APPG for Entrepreneurship Digest: May 2023

** A reminder: if you’re an MP or Peer who wants to get more involved with the APPG for Entrepreneurship, we are on the hunt for new Members and Officers ahead of our AGM on Tuesday 16th May. Email our APPG Coordinator, Katrina Sale, at katrina@tenentrepreneurs.org to learn more. ** 

While the Coronation of King Charles III makes it seem like a lifetime ago, readers might remember that it was only last Thursday that saw council elections taking place up and down the country. Congratulations to any of you who gained or retained your seats, and commiserations to any who fell just short. I will leave it to others to pick over the results, but I won’t pass up the chance to use it as a convenient – if admittedly slightly tenuous – peg on which to hang this month’s newsletter.

Entrepreneurship and local government aren’t two terms which regularly find themselves cropping up in the same sentences, but on occasion they do – and for good reason. Councils are big spenders, and need to procure a diverse range of goods and services to carry out their responsibilities. This creates a wealth of opportunities for canny entrepreneurs to provide solutions – especially where they think they can do so in a particularly innovative or cost-effective way, as they so often prove they can. 

Indeed, that’s the message from the CEO of Enterprise Nation (and Adviser to our APPG), Emma Jones CBE, in Operation Innovation – an essay collection recently published by our Secretariat, The Entrepreneurs Network. She notes how: “accessing public sector contracts can act like an accelerator for SMEs. Government contracts are complex – but solid and reliable.” 

Yet the picture isn’t entirely rosy, and procurement in the UK is showing signs of ill – and worsening – health. Between 2012 and 2018, there was a fivefold increase in ‘single-bid tenders’ – whereby there was a contract which only a single company submitted a bid for, guaranteeing them to secure it. 

Councils themselves should therefore be proactive in thinking about how they can work more closely with entrepreneurs. Again, this is something Emma stresses in her essay. She notes that entrepreneurs and small businesses: “are all too often excluded from public contracts because the bidding process is too complex, or it requires mandatory previous experience of working on government contracts and years of audited accounts.” Readers won’t need to be reminded that entrepreneurs, while naturally savvy and ambitious people, seldom have the time to navigate mountains of paperwork, nor the resources to pay someone else to do it. It isn’t impossible to streamline how contracts are awarded while retaining necessary safeguards to ensure taxpayer money is being spent well. 

Emma also gives some good advice about more fundamental reforms which could help bring more entrepreneurs into the procurement fold. “Instead of being overly prescriptive when contracting for goods or services,” she writes: “governments should be willing to hear alternative approaches to the delivery of whatever it might be procuring – be that in education services, transport provision, or buying new technology.” By embracing more innovative forms of delivery, in the long run, the public – as both taxpayers and recipients – stand to benefit from higher quality services, provided at less expense. 

While Emma’s essay is a welcome contribution which highlights the challenge entrepreneurs often face, it is scarcely the only one. Almost exactly a year ago, The Entrepreneurs Network published a briefing paper co-authored with Dr Chris Haley (also an Adviser to our APPG), which covered how the procurement status quo hinders startups, and how we might go about fixing it. It’s still well worth a read, and goes to show how policy change is as much about a steady drumbeat as it is one-off moments. 

Innovation is typically something we associate with cutting-edge tech firms or medical breakthroughs. But it should apply equally as something to strive for in all walks of life, however mundane – and that includes humdrum local issues from collecting bins to filling potholes. As the latest crop of councillors nestle into their new positions, here’s to hoping that they appreciate the role entrepreneurs can play in delivering for the public.

Adviser Update

Our Secretariat, The Entrepreneurs Network, is hosting a roundtable discussion in Parliament with Shadow Minister for Immigration Stephen Kinnock MP on Labour’s approach to immigration and business. Find out more by clicking here.

Applications are open for GEN UK’s new programme, RESTART Ukraine, which is aimed at female founders from Ukraine. Find out more by clicking here.

The Enterprise Research Centre released new research on how much we know about the effectiveness of business advice. Read it in full by clicking here.

And they’ll be hosting an event later this month, showcasing research on workplace mental health and the links with productivity. Find out more by clicking here.

In Parliament

Chloe Smith was welcomed in the Commons as the new Science Secretary, covering for Michelle Donelan while she is on maternity leave. Rupa Haq asked her: “What steps she is taking to support the commercialisation of research.” Answering on her behalf was the Science Minister, George Freeman, who said that: “Better commercialising our UK research is completely key to our global science superpower and domestic innovation nation missions, and a key component of our science and technology framework and this Department’s work. I am delighted to report that spin-outs from universities have gone up sixfold in the past nine years, to £2.5 billion last year, and in the life sciences sector that has gone up 1000% since we took office.”

In the same debate, Tim Loughton asked what steps the Government is taking to: “ensure effective regulation of artificial intelligence technologies.” Responding, Chloe Smith said: “Artificial intelligence plays a vital role in our economy and society, from helping doctors to identify cancers faster to powering smart devices and driverless cars. We recognise the need to act not only to unlock the opportunities but to address the potential risks of this technology. Our White Paper articulates what the responsible development and use of AI should look like, supporting innovation while protecting people so that businesses, consumers and the wider economy can all benefit.”

A question came from Stephen Metcalfe, requesting a: “comment on the Department’s 10-point science and technology framework, which will help provide the long-term funding needed to turn the start-ups he has mentioned into sustainable, successful, globally leading businesses.” George Freeman was quick to reply with: “A fundamental part of that is converting the health of our start-up ecosystem into scale-ups. That is why the Treasury is leading on the re-regulation of pension funds – so that we can unlock some of our pension trillions and put it into supporting our companies to grow here rather than go to NASDAQ.”

The Business Minister, Kevin Hollinrake presented the Digital Markets, Competition and Consumers Bill to Parliament, claiming it will: “drive growth, innovation and productivity.” 

In a debate on the Non-Domestic Rating Bill, the Shadow Financial Secretary to the Treasury, James Murray, reiterated Labour’s promise to: “replace the business rates system with one that shifts the burden of tax away from the high street and on to online giants, that moves towards annual revaluations and that truly supports entrepreneurship.”

In a debate on Horizon Europe, the European Union’s flagship funding programme for research and innovation, SNP MP Martyn Day asked for an update on: “recent meetings between the UK Government and the European Commissioner.” Responding, the Europe Minister, Leo Docherty said: “We have always been at the centre of scientific innovation. I will not give the House a running commentary on the negotiations, but we do have optimism. We are confident that we will be able to secure that fair deal for researchers, businesses and taxpayers, with the kind of important research that the hon. Gentleman has mentioned.”