Capital and Export Finance: SMEs

On 26 June, the Department published our trade strategy, announcing the expansion of UK Export Finance’s capacity to £80 billion. We also announced measures to give smaller firms, including those in Buckingham and Bletchley, better access to export protection insurance. The significant increase in the capacity of the British Business Bank will also help to improve access to capital for SMEs, including, potentially, in my hon. Friend’s constituency.

Innovative high-growth companies, such as Envisics in Bletchley, are developing and exporting world-leading technology-driven products but face difficulties securing the domestic capital needed to scale up. Too often, overseas investors and, sometimes, Governments, offer both finance and other incentives for them to relocate. Will the Minister set out in more detail how his Department is working across Whitehall to ensure that domestic financial institutions, including Government-backed entities, are helping companies like Envisics to firmly anchor their innovations here in the UK?

We heard during our SME consultation that one of the biggest issues facing small and medium-sized businesses that want to scale up relates to access to finance. Indeed, since 2011, the stock of bank lending to SMEs relative to GDP has fallen by around 50%, which graphically demonstrates the significance of my hon. Friend’s point. We have been working closely with Treasury colleagues in particular, and when we launched the industrial strategy, we also launched a funding arrangement for the British Business Bank that will provide £4 billion of capital to our high-growth innovative businesses to ensure that they remain anchored in the UK and are able to scale up here.