LONDON — Jeremy Corbyn will promise greater protections for small businesses if he is elected prime minister, in a speech to the Federation of Small Businesses (FSM) on Tuesday.
The Labour leader will tell business leaders that a government under his leadership would “declare war” on big companies that withhold money owed to its much smaller suppliers.
“Cash is king for any business, and big companies are managing their cash by borrowing — interest-free — from their suppliers,” Corbyn will say in a speech in central London this morning.
“Some of the biggest names in business are holding cash piles that don’t actually belong to them.;
“It’s a national scandal. And it’s stopping businesses from growing and causing thousands to go bust every year. It kills jobs and holds back economic growth.”
The Labour leader will point the finger at companies like Capita, BT Group, Vodafone, National Grid, E.On, and Marks and Spencer as some of the “worst culprits” for persistent late payments to their suppliers.
He’ll add that any company bidding for a public sector contract will have to prove that it pays its own suppliers within 30 days and a punitive system could be introduced to the private sector to hand large fines to late payers.
“We will support those striving to make a living through self-employment and in small businesses.
“Not just because it is the right and fair thing to do, but because millions of jobs and the future of our country depends on it,” Corbyn is set to announce.
The Labour leader will make three key pledges to Britain’s small-sized businesses:
1) Tougher action against big companies that buy from them.
2) The obligation on small businesses to produce quarterly reports will be scrapped.
3) The creation of regional investment banks to make it easier for small businesses to access funds.
Corbyn’s pledge to scrap quarterly reporting applies to businesses with a turnover of less than £83,000 a year and is designed in order to help them “focus on growing” instead of being distracted by producing periodic reports.
He will say: “In last month’s budget, the chancellor bowed to pressure by delaying the implementation of quarterly reporting for small businesses by one year. That’s not good enough. Labour is against small businesses having to report quarterly. It’s a burden, a distraction, that will hold entrepreneurs back.
“Labour will scrap quarterly reporting for small businesses with a turnover of less than £83,000 a year to help you focus on growing your business.”
Today’s announcement will be the latest in a series Corbyn has delivered in the past week relating to policy.
Last week the Labour leader and shadow Education Secretary Angela Rayner promised to provide free school meals to all primary school pupils meals by adding VAT to private school fees and on Monday Corbyn pledged to raise the national minimum wage to £10 by 2020.
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