Rising Fuel Prices Restrict Small Business Growth
Increasing fuel and energy prices are threatening small-business growth, as 80 per cent of SMEs believe that high gas, electricity and petrol prices will restrict their expansion over the next 12 months, the Federation of Small Businesses (FSB) has warned.
With petrol prices rising by 5.61p per litre between mid-May and mid-June, research from the FSB revealed that 40 per cent of small businesses believe the high prices will force them to delay plans to recruit more staff.
“Small businesses are reaching breaking point and if something is not done about rising fuel prices very quickly then we will have a major economic crisis on our hands,”
said FSB chairman John Wright.
“The UK’s 4.5 million-strong small-business community simply cannot cope with the cost of fuel rising at these rates. The problem is affecting every type of business in every area of the country.”
Wright also urged the Government to help small firms by using windfall tax revenues from high North Sea oil prices to help cut fuel duty.
“The most frustrating thing is that the Government can do something about it. Its estimate of the cost of North Sea oil in the last Budget was well below the actual cost, which means that tax revenues have been well above expectations.”
Responding to the criticism, a Department for Business, Enterprise and Regulatory Reform spokesman said:
“Tackling fuel poverty is a priority for Government. It is worth noting that industry regulator Ofgem is carrying out a report into the electricity and gas markets for consumers and small businesses which will be published in September.”