Help to Grow: Digital

Debate between Martin Docherty-Hughes and George Freeman

Monday 20th September 2021 General Committees

[George Freeman]

Having a run a few myself, as colleagues here have, I am all for them. I simply make the point that we are the fastest growing economy in the G7, so we must be doing something right. The hon. Lady is right to highlight, as this measure does, the importance of SMEs.

This is a targeted measure. We are not trying to boil the ocean; we are trying to target specific funding at businesses for which all the evidence shows that the uptake of digital technologies such as those I have described will have maximum impact in terms of productivity and competitiveness. A number of us have started companies. Very often in the first three, six, nine or 12 months we find that digital technology is not necessarily the biggest barrier to getting going. It is important, but we are doing here is focusing where all the evidence from the business community suggests that support for digital uptake will have the biggest.

I will take the questions in turn. First, this is designed specifically for businesses, so charities are not eligible, but I am delighted to say that all social enterprises—businesses that recycle their profits back into good causes—are eligible, which sends an important message.

[Martin Docherty-Hughes]

Will a social enterprise that is also a registered charity be eligible, because most social enterprises, at least in my constituency, are registered charities?

[George Freeman]

Many social enterprises are not charities, but the hon. Gentleman makes a good point, because many charities also have an operating arm as a company. I will come back to him on that point.

Secondly, on take-up, I am happy to say that there have been a series of meetings, roundtables and engagement projects over the spring and summer. I do not have the exact figures, but hundreds of companies have already registered to take up when this opens shortly.

Thirdly, the hon. Lady mentioned the importance of this being across the whole UK, and I could not agree more. This project is not just for the golden triangle, golden and important though it is; it is absolutely about reaching companies across the Union, in Scotland, Northern Ireland, Wales and all the regions of this country. On her point about monitoring, one of the key assessments will be to ensure that we are reaching all across the country, so take-up will be monitored in that way.

Fourthly, the hon. Lady asked about procurement. I can assure her that Her Majesty’s Treasury, which is not quick to hand out taxpayers’ money, has been through this with a fine-toothed comb and is satisfied that the procurement process has been done properly. She asked about marketing, and I am delighted to confirm that the marketing budget for this is currently £7.5 million, which is a substantial sum, with £1.5 million in the first year to ensure that we are reaching out and raising awareness among those companies. With Her Majesty’s Opposition onboard, perhaps I can take this opportunity to encourage her and others to highlight the link on the gov.uk website, and to encourage businesses and social enterprises to apply.

Fifthly, on value for money, the Treasury and the business sector calculate that this £260-odd million, if we can get it out to these companies over the next three years, can produce a £7 billion boost to productivity. I think that speaks to the importance of digital productivity and competitiveness in our small business sector. Yes, I am incredibly proud that we are ranked eighth in the world for innovation, but we are 31st on digitalisation in the small business sector, and the level of digitalisation in that particular segment of companies is where Denmark was 10 years ago. That gives a sense of how important this is. I am sure that many of us know businesses in our constituencies that are very successful and doing well, with five to 50 or 100 employees, but that still use paper invoices and some very basic management systems. This is a very targeted scheme that is designed to help those businesses adopt digital technology.

Finally, turning to the very sensible point made by the hon. Member for West Dunbartonshire, from north of the border, I completely agree that this is, as he called it, “a state issue”, which is why we are absolutely determined to ensure that it goes across the whole UK, in Scotland, Northern Ireland, Wales and England. His point about cyber-security was well made. It was one of the issues considered in the assessment of how the scheme would work, and the system for making sure that only authorised procurers are part of the scheme. However, I will raise his point with the National Security Council, because one of the ways that cyber-security can be threatened is by getting into the software in small businesses at the bottom of the supply chain. It is a very good point, but I am delighted to know that the project also has support north of the border.

Question put and agreed to.