We feel that overall the Government has taken the right approach with the recommendations it is going to take forward from the Heseltine Review. As he rightly identifies, local economic development is incredibly important to growth and the development of small businesses. Funding for the regions has for too long been overly centralised and Lord Heseltine’s proposals will finally allow local communities to start to have direct influence over their local economies.
While they still require further development, we believe Local Enterprise Partnerships (LEPs) are best placed to know what action is needed to help their local areas develop. A gradual approach taken by the Government to devolve spending is the right one, which will allow LEPs to build their capacity to draw up economic plans and bid for funding.
Going forward, the Government must ensure that LEPs in each region are delivering for all sections of the community. This is absolutely key if the project is to be a success. We know that in some areas LEPs have little or no small business representation or input. The Government must therefore ensure a 360 degree view of business is taken when bids for the single pot are made so that the views of small as well as large businesses are fully captured in any submissions.
While this does represent a significant change in the way economic policy operates, and one we broadly welcome, we feel that the Government and Lord Heseltine have missed a trick by not looking at the way central government creates enterprise policy and how this can be decentralised to deliver a long-term and coherent approach. The FSB believes a single institution, similar to the Small Business Administration in the US, would help to provide this much-needed focus and should be looked at.