eBay for Small Business

Wi-Fi generation calls for tougher squeeze on benefit payments

Big new survey of firms trading on eBay finds little support for welfare handouts but warns Government against hitting the elderly.

Britain’s Wi-Fi generation of internet businesses want far deeper cuts in state handouts than anything proposed by the Coalition Government, according to a comprehensive new survey.

An overwhelming majority of online traders back workfare – forcing all benefit claimants to do some work in return for their money.

They also want a halt to payment of benefits to all asylum seekers and want savings in the roads budget by forcing prisoners to build new roads.

By a smaller margin, most of the firms who responded to the survey conducted by eBay wanted an end to the winter fuel allowance for wealthy pensioners and the scrapping of Trident and the £740 million Eurofighter upgrade.

The eBay Online Business Index, one of the biggest surveys of its kind among internet businesses, is based on responses from over 600 firms. Nearly 80 per cent of the respondents were aged under 50 and just over a quarter were aged 18-34.

The findings suggest that the younger generation, who have pioneered the explosion in online trading in the last decade, have little sympathy with the “something for nothing culture” and would like the Government to go further in tackling welfare dependency.

A surprisingly high number – 39 per cent – want a freeze on all state benefits – a measure thought not to be on Chancellor George Osborne’s hitlist as he prepares to announce deep spending cuts in just over a week’s time.

Commenting on the research, Jody Ford, Director of SME Businesses for eBay UK said:

“Government must listen carefully to the wealth creators who will deliver economic growth.

"Online businesses have been among the strongest performers during the recent economic turbulence. These results show they want much tougher action from the Government.

"But online businesses also want fairness. This survey shows that spending cuts should not come at the expense of those who have contributed to society. Instead, online firms believe that the burden should be borne by those who are less deserving of help.”

Conducted in the weeks leading up to the Labour and Conservative party conferences, the survey suggests that Mr Osborne could be even bolder with his cuts package.

However, it contains a warning about the Chancellor’s controversial raid on child benefit paid to the middle classes.

A majority of respondents opposed axing child benefit for the middle classes, suggesting that the Government will face a public backlash over the move.

And they were opposed to measures that would hit the elderly. Only 15 per cent wanted to freeze the basic state pension and to withdraw from pensioners free TV licences.

Even fewer – 11 per cent – wanted to see free bus passes for older people scrapped.

There was more support for economies aimed at families. Some 27 per cent supported the idea of saving £1.4 billion by scrapping the Sure Start programme.

And a significant minority – 42 per cent – believed there was more scope for cutting bureaucracy in the health and education sectors, even though health spending has been declared off limits by the Government. They backed the idea of saving £920 million by cutting back-office staff in these two services.


Notes to Editors:

Note to editors

1. Survey results

Q: The Government will announce its comprehensive spending review on 20 October and is aiming to make £60bn of savings from current expenditure. Which of the following steps do you think should be taken to cut public spending?

Compulsory “workfare” for all benefit claimants.

69.6 %

Withdraw all benefits for asylum seekers.

65.6 %

Save on road maintenance by making prisoners build new roads

61.5 %

Abolish the £2.7bn Winter Fuel Allowance for wealthy pensioners

52.9 %

Scrap the £740 million Eurofighter upgrade

52.4 %

Save £20bn by scrapping Trident

51.4 %

Axe child benefit for the middle classes

45.3 %

Save £920 million by cutting back office staff in health and education by 10%

42.1 %

Freeze all state benefits

38.7 %

Scrap the £1.4bn Sure Start programme

27.3 %

Withdraw the £500m free TV licence for pensioners

15.0 %

Freeze basic state pension saving £1.4bn

14.5 %

Save £1bn by scrapping free bus passes for older people

11.1 %

Other (please specify)

13.1 %

None of the above

2.8 %

2. Methodology for Online Business Index

· The Online Business Index is eBay’s regular barometer tracking the performance of companies trading on the internet, mapping the attitudes of hundreds of online firms operating on eBay.

· It is based on a major survey of 605 online retailers.

· The survey was conducted by independent research consultancy FreshMinds, using seller information provided by eBay. Survey fieldwork was carried out online between 1th and 22nd September 2010

· Previous surveys were conducted in January, April and September 2009 and January 2010

· On average, the businesses covered obtained 61% of their income from eBay, and 39% from other websites, including 7% from Amazon.

· All survey respondents are registered as businesses on the eBay site and have an annual turnover of at least £68,000 on eBay alone, excluding other sources of income. The largest group of respondents (33%) were small businesses with a turnover between £100,000 and £199,000. A quarter of the respondents have a turnover of over £500,000.

· All figures in this report have been rounded to the nearest percentage point. As a result, figures may not always add up to 100%.