EIS Association calls on Chancellor to look to entrepreneurs and their investors to drive economic growth in the fiscal announcement
The Enterprise Investment Scheme Association (EISA), representing entrepreneurs, investors and advisors involved in facilitating private sector investment through the Enterprise Investment Scheme (EIS), is calling on Chancellor Kwasi Kwarteng not to underestimate the role entrepreneurs and their investors can play in helping to drive economic growth post Covid.
Director General of the EISA, Christiana Stewart-Lockhart makes the point that, “The Enterprise Investment Scheme (EIS) and the Seed Scheme (SEIS), are crucial for UK entrepreneurs looking to secure investment into high growth businesses. The EIS is recognised as extremely valuable in ensuring the UK has a thriving start up culture and these world leading schemes play a significant role in driving investment, innovation and economic growth in the UK. Since the schemes were launched, over £27billion has been invested in more than 52,000 businesses.”
As matters currently stand however, the EIS is set to close in April 2025, and without the intervention of the Chancellor confirming an extension of the scheme, many early stage businesses will be starved of the investment that they need to grow, create jobs and contribute in a sizeable way to the economic recovery.
Christiana Stewart-Lockhart adds, “Removing the sunset clause on the EIS now would provide some vital security for UK start-ups. This is especially important for entrepreneurs given the wider economic uncertainty. The country would suffer a major shortfall in the funding currently available from private investors if the EIS was not extended. Already we are seeing the looming sunset clause having an impact on entrepreneurs’ ability to secure crucial investment and we would welcome clarity from the Chancellor regarding the future of the EIS. It is critical that entrepreneurs are given the reassurance that the Chancellor sees the EIS as continuing to play a major part in his plans to build on the entrepreneurial culture in this country and drive economic growth.”
The sunset clause was an EU requirement when the EIS was last renewed in 2015.