Minister announces 'unfair advantage' for small businesses

Nigel Griffiths, Minister for Small Business, has announced a £75 million Government fund to help new and existing small businesses to grow in the UK. At the same time, he announced a £2.7 million campaign which he says will give small businesses 'an unfair advantage' over competitors by increasing their access to Government 'Business Link' services.

Part of the Small Business Service (SBS) initiative will involve the setting up of small business 'incubators' to provide:

• An instructive and supportive environment for entrepreneurs in start-up and early stage businesses;
• Access to small workspace units on flexible terms with 'easy-in, easy-out' terms;
• Access to early stage finance;
• Networking and peer group support;
• Effective technological infrastructure, including broadband communication links; and
• Access to business support tailored to the needs of the client businesses.

Mr Griffiths announced the new initiatives with David Irwin, Head of the Small Business Service.

Mr Griffiths said: "Providing the right environment for business start-ups to flourish is essential as small businesses are the lifeblood of our economy. This fund will help small businesses to turn new ideas and technology into prosperity and jobs across the country. There is a wealth of untapped enterprise in our society, this fund should increase the availability of incubation in local communities so that all those who would benefit from it have a better chance of access."

The £75 million loan fund was announced in the 'Opportunities for All' White Paper published in February. It will be operated by the Small Business Service working closely with other Government organisations at regional and local levels, such as the Regional Development Agencies.

Mr Griffiths simultaneously launched a £2.7 million campaign to give small businesses what he called 'an unfair advantage' by providing increased access to Business Link centres around the UK.

Launching the campaign Mr Griffiths said: "Small businesses are the life blood of the economy. They employ 12 million people and contribute £1 trillion to the UK economy each year. That is why it is crucial our businesses get the best advice possible. The Business Link network can be a stepping-stone to funding as well as advice. It can be your unfair advantage over your competitors."

The campaign, entitled 'The Unfair Advantage', runs until the 14th October and aims to raise awareness of the need for small business advice among the UK's small businesses and establish Business Link as the best place to go for it.

The announcements follow a recent survey by the Institute of Chartered Accountants for England and Wales (ICAEW) in which they conclude that the Government is damaging the growth of small businesses because of excessive regulation, despite the initiatives it has introduced.

The ICAEW survey found that three-quarters of the 1,290 Chartered Accountants who took part agreed that the Government is not doing enough to encourage an enterprise culture. Fifty-five per cent considered that current support from the Government for start-ups is 'poor or dismal.' The report also revealed that 79 per cent also regard the current regulatory environment as either 'poor or dismal.'

Michael Groom, President of the Institute of Chartered Accountants, said: "Interest rates and inflation may be favourable for start-ups, but the Government clearly needs to improve, and better publicise, the level of support available to help them survive and thrive. Too many new businesses are constrained by red tape, cumbersome regulations and lack of access to finance. These barriers urgently need addressing if the UK is to become the world's enterprise capital."

The ICAEW has since issued a statement expressing support for 'a Government campaign which encourages small businesses to seek professional advice offered by their local Business Link network.'

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Richard Powell, UKTECH