A Government for Growth: Signalling commitment to Scaleups

The Scale-Up Institute wrote a helpful summary of the commitments the new Government has made that will support the scaleup ecosystem. Read more 👇

Labour Manifesto Commitments

Access to Finance 

There are a number of significant initiatives planned by Labour which match needs highlighted in the SUI’s Growth Capital Report and ongoing analysis. This includes evolving the role and remit of the British Business Bank and creating a new National Wealth Fund, mirroring evidence that SUI has highlighted over the years that reflects that countries ahead of the UK in scaling up businesses have some form of Sovereign Wealth Fund, and larger pools of institutional money directed towards domestic scaling firms. 

Published Labour proposals:

• Increase investment from pension funds in UK | by adopting reforms to ensure schemes take advantage of consolidation and scale, and by undertaking a review of the pensions landscape to discover what further steps are needed to improve outcomes and to increase investment in UK markets

• Reform the British Business Bank | to give it a stronger mandate to support growth and SMEs

• Create a National Wealth Fund | which will encourage a partnership between government and industry to remove barriers to growth. The Fund will be capitalised with £7.3 billion over the course of the next Parliament and will have a target of attracting £3 of private investment for every £1 of public investment

• Translate world-leading research into growth | by publishing a yearly dashboard summarising each university’s offer to spinouts, and metrics of each university’s spinout success (from Start Up, Scale Up)

• Incentivise investment and entrepreneurship | maintaining and building on existing incentives, such as SEIS, EIS and the R&D tax credit system, to ensure investors and firms have the best possible incentives for growth (from Start Up, Scale Up)

• Retain permanent full expensing for capital investment | providing better clarity on what qualifies for these allowances

• Maintain wider tax rates | by not raising headline income tax, NICs, or VAT; cap corporation tax at its current level of 25% for the entirety of Labour’s first Parliament and publish a ‘roadmap for business taxation for the next parliament’; reform business rates to re-balance the burden between brick-and-mortar businesses and online retailers;

• Continue with the Invest in Women Task Force and the Lilac Review / to encourage more female and disabled entrepreneurs.

• Make the UK the green finance capital of the world | by mandating UK-regulated financial institutions – including banks, asset managers, pension funds, and insurers and FTSE 100 companies – to develop and implement credible transition plans that align with the 1.5°C goal of the Paris Agreement

Access to Markets

Labour promises an industrial strategy and aligned trade strategy, structured around four pillars - Sovereign Capabilities, Global Champions, Future Successes and Everyday Economy - reflecting the diversity of the UK’s innovation economy and the global nature of scaling firms.  As the SUI has evidenced from outset and in the work we have undertaken with successive Governments, Procurement and R&D funding, including the role of clusters and hubs close to R&D Facilities / anchored with Universities, each  have a pivotal role to play in scale up growth which demands long term solutions and outlook, and is reflected in Labour’s intended policies.

Published Labour proposals:

• Making public procurement work for start-ups and scaleups | create a Procurement Council of Experts to review best practice and identify areas of improvement and should review the barriers to better pre-market engagement (from Start Up, Scale Up Review)

• Introduce a new industrial strategy with 10-year R&D budgets / including establishing an Industrial Strategy Council and creating a new Regulatory Innovation Office, bringing together existing functions across government.

• Introduce a Ten year infrastructure strategy aligned with the industrial strategy | and create a new National Infrastructure and Service Transformation Authority

• Create a National Data Library | to bring together existing research programmes and help deliver data-driven public services, while maintaining strong safeguards and ensuring the public benefit.

• Publish a trade strategy | modernising trade rules and agreements and aligning them with industrial strategy priorities, and seek an FTA with India, and deepen ties with the Gulf on trade and investment

• Improve the UK’s trade relationship with the EU | but committed to no return to the single market, the customs union, or freedom of movement

• Create Great British Energy | a new, publicly-owned clean energy company.

• Increase capital spending | including £2.5bn to ‘rebuild our steel industry’; £1.8bn to upgrade ports and build supply chains; £1.5bn for new gigafactories; £1bn to accelerate deployment of carbon capture; and £500mn to support manufacture of green hydrogen

Talent: Skills & Leadership Development

Labour is proposing a comprehensive review of the education systems and greater local control over skills funding and the transformation of FE colleges. Access to talent is a longstanding critical issue for scaling firms and our evidence has consistently highlighted the greater collaboration and connection that scaling firms want with the education system across all its levels, including  the need for the curriculum to be updated to reflect modern entrepreneurial, digital and business skills.  As significant  providers of apprenticeships, they also seek that scheme and the levy to be more  flexible and for digital skills training to reflect evolving technological developments  Our Visa system also needs to be fit for purpose to attract the vital international talent that scaleups require. The Labour stated approach aims to integrate various stakeholders through Skills England to align with industrial and business needs to support growth.

Published Labour proposals:

• Create Skills England | to unite business, training providers, unions and government workforce training and ensure it works formally with the Migration Advisory Committee to guarantee training in England accounts for the overall needs of the labour market.

• Replace Apprenticeship Levy | with flexible Growth and Skills Levy, with Skills England consulting on eligible courses to ensure qualifications offer value for money to reform the Apprenticeship Levy. 

• Devolve adult skills training to local authorities | to give local leaders greater control of skills development in their areas and get more people into work locally. 

• Transform Further Education Colleges into Technical Excellence Colleges | which will work with businesses, trade unions, and local government. 

• Launch an expert-led review of curriculum and assessment | working with school staff, parents and employers to enhance the curriculum to ensure strong foundations in reading, writing and maths, and support to develop essential digital, speaking, and creative skills in all subjects. 

• Secure a mutual recognition agreement with the European Union / for professional qualifications

Infrastructure 

Labour will look to implement a suite of policies across different areas to improve local infrastructure, including devolving more powers to local areas and reforming the planning system. Scaleups around the country consistently cite the inefficiency of the planning system,  and availability of space to grow as key challenges holding back their scale up aspirations. The Labour Government’s plans to overhaul the planning system will be  vital.

Published Labour proposals:

• Devolve powers out of Whitehall | giving local areas more powers of transport, adult education, skills, planning, and employment support and introducing a new statutory requirement for local growth plans to cover towns and cities across the country. 

• Modernise the planning system | making it easier to build laboratories, digital infrastructure, and gigafactories.