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Con SP: Institute of Directors
Shadow Chancellor Caroline Blakesley spoke at an event hosted by the Institute of Directors* on the Conservative policy to promote innovation and investment in the United Kingdom.

Ladies and gentlemen:

Thank you for your warm welcome. This is, as you may be aware, my first engagement as Shadow Chancellor and it is an honor to be speaking at the Institute of Directors.

The past year has certainly been a year. We saw the Labour government introduce the most broadly anti-business budget in recent history. We need look no further than where we are today to see that. Our economy is stagnant and manufacturers are hemorrhaging jobs. This is not, despite the statements of the Chancellor, an economy that we can be proud of. It is not an economy that is good for business, good for investors, or good for workers. The Labour agenda released during the Queen’s Speech made little mention of economic progress. Despite the promises of the Chancellor that another U-turn in government economic policy is forthcoming - we cannot rely on that hope, on the economic mismanagement that leads to flailing from a tax increasing budget to a "business budget".

Let me be clear: the previous budget set out by the Chancellor turned the long-term challenges facing our economy – difficulty driving investment, promoting productivity of industry – into immediate challenges. They are, I will note, challenges that may have been avoided had the Conservative Shadow Budget been adopted in part in the past year. Therefore, it is necessary to continue where our proposals left off and create a Britain that innovates and invests. It is necessary to create a Britain that grows stronger and not stagnant.

These aims of innovation and investment to create growth are linked extremely tightly. As many of you are aware, new start-up leaders are critical members of the Institute of Directors – many of you here tonight are start-up executives. While we do not see the role of government replacing enterprise – we will not be nationalising any industries – we do see a role for government in engaging with private enterprise to support innovation and the development of our start-up and small and medium sized industries. We propose to achieve this role through three primary aims: creating new avenues for investment in Britain’s innovative industries, facilitating new partnerships with academic centers to commercialise technology, and expanding support to our current leaders in technology development and research.

The flagship of our plan to promote innovation and investment is the immediate creation of a British Investment Bank that will provide low-interest financing to Britain’s small- and medium-sized enterprises. The BIB will have the explicit mission of specialising in the finance needs of SMEs and start-ups – offering a unique set of financial products designed to fit the needs of a niche market in need of immediate support in order create jobs and support productive growth in Britain. The BIB will be augmented by a start-up loans scheme that provide the funding necessary for start-ups, at low interest, to develop their business plans and products to the point of receiving significant outside investment – be it from angel investors, institutional venture capital, or traditional financing sources. This influx of capital will facilitate the ability of our SMEs and start-ups to grow, to thrive, in Britain.

We do not, of course, forget the role of private investors in supporting start-ups and SMEs – a marked contrast with the Labour government that is happy to make investors pay more and more. In addition to our previous proposals to promote private investment by lowering the capital gains tax, a Conservative government would implement a risk reduction scheme for investments in high tech start-up companies. While our proposal would not completely eliminate the risk of a loss, we would allow investors to write off a significant portion of a loss – mitigating a portion of the risk and encouraging investment in potentially high-reward ventures. We stand for both well-managed public and entrepreneurial private investment in British innovation.

In our previous Shadow Budget, when Labour barely increased investment in research, we proposed a significant increase in funding for both Research Councils and the R+D Fund. These initiatives are critical for developing ideas and breakthroughs in our universities that lead to technologies commercialisable by British industry. We pledge to maintain heavy investment in Research Councils, particularly those focused on biomedicine, life sciences, energy, and technology development – in order to facilitate discoveries that promote high-tech growth in Britain. Moreover, we will use the R+D Fund established under the last growth-minded Labour Chancellor, Mr Manning – I will give credit where credit is due – to develop both institutional technology transfer offices at universities that help turn academic innovations into marketable products and facilitate the formation of new networks of investors, academics, advisors, scientists, and developers around Britain’s universities. These start-up hubs will prove to be engines of growth for technology development in the United Kingdom.

Moreover, there is certainly, as many of you are aware, a need for new capital to facilitate the formation of these start-up hubs surrounding our universities. I propose the launch of university-based venture funds that will provide students with applicable training in finance and management of start-up investments and will provide much needed capital to fledging start-ups seeking to break out from the university and into the universe. These funds will provide an opportunity for Britain’s young entrepreneurs to become front-line investors and business leaders as local- and university-based start-ups launch British communities into a new era of productive and innovative growth.

Finally, Conservatives understand that existing businesses still have much to offer. As a scientist and an executive at GlaxoSmithKline, one of the larger pharmaceuticals headquartered in Britain, I came to fully appreciate the role that these large companies play in driving research investment forward. To that end, we will extend the R+D tax benefit that currently targets SMEs to larger companies, such that they may see the benefit of increased investment in innovation. Promoting investment across our corporate landscape, whether in SMEs or larger companies, stands to benefit the British people, British investors, and ultimately, our British economy.

In light of recent economic data there is a clear case that we can no longer penalise success, discourage corporate innovation, or target Britain’s job creators for tax increases.

We need investment in Britain’s innovative industries – not new taxes on investors.

We need development of greater links between British universities and British businesses – not a stagnant environment for research funding.

We need to support British enterprise that drives so much of our job creation and growth – not suffocate it.

Herein, we have laid out the plans of a Conservative government to promote enterprise, investment, and innovation. Our plans will stand to benefit every start-up, SME, or high-tech leader in this room. They will benefit our universities, our students, our workers, and our innovators. That is what Britain needs. I hope you agree with me on this.

Our proposals – a British Investment Bank, new incentives for venture investors, investment in research, and university venture funds – are but a fraction of our policy for growth in Britain. They are not a final solution. They are not the only solution. They are part of the solution. And as we propose our next budget, we will make this clear – we will fulfill these obligations while promoting the pro-business tax reform that we championed previously. The Government may twist and turn, managing the economy from crisis after crisis, but our support for growth and innovation in Britain will never waiver. Through these proposals and our actions in Parliament, I shall endeavour to prove this to you.

Thank you for your time and good night.

*Approved by Steve
The Hon Lady Eleanor Grosvenor MP
Shadow Chancellor of the Exchequer
MP for Sevenoaks | Conservative Party
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This is a decent speech for the audience, and it is great to see some policy, but it is a bit technocratic (that is not a bad thing necessarily). Always worth thinking about what you want the headline to be on the daily mail front page the next day if you want to make a bigger bang - this doesn't quite meet that test. But it is a good speech for this audience and they are thoroughly interested. You get decent write ups in the FT and Times for your focus on innovation; the Guardian approves of a British Investment Bank but muses that it is rather interventionist for the Tory Party.

Conservative +7
Will be doing things soon
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