01.12.2014

Survey Finds That Over Half Of MSBs Have Grown By At Least 10% Each Year For The Last Three Years

The ‘forgotten army’ of medium-sized businesses (MSBs) are critical to the UK’s future prosperity, but require greater support from the Government, says the CBI.
 
Speaking at the organisation’s first ever national #MSBMonday summit, John Cridland, CBI Director-General, highlighted the need to widen the supply of finance,  step up support for exporters and ensure that skills challenges are tackled so that  the full potential of MSBs can be fully realized.
 
In his speech, Mr Cridland called for a number of initiatives including the establishment of a private placement market for MSBs to issue debt to institutional investors, along with reform of capital gains tax to incentivise long-term equity investments in MSBs and promote a culture of equity finance in the UK.
 
The leading national trade body also published new research today which revealed that over half of the 200 firms surveyed (51%) have grown by at least 10% a year over the last three years. The vast majority (82%)said that they were confident the next five years would bring further growth.
 
John Cridland said: “Our forgotten army of MSBs contribute a huge amount to our economy. Despite making up less than 2% of all British companies, they generate almost a quarter of private sector GDP, and employ one in every six people.
 
“MSBs have come out of the downturn leaner, fitter and ready to kick on. Up and down the country, they are brimming with confidence, and many are growing quickly. Unlocking their potential to grow is vital to our future prosperity. With the right support from government and other businesses, they can be the engine of our economy into the next five years and beyond.”
 
He added: “We are simply behind the curve in developing patient capital options for MSBs. The United States, France and Germany have all stolen a march on us. The banking sector cannot do all the heavy lifting, so we urgently need to plug the finance gap that exists for both equity and debt.”

Expert Opinion

The CBI is right to highlight the value of medium-sized firms and it’s clear from their research that they have contributed hugely to the UK’s recent economic growth. It is also apparent that they want to do more and have a huge role to play in generating future wealth for the UK. <br/> <br/>“We fully support the MSB Monday summit and hope that it raises awareness of the key issues affecting the sector and encourages the Government to examine ways in which it can provide a more favourable environment for them to flourish.” <br/> Fergal Dowling - Partner