Small firms lack confidence in the economy after last week's election results, according to the Federation of Small Businesses.
An FSB snap poll showed that 54% of firms will not move forward with expansion plans following the results and 49% want another election in six months.

After last week's general election, which produced a hung parliament, over half (52%) of the 3,200 respondents said they lack confidence in the economy with 54% saying they would not move forward with plans to hire new staff or introduce new products and services.

Seven in 10 small firms want the incoming government to reduce the budget deficit and 52% want this done through cuts in public spending, sooner rather than later. Another 44% want to see the banking system reformed and 38% want the government to steady the financial markets.

FSB national chairman John Walker said: "These figures worryingly show that small firms have lost confidence in the economy following the outcome of the election just as the business community was beginning to recover from the downturn. At a time of economic uncertainty small businesses really need a government - of whatever makeup - to get on with the job and set out a plan for dealing with the deficit and returning the UK economy to growth.

"Confidence is vital for small businesses and we know that they want to take on new staff and grow their businesses, but are still cautious about whether the economy is strong enough to do so. The FSB is calling for a renewed economic stimulus to help small businesses continue to create jobs, get access to crucial finance, innovate and start up new businesses, to get us squarely on the road to recovery."

The Forum of Private Business has called on newly-elected MPs to put side their differences and create a functioning government as quickly as possible.