One of their senior members, Rudi Plaut, has written a riposte to my recent article questioning their stance on the lack of support for small firms.
However, his main critique seems to be that we should stop support to small firms because the process it too bureaucratic.
As he notes
“The article equates the money budgeted for business support as actually going to businesses to help them. Unfortunately, that is not the case. A high proportion of the £30m goes into the overheads and salaries of the grant giving departments and never reaches business. Time and time again SMEs are promised money which then takes months longer than expected to reach a decision. In the meantime, the application has involved large amounts of management time in completing forms and answering questions, often the same ones several times over.”
Therefore, why doesn't the CBI support a streamlining and simplification of business support instead to ensure that the funds get to small firms quickly, rather than a scrapping of the service?
Surely that would the logical conclusion to such a critique of the current system? It is certainly what the responses to the consultation by WAG to the Economic Renewal Programme demanded of their government.
Mr Plaut then goes on to say that the process of approving grants for smaller businesses was cumbersome and bureaucratic and represented a “huge waste of money”. “We need big companies as they provide so much employment and we must stay internationally competitive – it is a constant battle, so we need grants for that.”
So, the CBI's position is confirmed yet again which seems to be a line of scrapping support for small firms but continuing to give grants to large firms, which are the only hope for the Welsh economy.
This also seems to be confirmed by Mr Plaut's bizarre attack on the Wales Fast Growth 50 project which suggests that it "showed the “best way of killing companies that exist.”
Given that last year's FG50 companies created 15 per cent of all private sector employment in Wales and that this year's list has generated an additional £300 million in sales during the worst recession since 1921, there is little logic to that comment.
This is in addition to the overwhelming academic evidence on the job and wealth creating potential of high growth businesses within regions and nations, a point I will be making very strongly in my Western Mail column on Saturday.
Indeed, it says a lot about the CBI when it decries the growth of indigenous Welsh businesses but supports further grants to large firms.
Still, it contributes to the debate on the economy that is long overdue, even if it reinforces the impression that the CBI is out of touch with the vast majority of the business community in Wales.
Comments
Just for the record, I thought Business Eye operated fairly effectively; unfortunately, business support became bureaucratic when it tried to incorporate a new business relationship management system, the seven grant schemes, along with the call centre service, all in one go. This was also expected to work within competing exWDA & WAG cultural structures.
Clearly by replacing SIF & FS4B with ERP, then we can, in simple terms, state the former policy was a catastrophic failure i.e. IWJ’s failure.
PDJE: Is the ERP debate, to be held on 12 October, an open invitation?
http://www.walesonline.co.uk/business-in-wales/business-news/2010/09/29/economic-renewal-debate-91466-27360088/
I vaguely remember he had something to do with Technoquest
Oh and wasnt he a business advisor with the old WDA
Really good business background
That is an incredible statement from a "senior figure" in the CBI and a statement that is inherently anti-Welsh. No wonder they want to support big business only.
http://news.bbc.co.uk/democracylive/hi/wales/newsid_9057000/9057853.stm
Conservatives debate on the Economic Renewal Programme
A similar "CBI mindset" has taken hold in the Obama Administration. The concerns of American small businesses are increasingly ignored.
"The change of direction is outlined in a document called the 'Economic Renewal Programme' (ERP) and was announced two months ago, by Ieuan Wyn Jones, the Deputy First Minister of Wales. The author of the new policy, however, was James Price, the Director of Transport and Strategic Regeneration at WAG.
Mr Price is due to attend the next Blaenau Gwent Regeneration Partnership Board, at which he will be able to answer questions regarding the implementation and effects of the Economic Renewal Programme."
The e-mail has requested that members of the IBC submit questions to the Representative and they will put them to Mr. Price at the meeting, which I assume will be held soon after the deadline for question submission, which is 11th October. Unfortunately I can’t go to either event, but I would love to be able to attend the Hugh James Exchange event on 12th October and then the Blaenau Gwent Regeneration Partnership Board meeting to see whether any anomalies arise between the views of IWJ and Mr. Price.