It would be better if more foreign money was invested in British companies to create jobs and pay taxes rather than simply funding Government borrowing. The answer to a recent parliamentary question highlights the need for a change if overseas money is to help boost jobs and economic growth.
In a column written for the Huffington Post, I argue that the Government needs to strengthen the investor visa in three ways to encourage more investment in UK private companies.
This morning I wrote an article about part-time entrepreneurs for the Huffington Post. Lots of people are now running small side businesses around their traditional 9-to-5 job, and I think this is something the Government needs to support.
We could do that by cutting regulation or giving them extra advice and guidance.
In our race to make Britain the best place in the world for business, it is all too easy to forget about younger people. If we’re going to create a country that is truly business-friendly, then our schools need to give their students hands-on experience of trade and enterprise.
Last year, I hosted an event in Parliament for kids who had founded their own companies with the help of Young Enterprise, a charity that works in British schools. These teenagers explained how starting a business had helped them find their own feet while making a few quid in the process. They were excited, energised and optimistic about their futures. This event reinforced just how important business experience can be in changing the lives, attitudes and prospects of young people.
But, unfortunately, most children go through school without ever coming into contact with business or enterprise, let alone having a chance to run their own company. This is problematic because early hands-on exposure is crucial. If you’re exposed to business as a young person, you’re more likely to recognise self-employment as a serious and exciting career option later in life.
It’s not a coincidence that many children of entrepreneurs become entrepreneurs themselves. In fact, a US survey found that around half of all self-employed business people in America were second-generation entrepreneurs, and that the sons of self-employed fathers were three times more likely to be entrepreneurs themselves.
Crucially, business also plays an important role in social mobility. Business doesn’t discriminate. Business decisions are dictated by the bottom line rather than the background of the person you’re dealing with. So it’s not surprising that research from the Institute of Education shows that social mobility is higher among people who are self-employed than those who are in paid employment.
Entrepreneurship is not just for middle-class kids or those from privileged backgrounds. It’s not just for children in London or the South East. I remember being struck at the event in Parliament by how many of the young entrepreneurs didn’t come from privileged backgrounds. Whatever your background, if you’re enterprising and hard-working, business will give you a leg up.
But without hands-on experience of business, many children simply assume that university is the next and only step possible after school. They also assume it’s the best thing for them – and that is not always the case. Lots of young people spend three years of their lives studying something they don’t actually want to study when they could have been part of building a profitable business; right now, a sixth of our graduates regret going to university. Entrepreneurship could have provided these people with an alternative from the outset.
It’s no wonder that we struggle to win the argument that enterprise and competition are at the heart of economic growth. Wealth creation has all too often been frowned upon, or been seen as distasteful by our political elite. This ignorance has been fuelled by a lack of hands-on experience of how wealth creation actually works.
It’s not unusual to hear honest, sincere people support entrepreneurs and job creation in one breath, while arguing for high business taxes in the next. Giving young people some practical experience selling products, controlling a business account and navigating our labyrinthine tax code would give them a better sense of how government and business interact.
More children should have the chance to take part in setting up their own business at school. And I mean the whole caboodle: from registering a business and opening a bank account, to designing and selling their wares, paying taxes and taking home the profits. Schools are the natural place for this to happen.
But, we have to be wary of institutionalising this whole process. Hands-on business experience mustn’t become a box-ticking exercise. Nor should we add layers of bureaucracy to teachers’ work or handcuff head teachers. We need to get away from telling schools what to do with the limited resources that they have.
Thankfully, these schemes don’t have to be run by schools themselves because charities like Young Enterprise have been doing this work incredibly successfully for more than 50 years. They go into schools, give youngsters a small loan to get started, help them to found a business and put them in contact with business mentors. Does it work? Definitely! 42 per cent of Young Enterprise alumni go on to run their own businesses – well above the national average of around 26 per cent.
The quicker we get more young people into these schemes the better for all of us economically and socially. This doesn’t need to become part of the core curriculum to happen; the Education Secretary just needs to state, quite explicitly, that hands-on business experience is a national priority. This would signal to head teachers that they need to start thinking about broadening the experience they offer. Charities are ready and waiting to do the rest.
Of course, a dab of business experience at schools won’t solve all our economic and social problems. But I do think that if it is done in the right way, it will provide our children with another exciting option to consider after they leave school – and, hopefully, gather enough momentum to change people’s minds about the power of business. Even if students don’t go on to start their own business, they will have learned what sort of career they may want, and the value and risks involved of being an entrepreneur.
Schools should take proper business experience seriously. It should be a national priority – starting right now.
The year is 2020. The UK has enjoyed five years of economic prosperity and stability with a wholly Conservative government. We are heading back to the top of global economic tables for competitiveness, employment and public sector productivity. International businesses and investors recognise the UK as “the place to be”. Britain is recognised as the world’s leading hi-tech nation. Almost everyone has a tangible stake in the economy by holding shares and bonds in family businesses, mutuals and social enterprises. Above all people are planning confidently for their future.
The vision I have set out with my colleagues in the 2020 Agenda for Transformation is optimistic, hopeful, and eminently achievable. Policies are the tools of the trade which politicians must use to realise their longer term purposes and objectives: what kind of future do we want, and how do we get there? It is all too easy for politicians to speak about policies without first defining a vision of the future.
It is vital that Britain knows what a Conservative country looks like. This publication by Conservative MPs defines a vision of Britain founded on fearless optimism and sound Conservative values – and it sets out the steps to achieve that vision by presenting nothing less than a framework for the 2015 Conservative manifesto.
As co-chairs of the Economic Commission, George Freeman MP and I want to see thriving clusters in aerospace, biosciences, advanced manufacturing and digital technologies spread across the country. To do so, we need an economic culture that embraces innovation at every level because innovation is the central driver of jobs, productivity and competitiveness in an increasingly globalised economy. An innovation economy is one in which Britain is:
- Globally competitive: SMEs thrive and UK big businesses lead the world, whilst international corporations compete to base their HQs in Britain.
- An enterprising nation with flexible employment: tax is low and simple to administrate, and businesses are easy to set up. Businesses compete for employees, with improving terms and conditions in the absence of major legislation.
- A ‘participatory economy’ where everyone has a direct stake in the economy: people own shares in businesses and mutuals, and hold stakes in cooperatives and public services.
- Crammed full of high-tech, high-value businesses: the UK is a global hub for science, technology and engineering. It is the first choice world-wide for registering and exploiting intellectual property.
- Known to have the most productive public sector in the world: the public sector landscape is a rich mix of organisations from public bodies, mutuals and cooperatives to private trusts, businesses and investors. Services improve year on year as these organisations compete with one another.
- Completely connected: people are employed and run their own businesses in their spare time. Public services are easily selected through online apps.
The Coalition Government came together in the national interest to fix the economic mess left by the previous administration. It has not been easy, and significant progress has been made. Yet a managerialist approach to government will not win a Conservative majority in 2015. The biggest challenge Conservatives now face is to set out a cogent and convincing vision of what Britain will look like after a Conservative victory in 2015. My colleagues and I will be shaping these themes over the coming months, before setting out policies in more detail to be at the forefront of the next manifesto.
It will take nothing less than a clear and distinctive vision of the future to achieve a Conservative majority in 2015 following this unusual period of Coalition.