Posted: Fri 27th Jan 2023
Encouraging the creation of new businesses and supporting the growth of existing firms is one of four pillars in the chancellor's plan for growing the economy.
In a speech in London, Jeremy Hunt promised that the government will focus on the "four Es" of enterprise, education, employment and everywhere. The fourth point refers to removing regional economic inequalities.
"If we are to be Europe's most prosperous economy, we need to have, quite simply, its most dynamic and productive companies,” Hunt said.
Lower taxes are required to achieve that, the chancellor continued, as well as "a more positive attitude to risk taking” and “smarter regulation".
Hunt claimed that Brexit gives the UK the freedom to change rules that will help create an economic environment that is more focused on innovation and growth.
He repeated a previously made pledge to turn Britain into "the world's next Silicon Valley", adding that it won't happen "unless we nurture battalions of dynamic new challenger businesses".
Addressing the audience of tech entrepreneurs and investors, Hunt said:
"If anyone is thinking of starting or investing in an innovation or technology-centred business, I want them to do it here [in the UK].
"I want the world's tech entrepreneurs, life science innovators, and green tech companies to come to the UK because it offers the best possible place to make their visions happen.
"And if you do, we will put at your service not just British ingenuity - but British universities to fuel your innovation, Britain’s financial sector to fund it and a British government that will back you to the hilt."
For his second pillar, Hunt said "a good education system is the best economic, moral, and social policy any country can have".
He highlighted prime minister Rishi Sunak's pledge to ensure all pupils study maths until age 18.
"We have around nine million adults with low basic literacy or numeracy skills, over 100,000 people leaving school every year unable to reach the required standard in English and maths. That matters," Hunt said.
"We are becoming an adaptive economy in which people are likely to have to train for not one but several jobs in their working lives.
"Not having basic skills in reading and maths makes that difficult, sometimes impossible."
Total employment in the UK is almost 300,000 people lower than pre-pandemic with around one fifth of working-age adults economically inactive, which Hunt said is "an enormous and shocking waste of talent and potential".
The chancellor said it was time for "reforms to support people with long-term conditions or mental illness to overcome the barriers and prejudices that prevent them working".
Hunt's final pillar focuses on making sure the whole of the UK benefits from economic development rather than just London and the South East.
He said that if Britain's second cities were as productive as those in other major countries, UK GDP would be nearly 5% higher, second only to the US and Germany for GDP per head.
The government will announce investment zones later this year, the chancellor revealed, with economic benefits and advantages to local businesses.
Investment zones were a policy included in the controversial mini-Budget by former prime minister Liz Truss and ex-chancellor Kwasi Kwarteng.
Another way to achieve the government's 'levelling up' aims and boosting local enterprise, Hunt said, is giving "civic entrepreneurs the ability to find and fund their own solutions without having to bang down a Whitehall door."