Executive Summary
Formedin1972,theBritishAssociationofLandscapeIndustries(BALI)representstheinterests ofapproximately1800memberbusinessesandover950accreditedmembers.Membersinclude landscapecontractors,suppliers,gardendesigners,arboriculturists,trainingproviders,students andotherrelatedprofessionals.
BALIissubmittingthisresponsetotheBusinessandTradeCommitteetohighlighthow supportingSmallandMediumEnterprises(SMEs)canpositivelyimpactlandscapingbusinesses andfacilitategrowth,investment,andresiliencewithinthesector.OfBALImembership, approximately98%areclassedasSMEsorsoletraders,makingitclearthatanySMEsupport strategymustberelevantandinclusiveforthelandscapingindustry.
Strategy
What key issues should be addressed through the small business strategy?
BALIwelcomestheGovernment’sambitiontodevelopanddeliverasmallbusinessstrategy. LandscapingbusinessesarepredominantlySME’s;however,theimpacttheyhaveontheUK economyiswide-ranging.AccordingtoanOxfordEconomicsreportontheeconomicimpactof environmentalhorticultureandlandscapingontheUK,theenvironmentalhorticultureand landscapingindustrycontributes£38bntoUKGDPandsupportsapproximately722,000jobs. Landscapingservicesalonecontributed£17.9bnin2023,whichismorethanfarming’s contributiontoUKGVA.EvidencefromBALIandtheEnvironmentalHorticultureGroup suggeststhatthelandscapeindustrycouldbeworth£51.2bnby20301,ifsupportedby government.
However,withoutsufficientsupportforlandscapingbusinesses,theindustrywillnotgrowand developtoitsfullpotential.Keyareasforsupportwhichwillbecoveredinthisbriefinginclude:
• Cashflowsupportincludingconcernsaroundlatepaymentsandextendedpayment termsaround120days
• Localauthorityguidanceandcapacitybuilding
• Challengingcontractswithuncappedliabilityforlandscapingbusinesses
• Changestonationalinsurancecontributionsandthenationallivingwagealongwiththe challengesthatcomewiththatarounddifferentials
• Skillsandtraining
• Tradeandprocurementchallenges
• Forwardcontractingandconfidencetoinvest
1 https://www.rhs.org.uk/science/pdf/ehg-green-growth-report-2024.pdf
Supporting, representing, and accrediting the landscape industry
Althougheveryefforthasbeen madetoensureaccuracy,neither BALInortheauthorcanaccept liabilityforerrorsandoromissions.
How can policymakers ensure that the voice of small businesses’ is heard in government?
InordertoensurethatSMEsaresufficientlyrepresentedacrossgovernmentandpolicymaking decisions,governmentmustengagewithrepresentativebodiessuchasBALIthatrepresentour membersandtheirbusinesses.Thisincludesengagementwiththeindustrythroughoutthe designofpolicy,soourviewsarerepresentedandreflectedinanypoliciesdeveloped.
BALIPolicyRecommendation:
• Governmentmustengagemeaningfullywiththelandscapingindustryacrosspolicy makingdecisions.Thisincludesrecognisingthelandscapingindustryasavibrantand uniquesectorandnotjustasapartofagricultureorconstruction.
• CreateanindustryroundtablewhichfeedsintoDefra,MHCLG,Treasury,andother governmentdepartmentstoensurethatlandscapingisrepresentedacrossgovernment.
Supporting Growth
How accessible are public procurement processes for SMEs, and what are the consequences of the Procurement Act 2023 for small businesses?
TheimpactoftheProcurementAct2023isstillyettobefullyunderstoodastheactonlybegan inFebruary2025.Thismeansthatitishardtoassesshowsuccessfultheacthasbeenin creatingmoreopportunitiesforsmallbusinessestowinpublicprocurementcontracts.BALI welcomestheaimoftheacttocreateasimplifiedpublicprocurementprocesswhichismore accessibletosmallbusinessesandwithgreatertransparency,thoughmoreevidenceisneeded toassesshowsuccessfulitisinsupportingsmallbusinesses.
