DTI shake-up could benefit SMEs

Small businesses stand to gain much from a planned restructuring of the Department of Trade and Industry.

Trade and Industry Secretary Patricia Hewitt announced a series of reforms to the structure and operation of the DTI last week. These aim to improve the department’s relations with business as well as consumers and employees.

Of particular interest to smaller businesses are proposals to shake up and simplify the scores of business support funding schemes. Those currently in existence will be organised into five distinct groups. An estimated £1 billion is currently spent on British industry via these grants and loans. The revamp should in theory make it easier for businesses to identify and access the right support they need to develop and flourish.

The British Chambers of Commerce (BCC) reacted with scepticism though to the proposed creation of a new anti-regulation champion for small- and medium-sized enterprises.

“Business needs government simply to concentrate on practical measures to reduce the burdens they face,” said David Lennan, director-general of the BCC. He added that the issues and arguments in this area are already laid out, with clear solutions at the ready.

The organisation welcomed plans to give greater powers to the Small Business Service, with an emphasis on Business Links. Lennan said that the measure answers business’s calls for strengthened and more streamlined branches, which would help “to support local and regional competitiveness.”

In a revolutionary move each of the DTI’s senior civil servants will actually spend a week each year with a relevant business. Particular emphasis in these work placements will be placed on contact with SMEs, including social enterprises.

The basic thrust behind much of the revamp is to involve a greater number of experienced business people in developing strategy and making departmental decisions. This could come through involvement on the departmentÂ’s boards.

Garry Parker, head of policy at the Forum of Private Business, cautioned that a restructuring of the DTI is “nothing new.” However, he said that if the business people were carefully chosen, ensuring that both large and small business communities were represented, “then the strategy has every chance of success.”

With thanks to Lloyds TSB Success4Business.

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