A similar proportion (35%) thinks that although there will be a recession in the next 6 to12 months, it will not be severe. Just 16% of SMEs feel that Britain will experience a full-blown recession during the next 12 months.

The survey also asked SMEs what they regarded as the single most important benefit for their business that could be included in the next Budget on 27 November. "Lower business rates" (35%) and "lower personal taxes" (25%) were the most common responses.

However, a range of other benefits were highlighted by many including "greater incentives for business expansion and investment" (12%) and "better skills training for staff" (seven percent). Less than one per cent said they wanted to see measures in the Budget which would help to "cut back on red tape and bureaucracy". At the same time, some 46% of SMEs felt it was likely that their businesses would be directly affected by the recent terrorism attacks in the USA and the current military activity that has resulted.

According to Adrian Gammon, TNS Finance managing director, "The events of 11 September have introduced an understandable level of caution into the minds of many SMEs in Britain - which was probably already starting to grow in the wake of the US economic slowdown. However, it is clear that in spite of these factors, there is also an underlying sense of confidence about the future amongst SMEs, with a significant majority believing that recession - if it hits at all - will hit them relatively lightly and they will be well placed to bounce back quickly."

The findings are based on 999 interviews conducted with those responsible for financial matters at small businesses in GB between 29 September and 16 October 2001.



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