FSB research suggests that 44 per cent of small firms would take on more staff if the government cut National Insurance, providing an environment for growth and helping to create jobs.

As well as helping small firms with much needed cash flow, the Treasury would also benefit from the extra jobs created through extra income tax and employees’ NICs, the lobbying organisation adds.

John Walker, FSB national chairman says, ‘Unemployment is worryingly high and with inflation above target, small firms cannot rely solely on the consumer for growth. Government must give a helping hand and create an environment that helps small businesses grow and develop.’

Adds Walker, ‘As we have heard time and again, the government is looking to the private sector to lead the recovery, but without the right measures in place, small firms are left without the tools they need for the job at hand.’