Ministers have delayed a long promised enterprise strategy that would have set out plans to drive growth and boost private sector investment in the UK as it emerged from the coronavirus pandemic.
Business secretary Kwasi Kwarteng has been working on the plans to encourage entrepreneurship and support small business expansion since last summer to address concerns that the British economy had become too dependent on state subsidies after Covid hit two years ago.
Kwarteng had previously said he was hoping to publish the document by the end of last year. “I hope to land an enterprise strategy in the next six months and then spend the rest of the parliament delivering,” he told the FT in August.
However, it never materialised and instead officials have recently paused work on the strategy, according to three people familiar with the situation, sparking dismay among business groups who want the government to focus on supporting growth at a time when confidence is faltering.
The enterprise strategy was seen by officials as part of the plan to replace the industrial strategy, which despite business sector support was killed off by the government last year. Kwarteng had dismissed it as too vague, calling it “very, very broad”.
Officials said work on the new enterprise strategy has stopped to focus resources on more pressing issues such as dealing with rising energy costs, adding that it could restart at a later date.
One ally of Kwarteng said the minister had deliberately pushed the publication of the strategy beyond the next Budget — expected in November — to ensure that it will include some new financial pledges: “It would have been [just] words otherwise.”
Craig Beaumont, chief of external affairs at the Federation of Small Businesses, said it would be “very disappointing” if the government stopped work on the strategy. He said small businesses needed help to grow as they faced rising costs and the burden of late payments. “We need to create a new generation of entrepreneurs in the UK.”
The CBI said that the “private sector has a substantial role to play in the government meeting its ambitions and create growth across the country,” adding: “Businesses are looking for good reasons to get investing and this strategy should help, so we hope the details [of the strategy] are published sooner rather than later.”
The government has already stripped the legislative timetable for the next parliamentary term of some businesses-focused policies. The long-awaited employment bill was not included in this week’s Queen’s Speech, while reforms to audit and digital competition were only included in draft form.
Officials said those bills were delayed to make room for more urgent legislation including an energy security bill to ease the path to “net zero” by 2050 and an economic crime bill to tackle money laundering.
Tuesday’s Queen’s Speech also included financial services regulations to boost investment in the UK, as well as to give the new infrastructure bank a statutory footing as it sets out to invest billions of pounds in UK assets.
In a statement, the business department said: “The government remains fully committed to supporting businesses and creating the best conditions for enterprise to flourish right across Britain.”