Backing vital enterprise
The Rt. Hon. Vince Cable MP
“Business has weathered a brutal recession yet entrepreneurial spirit is alive and well”
Commentary by The Rt. Hon. Vince Cable MP, Secretary of State for Business, Innovation and Skills
The first edition of this report, published in 2013, shone a light on a vital group of British businesses. Despite their small size and relative infancy, they are responsible for a disproportionate share of economic growth and job creation nationally.
Of course, almost all businesses in this country – 99.9%, in fact – are small or medium-sized. The Coalition Government has been attentive to their needs by capping business rates increases, cutting National Insurance bills and pushing through a sustained programme of deregulation.
But we have also sought to catalyse growth among the so-called ‘vital 6%’: companies, which, irrespective of sector, are often technology-focused, require specialist financial support and possess major export potential. There is a lot of overlap with the medium-sized ‘gazelle’ companies identified by the Confederation of British Industry.
We set up the Catapults with such firms in mind – providing the research and development facilities and expertise necessary to companies that are seeking to commercialise new and emerging technologies. The network now covers seven sectors, ranging from cell therapies to satellite applications to high-value manufacturing.
The same goes for the British Business Bank, established to provide SMEs with a diverse range of finance options. The Bank has £3.9bn of public funding, which it will utilise alongside private sector funds to enable up to £10bn of lending and investment. Among its programmes are the Venture Capital Catalyst Fund and Enterprise Capital Funds, designed to help dynamic young companies cross the ‘valley of death’ and end an over-reliance on bank funding. This public support complements private activity like the Business Growth Fund, which also targets innovative and growing companies.
It is also important that households across the UK can participate in – and benefit from – the growth of British SMEs. Our decisions to allow ISAs to be invested in shares of companies quoted on growth markets and to exempt these shares from stamp duty will support a stronger funding pipeline.
High-growth companies have also benefited from increased export support. Some 90% of the 48,000 companies helped by UK Trade & Investment in 2013–14 were SMEs. UK Trade & Investment is on hand to help firms take their first steps in international markets, source trade finance or credit insurance, and sell through online marketplaces overseas.
As this second report on inspirational British companies comes out, there is still more to do to make this country the best place to start and grow a business. The legislation I’m currently taking through Parliament, for example, contains measures to increase the availability and sources of investment for small businesses, assist small business expansion overseas, improve access to the sizeable public procurement market and further reduce red tape.
Business has weathered a brutal recession yet entrepreneurial spirit is alive and well. There are 760,000 more private sector companies trading in the UK than there were in 2010. I commend anyone with the courage and determination to start a business – and I have only admiration for the firms showcased in this report. They are the very best advertisement for British enterprise, and powerful role models for any entrepreneurs in waiting.