As we begin to recover our way of life from the devastating effects of coronavirus, it is vital that we get Britain’s economic engines firing once again. I know that many businesses are still focused on surviving the crisis, and we will continue to give them every support we can. Already, vast swathes of the economy have started to reopen again under government guidelines to make workplaces safe, giving those people who cannot work from home during the coronavirus pandemic confidence to go back to work.
We are also supporting millions of businesses by reducing the VAT rate to 5 per cent for accommodation, attractions and the hospitality sector and launching the Eat Out to Help Out scheme to encourage consumer demand at establishments including restaurants, cafés and pubs. Britain will bounce back, and we in government stand right behind the companies and the workers that are helping the country reopen for business.
The Prime Minister has been clear that we are not only committed to defeating this virus, but to using this as an opportunity to build back better, greener and faster. In recovering from this crisis, we do not just want to keep the economy ticking over. This government was elected with ambitious plans for the economy – ambitions which remain firmly in place.
The UK’s recovery from this crisis will now be about securing people’s livelihoods for the long term, by doubling down on uniting and levelling up, infrastructure and technology, education and building the platform that business needs for growth. These changes will make life better for people and businesses and unleash Britain’s potential.
As Small Business Minister, I speak to companies from across the country every day about the challenges they face, their aspirations for growth and the support they need from government to get there. It is no exaggeration to say that small businesses power our economy and our communities. From boat operators in the south-west of England to whisky distilleries in the Highlands of Scotland, it’s crucial that the UK’s small and medium-sized enterprises are at the heart of our economic revival.
At the start of this crisis, we took the difficult but necessary step of asking a huge number of businesses to close to slow the spread of coronavirus, protect the NHS and save lives. We recognised the scale of the challenge facing business owners and their staff and have stood by them and their workers. That is why we put in place an extensive package of support for business, including grants and loans for small businesses, a business rates holiday, the job retention scheme, and support for the self-employed.
Throughout this crisis, I have admired the resilience shown by British entrepreneurs. Businesses have adapted the way they work and interact with their customers in all sorts of unique ways. We have all seen local pubs and restaurants temporarily converting into takeaways, and businesses like Popcorn Shed, which had previously sold gourmet popcorn only to retailers and venues such as cinemas, opening themselves up directly to consumers, marketing their product to people craving quality popcorn at home.
I am excited to see how our businesses can channel this energy once this crisis is over. That entrepreneurial spirit must continue, and we are creating the right conditions for innovative ideas to thrive. We have ambitious plans for the economy, including boosting opportunity and productivity, making Britain the best place in the world to start and grow a business. That means reviewing the costs that are placed on firms, and any common obstacles stunting their growth. It also means backing entrepreneurs from all walks of life at every stage of their business journey.
We are already supporting a diverse range of start-ups and business owners across the country. While the government-owned British Business Bank has done fantastic work on emergency loans for businesses of all sizes affected by the virus, it also runs programmes like Start Up Loans, which give ambitious and creative people, who might otherwise struggle to get funding from a bank, the start they need to launch a company.
I’m proud to say that, since they were established in 2012, Start Up Loans have provided 40 per cent of their funding to women, 22 per cent to entrepreneurs from a BAME background and 36 per cent to people who had previously been unemployed. We can do better still, by helping more entrepreneurs get the capital they need to flourish.
The British Business Bank has also launched Bounce Back Loans to relieve pressure on cash flow for smaller businesses. These loans of up to £50,000 are delivered at speed and come with a 100 per cent government guarantee and interest payments covered by the government for the first 12 months. The intention here is not just a quick fix for the economy. It is about giving investors and businesses the security they need to keep money flowing, while finding creative ways to plan ahead.
Meanwhile, the Future Fund supports innovative companies which rely on equity investment. It matches funding delivered by private investors to early stage businesses, on terms that protect the UK taxpayer, ensuring that the cutting-edge companies of the future can continue to lead the field through these unprecedented times.
The scale and speed at which we have been able to stand behind our businesses shows that by working together, government and industry can unleash the potential of business as we recover the economy. To spearhead these efforts, my colleague Alok Sharma, the Business Secretary, has been chairing meetings of new recovery roundtables, bringing together businesses, trade groups and academics to ensure we have the right opportunities in place for growth across the country over the next 18 months and beyond.
These roundtables have covered all bases, from how to level up economic performance across the UK, to skills and apprenticeships, and to how best to use COP26, which takes place in Glasgow in November 2021, to capturing opportunities from tackling climate change. We are working with business to see how best we can support a green and resilient recovery and ensure the UK is leading the development of the industries of the future.
This pandemic has been challenging for many firms, but there are some positive signs for the long-term future of UK business. By being flexible and showing that entrepreneurial spirit for which Britain is renowned, many businesses have been able to adopt new technology, expand their offering and even attract new customers. We must ensure that these efforts are not wasted and our recovery from this crisis moves us towards the resilient, sustainable and innovative economy which this government is determined to build.
Paul Scully MP is the Minister for Small Business.