SME growth stunted by admin and red tape
Posted on in Business News , Political News
SME owners admit that, in an ideal world, they'd spend less than half the time they currently spend on admin and red tape and 24% believe they won't have the time to implement forthcoming pension law changes.
A survey has revealed that small business owners are wasting around 28 hours a week on red tape, administration and day-to-day running of the business.
If business owners were able to devote 10% more of their time to activities that helped their company grow, an extra £4.7bn a year could be added to the UK's economy, according to the report by the Centre for Economic and Business Research (CEBR).
The report has been released ahead of the next stage of auto-enrolment for companies with under 57 employees.
When surveyed, more than a fifth admit that they put off tasks they know are important but don't enjoy doing. For almost half (46%) the task of auto enrolment is categorised under this heading, highlighting the fact that the legislation is going to eat further into the time they dedicate to growth activities.
Entrepreneurs are already feeling uncertain about business growth in the run-up to the general election. Some have said they are putting off investment decisions because they are uncertain about whether it will pay off when the new government comes in.
Just a quarter of these business leaders (24%) say they are confident they will find time to implement auto enrolment and make it a success. One in five business leaders are set to miss their preparations, either by ignoring auto enrolment completely (12%) or because they are unaware of what auto enrolment is (11%).
The report says that for businesses with 1 to 100 employees, auto-enrolment takes up to 103 days and typically costs between £8,900 and £12,600 to implement. This could weigh heavily on the business on top of other administrative tasks.
"In 2015, tens of thousands of employers will reach their staging date over the course of the year. Small employers don't have in-house experts in pensions, payroll and data management, and may not be able to afford the expensive services of external advisers," said Pete Glancy, head of industry development at Scottish Widows.
David White, managing director of Creative Auto Enrolment, said: "Time is precious for all of us but for the heroic leaders of the country's small firms, time is a commodity they never have enough of. Our research shows they are frustrated by the tasks that are taking away from their primary focus - growing their business.
"Workplace pensions have been introduced with the best of intentions and will make a huge difference to everyone, but they shouldn't get in the way of business growth. With auto enrolment taking each company up to 103 man days to implement, small businesses must find a solution that takes the burden of auto enrolment away, allowing them to focus on what's important - running and growing their business."
If you're looking for guidance on your auto-enrolment responsibilities, ActSmart can help.
ActSmart have made arrangements to introduce you to Elliott Sanders of Copthorne Hundred Wealth Management, a Partner Practice of St. James's Place Wealth Management.
St. James's Place Wealth Management are one of the leading wealth management organisations in the UK with a national network of advisers. Using their experience, they offer businesses and individuals a wealth management service, incorporating pension advice. The advice is face-to-face and tailored to your business or personal objectives.
- Complimentary initial consultation
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Phone Elliott Sanders's team on 01372 721616, email Elliott.Sanders@sjpp.co.uk or complete the enquiry form here.
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