Road to recovery: the budget, SMEs and a new era for UK innovation

In last week’s budget, the importance of SMEs to the long-term recovery of the UK economy was underlined by the chancellor, Rishi Sunak, when he said:

our brilliant SMEs are the backbone of our economy, creating jobs and generating prosperity - so it’s vital they can access the tools they need to succeed.”

Ambitious, high-growth SMEs are the lifeblood of any economy and can play a key role in accelerating the pace of economic recovery. To do this, they need fertile conditions for innovation and growth. Encouragingly, there were some positive and tangible developments in the budget, which will provide valuable support for many of these SMEs. These included:

  • £520 million of funding via a new ‘Help to Grow’ programme was unveiled, which will provide discounted training in technology and management skills to 130,000 SMEs to “innovate, grow and help drive recovery.”
  • The establishment of a new £375m UK-wide scheme, known as Future Fund: Breakthrough and delivered via the British Business Bank, which will encourage private investors to co-invest with government in high-growth, innovative firms. Launching in early summer, it will focus on investment for R&D intensive companies.

While these are positive developments, there was a clear acknowledgment from the government in its growth plan ‘Build Back Better’, also published on budget day, that “the UK has a lower proportion of innovating firms overall than other advanced economies and weaker business investment.”

This document makes for interesting reading, providing a detailed analysis of the UK’s strengths, weaknesses, opportunities and threats in terms of its capability to turn good ideas into commercial success. It acknowledges a need for regulatory reform to make the UK more pro-innovation and reveals that a new innovation strategy will be published this summer, so watch this space.


Working with ambitious and innovative companies every day, we see the hurdles that must be overcome to secure funding to realise these ambitions. That’s why we want to put the tools in place from an intellectual property perspective to support your business growth - the first of which we launched last week. Our IP Blueprint for Growth provides practical guidance on how innovative SMEs like yours can attract and secure funding. Intellectual property alone will not likely secure funding, but a weak IP position could significantly impact on valuation - by as much as 70% in our experience - or see an investor walk away altogether. We hope you find it useful in helping to inform your future growth plans.