Forwardprocurementandcontractingforlandscapingprojectsareanimportantpartof deliveringgrowthandcertaintyforthesector.Thisgovernmenthasmanyambitionsfor deliveringinfrastructureprojects,includingacommitmenttodelivering1.5millionhomesby 2030,andtheseprojectswillallrequirequalitylandscapingandgreenspacecreationwithinthe projects.However,thelandscapingelementsoftheseprojectsareoftenafterthoughts,with limitedorreducedbudget(valueengineered)andshorttimeframesinwhichtocomplete. EncouragingforwardprocurementofcontractswillallowlandscapingSMEstoinvestintheir businesseswithconfidenceastheywouldknowthattheyhaveworkforthcoming.Thisalso allowsforlandscapingbusinessestoworkwiththeprojectownersfromtheoffsetanddeliver greaterbenefitswiththeprojects,suchasbiodiversitynetgain(BNG)opportunitiesorwater managementwithindesigns.
What is your assessment of the export support available to small businesses?
Whilethereisqualityexportsupportandguidancefromgovernment,therealissueisnotalack ofguidanceforexports,butchallengeswithinthesupplychainsforimportsandexports.96%of
Supporting, representing, and accrediting the landscape industry
Althougheveryefforthasbeen madetoensureaccuracy,neither BALInortheauthorcanaccept liabilityforerrorsandoromissions.
Britishplantandtreegrowersimportfromabroad2,meaningthattradedealsandsubsequent delaysoradditionalfeesimpactsthelandscapingindustry.
Similarly,withinthehardscapingsectoroftheindustry,theUKimportsmorematerialsthanwe export,andexportshavedecreasedin20233.Thishighlightsthatwhileexportsupportis important,itisvitaltoalsoaddressimportcostsandchallengeswhichdirectlyimpactssmall businessesbottomline.
ThenewlyannouncedEU-UKSanitaryandPhytosanitary(SPS)Zoneisawelcomeagreementas itwillremoveplanthealthcertificates,whichwillsavebusinessesapproximately£25per certificate.Further,thelinkingofEmissionsTradingSystems(ETS)willreducecostsforthose exportingandimportingastheUKwillnothavetopayanyadditionalcoststotheEUCarbon BorderAdjustmentMechanism.Similarly,theannouncementthattheUK'ssteelquotawillbe restored(post2026)willsupporttheBritishsteelsectorandreducecostsforinfrastructureand landscapingneeds.Agreementssuchasthisarepositiveinenablingtradeimportsandexports whichsupportssmallerlandscapingbusinesses.
BALIPolicyRecommendations:
• Encourageforwardprocurementofcontractswhichpositivelyimpactsbusiness confidenceandcashflowforlandscapingbusinesses.
• SupporttradeopportunitieswhichallowforUKbusinessestoimportandexport withoutincreasingfinancialburdensorredtapeforSMEs.
• AssessandamendtheProcurementAct2023toensureitisdeliveringforSMEs.
Costs
What are the key cost pressures, such as energy prices, facing SMEs, and how should these be addressed?
TherearemanycostpressureswhichSMEsface,includingenergyprices,inputcostsfor growing,staffingcosts,andchangestoNationalInsuranceandtheNationalLivingWagehave increasedpressuresforlandscapingbusinesses.AccordingtotheFederationofSmallBusinesses (FSB),96%ofallsmallbusinessesareconcernedaboutrisingenergycosts,with38%being extremelyconcerned4.Thishasimpactedbusinessespricesforclients,aswellasbusiness growth,with24%cancellingorscalingdowninvestmentsandexpansions.Thesepressuresare impedingbusinessconfidence,whichisnotinlinewiththisgovernment’sambitiontodeliver
2 https://hta.org.uk/policy/cross-border-trade/let-britain-grow
3 https://www.gov.uk/government/statistics/building-materials-and-components-statistics-february2024/construction-building-materials-commentary-february-2024
4 https://issuu.com/federationofsmallbusinesses/docs/fsb-out-in-the-cold?fr=xKAE9_15JNQ
Supporting, representing, and accrediting the landscape industry
Althougheveryefforthasbeen madetoensureaccuracy,neither BALInortheauthorcanaccept liabilityforerrorsandoromissions.
businessgrowth.Governmentmustlookatmeasureswhichcansupportsmallbusinesseswith thesecostsincludingincentivesandsupportforinvestingingreenenergy.
