A mismatch has been found between MPs’ strong opinions about what would boost start-ups and their generally poor understanding of policies already in place to help such young enterprises.
Having quizzed 105 MPs, pollster YouGov determined that “too often, over half of MPs either haven’t heard about established policies or don’t know whether they are effective.”
But such a “surprising lack of knowledge” does not stop them having an opinion, as a Conservative or Labour politician, on what should be done to encourage entrepreneurship.
In particular, more than nine in ten Tory MPs say they key to unlocking more companies is to lower personal taxation, with almost as many backing a reduction in corporation tax.
However, many of the respondents from the Conservative party admitted they were unaware of the tax incentives already in place for entrepreneurs.
Fifty-two per cent either had not heard of the Seed Enterprise Investment Scheme (SEIS), or didn’t know enough about it to determine whether it is effective.
Introduced in April 2012, the scheme grants individual investors up to 50% tax relief on investing in smaller firms up to a maximum of £100,000.
Labour fared even worse in the poll, which was commissioned on the eve of Small Business Advice Week by The Entrepreneurs Network, a think-tank.
Three-quarters of the party’s MPs said start-ups needed more spent on either support services or grants, yet a strong majority were unaware of a key spending initiative already in place.
In fact, asked about the GrowthAccelerator, 62% of Labour respondents hadn’t heard of the support, coaching and advice programme, or didn’t know about it enough to determine whether it is effective.
Among MPs a whole, the Angel CoFund was the least known ‘start-ups’ policy, with 74 per cent saying they hadn’t heard of it, or didn’t know enough about it to say if it’s effective.
The fund, with an investment budget of £100m to back promising firms, is in contrast to the Patent Box, as this tax discount for firms with profits from patents was the best-known policy.
Still, the 2013 tax relief was completely unknown to 42% of the MPs,
and the same percentage confessed they had “never heard of” Entrepreneurs' Relief, which can cut Capital Gains Tax.
Philip Salter, director of The Entrepreneur’s Network, said: “It’s encouraging that MPs are increasingly vocal about supporting Britain’s entrepreneurs; however, the fact that they are unfamiliar with the policies already in place is worrying.
“As things stand, MPs don’t appear adequately informed to vote on future policy changes impacting entrepreneurs. Also, MPs should be familiar with these schemes so that they are able to pass on details to the many entrepreneurs they meet in their constituencies.”