NatWest boss PAUL THWAITE talks £35bn secret weapon to save UK economy

In the UK there is an overlooked powerhouse of 13,000 businesses that could be the key to driving our future productivity and growth.

Medium-sized businesses, employing between 100 and 2,500 people, have over the past decade consistently grown at a faster rate than the economy as a whole.

They represent just 0.5 per cent of total UK businesses, but punch well above their weight; They represent more than a quarter of national turnover and more than seven million jobs throughout the country.

However, these companies do not receive the recognition they deserve. They operate in a twilight zone between exciting startups and large corporations, with an equally large platform.

They are packed with potential to boost national prosperity, but too often overlooked by policymakers and financial institutions. But make no mistake: these companies have transformative power.

Our research shows this group could add £35 billion to the economy over the next five years and create more high-quality jobs. The ripple effect would be felt across the UK with 70 per cent of this growth occurring outside London and the South East.

A third of these companies already export their goods and services abroad, compared to only 13 percent of smaller companies.

Take, for example, Bristol-based Open Bionics, which I visited a few weeks ago. The company develops custom 3D-printed bionic arms for amputees, including Disney designs for children as young as five in the style of their favorite superheroes.

With plans to open six more clinics in the US, Open Bionics is not only improving lives with life-changing medical devices, but also enhancing the UK’s reputation as a global leader in innovation.

This is precisely the type of company that deserves support to further expand its operations.

But these medium-sized businesses need adequate support. Despite their potential, they face specific challenges: they often struggle to access the skills, infrastructure and investment they need to grow.

Regional support networks may be fragmented. For example, it can take too long to move products and people relatively short distances, and delays in planning decisions can undermine expansion ambitions.

The pace of growth itself can be a problem for mid-sized companies. This sounds paradoxical, but if the complexity of your business grows faster than its capacity, then it can be a headache.

Pressured leaders tell us they find themselves wearing many hats. As their business grows, they have to deal with increased bureaucracy and new reporting requirements.

If they expand international trade, they may have to deal with legislation in multiple jurisdictions.

There is a lack of solid data on mid-sized businesses, leaving them without a strong voice in government. Therefore, when policies or laws are made, they do not reflect your unique needs.

As a first step in addressing these challenges, NatWest, with support from the Department of Business and Trade, will create a new UK Mid-Market Council, with members representing primary sectors from across the business sphere.

This coalition of public and private sector leaders will amplify the unified voice of mid-market businesses, dismantle barriers, and champion their growth.

We will support this initiative with the introduction of a mid-market growth tracker in collaboration with data company S&P Global.

Starting in January, this monthly report will provide vital data on the sentiment and growth prospects of this critical group, highlighting where they are thriving, how new challenges are impacting them, and monitoring progress to identify where additional targeted support is needed.

This fundamental work will provide the understanding and analysis that will improve policymaking. Bold and sustained action is needed if we are to unlock the potential of medium-sized businesses.

Public and private sector collaboration is key to helping these businesses reach new levels of success, benefiting our communities, our industries and the future of the UK economy.

What’s good for medium-sized businesses is good for the UK. By investing in their success, we are investing in a stronger, more inclusive economic future for all of us.