Further,ourmembersarestrugglingtoabsorbrecentincreasesinemploymentcosts,andwith furtherincreasesloomingundertheEmploymentRightsBill,wefeartheirroleinsupporting economicgrowthwillberestricted.Boththeriseinemployernationalinsurancecontributions andtheriseinthenationallivingwagehavehadasignificantimpactoncosts,butitisthe combinedeffectofthesechangeswhichismostconcerningforus.Inaddition,theincreasesin wagedifferentialshaveanevengreaterimpactonthebusiness,almostasahiddencostand recoveryofthesecostsfromclientsandthroughcontractsbecomesagreaterheadachefor businessowners.Moreover,thesecostincreaseswillsoonbefollowedbyothersunderthe EmploymentRightsBill,addingfurthertothecombinedimpactofchangesonbusinesses.While werecognisethepositiveimpactsofthesechanges,bothforemployeesandthewidersociety, theyarelikelytoholdbackgrowthinoursector–particularlyasitisdominatedbysmall businesseswithouteconomiesofscale.
BALIPolicyRecommendations:
• ExpandOfgem’sDefaultTariffPriceCaptoincludeSMEswhichwouldprotectsmall businessesfromenergypriceuncertainty.
• Incentiviseanddelivergreenenergyandmakeitmorewidelyaccessibleforsmall businessestoinvestinalternativeenergies.
• ReviewingtherecentlypublishedEmploymentRightsBillroadmaptoidentifyany opportunitiesfordelayingtheimplementationofthecostliestnewdemandsonSMEs.
Business Support and Improving Productivity
Aparticularchallengeforsmalllandscapingbusinessesischallengesaroundcashflowandlate ordelayedpaymentsforservicesrenderedandextendedpaymentterms.Researchdonebythe FSBshowsthat50,000businessclosuresayearcouldbeavoidediflatepaymentsweremadeon time5.ThereisanunfairburdenonSMEstomanagetheirbusinesseswithoutdueprocessesto ensuretheyreceivethemoneytheyareowed.Theconstructionsector,whichisinclusiveofthe hardscapingsectorwasthemostaffectedsector,with34%reportingmorelatepaymentsthan inthepreviousthreemonths.
Latepaymentsalsocontributetocashflowchallenges,asbusinessesthathavedelayed paymentswillstruggletomaketheirownpayments,creatinganegativecyclethroughoutthe landscapingindustry.Additionally,businesseswithreducedcashflowwillbemorereluctantto investandexpand,astheymightlackconfidenceintheirabilitytoprovidecapitalorreduce theirwillingnesstoinvest.Therearemanynewandinnovativetechnologiesthatcould
5 https://issuu.com/federationofsmallbusinesses/docs/fsb-time-is-money?fr=xKAE9_15JNQ
Supporting, representing, and accrediting the landscape industry
Althougheveryefforthasbeen madetoensureaccuracy,neither BALInortheauthorcanaccept liabilityforerrorsandoromissions.
positivelyimpactthelandscapingindustry,butwithoutconfidenceorcapitalwithwhichto invest,theuptakeofnewtechnologieswillbeslowthroughouttheindustry.
Anotherissuethatisfacedbysmalllandscapingbusinessesisunfairliabilityincontracts. Groundsmaintenancecontractors,manyofwhomareSMEs,areoftenforcedtoacceptunfair contractualtermsaroundliabilityandwebelievethiscouldbelimitingtheircontributionto economicgrowth.Specifically,ourgroundsmaintenancememberstellustheyroutinelyface clausesarounduncappedliabilityandindirectandconsequentialloss,whichareparticularly difficulttochallengeassmalleroperators.Thissituationputstheindustryatoddswiththelikes oflegalandaccountingservices,whereliabilityisroutinelycappedincontracts,andputsits forecastedgrowthatrisk.Thatistosay,businessesmayturndowncontractsduetoan unacceptablelevelofriskor,worsestill,theymaystruggletomeetliabilityobligationshaving enteredintoacontractpreviously.
BALIarealreadydoingwhatwecantoaddressthisissuebutactionfromnationalandlocal governmentwouldhelpusmakerealchange.Forinstance,weareworkingonadviceandtools tosupportourmembersincontractnegotiationsaswellasengaginglargepublicandprivate clientsontheissue,however,governmenthasaroletoplayinencouragingfairercontractsfor SMEs.
