The pandemic was the biggest crisis most of us have seen in our lifetimes, and small businesses were hit extremely hard. So many of the pubs, shops and restaurants at the heart of our communities had to close to protect customers and staff from the virus. So did the gyms, leisure attractions and personal care services that so many of us enjoy and rely on. In government, we moved as fast as we could to protect as many of the UK’s brilliant, hard-working small businesses as possible and we continue to stand behind them.
Support during Covid-19
We provided an unprecedented £352bn package of support to protect jobs and livelihoods including grants, the furlough scheme, government-backed loan schemes, business rates holidays and VAT deferral.
Some of these measures have wound down now that businesses have reopened and we’ve moved closer to normality. But there is continuing support for those in need, with measures such as the Recovery Loan Scheme remaining in place. The scheme provides businesses with up to £10m in the form of government-backed loans, acting as a further safety net to those businesses that need it.
But many businesses are still feeling the economic impact of the pandemic. To address this, we’ve introduced the Pay As You Grow scheme to help businesses pay back loans they took out at the height of the pandemic on a timetable that suits their needs. We are also helping businesses and landlords resolve outstanding rent disputes. The government’s new laws and Code of Practice, introduced earlier this month, will help businesses resolve these issues more easily and provide the clarity and certainty they need to plan ahead with confidence.
Although dealing with the pandemic has, of course, been the priority, we have not lost sight of our mission to level up every part of the country and deliver a more high-skill, high-wage economy. Now that the economy has reopened, the government is looking at broader ways to support small businesses as we look to the future. This is a personal passion of mine and something I feel privileged to work on.
The government introduced the Future Fund to help innovative, newer firms access the funding they needed. This supported more than 1,000 companies, and we have now launched a £375m successor scheme called the Future Fund: Breakthrough, which will support UK start-ups and fast-growing firms. For freelancers and the self-employed, the Self-Employed Income Support Scheme (SEISS) provided millions of pounds worth of grants.
Other schemes such as the Start Up Loans programme have continued, offering government-backed funding to new businesses and those looking to scale up. This has provided over £770m of loans to UK entrepreneurs since 2012, including more than £600m to those outside of London.
Levelling up will mean boosting opportunity and backing entrepreneurship across the country. Schemes like these are designed to help innovative firms get off the ground, complementing private sector lending and levelling the playing field – especially for entrepreneurs who might otherwise struggle to get a bank loan.
Businesses often learn best from their peers, so we’ve launched the Help to Grow: Management scheme to provide expert advice, mentoring and networking opportunities to small business leaders across the country. Thousands of business leaders have already registered for this programme, and we’ve received a lot of positive feedback. I’m sure any ambitious business owner would get a lot out of it, and so I encourage everyone to explore the support on offer through the schemes.
The Help to Grow: Digital scheme will also be launching later this month, providing approved software at a discount as well as expert advice and support to smaller firms looking to utilise digital tech to improve how they work. Initiatives such as this will not only support individual businesses but also provide a real boost to economic productivity – in turn, supporting more quality jobs across the country.
The changing business landscape
Nobody yet has the full picture on how the business landscape has changed since the pandemic. A lot of entrepreneurs have risen to the challenge incredibly well. This has included taking more of their business online or offering services like delivery, takeaway or click and collect, which they might not have adopted otherwise.
Transitioning from a physical to a digital marketplace is a trend that has been accelerated by Covid-19. But it’s also an opportunity enabling businesses to expand their customer base, broaden their offering, and potentially streamline how they do things.
Whether these changes are permanent or temporary remains to be seen, but we want to see that creative, entrepreneurial spirit continue and are doing our bit to support it.
The government is working with business schools, local growth hubs and businesses themselves to understand the challenges they face and help them adapt and level up. I regularly meet business owners on the ground and it’s always insightful to hear how government can help.
Through all these measures, the government is working to support businesses through current challenges while helping them seize every opportunity to grow in the weeks, months and years ahead.
Paul Scully MP is the Small Business Minister at the Department for Business, Energy and Industrial Strategy.