The next administration has been called upon to focus more on helping small businesses.

Whoever takes over government after the next general election should do more to help small businesses remain stable, according to the Federation of Small Businesses (FSB).

Those who have set up recruitment companies may be facing financial difficulty due to the economic climate as the latest Red Flag report has revealed that there has been a rise in the number of businesses in distress.

A 14 per cent increase in companies facing financial distress was recorded in the first quarter of 2010 compared to the last quarter of 2009, which is the second consecutive quarterly rise.

The FSB's national chairman John Walker said the government can help by "making it harder for HM Revenue & Customs to close small businesses down if they are late on tax payments".

Companies should also be given better access to affordable finance and credit and the government and big business should "pay invoices on time to ensure a steady cash-flow in the small business community".

Outsourcing back office services, such as invoice requirements, can help companies free up time to concentrate on growth.