APPG for Entrepreneurship Digest: November 2023

Not for the first time this year, this month’s digest centres on the big political story of the week – Rishi Sunak’s latest Cabinet reshuffle. While no new departments have been conceived this time around, the shake up was arguably more eye-catching than February’s, if only for the announcement that former Prime Minister David Cameron would be returning to frontline politics for the first time since stepping out of the spotlight in 2016 after losing his Brexit gamble. 

It’s hard to look past the pure politics of any reshuffle, although that doesn’t mean they don’t have important consequences for the future direction of policymaking – and, even with time quickly slipping away before the next general election has to be held, the switches made this week could still have significant ramifications for Britain’s startup scene. 

Sunak’s first act of the day was to sack the Home Secretary Suella Braverman. Better commentators than I can walk you through the reasons why the PM thought she had to go, but go she did. Her replacement, James Cleverly, was swiftly moved into post – meaning he will be the man to take responsibility for the country’s immigration frameworks, among other things. Groups representing startups could speak for hours about the importance of a competitive and navigable visa system for entrepreneurs, and they’ll be hoping that Cleverly is in listening mode.

Changes in the Home Office therefore left the Foreign Office without a helmsman. Few could have predicted the role would end up being filled by Cameron, who has cut a distant figure since leaving Downing Street, but a quickfire ennoblement saw him return to the Cabinet after a hiatus of no fewer than 2,680 days. He’ll most obviously front the UK’s responses to conflicts in Ukraine and the Middle East, as well as managing the usual diplomatic duties overseas. But also in his remit will be new challenges to when he was last in public office, not least participating in global conversations around the development of artificial intelligence (and continuing the dialogues of the recent AI Safety Summit brokered at Bletchley Park). Entrepreneurs working at this frontier of the economy will have their fingers crossed that any future regulatory frameworks are considered and proportionate, and enable them to build their cutting edge businesses.       

The above two job swaps predictably captured the majority of the newspaper headlines. But, and perhaps more interestingly, there were a slew of other changes, largely at ministerial level, which are worth pointing out for the UK’s entrepreneurial community. 

In the Department for Science, Innovation and Technology – an entity only created at the last reshuffle – George Freeman announced he would be stepping aside as a minister. In his stead, Andrew Griffith was appointed, saying that he is “look[ing] forward to building on [his] work as City Minister to unleash capital to support these exciting opportunities.” 

At the same time, Paul Scully, the Department’s Minister for Tech and the Digital Economy, was given the ‘Spanish Archer’, as he put it, and was replaced by Saqib Bhatti, who declared “we are on the brink of huge innovation” and that he is “excited by the possibilities and opportunities that lie ahead for us.” Scully also lost his role as the Minister for London, and while startups can be found up and down our country, the capital is undeniably its entrepreneurial hotspot, making the brief critically important. It will now be overseen by Greg Hands, who also snapped up a job as the Minister of State in the Department for Business and Trade, having previously held the role on three other separate occasions.  

Over at the Treasury, meanwhile, Laura Trott was appointed as the Chief Secretary, taking responsibility for spending decisions. She moved into the position having previously been the Pensions Minister, where she worked on the Mansion House reforms which aim to turbocharge investment opportunities for high-growth startups in the UK, and comes in at the deep end with the Autumn Statement due to be made just next week. 

Given the fact that entrepreneurs operate in just about every sector of the economy, in truth, just about every ministerial move matters for one startup or another. I’ve not yet mentioned the new Environment Secretary, Steve Barclay, or the new Health Secretary, Victoria Atkins, for instance, who will be eagerly watched by those in the UK’s burgeoning sustainability and healthtech industries respectively. The full list of changes can be found here. 

Adviser Update

Our Secretariat, The Entrepreneurs Network, launched the latest report from their Female Founders Forum, in partnership with Barclays. Accelerate to Excel looks at the challenges women entrepreneurs continue to face, as well as the progress that has been made over the last several years. 

Form Ventures’ latest newsletter argues the case for “fixing the regulators.” Read it here.

This Friday, GEN UK is holding a half-day conference on the importance of inclusivity and purpose driven entrepreneurship. Register to attend here.

Nesta’s Innovation Growth Lab published a report examining the case for supporting SMEs to take action on Net Zero, the challenges for policy interventions, and the role for experimentation. Read it here.

In Parliament

During a parliamentary debate on environmental, social and governance (ESG) developments, Alexander Stafford said that “since the turn of the millennium there has been a 647% increase in ESG regulations, alongside miles of other red tape in all shapes and sizes. The disclosure burden on investors and businesses is bigger than at any previous point, leading to whole sectors and teams devoted to auditing every aspect of a business.”

While discussing policies to “break down barriers to opportunity,” Rob Butler said that the “key to opportunity is the economy,” and rather than demonising the “profit motive,” debate should encourage entrepreneurship. 

In a debate on the future of the NHS, Paul Bristow highlighted that advances in artificial intelligence are promising great innovations in healthcare. He added that the “one-year NHS funding cycle” must be replaced with “multi-year financial settlements” to save money and enhance innovation. 

While debating the Government’s AI Safety Summit, Michelle Donelan, Secretary of State for Science, Innovation and Technology, said that copying EU legislation would be a mistake. She highlighted the praise the UK’s AI White Paper received and claimed that it led to “leading AI companies to set up their first international offices here in the UK.” 

Kevin Hollinrake, the Parliamentary Under-Secretary of State for Business and Trade, said that his Department was implementing policy recommendations from Theresa Villiers’ and Sir Iain Duncan Smith’s 2021 report on easing regulations to enhance growth. 

During a House of Lords session on the King’s Speech, the Lord Bishop of Oxford described artificial intelligence and climate change as “existential risks.” He claimed that encouraging innovation in machine learning is “welcome” but its potential impacts should be strongly discussed with civil society.

In the same session, the Lord Bridges of Headley highlighted that government spending to “save companies” is an unsustainable way “to encourage innovation and enterprise.”