Start-Up, Scale-Up: Making Britain the best place to start and grow a business
Introduction from Shadow Chancellor of the Exchequer, Rachel Reeves
These are challenging economic times. But I know the spirit of enterprise, of creativity, of hard endeavour are as present in Britain today as they ever have been. I have seen that time and again as Shadow Chancellor, as I have had the opportunity to see the work of businesses and entrepreneurs all around the country.
We are at a post-Brexit crossroads. We can continue down the road of managed decline, falling behind our competitors, or we can draw on bold thinking to propel us forward. We can cling to the old ways; or we can apply ourselves with creativity, determination and common sense to shaping our future outside the European Union, while improving our trading relationships, including with our nearest neighbours.
That calls for fresh thinking about regulation and planning, access to finance and strategic partnership with industry, so that we lead the way. That is why I am so pleased to welcome this radical plan to make Britain the high growth, start-up hub of the world.
Innovation is a great British strength. It defines our history, and it endures today in our entrepreneurs and businesses, in our world-leading universities, and in our people. These are immense resources. Fast-growing firms already contribute £1 trillion to our economy and employ 3.2 million people.
But I have heard time and again about the stubborn obstacles preventing many businesses from scaling up, and the opportunity to start and grow a business is still not shared widely enough. If we can remove those obstacles – if we can unlock that potential – that has implications not just for the entrepreneurs and founders of tomorrow, but for all of us.
If the UK had the same level of venture capital investment as a % of GDP as the US, this would mean £16 billion more venture capital investment – nearly double the level currently. This would mean more innovation, higher economic growth, and better living standards.
The start-up review was tasked with giving us a road map to get there, to ask the difficult questions and present solutions: about incentives, access to capital, how to encourage more spin outs from our leading universities, and how to make the most of entrepreneurial potential across the whole country and from a more diverse range of founders.
The report is full of important ideas addressing exactly those questions: about the ambition and autonomy of the British Business Bank and unlocking patient capital; about how we can translate our world-leading university research into innovation and economic growth; and about building on our pre-existing system of tax reliefs for entrepreneurs and investors – Seed Enterprise Investment Scheme, the Enterprise Investment Scheme and R&D tax credits – to widen access and ensure those tax reliefs work to the greatest effect, spurring innovation and entrepreneurship.
The ideas contained in this document will inform the development of our next manifesto.
I want to thank Alex, Jim, Julie and Tom – and the many others who took part in roundtable discussions and our call for evidence – for bringing their experience, commitment and insight to Labour’s start-up review.
This document, Start-Up, Scale-Up provides crucial insights towards achieving one of the guiding ambitions of the next Labour government: to make Britain the best place to start, and to grow, a business. And it sends a powerful message: that Labour is back in business.
Shadow Chancellor of the Exchequer