It has been a week of rapid change in UK politics – one that could have a significant bearing on SME investment and the use of the Enterprise Investment Scheme in the near future.
There was a wave of action as Theresa May was confirmed as the winner of the Conservative leadership campaign, followed promptly by David Cameron officially relinquishing the reins as the country’s political leader before the newly sworn-in Prime Minister completed a swift and significant reshuffle of the Cabinet.
Theresa May is Number 10’s newest resident and Britain’s second female leader. Here is an overview of her career timeline to date and how she has progressed to be the new Prime Minister:
• 1956: Born in Eastbourne, Sussex
• 1977: Graduated from the University of Oxford with a degree in Geography
• 1977-1983: Worked for the Bank of England
• 1985-1997: Worked as a financial consultant and senior advisor in International Affairs at the Association for Payment Clearing Services
• 1997: Elected as the Conservative MP for Maidenhead in the General Election
• 2002-2003: Named the first female Chair of the Conservative Party
• 2004: Becomes the Shadow Secretary of State for Culture, Media and Sport
• 2005: David Cameron appoints her as the Shadow Leader of the House of Commons
• 2009: Becomes the Shadow Secretary of State for Work and Pensions
• 2010: Named Home Secretary and Minister for Women and Equality in Prime Minister David Cameron’s first Cabinet
• 2016: Theresa May succeeds David Cameron as leader of the Conservative Party and the British Prime Minister
The new Prime Minister takes on the role at a time of political and economic instability, with financial markets fluctuating notably in the aftermath of Brexit. The Federation of Small Businesses (FSB) released a comment when May was announced as the next PM stating: “Immediate action is needed to improve small business confidence and allow them to reliably plan ahead for the future.”
Stabilising the private sector will be a high priority for May, but it is not a task she will undertake alone. On Thursday (14 July), the Tory leader unveiled her new-look Cabinet, with a new Chancellor and Business Secretary named as part of wholesale changes to the front bench. George Osborne departed as the Chancellor of the Exchequer to be replaced by Philip Hammond, the former Secretary of State for Foreign and Commonwealth Affairs. Meanwhile Sajid Javid – who is now the Communities and Local Government Secretary – has been replaced as Business Secretary by Greg Clark. Together, May, Clark and Hammond will be three pivotal characters in reassuring Britain’s businesses of their long-term growth prospects in the wake of Brexit.
Away from Westminster, the Bank of England also made newsworthy announcements this week, with the Governor of the bank Mark Carney revealing that there would be no cuts to interest rates, despite many experts predicting the opposite. As with May’s appointment, both the pound and stock markets responded well to the Bank of England’s decision – the challenge now is to act swiftly to calm market volatility and provide the necessary support to the UK’s small business sector. This, in turn, will boost the long-term confidence of businesses and investors, ensuring finance remains available for the UK’s high-growth SMEs.
In light of the political and current climate of uncertainty, IW Capital will soon be launching a new research report that will examine investor attitudes towards SME investment in the wake of Brexit. Based on a survey of 2,000 UK adults, the report will reveal the impact of current market instability on consumers and whether or not the UK’s investment-minded population would consider supporting the nation’s small businesses through private investment. We look forward to sharing this report with you soon.