BALIPolicyRecommendations:
• Providefundingsupportavailabletobusinesseswhicharegreening,upskilling,and expandingtheirbusinesses,astheseareallprioritiesofthisGovernmentassetoutin labour’smissions.
• Increasespotcheckingandmonitoringoflatepaymentsassetoutinthegovernment’s promptpaymentpolicy.
• Encouragingpublicbodies,particularlylocalauthorities,toputforwardfairerterms aroundliabilityintheirgroundsmaintenancecontracts,potentiallythroughnew guidance.
• Reviewingpoliciesaroundpublicandprivatecontractstoidentifyanyopportunitiesto compellargeorganisationstoofferfairertermsaroundliabilityingrounds maintenancecontracts.
Implementation
How should work across multiple government departments, mayoral strategic authorities, and local authorities be coordinated to support the growth of SMEs?
AcornerstoneofensuringsuccessfuldeliveryofbusinesssupporttoSMEsistheroleoflocal authorities.Throughdevolution,localauthoritiesareresponsibleforskillstrainingand education,planning,infrastructure,businesssupport,andotherpolicyareaswhichallimpact thesuccessoflandscapingbusinesses. InordertodeliverthebestsupportforSMEsatalocal
Supporting, representing, and accrediting the landscape industry
Althougheveryefforthasbeen madetoensureaccuracy,neither BALInortheauthorcanaccept liabilityforerrorsandoromissions.
level,localauthoritiesmusthavethecapacity,knowledgeandpersonnelresourcetoaccurately distributefundingandinvestmentintoareasofconcern.
Localauthorities’policyremitscovermanyofareaswhichifgivenduesupport,couldpositively impactlandscapingSMEs.Recruitmentandeducationwithintheindustrycontinuestopresenta challengewhichlocalauthoritiescouldpositivelyimpactthroughengagementwithlandscaping businessestoidentifyskillsgaps,particularlythroughlocalskillsimprovementplans(LISPs). CentralgovernmentshouldensurequalitydeliveryofsupportsuchastheGrowthandSkills LevyandtheLifelongLearningEntitlementFund.
Planningissuesalsocontributetochallengesforlandscapingbusinesses,asonly19%ofmajor planningdecisionsaremadewithinthelegaltimescaleof13weeks6.Thisisnotsurprisingas 80%ofplanningauthoritiesareoperatingatbelowfullstaffcapacity,howevertheimpactthen fallstoSMEsthatfacecashflowchallengesduetothelackofcertaintyinprojecttimelines.More planningofficersandstreamlinedprocesseswithinlocalauthoritieswouldsupportlandscaping businessesindeliveringprojectsontimeandwithconfidenceensuringlandscapeschemesare deliveredasspecifiedandnotcutbackduetovalueengineeringofprojectsthathaveoverrun andoverspent.
Centralgovernmenthasavitalroletoplayinthisrelationshipbetweenlocalauthoritiesand SMEsastheoversightmechanismwhichholdseverylocalauthorityaccountablefordelivering SMEsupportforallindustriesequitably.Landscapingbusinessescannotbeadvantagedor disadvantagedaccordingtowhichauthoritytheyfallwithin.Centralgovernmentmusthave auditingprocessesinplacetoensurethatSMEsupportisbeingdeliveredforlandscapingand thatthelocalauthoritieshavethecapacityandknowledgetoknowhowtobestimplement supportfortheindustry.
BALIPolicyRecommendations:
• Ensurelocalauthoritiesareproperlyresourcedandhavesufficientknowledgeand capacitytodeliveracrosspolicyareas,includingthosewhichdirectlyimpact landscapingSMEs.
• LocalauthoritiesmustworkwithorganisationssuchasBALItoestablishbestpractice andfillknowledgegapsofthesectoranditschallengesandopportunities.
• Establishtheroleofcentralgovernmentastheoversightbodytoensurethatthelocal authoritiesareaccountableforqualitydeliveryofSMEsupport.
6 https://www.hbf.co.uk/research-insight/planning-on-empty/
Supporting, representing, and accrediting the landscape industry
Althougheveryefforthasbeen madetoensureaccuracy,neither BALInortheauthorcanaccept liabilityforerrorsandoromissions.