If you’re already getting our Policy Updates, you may have heard enough from us this week. For the two-thirds of you not already subscribed, this is where we share occasional updates on — yes, you guessed it — policy.
It may not surprise you that the vast majority of the many messages I’ve received have been about the narrow conditions for qualifying for Founders’ Relief. We’ll be pushing for it to be widened, but there’s also a lot more to the Budget than this.
First, as our Adviser Oliver Claridge set out today in a Policy Update, there is an upgrade to the UK’s two main tax-advantaged share option schemes, Enterprise Management Incentives (EMI) and Company Share Option Plans (CSOP) — the latter rebranded EMI2, which is what everyone will be calling it from now on. At present a CSOP grant eats into what you can then give the same employee under EMI, because both count towards one £250,000 ceiling. From 6 April 2027 the two are counted separately, the CSOP limit doubles from £60,000 to £120,000 a head, and options can run for 15 years instead of 10. This is a big deal.
Callum Hemsley, CEO of TypeDB, is “cautiously optimistic”. He messaged to say: “There is plenty to like as an entrepreneur in this Budget, particularly the £80 million for sovereign AI procurement, greater use of challenge-based procurement, and a clearer definition of UK suppliers.” And as I covered in my Forbes article, entrepreneurs had positive things to say about the British Business Bank doubling its commitment to women-led businesses and funds to £200 million, alongside a new scale-up programme for female founders, and a higher trading allowance for sole traders.
One change we were particularly happy to see answered our long-standing call — most recently in Job Creators 2026 — to expand the list of universities whose alumni would qualify for the High Potential Individual visa. In fact, just the day before the Budget I was reiterating this when giving evidence to the Business, Innovation, Science and Trade Committee.
Finally, as our Patron Steve Rigby wrote on LinkedIn:
“The roadmap to retaining 100% of business rates locally by 2030, with 20% flowing to mayors from next year, and a share of income tax from 2028, is the most consequential policy initiative announced today. It is the first serious attempt in a generation to link regional growth with regional revenue. For companies headquartered outside London, it means local leaders having real money and a direct stake in businesses’ success. It also means we need to be at the table as mayors decide how to use these funds.”
As we have argued before, devolution comes in two forms. The first transfers funds, on the assumption that decisions made closer to the ground will be better ones. The second lets places keep the proceeds of growth, and bear the cost when it doesn’t come. It is only this latter model that alters the incentives at play. This is the right sort of devolution.
National Importance
I would hate to fall into the rightly parodied class of organisations calling the Budget a “missed opportunity”, but it didn’t address the key concern of entrepreneurs in our network. As I wrote in our snap reaction:
“Our latest Entrepreneurs Survey with Blick Rothenberg, which closed just before the Budget, found that cutting Employer National Insurance was founders’ top Budget ask. Reducing the obligations on employers in the Employment Rights Act was entrepreneurs’ fourth-highest priority.
“With the National Living Wage rising 3.9% to £13.21, nearly a million young people not in education, employment or training, and unfair dismissal rights after six months and uncapped compensation from January, the number one issue facing entrepreneurs and the next generation remains unaddressed.”
As Bugrahan Eroglu, Founder at SpeakLab, wrote to me:
“At 22, I built SpeakLab on my own — an AI-powered language-learning platform now used by more than 25,000 learners. My next challenge is building a team to improve the product, reach more learners globally, and expand partnerships with universities and language schools. I welcome the Budget’s expansion of employee share options, but reducing employer National Insurance for a startup’s first few hires would make a more immediate difference at this stage.”
The forthcoming Milburn Review will hopefully address some of this. But the cost of employment and the dearth of opportunities for the next generation to work are such monumental problems that they need more than a pilot of a Young Entrepreneurs Allowance (welcome as it is, and reflecting our Starting Out and Starting Up report).
Thanks for reading Perennial Gale!
Depledge of Allegiance
Regular readers will already be aware of the high regard in which we hold Alex Depledge, the outgoing Entrepreneurship Adviser to the Chancellor of the Exchequer. In short, everything good that the Government has done for entrepreneurs over the last few years has her fingerprints on it. I’ll share some of her words on LinkedIn in the hope that others with her talent who are reading this follow in her footsteps:
“I took this job because I want Britain to build companies that compete with the biggest on the planet. I want the next Magnificent Seven to include British businesses. I want companies like Revolut to scale and stay here, and for people across this country to benefit from their success. That has been the objective all along.
“Having built two businesses myself, I know how much founders put on the line. I also know what can happen when an ambitious company gets the backing it needs. The jobs that creates, the opportunities it gives to people, the investment and tax revenues it generates as it grows.
“This is why I believe so deeply in entrepreneurship as an engine of growth. Britain’s prosperity urgently depends on our ability to turn our extraordinary ideas into extraordinary companies. Our future rests on it.”
Thank you for your service.