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Business support scheme reform needed, says FSB

Small businesses are not getting enough local or national support, according to a report by the Federation of Small Businesses (FSB).

The study, based on findings from the Enterprise Research Centre, argues that business support mechanisms are "often ineffective" due to:

  • high levels of complexity 
  • under-promotion
  • a lack of research into business support best practice.

The FSB believes that current schemes are either causing confusion or business owners are simply not aware of them. The lack of a research-based strategy has resulted in the duplication of different programs and a lack of coordination between support providers.

Local Growth Hubs

The FSB highlights the role that Local Enterprise Partnerships (LEPs) can play in delivering targeted, localised support to small businesses.

LEPs are partnerships between businesses and local authorities that cooperate in prioritising investment for local areas.

The FSB recommends that LEPs:

  • review the schemes currently on offer to avoid duplication
  • tailor support services to fit the local economic conditions and needs of businesses
  • focus on getting a small number of schemes right, instead of launching many under-supported schemes
  • think about how the schemes' successes will be measured.

The FSB is calling on LEPs to work with Growth Hubs to deliver an effective framework for regional business support. Growth Hubs were recently set up in regions around the country and provide direct support and investment access to local businesses.

John Allan, national chairman of the FSB, said:

"There is no 'magic bullet' solution that will work across the country, because every locality has unique needs that individual LEPs must satisfy. But a long-term approach based on proper evaluation of initiatives, co-ordinating plans nationally and focusing on fewer, more targeted initiatives will all work to raise business performance."

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