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Economy Economy

Explore how government can do even more to support innovation

Last updated: 11:07am 13 September 2019

As part of our modern industrial strategy, we will explore how government can do even more to support innovation by small and start-up firms.

Conservative Party Manifesto 2017, p.21

Our verdict

Innovation is generally considered one of the key factors in economic growth. Supporting innovation by new and small businesses is, therefore, always an important objective for any government. This policy is a promise to “explore” ways to provide even more of that support.

Innovate UK is a government-funded body (recently incorporated into UK Research and Innovation) which aims to “accelerate innovation and drive business investment into research and development”. It looks for new ways to drive innovation, outlining these recently in its 2019 Delivery Plan.

In 2018, under the first round of its Business Basics Fund competition, Innovate UK funded over 70 successful proposals. So far in 2019, more than 30 proposals have received funding.

At the time of writing there are 27 live government-backed innovation competitions for businesses, most offering a share of a funding pot for businesses meeting various innovation criteria.

More broadly, the government offers a range of support for small businesses, and from May to July 2018 ran a consultation on a Business Productivity Review looking at how to improve the productivity and growth of small and medium-sized businesses. The outcome of that consultation is pending.

Innovate UK is there to support business innovation, but the Business Productivity Review is largely about exploring new interventions which are “effective in improving the practices that drive business productivity”. Alongside their 2019 Delivery Plan, there is enough evidence that the government is looking for new ways to support innovation in small firms. This one is ‘done’.

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