Why we must get behind small businesses
- By Richard Branson -
- May 27, 2012
On my trip to Canada last weekend I was asked by the UK media about the prospects for the UK and my thoughts on what the Government could do to promote growth.
For many years I have campaigned for more focus on small business and start-ups as the way to get growth in the economy and to create more jobs. This needs to be backed by more bank lending and start-up loans for entrepreneurs.
The Observer picked up on my comments but I thought useful to publish them in full and also see what my readers felt were the key initiatives that will help the UK and other countries get their economies firing again.
When asked if i agree any growth will have to happen through the private sector, I said I do believe that sustainable growth in the economy will come from private sector investing to create jobs.
There is however a timing issue at the moment as the UK economy is being squeezed by the impact of less public sector investment funded by borrowing. As well as uncertainty over the Eurozone and fears over Greece.
To get the growth from the private sector, we need to get behind the small and medium-sized businesses that are the engines of any healthy economy. To do this they need investment and finance and that comes from the big banks. The politicians talk of encouraging lending. We need action to match that rhetoric.
At Virgin Money we are keen to build our bank to be able to do this in time. But first we need to build up our position with current accounts. It will be one step at a time.
I was also asked what the Government could do differently to stimulate growth, and put forward the idea of flexible working. I am a strong believer in encouraging more flexible working practices. This will help promote part-time working and enable companies to take more people on. It should help reduce unemployment and it has proved to be a big help to Germany in its recovery post the unification with East Germany.
Government needs to focus on smaller businesses and find ways of making it easier to set up a business in the UK. It should look at reducing business rates and regulation on small and start-up companies. It is these costs and rules that are hampering employment growth. It could look at introducing policies such as a National Insurance holiday on hiring people for the first two years.
We need to encourage more entrepreneurship from the next generation - and focus on giving them the basic business and money management skills as part of the schools curriculum.
By Richard Branson. Founder of Virgin Group