The Finance and Leasing Association (FLA) has
warned that Britain’s economic recovery is at risk of
underinvestment and is calling on the next government to help SMEs
invest in new equipment through leasing.
The trade body said that research it recently
commissioned to Oxford Economics and the Open University Business
School shows that investment is lower than in the two previous
recessions.
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According to the research papers, SME
investments dropped by 27 percent in 2009, and around a fifth of
small businesses cannot upgrade equipment due to poor cash flow,
difficulties accessing finance or problems sourcing equipment.
The FLA said that making leased equipment
eligible for capital allowances would boost firms’ prospects
for recovery.
Julian Rose, head of asset finance at the FLA,
said: “This recession has seen the lowest ever levels of
investment. Britain’s 4.7 million small businesses should be the
engine of recovery.
“The risk is that, without the tools to
invest, instead of having the latest, high quality equipment the
next government will be faced with repairing Rusting Britain.”
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