Government lays out post-Brexit business subsidies system

Under the proposed system, the government said local authorities, public bodies and the devolved administrations in Edinburgh, Cardiff and Belfast will be able to decide if they can issue taxpayer subsidies by following a set of UK-wide principles.

The government said the principles will ensure subsidies are designed in such a way that they deliver strong benefits and good value for money for the UK taxpayer, while being awarded in a timely and effective way.

Further, it said the new subsidy control system will allow the UK to be more dynamic in providing support to businesses, including in innovative, R&D-focused industries, to encourage job creation and growth across all parts of the UK.

Businesses have been called on to participate in the consultation, particularly regarding:

• whether the UK should apply its own additional principles on subsidy control, as well as those set out in the UK-EU Trade and Co-operation Agreement;
• how best to ensure transparency across the system;
• the possible roles and responsibilities of the independent body that will oversee the new system;
• how this independent body could have some role in supporting enforcement of the principles, alongside normal judicial review standards; and
• how the system could seek to introduce exemptions consistent with our international obligations, such as ensuring subsidies of low value, those given to support natural disaster relief or in response to global economic emergencies.

Business Secretary Kwasi Kwarteng said this is a significant milestone on our historic journey as an independent, sovereign nation.

“Our new, more flexible system will empower public authorities and devolved administrations, and ensure fair competition for businesses across the UK,” Mr Kwarteng said.

“Now we have taken back control of our money and laws from the EU, we want to use our newfound freedoms to propel the UK to the forefront of innovation and help create the jobs of the future, while also making the UK the best place to start and grow a business.

“With a modern, tailored approach to supporting businesses, we will also be able to press ahead with our long-term ambitions to tackle climate change and to level up opportunity as we build back better from the pandemic.”