On Wednesday 25th November, Chancellor George Osborne unveiled the Government’s 2015 Autumn Statement and Spending Review. During his speech, Osborne made it clear that Britain’s economic security cannot be guaranteed unless it is supported by a “vibrant private sector and successful entrepreneurs.” Osborne’s latest raft of policy duly acknowledges the value of the UK SME economy, one that in 2014 generated over £1.75 trillion worth of revenue and employed over 15.6 million people; the equivalent of 48% of Britain’s total private sector workforce. Subsequently, the UK has firmly established its status as the second most innovative country in the Global Innovation Index (GII), ranked above the USA, Singapore and Germany for the third year running.
In a bid to support Britain’s nation of entrepreneurs and innovators, the Chancellor reaffirmed the Government’s commitment to supporting new research and development centres across Britain. This saw Osborne announce plans to extend the small business rate relief scheme for another year. Additionally, corporation tax was held at 18% – the lowest within the G20.
A pivotal initiative to frame the political agenda for SME Britain was the devolution of central government power. Osborne announced the creation and expansion of enterprise zones across the British Isles, taking the total to 44, in addition to a £12 billion local growth fund for regional councils. Prioritising a national agenda, it was announced that £400 million has been set aside for the Northern Powerhouse investment fund, in addition to further investment towards regional infrastructure. This is welcome news for the thousands of SMEs rapidly emerging across Britain.
With the Summer Budget focusing on industry and agriculture, November’s review backed tech and science innovation. A total of £1.8 billion has been ring-fenced to support digital technology – specifically the full digitisation of the taxation system – in addition to a £4.7 billion resource budget for scientific research. Surprisingly, there was a distinct lack of acknowledgment surrounding fintech and professional services. Instead, Osborne delivered what appeared to be a modular focus on grass-roots innovation, as opposed to sector-agnostic initiatives that better the wider infrastructure supporting UK SMEs.
To understand whether local governments and the SME communities that support regional hubs have the capability, resources and future-facing growth to warrant a devolved government, IW Capital today launches the SME Heatmap 2015. The infographic and wider report delivers a timely analysis of the revenue and business birth rates that are set to define the next five years of SME-based investment. Focusing on projected growth figures for every UK region, the sector-based analysis also identifies the high performance industries that will fuel economic progression into 2020.
IW Capital are long-standing supporters of the world-class enterprise talent that is evolving at a momentous speed across the British Isles. Our sector agnostic portfolio is defined by a suite of SMEs that hail from across the UK, sourced by a UK-wide investment management team. We welcome Osborne’s national agenda of regional empowerment, and are keen to see the progression of enterprise zones that champion diverse sectors of innovation and growth. As reflected in our SME Heatmap, the regional prowess of rising SME hubs across Britain reinforces the need for targeted business support that extends beyond the capital.
To find out more about IW Capital’s latest SME Heatmap, click here.
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