SMEs don’t need another budget headline. They need the economics of growth to work.

By Martyn Freeman, CEO, Q3 Services

If you want to understand what would help an SME grow, look beyond its corporation tax bill. Look at the cost of employing the next person, the investment needed to improve productivity and the invoices still waiting to be paid.

For a people-intensive facilities management business like Q3, those are not peripheral issues. They determine whether growth is something we can fund and deliver, or simply something we are encouraged to talk about.

My Budget wish list starts here:

• Make employing people more affordable.
• Make productivity investment more accessible.
• Make growth finance simpler to obtain.
• Stop treating timely payment and genuinely accessible public contracts as secondary concerns.

These are not requests to the Chancellor to remove commercial responsibility. They are practical ways to give viable businesses more room to invest, recruit and compete.

Start with the cost of employing people

For Q3, employer National Insurance and wider payroll costs sit near the top of the list. Employer NI rose to 15% from April 2025, and its threshold fell to £5,000. In a labour-intensive business, this affects the economics of the service we deliver every day. A higher employer NI threshold, targeted relief for new hires and apprentices, or an enhanced Employment Allowance would, in my view, have a more immediate effect on recruitment decisions than a headline corporation tax change.

The National Living Wage also matters to our forward planning. For FM providers, employment costs, contract pricing and indexation have to connect. We need to understand the cost of delivery before committing to the price of a service. Supporting employment means recognising that relationship, not treating payroll costs as an issue separate from growth.

Back productivity, not just the language of innovation

There is no shortage of discussion about AI and automation. What SMEs need is a practical route from interest to investment. I would like to see stronger tax deductions or grants for technology, digital systems, energy efficiency and skills.

In FM, that could mean computer-aided facilities management systems, robotics, connected building technology or AI that reduces repetitive back-office work. The test is not whether an investment sounds innovative. It is whether it helps people deliver a better service or removes avoidable work. Support should help SMEs put useful technology into practice, with the skills to make it work.

Make growth finance easier to reach

Announcing funding and making it accessible are different achievements. My priority would be simpler access to government-backed growth capital, particularly for established businesses seeking £250,000 to £5 million for acquisitions, technology or expansion. The value of a finance package lies in whether a viable business can access it when the opportunity arises – not simply in the size of the headline figure.

Treat late payment as a barrier to growth

Fixing late payment could be as important as cutting taxes. Payroll does not wait for an invoice to clear. Once a service has been delivered, the employment costs have already been incurred. Money tied up in unpaid invoices is money unavailable for recruitment, equipment, training or expansion.

I would like 30-day payment to become the default for public-sector and large-company contracts, backed by stronger interest and penalties and tougher reporting of habitual late payers. Payment also needs to move promptly down the supply chain. A commitment at the top is of limited value if the smaller business delivering the work is still waiting at the bottom.

Make public contracts genuinely accessible

Public procurement is a potential growth opportunity for Q3. But an invitation to compete is not the same as an opportunity that an SME can realistically pursue. Contract size, financial and insurance requirements, and the cost of tendering all influence whether bidding makes commercial sense and it currently favours the big industry players.

I would like explicit SME procurement targets, more contracts divided into accessible lots, proportionate requirements and less costly tendering. That is not an argument for lower standards. It is an argument for allowing capable smaller businesses to demonstrate what they can deliver without the process itself becoming the barrier.

Judge the difference, not the announcement

Business rates and energy measures matter too, both to our own costs and to the customers we support. But the broader point is that these pressures do not arrive in isolation. Employment costs affect margins. Margins affect investment. Payment delays restrict cash. Tendering uses resources before it produces revenue.

I will judge support for SMEs by what it changes on the ground: our capacity to employ, invest, compete and deliver. For a people-intensive business, a £1 reduction in employment costs or a £1 productivity improvement per labour hour, multiplied across the workforce, could be more valuable than a small one-off grant.

 That may make a less eye-catching announcement. For a business like ours, it could make a much more meaningful difference.