The United Kingdom’s widely debated productivity woes are not a macro-level failure but a micro-productivity crisis. The real economic drag is the daily pile-up of operational roadblocks—particularly poor financial administration, that drains the time, energy, and creativity of entrepreneurs, a burden that hits small businesses the hardest.
In this article by Sabby Gill, CEO of Dext, who previously co-owned a jazz club in Reading, spent Sundays and Mondays chasing paperwork just to make Tuesday’s payroll.
This frontline experience now shapes his leadership at Dext and his view on what entrepreneurs truly need from the government. He is clear that policymakers, who have been focused on macro-levers, have ignored the day-to-day realities of small business owners. He likened the government’s approach to “revving your engine at a set of traffic lights, but the wheels aren’t even on the car”.
The Admin Drain
Dext’s research reveals the damaging extent of this crisis: a quarter of UK small business owners are losing an entire working week every month to financial administration. This is time not spent on strategy, innovation, or customer growth, but on “paperwork and process”.
Despite it being 2025, over half of the small and medium-sized businesses (SMBs) Dext surveyed still manage their finances manually, with 41% relying on basic spreadsheets. Furthermore, nearly a third do not use any external accountancy support at all.
Gill emphasised that small business owners are failing to realise that automation is one of the “most simple growth levers they can pull”. Technology can handle the transactional “grunt work” like keying in invoices or reconciling expenses in seconds, improving accuracy and making reporting effortless. The crucial benefit, however, is not just efficiency but “buying back leadership time”. This reclaimed time can be the difference between spotting an early-developing issue and watching it “blow up into a major crisis”.
Technology as a Survival Strategy
In challenging financial times, technology investment is often the first thing to be cut—a move Gill described as a mistake. He believes the entrepreneurs who will come out strongest are those who treat technology as a “survival strategy, not a luxury” and continue to invest in solutions that drive efficiency across their entire business.
The ability to “protect margins with data and ruthlessly defend unit economics” is non-negotiable for survival. This means having real-time data running throughout the business to see what is selling and what is stalling, allowing leaders to pivot before the numbers turn red. Gill also stressed that cash flow is the number one reason businesses fail. Without real-time visibility of monthly incomings and outgoings, a business is “driving blind,” making it impossible to plan for potential disasters.
Intentional Policy Needed
Ministers frequently discuss “digital transformation,” but Gill argued that government policy is anything but intentional. There is currently “no incentive for businesses to adopt tools that really drive productivity”.
Gill proposed specific, practical policy actions, starting with a clear productivity tax break. He suggested the government could offer businesses the option of claiming back VAT or a tax credit on their spend with HMRC-certified vendors. Alternatively, the government could reduce planned National Insurance tax by 1% and earmark that saved 1% to pay for certified productivity software.
An effective incentive scheme, he explained, would be low cost and high impact, treating digital infrastructure as a public good, similar to Electric Vehicle (EV) subsidies. A modest monthly credit or tax relief per business, tied to clear outcomes like the amount of financial admin time saved, would signal the government’s commitment and give firms the confidence to invest in their futures.
With the Autumn Budget approaching, Gill offered a warning. He doesn’t anticipate a huge relief package due to the Chancellor’s “fiscal headroom virtually evaporated”. Instead, he expects “creative” revenue measures like tweaks, freezes, and loophole closures. For SMBs, each “micro-measure” adds “another form to fill, another rule to follow,” which is indirect taxation through admin that drains time, not just cash. This makes investments in productivity tech even more essential than ever.
The AI Transformation
Looking ahead, Gill sees AI as the “biggest shift in my lifetime”. For accountants and bookkeepers, AI is redefining their roles from “number-crunchers” to invaluable strategic advisors driving business growth. With AI handling the bulk of transactional work, accountants are freed up to focus on high-value activities like forecasting and guiding their clients.
Dext is doubling down on this opportunity by building a unified platform to help businesses embrace the transformative nature of AI while protecting them from risks like sophisticated fraud. The company is also expanding globally, including a move into the UAE, Malta, and Cyprus. Gill noted that the UAE, in particular, is booming, with the number of new businesses doubling in the last five years and a large influx of independent UK professionals, creating a “huge” appetite for digital bookkeeping and compliance solutions.
For Sabby Gill, the core lesson from his jazz club days—that “time is the most important margin an entrepreneur has”—remains Dext’s guiding principle. He speaks with multiple customers daily because their pain points “drive our roadmap,” ensuring the company’s role is to remove the administrative roadblock and give that time back to every business owner.
