How much do MPs know about the real business world? A new survey suggests it might be even less than you think (and we're assuming you had pretty low expectations already).
The Entrepreneurs Network's annual parliamentary snapshot has exposed a “worrying lack of knowledge” about existing policies that are designed to support entrepreneurs.
More than half of Conservative MPs – 56 per cent – either hadn’t heard of the Seed Enterprise Investment Scheme (SEIS), or didn’t know enough about it to decide whether it was effective.
And there has been a drop in the number of Tories who back the Enterprise Investment Scheme (EIS), down to 45 per cent from 68 per cent last year.
The survey – conducted for the think tank by YouGov and supported by law firm Bircham Dyson Bell – found a similar lack of knowledge from politicians on the opposition benches.
Almost two-thirds of Labour MPs – 61 per cent – had not heard of Innovate UK, which supports entrepreneurs by running competitions for up to £536m government funding, or didn’t know about it well enough to determine whether it is effective.
These initiatives “are rightly seen by many in the startup community as essential to the UK’s entrepreneurial success”, The Entrepreneurs Network said.
“Too often, MPs are in the dark about established initiatives – or if they have heard of them, they don’t know enough to decide whether they are effective,” it added. “There is also a discrepancy between the strength of MPs’ opinions about what would benefit entrepreneurship in the UK and their understanding of the current policies in place.”
The survey also looked at the political hot potato that is Brexit, finding that 58 per cent of Tories thought leaving the EU would have a positive impact on entrepreneurial activity.
Conversely, 95 per cent of Labour MPs thought the opposite, with just one per cent saying it would have a positive impact.
As many as 90 per cent of Conservative MPs think exempting the UK from EU business regulation would have a positive impact on entrepreneurial activity in the UK. Just 10 per cent of Labour MPs agree.
Hollie Gallagher, head of entrepreneurs at Bircham Dyson Bell, said: “It is concerning that MPs are not as well informed as they could be about important government schemes to support UK entrepreneurs.
Fast-growing small firms are vital to our economy… Great initiatives already exist for startups, but steps need to be taken to promote them and ensure that these businesses continue to thrive.”
Simon Rogerson, chief executive of Octopus Investments, a founding supporter of The Entrepreneurs Network, warned that MPs had “a particular blind spot on SEIS and EIS, two of the UK’s most successful policies for helping small, risk taking companies to grow”.
He added: “Entrepreneurs need policies in place that really work, so clearly there is a need to help MPs understand how well these established initiatives perform for both investors and the businesses funded by them. High growth small businesses are extremely valuable to the UK in terms of job creation, wealth generation and economic growth. We must help MPs bridge the knowledge gap highlighted by this report, so that they support policies that will help secure the UK’s strong reputation for fostering entrepreneurship.”