A Treasury initiative to help small businesses attract and retain talented staff this week hailed as extremely successful by independent analysts.
Analysts the Employee Share Ownership Centre (Esoc) said that some 100,000 employees and more than 7,250 firms have taken share options under Chancellor Gordon Brown’s Enterprise Management Incentives (EMIs) programme. The scheme allows employees tax relief on share options they take out in their firms. Esoc expects the total value of options granted under the EMIs scheme to break the £2billion mark this month.
The scheme is designed to make working for smaller businesses more financially attractive, even though they may not be able to offer the same level of salaries as their larger counterparts. Firms with assets of more than £30million are excluded from the scheme.
EMIs offer workers a tax break as well as a stake in their company. They cal also deter them from moving, as those who leave firms after a short period can forfeit their share options.
Esoc’s Joel Lewis describes the initiative as one of the best schemes of its kind. “It was very well devised,” he said.
The analysis is a rare case of praise for government business incentives. A survey of business attitudes to nine separate government schemes by Price Waterhouse Coopers showed an average of only 11 per cent of businesses used the programmes; less than half has heard of them.
