Finance

The Budget 2016: Government commits to helping benefit claimants start and grow enterprises

Hannah Wilkinson | 17 March 2016 | 8 years ago

New Enterprise Allowance

Freelancers and contractors in receipt of working tax credits are to receive access to business support and mentoring under new plans unveiled in George Osborne’s 2016 Budget.

The chancellor also revealed that the New Enterprise Allowance (NEA) which currently provides money and support to people on Jobseeker’s Allowance who want to start their own business will be made available to self-employed recipients of universal credit.

The scheme which has been championed by high-profile entrepreneurs including successful Dragons? Den contestant LevI Roots has been responsible for the launch of 2, 000 new businesses a month since it was created in 2011.

Roots has previously said of the NEA in 2013: it’s a great scheme, which helps people with ideas make the most of their talent.

by offering expert mentoring support and startup funds it sends a message to those thinking about starting their own business: you’re not alone

One of our Small Business Decision Makers 2016, Michelle Mone, is another supporter of the scheme. She applauded the NEA in her recently published report on boosting enterprise in deprived communities, arguing it is a ‘successful, value for money programme that has resulted in over 70, 000 people becoming self-employed.

But Mone also highlighted in the study that some important changes were needed to the scheme to make sure that recipients of funding were encouraged to grow their businesses. Research published in January 2016 showed that almost 40 per cent of businesses created by those receiving the allowance reported an average monthly turnover of under 500.

Self-employment is currently 50 per cent lower in the most deprived areas of the UK than it is in more affluent regions.

Those in receipt of working tax credits whether self-employed or working for a company will additionally be helped to build savings which could help them start a new company by another new scheme called Help to Save. The policy will see the government give a 50 per cent bonus to claimants who save up to 50 each month.

If you’re thinking about starting your own micro enterprise, don’t miss James Caan’s expert guide to establishing a business.

Topic

Finance

Related Topics

Financial Planning for Small Business Owners
11 September 2023

Financial Planning for Small Business Owners

Read More →
Navigating Financial Challenges: 5 Tips for SMEs
17 August 2023

Navigating Financial Challenges: 5 Tips for SMEs

Read More →
What is Debt Financing?
14 August 2023

What is Debt Financing?

Read More →
What is Straight Line Depreciation and Why is it Important?
11 August 2023

What is Straight Line Depreciation and Why is it Important?

Read More →
Understanding VAT
3 August 2023

Understanding VAT

Read More →
Financial Planning for Small Businesses
2 August 2023

Financial Planning for Small Businesses

Read More →

If you enjoy reading our articles,
why not sign up for our newsletter?

We commit to just delivering high-quality material that is specially crafted for our audience.

Join Our Newsletter