Food Tech CEO Urges PM Andy Burnham to ‘Undo Damage’ Dealt To Small And Medium Businesses By Predecessors

A UK food technology entrepreneur has called on the new Prime Minister to review policies which disproportionately impact small and medium enterprises (SMEs) as he begins to set out his plan for government.

Andy Burnham announced on Thursday (July 23) that he would be cutting business rates for pubs, clubs and music venues by 20%, but critics have said that the move does not go far enough.

Samuel Chapman, CEO and co-founder of the Bristol-based Leafe App, works with hotels and restaurants to help maintain their food hygiene records – both of which will be excluded from the rates cut.

He said that businesses need help “across the board”, and that exclusions and exemptions for some of the small firms most in need will do little to boost the confidence of business owners.

He said: “Cutting rates is a great start, but even a 20% reduction is a relatively small saving in the context of running a business, not to mention that cafés and restaurants aren’t even included.

“If Andy Burnham really wants to support British businesses then he needs to make major changes across the board, not tinker around the edges. We keep hearing from governments and prime ministers that they are all about business and entrepreneurship, but then you get down to the nitty gritty of their policy and a lot of it actively discourages small businesses from trying to grow and take risks.

“Andy Burnham has a real opportunity to undo the damage done by successive governments and bring the ‘Manchesterism’ attitude to business that he has embraced so heartily to the rest of the UK.”

He highlighted three key policies from the last two governments that are hampering start-ups and other early-mid stage ventures.

These include the merging of the R&D SME scheme with the Research and Development Expenditure Credit (RDEC), the hike in employers’ National Insurance contributions and reduction in the minimum threshold – both under Keir Starmer – and the cut of Entrepreneurship Relief (now Business Asset Disposal Relief) from £10m to £1m under Boris Johnson.

Chapman hit out at the R&D merger, claiming it only served to help corporate giants and hamper firms that need the most financial support. He said: “It was a complete own-goal for Starmer. It cut the tax relief for SMEs while giving large corporations a boost – who do you think needs that relief more?”

The merger meant that the net benefit for SMEs went down from 24.7% to 16.2%, while the net benefit for larger corporations went from 10.53% up to 15%.

The Leafe CEO also criticised the cut of entrepreneurship relief from £10m down to £1m. He said: “This seems like an easy win for Andy Burnham and a strong signal to entrepreneurs.

“The change came under Boris Johnson, and it’s a policy that limits social mobility without touching the already wealthy or generationally wealthy. It doesn’t need to be as high as £10m, but any increase would be encouraging to people like my younger self looking to start their own company.”

It also comes after the Work and Pensions Committee called for employer NI contributions for all under-25s to be cut to boost job opportunities for young people on Wednesday (June 22).

Chapman added: “Obviously everyone knows Starmer increased National Insurance contributions for employers – and I’m not against that – but he also almost halved the minimum threshold you start paying from.

“If you’re a business just starting out, or even trying to grow, that massively increases the cost of hiring and expanding – it’s effectively a tax on entrepreneurship.

“We are fortunate enough to be hiring for seven new roles at Leafe at the moment, but that change could be the difference between that number being eight or nine, and for early-stage businesses they might not even have the cash to grow their team at all.”

Leafe App is a start-up turned scale-up which helps food and catering businesses of all sizes – from Crystal Palace FC and Ibis Hotels to local cafés across the UK – to manage their food safety compliance, a legal requirement which quickly becomes piles of paperwork.

The app is Environmental Health Officer (EHO) audited and approved, allowing chefs and other staff to get on with their jobs without distractions.