Local Enterprise Partnerships, the regional bodies set up to help businesses, are not doing enough for small firms, according to a report.
The Federation of Small Businesses surveyed its members, local authorities and LEPs, and found that they were dominated by big business concerns.
The report, The Future of LEPs: the small business perspective, said: “66.7 per cent of FSB representatives felt that large businesses exerted the greatest influence over LEPs.
“Over two-thirds of the private sector representation on LEP boards are from businesses with more than 250 employees (0.1 per cent of the UK’s total business base).”
“Only six of the LEPs were chaired by an individual currently running an SME. With SMEs being so integral to the success of the LEP programme, not least because of the EU emphasis on this group, we felt that knowledge and experience of SMEs would be required at board level.”
The FSB also criticised the lack of consistency in the way LEPs were funded, saying: “We found a massive disparity in amounts of resource being attracted by LEPs, and that this was provided for on an ad hoc basis through a fragmented array of funding streams, each with their own bidding processes, timetables and reporting mechanisms.”
LEPs were announced in the emergency Budget of 2010 by the Coalition Government as a way to develop businesses on a local level. They were intended to be a way to enhance economic development by joining up local authorities, and commercial and voluntary sectors.
They replaced the regional development agencies which were seen as overly bureaucratic and stiflers of private innovation.
However, the FSB said that the performance of LEPs was patchy, and dependent on how good its local connections were already.
Adviser comment
Tony Laverick, chartered financial planner of Surrey-based Anders Bayley Scott, said: “I’m a member of my local chamber of commerce and they promote a government scheme but I’ve had no reason to use them.
“We get to know people in the area through chamber networking events - the accountants and solicitors are useful. If we were looking to export then the regional agencies would be more relevant.”
