The government should do more to make sure small and medium sized businesses (SMEs) can access a range of initiatives designed to provide finance, as the current approach is not operating as a unified programme, according to a report from the National Audit Office (NAO) say Harris & Co accountants Northampton, the specialist small business accountants.
NAO’s report follows work by the Department for Business, Innovation & Skills (BIS) to re-examine the nature of the finance problems facing SMEs in the run up to the launch of the Business Bank next year, and research which suggests SMEs may need an additional £22bn over and above the finance available to them by 2017.
The report found that, at present, although BIS and HM Treasury both have teams dealing with ‘enterprise’ policy, there is no formal research programme joining the departments with other departments, such as HMRC, with an interest in SMEs.
One of the Treasury’s priorities is to support the development of new routes to finance for SMEs, while BIS schemes target specific parts of the market. To date, NAO says the departments have not articulated clearly enough what the various schemes are expected to deliver as a programme.
NAO says BIS has also taken steps to provide better explanations to SMEs on the options available to them for financing their business, but warns that raising the profile of the help available will be a challenge for the Business Bank.
NAO head Amyas Morse said: ‘There is a range of schemes led by BIS to address areas of the market where there are problems. But there is work to be done in terms of managing the schemes as a unified portfolio and articulating what they are intended to achieve as a whole. Given the importance to the government of promoting growth, greater benefits and public value could be achieved through treating the interventions as a programme, with a clearer focus on assessing what results can realistically be delivered.’
In the wake of the UK’s first Small Business Saturday, which took place at the weekend, BIS has announced a package of measures to help the sector, under the umbrella Small Business: GREAT Ambition.
They include up to £100m of new broadband vouchers worth up to £3000 each to help small firms in 22 cities across the UK with faster and better broadband connectivity; an agreement from the major energy firms to end auto-rollovers for business customers, limit back billing, increase transparency of contract terms and make switching easier; access to £230bn of public sector contracts via changes to the bidding process; and steps to tackle late payment of small businesses who supply the public sector in a supply chain, as well as a consultation on late payment in the private sector.