory for the first time in almost two years, according to figures from the Federation of Small Businesses (FSB).
The latest FSB Wales Voice of Small Business Index shows that in the final quarter of 2015 confidence among FSB members fell three points to -1.3. It is the first time that the index has pointed to a lack of confidence among small firms since the start of 2013.
The fall in confidence in Wales is at odds with the wider UK picture, with UK figures released by FSB showing a marginal increase on the previous quarter.
While confidence has dipped in other parts of the UK, Wales is the only economic region where the survey found negative sentiment among small businesses.
The level of confidence among smaller firms in Wales has also remained below that of small businesses in the wider UK in every quarter since 2010 when the index began.
In line with the decline in confidence, fewer small businesses in Wales said they anticipated turnover and profit to increase over the coming three months. A positive balance of 7% of firms expect revenues to rise in the coming three months, whilst the positive balance expecting profitability to rise stands at just 4%. Both figures are the weakest for more than a year.
Disappointing
FSB Wales Policy Unit Chair Janet Jones said: “It is disappointing to see the index fall back into negative territory, but it does mirror some of the anecdotal evidence that we have heard from our members across Wales in recent months.
“We know that smaller businesses are absolutely key to the success of the Welsh economy, and indeed to the success of local economies in every part of Wales.
“With that in mind we need to do all we can to nurture and sustain our small firms and help them to achieve their potential. That is why in our business manifesto for the next Welsh Government we have proposed the creation of a Wales Small Business Administration, bringing SME finance, business support, procurement and SME research under a single umbrella body. We believe that such a body has an important role to play in boosting confidence and capability among the small business sector in Wales.”
Despite the deterioration in the confidence index, the small firms questioned by the study said that on balance they had created more jobs, with a positive balance of 6.3% of firms questioned having increased their staffing in the previous three months.
Poor business strategy, socialist party in government in Cardiff Bay, no business policy, spending money as if there is an abundance of it, criticisms of bib business, and a national Labour party promoting cooperatives. Is it really a surprise business confidence is on the slide?
Labour could not properly run a school fete, let alone a country.
The only party that considers small business a core part of policy is UKIP. The Tories, Labour, Lib Dems, Plaid all revere big business. The result is that Britain has many big companies operating on our islands that do not pay tax whereas just about every small business does pay tax. There is a mismatch here that needs to be addressed.
In defence of the Tories, big business is not a huge problem. Forget the taxes they do not pay (I do not blame them as the government wastes money), the jobs the large businesses create and the soft power around the world is more important.
For example, small businesses cannot compete by opening a big store in China and Paris like M&S has. Nor does a small business employ thousands of people in the country like British Airways.
Lastly, whilst big business may pay little tax as a percentage of their revenue, the actual figure for tax is a lot higher than small businesses in the country. Wales needs to attract big business if it wants to progress forward. Small business is not the way forward.
Small business owners may also be of the opinion that “government wastes money” but they have to pay their taxes and do not benefit from the sympathetic treatment from HM Revenue.
New jobs in Paris and China are not a personal priority of mine. Also British Airways is an ex public company, it was not built up from nothing by brilliant business minds. I am not anti large business, they should just pay tax the same as the small fry.
Ideally all businesses should not pay any tax as a tax on business is a tax on economic growth but if there is going to be a tax, keep it small.
Your point about British Airways is not quite true. British Airways was formed following mergers of four airlines. The airlines were state-owned, though the reason for it was nationalisation during WWI and WWII. Individuals worked hard to build their airline empires before merging, often being forcefully acquired by the government, being privatised, and then merging again.
I agree with that, ideally as a member of the Federation of Small Business I should pay no tax. That would suit me down to the ground. Unfortunately there are lots of things to be paid for, some things I agree with such as the armed forces, others I disagree with such as paying for the EU.
I have no choice but pay up, unlike the multinational companies who see to pay as little as they see fit. I believe that all should pay equally rather than expect the tax to come from the most productive, ie. small business, for the benefit of the least productive, in comparitive terms, which are the likes of Google and various coffee shops.
The real loss of confidence by business in and outside Wales, in respect to Wales, is not helped by Welsh Assembly Ministers signing off, publicly owned, land sales deals in Wales losing Tens of Millions of Pounds in Welsh Assembly Funds, and, Welsh Assembly Ministers signing off the purchase of Cardiff Airport to public ownership paying many millions of pounds MORE than its value for the privilage. Minister signing off huge financial subsidies to a second rate Airline, to run what has evolved into a private plane route between Cardiff and North Wales for civil servants working for the Welsh Assembly and Elected Assembly Members and families,(try and book a subsidised seat on it).Etc Etc Etc Perhaps these are some of the considerations of Private Companies who have to pay huge business rates in Wales, when they consider how much confidence they have in Welsh Business infrustructure and opportunity, and, the added prospect of second rate politicians in Wales soon to be given the right to rise TAXES in Wales.
How on earth has Carwyn Jones and the Welsh Assembly gotten away with selling off publicly owned land to their buddies in Guernsey for a fraction of what it was really worth? The whole thing stinks, and as for Cardiff Airport, that’s a waste of tax payers money and gives the state funded Cardiff airport an unfair advantage over Bristol airport which is only 60 miles away, I’m sure Carwyn and his cronies would be whining if Westminster were heavily subsidising Bristol airport.