Chancellor Alistair Darling has delivered his Pre-Budget Report speech, which promises to support SMEs.

Chancellor Alistair Darling’s 2008 Pre-Budget Report (PBR) has shown significant support for small and medium-sized enterprises (SMEs), including the introduction of generous tax relief and enhanced access to government contracts.

The Government has also announced that it is adjourning the planned increase in small companies’ rate of corporation tax. This will now be deferred for one year, remaining at 21% for 2009/10.

In his PBR speech, Chancellor Alistair Darling spoke of the “extraordinary, challenging times for the global economy” and its impact on business: “Small and medium firms are the engine of our economy. They make up the vast majority of businesses and employ around 60% of the private sector workforce. They also are facing continuing difficulties with cash flow and credit.

“I know that many profitable businesses are concerned that these twin problems threaten their future. I am determined to help them. So my objectives today [24 November] for business are threefold. First, help equip them for the challenges of the future. Second, to improve access to credit and ease cash flow. And third, to reduce burdens on them at this difficult time.”

Further measures to help SMEs include: access to government contracts, such as a new online portal for all government contracts over £20,000; a Small Business Finance Scheme – a new temporary guarantee scheme to enable up to £1 billion of new government-supported lending by banks; and a temporary increase of the threshold for empty property rate relief.

Richard Lambert, Director-General of the Confederation of British Industry (CBI), commented on the PBR: “The Chancellor’s growth forecasts depend on his success in stimulating consumer spending and otherwise look optimistic. On them also depends his forecasts for the budget deficit. It will be a long, hard haul to meet his deficit targets and given this, we would have hoped for an even greater emphasis on efficiency and potential savings.”

For full details of the 2008 PBR report, visit HM Treasury’s website.