APPG for Entrepreneurship Digest: October

Over the past few weeks I have been reviewing the submissions to the APPG for Entrepreneurship’s Call for Evidence on the Sharing Economy. It has been, to me, a testament to the valuable insights that entrepreneurs can provide to the policy process. From nitty-gritty details on tax breaks that most parliamentarians (almost two-thirds by last count) have not even heard of, to insights into international best practice – exporting is a great way to learn about which policies work and which do not.

It is a good reminder of why the APPG for Entrepreneurship was set up. Every politician we speak to understands the value of entrepreneurship and wants to support it, but entrepreneurs are often hard to reach. They understandably are more focused on doing right by their customers and employees than engaging in the policy process. Too often, their voices are lost in the debate and only the biggest businesses can get their views across.

Help to Grow: Digital

Our friends at The Coalition for a Digital Economy (Coadec) highlight one case where active engagement with entrepreneurs could improve policy. The new Help to Grow: Digital Scheme was recently debated in Parliament and Science Minister George Freeman MP was right to explain why a scheme was needed: “a key reason for the UK’s level productivity gap is the low adoption of basic digital technologies and weak digital leadership and management practices. While we excel at innovation, being eighth in the world, we are only 31st for ICT adoption. Our small business sectors are lagging in adopting digital technologies, and our tech adoption rates are far behind leading competitor countries.”

However, the scheme, which provides vouchers for SMEs with 5 or more employees, may be missing an opportunity. Coadec complain that the software covered by the scheme is too limited. They write: “The 50% discount vouchers to just three types of software: Customer Relationship Management (CRM), e-commerce and accountancy software… This narrow list of software products is typically dominated by larger corporate suppliers - sticking with this narrow list risks cutting out UK providers whose products can deliver immense value.”

They find that broadening the categories of software covered would boost the UK’s fast-growing tech startups, and calculate that it could also have significant productivity benefits: an increase of nearly £2bn increase in GVA.

Green Entrepreneurship

At The Entrepreneurs Network we are launching a new Forum: the Green Entrepreneurship Forum. At 10am on 14th October we’ll hold our launch event. Any MPs or Peers who would like to speak or attend should get in touch with Katrina Sale.

Calls for Evidence

We are looking at levelling up. We want to better understand how we can ‘level up’ the UK’s entrepreneurial ecosystems and promote job creation across the UK. The call closes on November 3rd.

We want to hear from both entrepreneurs and researchers. So if you have any insight to offer we would really appreciate a submission.

From our Advisers

Coadec is one of the many groups who advise the APPG for Entrepreneurship to keep us up-to-date on the issues that matter to business.

Each month, we highlight some of the best events, research, and programmes they have on offer.

Tech Nation launched its annual Jobs and Skills report during London Tech Week and revealed that 1 in 8 job opportunities are in the digital sector. As Birmingham Tech Week takes place this week, they note that the West Midlands has the fastest growing tech sector in the UK and is on track to create 52,000 jobs by 2025. Tech Nation has also been busy announcing the best and brightest companies that have joined its Future Fifty, Applied AI and Libra programmes. To find out more, here's the latest audio update from their CEO.

In Parliament

Kemi Badenoch MP (Conservative), the Minister for Equalities, announced the appointment of LGBT business champion Iain Anderson. “[He] will work with the Government, building the evidence base on how to ensure that LGBT people can be themselves in the workplace. Among his first priorities will be kick-starting a business-led mentor network, including small and medium-sized enterprises, supporting the global LGBT conference and engaging businesses to highlight the economic case for LGBT inclusion.”

There was a debate in parliament about Help to Grow: Digital. Parliamentary Under-Secretary of State for Science, Research and Innovation, George Freeman MP (Conservative), said “In 2019, the Department for Business, Energy and Industrial Strategy/Her Majesty’s Treasury business productivity review found that a key reason for the UK’s level productivity gap is the low adoption of basic digital technologies and weak digital leadership and management practices. While we excel at innovation, being eighth in the world, we are only 31st for ICT adoption. Our small business sectors are lagging in adopting digital technologies, and our tech adoption rates are far behind leading competitor countries.” He said that this was the rationale behind the Help to Grow: Digital initiative.

Chi Onwurah MP, the Shadow Minister for Science, Research and Digital (Labour), had some questions about the scheme. First, she wanted to know about the limits of the programme. “specifically whether it extends to charities, mutuals, co-operatives and other organisations that need to grow and have significant economic outputs and make a significant contribution to our economy.”

Second, she wanted to know about the take-up of the scheme. “It has been open for registration since March. How many SMEs have registered, and how many do the Government expect to register in future? What measures are being applied to ensure that businesses that are under-represented by sector, female-led and ethnic minority-led businesses, or businesses led by disabled people, are accessing the programme? Furthermore, given the Government’s commitment to levelling up –we have a new Department with that in its title – what provisions are there to ensure that this funding makes its way across the country rather than focusing on growth in London and the south-east? What is the Minister doing to encourage regional take-up?”

Third, she wanted to know about the procurement process for the technology: “Are the technologies purchased at the high street price or have discounts been achieved?”

Fourth, she wanted to know if provision was being made for sector specific digital technologies. “I worry that there is something of a one-size-fits-all approach. While there are many things that are common to SMEs, such as basic accounting, others may need more tailored support.”

And fifth, she wanted to know what other support is being made available to help SMEs. “Many SMEs are in debt having taken out Government loans and so on, or are facing rent arrears and even problems hiring staff because of the double impact of the pandemic and leaving the European Union. If businesses do not have support on these fundamental features of any business, my concern is that spending money on digital may prove fruitless or more likely that the programme will be taken up by businesses that are already doing well while others suffer.”

George Freeman (Conservative) replied to say that “this is designed specifically for businesses, so charities are not eligible, but I am delighted to say that all social enterprises – businesses that recycle their profits back into good causes – are eligible, which sends an important message.”

On her second point, he said that “[he] does not have the exact figures, but hundreds of companies have already registered” and about the scheme helping the whole UK, he said: “I could not agree more. This project is not just for the golden triangle, golden and important though it is; it is absolutely about reaching companies across the Union, in Scotland, Northern Ireland, Wales and all the regions of this country. On her point about monitoring, one of the key assessments will be to ensure that we are reaching all across the country, so take-up will be monitored in that way.”

On her third point about procurement, Freeman assures her that “Her Majesty’s Treasury, which is not quick to hand out taxpayers’ money, has been through this with a fine-toothed comb and is satisfied that the procurement process has been done properly.”

He did not touch upon the fourth and fifth points.