Small businesses are on the brink as energy prices soar, the Federation of Small Businesses warns | UK News

Rising energy costs are pushing cafes, restaurants and independent shops around the country to the brink of survival, according to an industry body.

Federation of Small Businesses director Martin McTague told The Independent that soaring bills, combined with a drop in consumer spending as shoppers grapple with their household bills, are forcing purchases. Thousands of small companies have to make “impossible choices”.

“How can an independent coffee shop make an extra £20,000 a year to keep the lights on and the coffee maker running, when they’re barely breaking even?” Mr. McTague said.

Or how can a “small manufacturer find another £70,000 to keep production lines going and staff rooms warm?” he asks.

“With the common 5-digit annual increase in energy costs, too many small companies are faced with impossible choices.”

According to an FSB poll, nearly 15% of small and medium-sized companies think they may be forced to close or downsize due to rising energy bills.

The warning coincides with another dismal forecast that energy bills for the average household could rise by £4,000 a year over the next eight months.

Auxilione, an independent energy consultancy, today predicts the price cap could hit £3,576 in October, rise to £4,799 in January and finally touch £6,089 in April.

About 45 million people are forecast to fall into energy poverty this winter as gas prices in Europe continue to soar.

Energy and labor industry voices have asked the government to freeze bills or top up an existing £400 rebate scheme, which could allow consumers to loosen their wallets.

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However, ministers said nothing could happen until the prime minister takes office on September 5.

“We need direct and immediate support from the government,” Mr McTague told the paper.

“Expanded energy support enacted through council tax for rate system, direct help with bills for small companies that don’t pay business rates and cut VAT on consumer goods.” Energy consumption will make a real difference in this area.”