A stark new survey has exposed a profound crisis of confidence among Britain's business owners, with a majority now so disillusioned they would actively discourage the next generation of entrepreneurs from starting a firm in the UK.
A Chasm Between Rhetoric and Reality
Despite Prime Minister Sir Keir Starmer's pledge to make wealth creation his "number one priority" and Chancellor Rachel Reeves's vow to make Britain "the best place in the world to start up, to scale up, and to stay," the reality on the ground is grim. A landmark poll of 1,150 family businesses and farmers, conducted for the Jobs Foundation by Whitestone Insight, reveals a historic wave of pessimism sweeping the nation's wealth creators.
The data is damning: 78 per cent of family business owners are now pessimistic about the UK economy. Furthermore, a full 80 per cent believe the government fundamentally fails to understand what it takes to run a business. Trust in the Prime Minister's growth mission has evaporated, with only 18 per cent agreeing it remains a priority.
The Collapse of Britain's Entrepreneurial Reputation
The most alarming finding for any Chancellor should be the collapse of the UK's standing as a beacon for enterprise. Only 17 per cent of current business owners would advise a young entrepreneur to start their business in the UK today. This represents a catastrophic failure of the government's economic mission when today's job creators are telling tomorrow's to look elsewhere.
The survey suggests the current business climate is viewed as worse than the troubled 1970s. Entrepreneurs are five times more likely to say that decade offered a better tax and regulatory environment than the 2020s. A mere one per cent of respondents selected the present decade as the best time to do business, with the 1980s seen as the peak.
Recent government policy is a key driver of this despair. Despite a partial U-turn on Christmas Eve, planned reforms to Business Property Relief (BPR) – a crucial Inheritance Tax exemption for family firms – threaten to impose crippling penalties on owners wishing to pass their life's work to their children. The polling shows 63 per cent of owners find this prospect "demoralising," with 74 per cent of aware farmers and 44 per cent of family businesses already changing future plans due to the threat.
The Path to Recovery: What Business Owners Actually Want
When asked what would genuinely help, business leaders sent a clear message to Westminster. The government must:
- Prioritise reducing business energy costs (47%).
- Reverse the increase in Employer National Insurance Contributions (38%).
- Make it easier to pass on a business to the next generation without a tax penalty (32%).
The Chancellor currently has a consultation open on reforming taxation to support entrepreneurship. However, as the survey indicates, the answers are already clear. To revive the UK's start-up ambitions, a radical policy shift is needed that respects family enterprise and ditches the misguided reforms to BPR and Agricultural Property Relief entirely.
As the data proves, you cannot build a "high growth" economy while penalising the very people who take personal risks to create jobs and build legacies. Without urgent change, the government's vision of a global start-up hub will remain a hollow phrase, and the UK's economic slide into an era viewed as worse than the 1970s will continue unabated.
