MPs are focusing on the wrong priorities for economic growth and are failing to address the issues most likely to help UK businesses expand, according to a new report from The Chartered Institute of Management Accountants (CIMA).
“Building the foundations of a better business environment”, a report based on polling of SME leaders, MPs and the public, reveals a striking disconnect between Westminster’s view of what is holding businesses back and the pressures felt by companies on the ground.
While MPs put energy and operational costs, regulation and compliance, international trade and training high on the agenda, SME leaders point first to weaker consumer demand, policy uncertainty, tax burden and the need for a more stable fiscal environment.
The findings raise questions about whether government growth plans are cutting through to the businesses they are intended to support. Seven in ten SMEs say the government’s growth plan is unclear, with a further 15% unaware that a plan exists.
Andrew Harding, FCMA CGMA, Chief Executive of The Chartered Institute of Management Accountants, said:
“Our research shows that business leaders are most concerned about weak consumer demand, taxation and policy instability, while Westminster appears to be focusing elsewhere.
“If ministers want to unlock growth, they need to start with the immediate conditions that give businesses the confidence to invest – stronger demand, a clearer plan and a stable tax and policy environment. Many SMEs want to invest in people, training and technology, but that will only happen when they can see a credible path beyond survival and stability.
“It is striking that MPs place greater emphasis on operational costs, trade and skills than on consumer demand and the tax environment. Those issues matter, but they are not where many SME leaders say the most urgent barriers lie.”
The research was conducted by FGS Global and draws on polling of 2,079 UK adults, 512 SME owners and directors, and 100 MPs conducted in July 2026.
Key report findings:
Disconnect between MPs and SMEs
- Perception of government support diverge: 53% of MPs think the government supports SMEs well to compete internationally, compared with only 18% of SMEs.
- Different views on growth barriers: 64% of MPs rank energy or operational costs among the top three barriers to SME growth, compared with 35% of SMEs.
- Policymaker-business disconnect concerns SMEs: 33% of SMEs rank a disconnect between policymakers and the realities of running a business among their top three barriers to resilience, compared with 16% of MPs.
- Skills shortages seen differently: Only 11% of SMEs cite skills shortages as a top-three barrier to resilience, compared with 46% of MPs.
Public support for local businesses
- Public support for local growth: 65% of the public believe local leaders should be given greater control over economic decisions.
- Local employers seen as delivering personal benefit: 67% of the public believe local employers profiting would benefit them personally, compared with 48% who say the same for large businesses.
- Trust in SMEs: 81% of the public trust local and small businesses to support growth and resilience in their area, ahead of community organisations and charities (69%), universities and further education colleges (60%), banks and financial institutions (48%) and national government (27%).
What is top of mind for SMEs
- SMEs not focused on growth: 25% of SMEs say their ambition over the next 12 months is survival, while 45% are focused on stability; only 2% are targeting ambitious growth.
- Micro businesses under pressure: 26% of micro businesses are focused on survival, compared with 12% of small and medium-sized firms.
- Government growth plan unclear: 70% of SMEs find the Government’s growth plan unclear, while a further 15% are unaware that a plan exists.
- Tax as a growth barrier: 62% of SMEs cite a stable tax and fiscal environment as a top priority for growth, and 56% cite reduced employment-related taxes and costs.
- Low confidence in tax competitiveness: Only 15% of SMEs believe the Government is creating a competitive and efficient tax environment, while 16% agree the current tax system creates meaningful incentives to invest and grow.
- 50% of SMEs say investing in people, training and skills is important, rising to 60% among SMEs targeting growth.
- Weak consumer demand: 64% of SMEs identify weak consumer demand and low domestic market confidence as a challenge to growth and productivity.
- Access to talent: Only 33% of SMEs agree they currently have sufficient access to the skills and talent they need to grow.
- Confidence in growth capabilities: Only 42% of SMEs feel capable of creating stable, long-term jobs; 45% feel capable of hiring the best person for the job; and 53% feel capable of scaling and expanding operations.
- Government support not translating: 84% of SMEs agree that government growth announcements rarely translate into tangible support.
- Regulation and compliance burden: 75% of SMEs identify the volume and complexity of regulation and compliance requirements as a challenge, while 65% agree the regulatory burden is disproportionate compared with larger businesses.
- Policy uncertainty: 71% of SMEs identify frequent changes in government policy as a challenge to growth and productivity.
- Only 43% of SMEs are confident their business can make productivity improvements over the next few years.
MPs’ views
- Tax competitiveness: Only 32% of MPs believe the Government is performing well on tax competitiveness.
- Regulation and compliance burden: 75% of MPs agree the regulatory burden on SMEs is disproportionate relative to large businesses.
Methodology
The CIMA: Building a Better Business report draws on three datasets: UK adults, SME leaders and MPs, to compare views on the UK’s growth landscape and identify areas of alignment and disconnect.
- Public opinion was captured through a nationally representative online poll of 2,079 UK adults, conducted 17–19 July 2026 and weighted by age, gender, region and socio-economic grade.
- Business views came from an online poll of 512 SME owners and directors, conducted 17–22 July 2026 and weighted to reflect UK SME company sizes.
- Political views were gathered from an online poll of 100 MPs, conducted 2–26 July 2026 and weighted by political party to reflect the House of Commons.
- Polling took place before Andy Burnham became Prime Minister, providing a baseline for tracking public, business and parliamentary sentiment under the new administration.
