AAT welcomes the Government’s new Small Business Plan

The Government has set out its long-term strategy to support SMEs. Here’s what it involves.

On 31 July, the Department for Business and Trade (DBT) published its Small Business Plan which set out the Government’s long-term strategy to supporting SMEs. It took aim at persistent barriers to growth – chiefly late payments, regulatory complexity, limited access to finance and skills shortages. 

The headline announcements are significant. They included legislation to enforce maximum payment terms of 60 days, and the £3 billion funding boost to the British Business Bank to help lenders offer more small businesses loans. The strategy is centred around five chapters, summarised below.

‘Fixing the Fundamentals‘

Late payments: maximum payment terms of 60 days, interest on overdue invoices, Small Business Commissioner’s powers expanded, among other measures. A consultation was simultaneously launched on this legislative package and will run until 23 October. 

Regulatory reform: new target to reduce the burden of regulation on SMEs by 25%. The Government will also have to complete a new Small and Micro Business Assessment (SaMBA) for new regulation. 

Tax modernisation: signposted the Government’s Corporation Roadmap (for example, the tax cap remaining at 25%) and HMRC’s Transformation Roadmap published 21 July, which we’ve previously written about here. 

Planning and Infrastructure: legislation will accelerate small-site development, support brownfield redevelopment and improve local authority planning capacity. 

Energy and Net Zero support: SMEs will receive expanded guidance through ‘The Net Zero Council’ supporting decarbonisation, as well as access to green finance. Programmes will train up to 18,000 workers for roles in retrofit and energy efficiency, to help SMEs access the skills they need.  

‘Unlocking Access to Finance’

British Business Bank: the Government will expand the Start-Up Loans programme to offer 69,000 loans with mentoring over the next four years, increase the capacity of the ENABLE Guarantee scheme by £3 billion and provide a longer-term commitment to the Growth Guarantee Scheme.

Equity and Early-Stage Capital: £340 million will help boost the availability of early-stage finance for innovative businesses.

Personal Guarantee Reform: new code of conduct to ensure fairer use of personal guarantees in SME lending.

Open finance: a roadmap for open finance will be published by Spring 2026 setting out practical steps towards SME Access to Finance.

‘Backing the Everyday Economy’

High streets and communities: up to 350 places will receive regeneration funding. New Growth Incubators will support high street renewal. 

Business rates: from 2026, permanently lower multipliers will apply to retail, hospitality and leisure properties under £500,000 in rateable value. 

Lease reform: ‘Upward Only Rent Review’ clauses (which ensure that costs can only go up) will be banned in new commercial leases to make UK high streets more affordable.  

Licensing reform: reducing red tape for hospitality and night-time businesses through a new National Licensing Policy Framework, as announced on 26 July. 

Crime Prevention: 13,000 additional officers, a new shopworker assault offence, and tool theft prevention initiatives will form part of the ‘Safer Streets’ mission. 

Co-operatives and mutuals: these are member-owned businesses that prioritise benefits for members. A call for evidence will inform support for the sector, which currently employs 1.3 million people. 

‘Future-Proofing Business Skills’

Digital adoption: the ‘Made Smarter’ (technology) adoption programme for manufacturing SMEs, which provides specialist funding and advice, will be expanded. A new adoption scheme will also be launched for high-growth potential Professional and Business Services sector SMEs (including accountancy). 

Mentoring: a new industry-led ‘Business Mentoring Council’ and portal will be launched.  

Apprenticeships: the strategy highlighted plans for the Growth and Skills Levy to replace the Apprenticeship Levy, and the already announced £1.2 billion ‘additional’ skills investment by 2028–29. 

Short courses and T-levels: new short qualifications in areas such as digital and engineering; an ‘Employer Support Fund’ will help SMEs host T-Level placements. 

‘Opening Up Opportunities’

Business Growth Service: a new central support hub for SMEs, integrated with local ‘Growth Hubs’ and on GOV UK, to make it easier to find and access the advice they need. 

Public procurement: SMEs will be prioritised to give them a better chance at winning public contracts, with SME spending targets set for each department.  

Export support: UK Export Finance capacity will increase from £60 to £80 billion (the agency will offer greater funding to help UK exporters secure contracts), with new insurance products and roadshows to promote overseas growth. 

Intellectual property and security: new IP guidance and a ‘Secure Innovation’ review scheme to help innovative SMEs manage cyber risks and IP protection. 

Digital trade: new online tools will help SMEs adopt electronic trade documents, with trade digitalisation estimated to cut paperwork costs and boost cross-border sales. 

Support for diverse founders: new £400 million ‘Investor Pathways’ scheme, expanding support to diverse angel networks, supporting the Invest in Women Taskforce and other initiatives.

What we think

Responding to the announcement, Claire Bennison, Executive Director of Customer, Partnerships and Innovation at AAT said: 

“AAT welcomes the Government’s Small Business Plan. We are pleased to read that the Plan is seeking to address key issues facing SMEs, including late payments and access to appropriate support and finance, which are critical to encouraging growth and investment.  

“We have long argued for the Small Business Commissioner’s scope to be expanded, including the ability to impose fines for late payment. New laws to introduce maximum payment terms and make audit committees examine payment practices sends a clear message to large firms.  

“The £4 billion investment in start-up loans and the British Business Bank to increase lending to small businesses shows the Government’s commitment to supporting them. We look forward to working with the Small Business Commissioner as a body whose members support thousands of small business owners across the UK.” 

Next steps

Today, AAT CEO Sarah Beale MAAT will attend an introductory meeting with new Small Business Commissioner Emma Jones. We also plan to work closely with DBT on upcoming reforms in the late payments space, including through engaging with the newly launched consultation. 

AAT Comment offers news and opinion on the world of business and finance from the Association of Accounting Technicians.