Frustrated reaction to closure of government’s Business Growth Service intensifies

Cathy Hayward, managing director at Magenta:

“I run a small PR agency and have signed up for the programme. I’ve been told that if I pay my invoice by yesterday they will still guarantee my business coaching, but it will have to be completed by the end of February rather than April.

“For a Conservative government, this seems like an extraordinary move following on from the even stranger chancellor’s decision in the Budget to no longer provide an incentive to entrepreneurs to set up businesses. 

“I set up my company four years ago and employ seven people. I still earn less than I would if I simply freelanced as a PR and less than I earned as a journalist before that. I have ambitions to grow the business, and employ more people, and signed up to the Growth Accelerator scheme, whereby I invest in coaching and the government matches it. To scrap it when the country’s sustained recovery relies on lots of people like me growing small business seems counter-intuitive.”

Mahmood Chaudhri, managing director at Datrix:

“Public sector organisations that partner with SMEs often receive up to a 30 per cent saving on solutions and services, with extra value on offer in terms of specialist expertise and account focus. 

Although the budget has implemented positive changes for certain aspects by closing the Business Growth Service, it will be disheartening to many SMEs which already feel the government doesn’t do enough to level the playing field against larger players.”

James Poyser, co-founder of inniaccounts:

“It’s a real shame that the Business Growth Service has gone. We had it in our sights as a vehicle to help us unlock the next stage of growth. I’d been struggling for a while to find impartial advice on growth and funding, and I was introduced to this service by a friend. 

It was ideal for our needs – helping us to achieve scale up growth. It was unique amongst advisory bodies as it had the expertise to match our ambition. We’ve tried regional development services previously and were unimpressed with the relevance of the advice. There’s plenty of good advice out there for start ups, but very little for scale ups: the Business Growth Service filled this gap. It’s short sighted to close it down.”

Dafydd Llewellyn, senior director for UK SMB at Concur:

“The conservative party campaigned heavily in the general election around supporting the beating heart of the UK economy – small businesses. This makes the closure of the Business Growth Service both a shock and contradiction. 

“SME support will now be facilitated by Growth Hubs, but it is unclear exactly what services these hubs will take on and their strategy for engaging the SME community. The implication is also that large enterprises will be called upon to do ‘their bit,’ but this seems somewhat presumptuous and as yet none have put their hands up.”

“There are more questions than answers at this stage. Are Growth Hubs an adequate replacement? Only time will tell. If they are not, the risk is that the government has taken the economic stabilisers off and pushed SMEs unaided down a steep slope.”

Wayne Brophy, managing director at Cast UK:

“We benefitted massively from participating in the Growth Accelerator programme two years ago. As part of this scheme, we received coaching from industry experts to help with our five year company strategy, and we’re now on the way to hitting the targets we set out. This looks like a surprising U-turn from the Conservatives, which traditionally markets itself as a ‘friend to business’.

“These services were specifically introduced to help SMEs to thrive, which is key to economic growth. It seems like a false economy to cut a service that is all about grass roots investment, encouraging SME expansion.”

Martin Campbell, managing director at Ormsby Street:

“It is already a challenge for small businesses to expand and grow, so for George Osborne to shut down the Business Growth Service is short-sighted to say the least. As a previous user of the Business Growth Service, I can attest to it delivering real world help to SMEs. In particular it’s great to get advice from someone who isn’t trying to sell you something.”

“But the mentorship and guidance provided by Business Growth Service does not necessarily have to come from government, and it could be argued that better small business access to support and advice can be found elsewhere.

“So although the Business Growth Service played a valuable role in supporting small business growth, if it was essential for the government to reduce Department for Business, Innovation & Skills expenditure by 17 per cent (I personally do not think it was), then the Business Growth Service was always going to be vulnerable.”

Siân Pelleschi, director at Top Venues & Events:

“As someone who works directly with the business advisers and leads on Business Growth Service I was extremely saddened and angered to hear the government, in particular George Osborne, had decided to pull the plug on what has proven to be a very successful initiative – only recently extended for another two years earlier this year due to its current successes.

“The whole point of this service was to support and aid growth in SMEs in order to help the UK economy thrive and grow and not to put us back into another recession. This was to enable smaller businesses to succeed and to enable new jobs to become available, new wealth in the economy and a happier outlook on the future.

“This rash decision, that’s been made by someone who clearly has no understanding of what this service was all about and how it’s helped secure business, will now not only affect everyone directly involved but also the economy on a whole.”

Chris Wood, CEO of Develop Training:

“Matching aspiring businesses with expert advice and funding opportunities for a modest fee would appear the very essence of a government-backed, market-led economy. 

“Closing the Business Growth Service, therefore, is wholly at odds with such a spirit of progressive entrepreneurism. The crux of this relationship lies in the ‘modest fee’. No doubt others can, and will, pick up the subsequent slack. After all, there is good money to be made in providing advice to companies. But it’s questionable whether embryonic firms will be willing, or able, to meet the often lofty costs of enthusiastic, private sector, consultants. Opportunities will be let slip or lost altogether. Britain’s longer-term economic backdrop will be the poorer for it.”

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