Since 1980s’ the United Kingdom small business population has increased significantly. Small businesses have acquired a key role in UK economic policies paralleled by development in support structures to promote them. Despite broad rhetorical claims that government policies and support have not helped in developing strong enterprise culture and promotion of the UK economic prosperity, outcomes of various researches, including this management project have proved otherwise. This paper examines the impact of government policies and intervention on innovation in SMEs within the UK and draws out some key findings and recommendations for their future in the UK. It concludes that government policies and intervention to SMEs over the years has yielded some positivity, however, more can still be done in areas such as research and development, advisory services and also, eradication of red-tapes and bureaucracies to enable the innovativeness in SMEs to come to fore.