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Re-inventing the wheel? – a blog by Philip King

30 January 2014

I was fortunate to attend the Federation of Small Businesses Policy Conference on Monday. It was a good day and the FSB had secured an impressive array of speakers including the Prime Minister David Cameron, the Chancellor George Osborne, and the Shadow Business Minister Chuka Umunna. All three made strong overtures to the audience emphasising the importance of small businesses to them (and their parties) and how the needs of small businesses are influencing policy. You’d have thought they were trying to warm up the small business vote ahead of a general election but maybe I’m just a cynic!

I want to make a plea about one particular Labour plan but must stress that, as in all my blogs, I’m expressing my personal views and I’m not speaking for the ICM.

Chuka Umunna used the conference to announce Labour’s firm intent to introduce a Small Business Administration if it wins power at the next election. The SBA will be based on the US model and Karen Mills who heads it in the States was one of the conference speakers. I have no problem with, indeed I applaud, taking the needs of small business into account. After all, the FSB tells us that small businesses account for 50% of UK GDP, and employ more than half of all private sector workers.

The details are not yet clear but this new body will, I understand, ensure that small business’ needs are recognised across all areas of government. It will, we were told at the conference, achieve what BIS should be achieving for small business and far more effectively. In July 2013, according to a report prepared for the Labour Party by Andrew Adonis, the Department for Business, Innovation and Skills (BIS) and its partner organisations employed 24,500 officials.

The Adonis report also highlighted the wide range of responsibilities held by ministers and recommended there should be a dedicated Minister for Small Business. I wrote a blog when Matt Hancock was appointed to his current role bemoaning the breadth of his portfolio so I’d support that too. If BIS isn’t working as well as it should, it needs fixing and 24,500 civil servants should give scope for improvement.

Maybe I’ve misunderstood but my reading of the Labour proposal is that it’s not just about ensuring a minister has ownership for small businesses and their needs. I sense an aspiration to create far more than that and my point is this: we already have BIS whose responsibility includes a small businesses remit. Indeed I have attended many meetings myself when this has been the sole focus of discussion. 

I’d support anything that enhances its engagement with SMEs and improves the environment for them. But please let’s not create another quango, czar, or whatever we end up with through reinvention of the wheel. If BIS isn’t working, let’s fix it but, please, not by introducing a body that will add confusion, duplication and bureaucracy!

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