Small businesses say government must cut NI to encourage hiring
A REDUCTION in National Insurance payments would help small business take on more new staff, according to the latest figures from the Federation of Small Businesses (FSB).
The industry body is calling for the government to change its policy on National Insurance, after a survey of more than 1,700 small business owners showed that almost a third of respondents would be more likely to make hires if contributions were reduced for the first six months of employment.
Companies would also be helped by an extension of the NI holiday scheme, introduced in 2010 to allow start-up firms to be exempt from up £5,000 of NI payments on the first 10 employees that they hire.
“Small businesses want to employ but have told us that they need incentives to do so,” said FSB chairman John Walker. “The Government must extend the National Insurance Contributions holiday to existing businesses if small firms are to take on new staff and so help tackle high unemployment.”
Other obstructions to employment cited by the FSB included insufficient work and uncertainty over contracts (37 per cent), the state of the economy (33 per cent), cash-flow (31 per cent) and access to finance and the cost of credit (16 per cent).