I’ve heard many, many politicians banging on about “freezing” energy prices, some want “nationalisation”, most blame “Putin”, but I have yet to hear any politician address the acute problems facing the UK’s small business sector. (UPDATE: I have just heard the Chancellor Nadhim Zahawi mention this on TV, the date is 18/08/2022). Energy supplied to businesses is NOT capped, and small businesses have seen astronomical prices increases. A typical example is the story of a takeaway in Aberdeen. The owner usually spends £1,000 a quarter on gas and £1,000 a quarter on electricity. The new rate offered to the business owner was £10,000 a quarter for gas and £4,000 a quarter for electricity. The business, which had been trading for fifteen years, closed a few days later.
This Winter, hundreds of thousands of business owners will have to decide between carrying on in the face of rising energy costs, or throwing the towel in. But, it’s not only rising energy costs that will finish these businesses. Inflation is reducing the amount consumers have to spend. They are cuting back on trips to the pub and meals in restaurants and they will not support businesses who raise their prices. This environment favours big business and that’s a real shame, because we’ve already lost twenty percent of the small business sector due to the pandemic and I think we’re going to lose a lot more than that in the coming months. Unless we’re prepared to spend another £450 billion (and we simply can’t afford it even if we wanted to), then it’s game over for lots of folk in the small business sector. Liz Truss and Rishi Sunak want growth in the economy, but with electricity at 70p per KWh, daily standing charges of £3 and inflation above 15%, the likelihood is recession, and a deep one at that.