Examination of Witnesses (Questions 140-148)|
TUESDAY 26 FEBRUARY 2002
140. Do you have a view about the regional venture
capital funds that the government is setting up to particularly
(Mr Fletcher) We were slightly perplexed at the time
it took to get approval. We saw a clear rationale for this scheme.
There is a clear market failure in the provision of small amounts
of capital and this is aimed at targeting that.
(Mr Peel) There is a long way to go in the implementation.
It is a relatively new scheme and it does not seem to be trickling
to the S in SME. There seems to be a barrier there. Why, I do
(Mr Fletcher) From our perspective, we would support
the fact that it has been targeted regionally.
141. Throughout your submission, you have put
some emphasis on the importance of good communication between
government and business. You have mentioned a few examples where
you think the idea is good but maybe the delivery mechanism is
too confusing or does not reach the S in SME. How would you go
about getting the kind of improvements in communication that you
would like to see?
(Mr Fletcher) I see this particular issue of productivity
as being analysed to death almost. We have had three competitiveness
White Papers from the previous government; we have had an enterprise
White Paper from this government. The Treasury analyses the problem
at budget and pre budget. There are various external commentators
that have looked at this issue in great detail from the National
Institute through to McKinseys etc. I do not see it as a problem
of analysis. What I see as the problem is that, at the end of
the day, increasing productivity is not something that is delivered
in the corridors of Whitehall but in the board rooms of businesses
across the United Kingdom. It is engaging them in this particular
debate and communicating to them that help is out there. There
is a lot of good help out there that they do not know about. In
that respect, rather than the DTI employing a new chief economist
that is highly regarded, I would put that money into employing
an equally well regarded communications expert who is able to
get these messages out and raise awareness of how government can
help. There is another facet to that and that is something that
we do, which is undersold, and it is the benefit of networking.
You can get business people together in a structured way. They
derive a lot, whether it be in business opportunities or sharing
142. Do you think that is happening at all,
not happening, happening a lot?
(Mr Fletcher) Our Chamber and Business Link in East
Anglia, in Norwich, has a fairly structured programme of looking
at exemplars of best practice and organising fairly informal networking
links where businesses come and learn about their particular experiences.
The 135,000 members of the British Chambers of Commerce are able
to network on a daily basis, but we are the only organisation
that has that infrastructure across the country. I see a great
deal of opportunity to do more.
143. How do you think the RDA network is doing
in providing support and fostering communication between government
and the business community?
(Mr Fletcher) We lobbied hard at the start for the
RDA to have greater autonomy over the way it spent its money.
Perhaps rightly for political reasons, in the first two or three
years of its conception, that was not the case. Now it has that
autonomy, it is able to do more to target particular regional
needs and we are pleased to see that happening.
(Mr Peel) A sample happens to be South East RDA housed
in Guildford. They are now three and a bit years old and have
taken time to get the whole process off the ground and get an
understanding of what happens in the region. They have formed
their "village" which has enabled many organisations
to put an individual on their premises and learn from them at
first hand and influence also at first hand. It has taken time
but in the south east it is coming along quite well. We do get
quite a lot of opportunity to input via their sector groups and
via some of their geographic groupings. Although not perfect,
it is quite good. If I can mention one other government initiative
which I approve of very much, Inside UK Enterprise, it is the
ability of one company to visit another. It used to be free of
charge; there is now a small charge for it. That has done a lot
to promote best practice through business, and encouraging chains
or groups of that nature, whether it be inside the Chamber of
Commerce or nationally, is an excellent move.
144. Would it be reasonable to say that the
BCC generally would like to see more in the way of regionally
based initiatives from government, expanding on things like the
RDA network and so on? When I was asking you, for instance, how
are you going to improve communications, you said, "Do not
employ that person, DTI; employ somebody else." Is that what
you are saying or are you saying you should do it regionally?
(Mr Fletcher) In our submission to the DTI review,
we were keen to see greater devolvement of decisions over programmes
to a local level to meet particular needs of the business communities
in those areas.
145. Do you feel that is going in the right
direction at the moment?
(Mr Fletcher) There have been some welcome
initiatives that have come out of the DTI review. The devolvement
of the Smart programme is one. That has been devolved out of the
RDAs and that would seem to make sense, given the different focus
on innovation clusters and different areas. At the moment, we
are in the process of review of all the DTI's programmes and the
rationalisation of those into five generic bands. I have not had
any intelligence in terms of whether that movement towards more
devolvement will continue.
146. What about LSCs? You mentioned earlier
that LSCs were involved in good things but maybe they need to
be more attuned to local needs.
(Mr Peel) I have a perspective on this which is therefore
mine alone. They do not appear to have sufficient business focus
on their boards. Their funding seems to be very prescribed. Talking
to our local Learning Skills Council chair, something like 95
per cent of the funding is prescribed as to where it goes so they
have little capability to modify training in a given area to suit
the needs of that area. I would like to see more flexibility for
147. Most of the written submissions we have
had list the familiar factors that we all think determine productivity.
The question is which are the most important ones. In your view,
what is the single most important thing that the government could
do to improve productivity? From your shopping list, what is top
of the list?
(Mr Peel) It has got to do something to try to improve
the management skills in industry to ensure that management can
direct the workforce and motivate the workforce at any level to
achieve the aims of the business. We do not think, generally speaking,
that management in this country does well. How you do that I leave
to the experts.
148. We sort of thought you were the experts.
Thank you very much indeed. We look forward to some further clarification
on the costs of regulation but thank you for your written submission
and thank you very much indeed for attending this morning.
(Mr Peel) Mr Berry, if you want to look
at a supply chain from end to end, I could certainly lay that
on for you as a Committee. It would take a day of your time.
Chairman: We will consider your offer. Thank