Source · Select Committees · Business and Trade Committee
Recommendation 35
35
Acknowledged
Paragraph: 148
International investment in British businesses can support growth and is positive on an individual basis.
Conclusion
International investment in British businesses can support growth and is positive on an individual basis. The flow of businesses and IP out of the UK, however, as a consequence of the international venture capital model is cause for concern. The drift towards foreign investment illustrates that scale ups and innovative businesses require alternative sources of investment to achieve the maximum long-term benefit for the UK economy in addition to short-term rewards for entrepreneurs.
Government response summary AI-generated
The government reiterates its commitment to building long-term strategic partnerships with businesses and to setting out a vision for high-growth sectors, but does not outline specific plans to provide alternative investment sources to retain IP and businesses in the UK.
Summary of the government's response below — read the verbatim text to verify.
Paragraph Reference:
148
Government Response
Acknowledged
HM Government · verbatim extract
Acknowledged
In addition to BEIS’s Innovation Strategy, launched in July 2021, the Government has put in place a range of measures designed to support businesses, including those achieving or likely to achieve high growth. The support ranges from Government Strategies and Sector Councils to specific policies, such as the Future Fund: Breakthrough and programmes such as Help to Grow. The provisions of Help to Grow: Management will support 30,000 UK small and medium sized enterprises (SMEs) over three years with an intensive management training offer, which will give them to leadership tools to increase productivity, seize investment opportunities and grow their businesses. Complementing this, Help to Grow: Digital will support 100,000 SMEs over three years with online advice and vouchers to subsidise the cost of digital technologies that are proven to increase firm level productivity. Programmes run by the Government-owned British Business Bank (BBB) are designed to bring benefits to businesses that are start-ups, businesses with high growth potential that are looking to scale up, and those looking to stay ahead in their market. The BBB works with over 130 delivery partners and as at end of December 2020, are supporting over £7.9 billion of finance to over 93,000 smaller businesses. The Future Fund: Breakthrough launched in July 2021. This is a £375 million UK-wide scheme, which will encourage private investors to co-invest with the Government in high-growth, innovative firms. These R&D intensive companies accelerate the deployment of breakthrough technologies, which can transform major industries, develop new medicines, and support the UK transition to a Net Zero economy. Due to high research and development costs, breakthrough technology companies typically require more capital than other technology companies to fuel the later stages of their growth. Future Fund: Breakthrough is delivered by British Patient Capital a commercial subsidiary of the British Business Bank. The Recovery Loan Scheme, which launched in April 2021, will ensure UK businesses of any size can continue to access loans and other kinds of finance up to £10 million per business as they grow and recover from the disruption of the Covid-19 pandemic. Businesses of all sizes and sectors can access free Government-backed advice and guidance from a number of sources, including Government-backed Growth Hubs across England and their equivalent in Northern Ireland, Scotland and Wales.
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