A Q&A with small business minister Gareth Thomas

Enterprise Nation CEO, Emma Jones, hosted a webinar with small business minister Gareth Thomas MP, during which he answered questions on the government's priorities for supporting the UK's small business community.

Watch a recording above and read a summary of the conversation below.

Beginning a wide-ranging discussion, Thomas emphasised that small businesses are fundamental to the economy, our communities, employment and the UK's overall success. His central focus, he explained, is identifying ways the government can meaningfully "shift the dial" to help small businesses grow and expand.

The minister outlined five specific areas of focus for his department. These encompass the challenges facing high streets, improving access to finance for day-to-day operations and scaling opportunities, enhancing the government's export support for SMEs, developing business capabilities through training and encouraging digital technology adoption. He also highlighted regulation and tax as key considerations.

High street regeneration

When questioned about high street regeneration, Thomas spoke about recently implemented powers allowing local authorities to auction leases on properties vacant for more than a year.

The high street rental auctions, which came into force in England in December, aim to facilitate collaboration between local authorities and businesses to revitalise empty properties. The minister explained that success would depend on conversations at the local level between high street stakeholders, local authorities and businesses interested in vacant properties.

Employer’s National Insurance increase

Addressing concerns about April's increase in employer's National Insurance Contributions, the minister acknowledged the challenging inheritance of public finances while recognising the impact on SMEs' trading positions.

He reiterated chancellor Rachel Reeves' assertion that future Budgets would take a different approach. The minister highlighted business rates as an area where relief could be offered, mentioning ongoing consultations and the establishment of a Small Business Council to ensure early engagement with the sector.

Digital adoption by small businesses

On digital adoption, Chantelle De Villiers, director of public affairs at Sage, asked about the timeline for the government's new small business strategy. The minister said it will be published after Easter, pending spending review outcomes. He also said the SME Digital Adoption Taskforce, of which Enterprise Nation founder Emma Jones is a member, is meeting regularly and preparing an interim report.

Public sector procurement

Regarding government procurement, the minister emphasised plans to increase SME opportunities to win public sector contracts at both local and national levels. He referenced ongoing work by Georgia Gould MP to simplify small businesses' access to government contracts through the Procurement Act, which will be introduced on 24 February.

International trade

The discussion turned to international trade, and the minister highlighted the lower proportion of UK SME exporters compared to other G7 countries. He spoke about plans to reintroduce the UK Tradeshow Programme, subject to Treasury approval. This scheme provided grants to help businesses exhibit at overseas trade shows.

Notably, the minister addressed Brexit's impact on European trade relations, describing efforts to reset the relationship with the EU, led by Douglas Alexander MP and colleagues in the Cabinet Office.

The minister also addressed small businesses' concerns about the impact of the EU's General Product Safety Regulation, which was introduced on 13 December and placed new requirements on British companies exporting to the EU, European Economic Area and Northern Ireland.

Thomas said the government's Export Academy has been running online advice sessions to guide businesses through compliance requirements. He emphasised the need for an improved relationship with Europe to better anticipate and influence such regulations.

On free trade agreements, the minister reported encouraging progress in negotiations with the Gulf Cooperation Council and expressed hope for concluding a deal with India. He stressed the importance of ensuring small businesses can capitalise on these agreements through proper export support.

Access to finance

On access to finance, the minister identified equity and debt finance as key gaps, noting regional disparities in funding accessibility. He announced plans for a consultation on access to finance and highlighted ongoing work with the British Business Bank to address regional imbalances, particularly noting the challenges faced by businesses in the North East compared to London.

Business support

Business support provision featured prominently, with the minister outlining that business secretary Jonathan Reynolds MP has been studying international examples, including the US Small Business Administration. Plans were outlined for a new Business Growth Service, initially based in Growth Hubs before transitioning to delivery through regional mayors and local authorities.

Government engagement with small businesses

The session concluded with the minister addressing concerns about government engagement with small businesses versus larger corporations. He detailed his commitment to regional visits and direct engagement with small business owners, complemented by input from representative organisations like Enterprise Nation through the Small Business Council.

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