BBB AR 2020 Banner image Centre of Expertise

Our objectives

Centre of expertise

To be the centre of expertise on smaller business finance in the UK, providing advice and support to government.

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As part of all its activities the Bank strives to build, refine and share its expertise, both to deliver more effective programmes and to advise and shape SME access to finance approaches with important stakeholders. This principally means working closely with the Bank’s Shareholder, BEIS, and HM Treasury, but also with wider government stakeholders and significant actors in industry, academia, think tanks and the media.

Through this objective, we track the impact of our research and publications, as well as our involvement in opinion and policy engagement, and cross-government programme development.

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Responding to the challenges, and 2019/20 snapshot

Research and publications

In addition to our two annual market reports – ‘Small Business Finance Markets’ and the ‘Small Business Equity Tracker’ – we published three topic reports on areas of market interest, and where there are knowledge gaps. These were:

  • an October 2019 analysis, ‘UK Venture Capital Finance Returns’, providing the most comprehensive and robust approach to date for assessing the comparative performance of UK VC funds since 2002
  • a November 2019 report, ‘The Future of DC Pensions: Enabling Access to Venture Capital and Growth Equity’, providing an in-depth assessment of the case for defined contribution (DC) pension scheme investment in these asset classes
  • a February 2020 report, ‘UK SME Exporting Trends in Finance and Trade’, where for the first time the Bank co-sponsored a report with three government departments (BEIS, DIT and UKEF).

Our reports received significant media coverage and continue to be a ‘go-to’ source of market information for the finance industry and policy-makers.

Policy engagement

In 2019/20 we worked with relevant government departments to progress ideas – such as on regional access to finance and post-EU-Exit strategy. Budget 2020 provided the Bank with a further £200m for investment in high-growth businesses as the UK leaves the EU. Additionally, we progressed important initiatives, such as the £600m Life Sciences Investment Programme, working with the Office for Life Sciences, and the DCMS-led Creative Scale Up Programme. These areas remain active in 2020/21.

Opinion engagement

We continued to enhance our reach, both within the media and through important academic and industry partners (with average monthly audience in 2019/20 having increased to 23.3m, compared to 18.7m in 2018/19). The Bank’s new Government Relations and Public Affairs (GRPA) unit increased engagement with senior government and parliamentary stakeholders across all political parties. The Bank was positively referenced in manifestos ahead of the December 2019 General Election.

Programme development

Working with government stakeholders we provide expertise for specific programmes and products, assisting with their development or refinement, to support government policy goals. In 2019/20, this included progressing further adjustments to ENABLE Build and the National Security Strategic Investment Fund. The latter secured an increase in its funding from £85m to £135m at Budget 2020.

BBB AR 2020 Case study Images Mitchs Kitchen
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Case study
Mitch’s Kitchen

  • Region: South East
  • Location: Droxford
  • Programme: Start Up Loans
BBB Case study map South East

Chef and vegan cookery teacher, Mitch Lee, co-founded Mitch’s Kitchen with his wife Shirin in 2017. The Hampshire-based online shop delivers home-cooked frozen vegan meals across the UK. The venture has also extended its business model to offer vegetable boxes to those self-isolating during Covid-19.

Mitch received a £15,000 Start Up Loan to help launch his business. Despite the difficult economic climate, Mitch’s Kitchen saw a 208% increase in sales from March 2019 to March 2020, with sales continuing to grow.

2019/20 KPI performance

Our KPI for this objective considers both delivery of specific initiatives, as well as contributions through the year on the key aspects of research and publications, policy engagement, opinion engagement and programme development. At year-end, our Board and Shareholder examine an internal report on centre of expertise activities and agree an assessment of performance, using a ‘Red Amber Green’ status.

While it was recognised that the Bank achieved the agreed outputs in the year, the overall rating of ‘Amber’ reflected the need to have a greater impact within government, and to be more proactive in our own research and contributions to policy debates.

Target

Report on delivery of specific initiatives (seven for 2019/20) and contribution across key aspects by 31 March 2020

Outturn

Amber

Interim Covid-19 update on Bank activities

We delivered significant volumes of advice and research to help inform, in particular, our Shareholder and HM Treasury on the policy and delivery options for emergency smaller business access to finance interventions. We offered our full resources to government, leveraging our market and product experience, as well as our network of established delivery partners. As highlighted earlier, this helped the rapid delivery of four substantial national programmes across debt and equity.

As well as delivery of Covid-19 response schemes, we are supplementing some of our existing activities to take account of the recent changes to the economic environment and the expected requirements of the recovery phase. A good example of this is in the tempo of our economic monitoring which has, where relevant, accelerated to daily and weekly updates, to complement the usual monthly, quarterly and annual approach that was appropriate pre-crisis.

We have also adapted our research projects, modifying, for instance, the scope of our forthcoming entrepreneur research to include a Covid-19 ‘impact lens’. This means we will gather the appropriate data to provide a more relevant and timely body of evidence from which to drive our interventions, and effectively inform government policy development.

We maintain intensive engagement as the situation evolves, working closely not only with officials at BEIS and HM Treasury, but also with delivery partner representatives, business and finance groups, and a wide range of other stakeholders.

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