Government announces major strategy to help small businesses

Among the measures included in the strategy are clamping down on late payments, £1 billion funding for start-up loans, targeted help for under-represented entrepreneurs and a new Business Growth Service. 

What is the new strategy all about? 

The new strategy focuses on the importance of small and medium-sized businesses (SMB) to the Government’s growth mission, and states that accelerating SMB growth by just 1% a year could deliver an extra £320 billion to the UK economy by 2030. 

In the foreword to Backing your Business: Our Plan for Small and Medium Sized Businesses by the Chancellor Rachel Reeves and the DBT secretary of state Jonathan Reynolds, they state their long-term goals, including new powers to reduce late payments, reducing red tape costs by 25%, improving access to finance, upskilling on digital and AI technology and a new Business Growth Service. 

Where is the new investment going? 

New investment is promised in: 

• new Fair Payment Code, to prevent late payments which can cripple SMBs 
• expanding start-up Loans to 69,00 new businesses 
• increasing the ENABLE guarantee for SMB lenders by £2 billion 
• £400m Investor Pathways scheme for business owners from under-represented backgrounds 
• an extra 13,000 police on the beat to tackle shoplifting and tool theft  
• permanently lower business rate multipliers for rateable values below £500,000 
• £1.2m extra spending on skills by 2029 
• UK Export Finance’s capacity increasing by £20 billion 

What did we already know about? 

The plan also sets out further details on areas already announced, such as HMRC’s Transformation Roadmap, which was announced on 21st July 2025, streamlining the planning process, and pushing the benefits of the Net Zero agenda. 

Tina McKenzie, Policy Chair of the Federation of Small Businesses (FSB), said: “Making sure businesses are paid on time, that our high streets thrive, and creating conditions in which everyone can start and succeed in business are crucial priorities for small businesses, communities and the economy.

 “I’m pleased that FSB and the Government have been able to work in lockstep on the bold and ambitious measures needed to tackle the scourge of late payment through legislation, and other pro-growth, pro-small business measures.” 

Last updated 1 Aug 2025 | First published 1 Aug 2025

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Helen Wood, CA

Helen is a qualified chartered accountant (CA) and joined TaxAssist in 2025 following three years as a freelance content writer for clients in the tax and accounting publishing sector. Prior to this, She spent 17 years at Big Four and Top 10 accountancy firms. Helen writes clear and helpful articles on tax and accounting for businesses and individuals.

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