PKF cares about small business

Published on the Malta Today issue 6th July 2011

One of the monumental laws passed in Parliament is the Small Business Act (SBA) which is aimed at improving competitiveness and help nurture the business grassroots in Malta. This law and its attribute have been discussed at an event “Regenerating Entrepreneurship” that took place at the Westin Dragonara Hotel today. The Hon Chris Said and the Hon Jason Azzopardi addressed the delegates together with many other high profiled speakers from both sides of the political spectrum¸ entities such as the Malta Employer’s Association¸ GRTU¸ UHM¸ Employers Association and other unions¸ together with FHRD¸ Bank of Valletta¸ Legal Experts and a consultant who assisted the Government in the drafting of the Small Business Act (SBA) amongst others. It took the organizers more than three months of preparation to round up a formidable team of speakers and yet as is the customary in Malta there is scant attendance from the captains of industry employing less than 250 workers. With hindsight it makes you wonder how am initiative from an SME sized audit (not a Big 4 audit firm) is thwarted by lack of support. Still we soldier on….. The gigantic theme imbued in the law is “Think Small First”.

No it was not a self confessed pragmatist who coined this phrase but it came out as an idea by the EU Commission in an altruistic zeal to reduce administrative burdens on small entities. The Commission is urging us to abide by the Small Business act  (SBA) which primarily aims to improve the overall approach to entrepreneurship¸ by irreversibly anchoring the “Small business first” principle. The SBA carries a wide ranging set of pro-enterprise measures designed to make life easier for Small and Medium sized Enterprises (SMEs). In a nutshell it seeks to promote entrepreneurship and strengthen their competitiveness .It sets out new procedures to respond to challenges resulting from the current economic crisis. Is this a pipe dream or a pragmatic approach to uproot the barriers to growth? On paper the concept is to set the right steps to trim heavy regulation in public service.

 To change the mindset from Big to small is a gargantuan task. But EU wants all to promote SMEs’ growth by helping them tackle the Herculean hurdles which hamper their development. SBA pontificates that the holy Grail will be reached if and only if bureaucracy is reduced by 25% next year. Some may well reply ….keep on dreaming. One may well ask who forms part of the SME’s brigade? The answer is all entities classified as small and medium-sized enterprises (SMEs) as defined by the EU as those with fewer than 250 employees and which are independent from larger companies. By definition they may be divided into three categories according to their size: micro-enterprises have fewer than 10 employees¸ small enterprises have between 10 and 49 employees¸ and medium-sized enterprises have between 50 and 249 employees. SMEs mostly treated as the Cinderella of the business community …..are  become increasingly visible in Malta as providers of employment opportunities and key players for the well-being of local and regional communities. Therefore¸ the Small Business Act was unceremoniously  promulgated last week ( no fanfares please as Cabinet is busy discussing divorce law ). SBA is bas