IoD: Starting and scaling businesses must be election priority

The Institute of Directors today released the first in its Let’s Push Things Forward series of manifesto papers, covering tax, employment, infrastructure, trade and more, to be published over the next two weeks

 Business leaders are calling on the next Government to pay particular attention to young companies after the general election. The IoD urged all political parties to commit to:

  • Clarifying whether retaining access to the European Investment Fund will be a priority in Brexit negotiations. UK venture capital funds received €2.3bn from the EIF between 2011 and 2015, but it’s unclear whether this will continue after the UK leaves the EU
  • Completing official reviews on entrepreneurship and long-term investment that have been stalled by the general election (the Dafforn and Buffini reviews)
  • Trialling higher tax reliefs for investing in start-ups outside of London and the South East, through the Seed Enterprise Investment Scheme
  • Pay attention to young companies in the post-Brexit immigration system – fast growing sectors need to be able to draw on foreign talent
  • Increase awareness of current business support schemes – between 2010 and 2015, half of IoD members had no contact with the Government’s Business Department

 Jamie Kerr, Head of Entrepreneurship and Tech Policy at the IoD, said:

“Boosting entrepreneurship has been a UK success story over the last few years, and as we prepare to leave the EU, enabling business to set up and grow will be even more vital.

“Brexit has introduced questions on funding for growing companies. The European Investment Fund has channelled billions to UK firms through venture capital funds, but the future of this stream is in doubt. After the election, we need to know whether the next Government will argue to maintain access to the EIF post-Brexit, and if not, how it will make up the shortfall. If future collaboration with the EIF is not their aim, ministers should beef up the capacity of the British Business Bank as soon as possible so it can pick up the slack.

“This Government had launched reviews into entrepreneurship and patient capital before the election was called, and we would urge whoever is in power after June 8 to see them through. In the era of increased regional devolution, it’s also crucial that start-up activity reaches all parts of the UK, so we are calling for a trial of increased tax relief for investments outside the South East.”

View full Scaling and Starting a Business paper here