By Claire West

A new report by the Federation of Small Businesses (FSB), backed by the Institute of Chartered Accountants for England and Wales (ICAEW), urges Local Enterprise Partnerships (LEPs) to drive small business growth through changes to the way business support is provided.

The report recognises the role played by LEPs in facilitating well-targeted business support, and its importance to the national economy in delivering future growth. However, it also highlights areas of weakness that LEPs should address in order to strengthen the system.

Based on evidence provided by the respected Enterprise Research Centre (ERC), the report reveals that current support is often ineffective, holding back the growth prospects of businesses in the English regions. A number of significant issues are cited as causing problems, notably the fragmented nature of the offer, with too many schemes in place without enough critical mass to make an effective contribution, and lack of co-ordination between various schemes.

The report argues that Local Enterprise Partnerships (LEPs), working alongside newly formed ‘Growth Hubs', are ideally placed to make improvements to the business support in their areas, and thereby boost growth. Their unique strategic position allows them to understand their local economies and the needs of their business communities.

The FSB is therefore calling on LEPs to provide much needed co-ordination and leadership, and provide much greater focus to the offer in their area, including regular monitoring of the effectiveness of schemes. As part of their upcoming reviews of business support, LEPs should therefore seek to follow the recommendations set out in the report, each of which is based on a sound evidence base and the expert insights of the ERC as to what works best.

John Allan, National Chairman of the Federation of Small Businesses, said:

"This report highlights the great potential of LEPs to energise small firms in England — but only if the right steps are taken to improve the design and delivery of business support. This could be achieved by cutting duplication, better co-ordination of support at the local level, and robustly evaluating schemes on their effectiveness. The FSB therefore calls for LEPs to work with newly formed ‘Growth Hubs', and make improvements to local business support an absolute priority.

"99 per cent of all UK firms are small businesses, so growing those firms through better business support can make a real difference to local economies, helping in the rebalancing of growth outside London and the South East. Growth currently compares well with other G7 countries, but the economy lags noticeably in key areas such as our exporting performance and labour productivity.

"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."