Small Business Commissioner

Baroness Rock Excerpts

Monday 22nd January 2018 Lords Chamber

[Baroness Rock (Con)]

My Lords, I too congratulate the noble Lord, Lord Mendelsohn, on securing this important and extremely timely debate. On this side of the House we are often referred to as “the party of business”. From some this is a compliment while from others it is less so. Certainly, when we are portrayed as the party of only big business, it is the latter. But I say that we support businesses of all and any size that have a contribution to make to the UK economy. We encourage and support disruptors, entrepreneurs, start-ups, scale-ups and high-growth innovators. What we really support is a functioning market, competition and a sense of fairness for all. That is why we must do everything we can to support our small and medium-sized enterprises. They have the ideas and the growth potential, and they can create more jobs by succeeding.

What further action can be taken? First, I commend the appointment of Mr Paul Uppal as Small Business Commissioner. Late payments remain a scourge on the business landscape, with too many larger businesses in the supply chain exploiting their position not to pay promptly. The Federation of Small Businesses has said that 30% of all payments to small businesses are late. This is unacceptable. But now those on the receiving end have somewhere to go to seek redress. I wish Mr Uppal every success as commissioner.

I also commend the Government on the appointment of Andrew Griffiths as the Minister for Small Business. With his background in working for his family business he will understand well the concerns of stakeholders. These appointments give ongoing confidence to entrepreneurs that the UK is the best place to start a new business. I also commend the continuing success of Small Business Saturday. Having now completed its fifth year, it remains an invaluable campaign for showcasing successful small businesses, as well as encouraging consumers to shop more at local businesses.

What more can be done? I will focus briefly on the two great challenges facing small and medium-sized businesses, especially high-growth ones: access to finance, as the noble Baroness, Lady Maddock, mentioned, and access to talent. On the first, we should not underestimate the commitments made in the Budget—a plan to drive over £20 billion in investment in innovative and high-potential businesses over the next 10 years. This includes a £2.5 billion investment fund, run by the British Business Bank, which will unlock a further £7.5 billion in private sector investment to help businesses gain the access to capital that they need to scale up. There will also be a further £1 billion for the enterprise capital funds programme, encouraging and backing Britain’s leading venture capitalists to operate in parts of the market where smaller businesses are not able to access the capital they so desperately need. I am also encouraged by the focus on looking at ways to tackle the barriers faced by female-led businesses in accessing venture capital.

Making sure that finance reaches smaller businesses in every corner of the UK is vital to deliver growth. On talent, though, we have further to go. I am encouraged that the domestic skills pipeline is improving. The Government have already recognised that more needs to be done, particularly for digital skills, which are essential for technology businesses. I welcome the announcement in the industrial strategy that an additional £406 million will be invested in maths, digital and technical education. As a member of the Select Committee on Artificial Intelligence, I know that we have heard much about the importance of investment in these skills.

However, on visas for the talent we need to supplement our domestic skills there is more that can be done. In a 250-page document representing a comprehensive plan for the future of our economy, visas are mentioned only twice. This is not encouraging. Perhaps the Minister can persuade me that this is not indicative of how the Government take the issue. Much of the feedback that I hear is that the regime remains too cumbersome and many businesses simply rely on applicants who already have the “right to work”, rather than engage with the visa process. This is a great shame. We need much clearer communication that highly skilled, digital and technically skilled migrants will continue to be welcome in Britain and that more will be done to reduce the cost of recruiting them, particularly for smaller businesses, which do not have the time or the resource to dedicate to it.

Everyone is in favour of supporting small and medium-sized businesses. That is the easy part. The question is what we actually do to support them. The Small Business Commissioner is a great start. I urge the Government to supplement his work with a focus on talent and capital to ensure that our high-growth businesses, which can contribute the most to our economy, have nothing standing in their way.