By Daniel Hunter
The Federation of Small Businesses (FSB) broadly welcomes Lord Young’s report and his ideas for proposed additional help for small firms, for example increasing access to procurement contracts and expert advice in business schools and boosting non-bank sources of finance.
However there remain concerns whether some of the schemes are of sufficient scale to change fundamentally the small business landscape and whether they add further complexity to an already crowded business support market.
Ultimately, to provide a coherent approach the FSB would like to see start-up loans and Growth Vouchers to operate under the aegis of the new Business Bank to ensure there is a joined up approach. Growth vouchers could be a promising idea, proving a means for business to access advice to help them grow, but needs development.
Past experience with funding apprenticeships show that key to their success will be putting the funding in the hands of businesses to choose the provider they believe best fits their needs and thereby drive the market, and not the training providers.
“We welcome Lord Young’s focus on bringing forward initiatives designed to help small businesses access loans and much needed finance as well as advice that could be crucial to their growth prospects," Graeme Fisher, Head of Policy, Federation of Small Businesses, said.
"However to ensure success we believe such schemes need to be carefully managed so they benefit many, and do not simply add further complexity to what is already a confusing market place for business advice. One means of doing so will be to house start-up loans within the Business Bank, and thereby tie access to advice closely to access to finance.
"Growth vouchers could be a promising idea but again how they are delivered will be all important. Experience shows that this will be most effective if put the voucher is put in the hands of businesses themselves so they can choose the best advice available to them, and not in the hands of providers.”
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