The survey of politicians, carried out by research agency ComRes in conjunction with the Industry and Parliament Trust (IPT), investigated the business experience of members of the UK and Scottish Parliaments, the Welsh and Northern Ireland Assemblies and the European Parliament. It found that only 13% had experienced even five years in business.

"The fear shared by many business owners is that the legislators responsible for the red tape that hinders them so much do not even begin to understand their needs," said the FPB's Chief Executive, Phil Orford. "Our members are sceptical that politicians care about anything other than clinging onto power. This research will only further the belief that their elected representatives lack the knowledge required to make a positive difference for businesses, which is all the more critical in the current economic climate."

The FPB's business-friendly MP/MEP award is being held in Westminster on Wednesday, 14 May. It aims to support those MPs and MEPs who, contrary to the research, regularly campaign on behalf of small businesses, many of which are bearing the brunt of the ongoing credit crisis.

According to Equifax's latest Business Failures Report, the total number of businesses which failed in the UK went up by 9.1% in the first quarter of 2008, compared to the same period in 2007. The worst affected region was the North West, with a rise of 21.4%.

Business failures in the East Midlands went up by 20.9%, in Yorkshire & Humberside it was 20.3%, and the North East saw an increase of 18.2%. In London, the figure was 13.9%, and in the West Midlands it was 13.1%. The number of businesses going bust in Wales went up by 13%. Other regions experiencing an increase were the South West (4.9%), and East England (2.1%).

In Scotland, however, there was a 23.8% fall in the number of businesses which failed.

The transport and communications industry has been hit hardest, with a 16.3% increase in the number of businesses in that sector failing. Increases in the other industry sectors were: construction (11%), retail (9.1%), services (8.3%), wholesale (4.3%). Conversely, manufacturing saw a 2.8% fall in failing businesses.

"Banks are going to look at businesses just as closely as they are looking at individuals, making it harder for firms to get funding to pay off debts and bolster cash their flow," said Equifax's External Affairs Director, Neil Munroe. "There are tough times ahead and it is clear that firms need to do more than ever to secure the future of their business and protect themselves from the risk of failure. It only takes one customer going bust to jeopardise a business, but careful monitoring today can reduce the threat of bad debt tomorrow."

Given the additional problems small firms have experienced with issues such as late payment, it is essential they take steps to better protect themselves. The FPB offers a solution to the shortage of available credit through its partnership with Cattles Invoice Finance, which allows businesses to access up to 85% of the value of an invoice within 24 hours of it being raised, guarding against late payment and saving firms an average of £3,000 in the first year of use.

For more information about the FPB's range of money-saving products and services, and to find out how, despite the credit crunch, businesses can survive and grow, visit www.fpb.org. The deadline for nominations for the FPB's business-friendly MP/MEP award is 25 April.