Examination of Witnesses (Questions 20-34)
HOLLY BONFIELD,
CHRIS FLETCHER
AND DAMIAN
WATERS
15 JUNE 2009
Q20 Rosie Cooper: Do you think
there is more that Business Link could do? Has the umbrella RDA
responded as quickly as you would want?
Damian Waters: There is a bit
of frustration. Business Link and the RDA have their hands tied
behind their back because they can only operate at the same speed
that central Government operate. A classic example is the venture
capital loan fund. I know Business Link has been geared up since
January to deliver that and the latest estimate is that it will
be launched in June. It is almost fighting with one arm tied behind
its back. That process should be slowed up. It was an issue over
the Treasury signing off that delayed that. There has to be a
recognition from central Government that there has been a six-month
delay and maybe a seven or eight-month delay. Businesses are going
bust. If that process is speeded up, Business Link and the development
agency can deliver more quickly. I have some sympathy for them
that there has been a whole wave of announcements and policies
that take a long time to filter down. Expectations are raised
therefore for things to be delivered now but it then takes maybe
months or maybe a couple of quarters of the year for that to filter
down into action on the ground. I have a lot of sympathy for Business
Link and NWDA on that side.
Holly Bonfield: Certainly that
was the case with the Enterprise Finance Guarantee fund. It was
announced and welcomed but it took a long time before it reached
even some of the banks.
I would also echo what Damian says about Business
Link being responsive. It has changed its product offer and put
a health check in. It has made it possible to give advice on access
to funding very quickly. I do not think it could have done more
in the time it has had available, given that it is limited by
national decisions.
Chris Fletcher: That is true to
a certain extent but when you look for example at the permanent
support service from HMRC that was virtually done overnight—the
idea of implementation and the roll-out. On occasions when it
works, it works effectively; that has been reasonably successful,
and the Government deserve some credit for that. However, on the
more fundamental things it is taking far too long. The flash to
bang time, as it has been described—from the announcement
being made to actual implementation—is way too long.
Holly Bonfield: Do businesses
know about the HMRC payment support line?
Chris Fletcher: That is another
thing. The level of information being given out around things
like that could also be stepped up a gear.
Q21 Mr Martlew: Is that getting
better?
Holly Bonfield: Well, Business
Link is doing quite a lot of marketing, but it is not enough.
That HMRC payment support service helpline is something that our
members are not talking about. They don't know about it.
Q22 Tony Lloyd: In a way, Government
can flood the airwaves with adverts about HMRC or about many different
things. Does the RDA serve as the one-stop shop that people need?
What ought to happen is that somebody comes along to you—to
Holly, Chris or Damian—and says "I have this problem".
You ought to be able to refer them to Business Link and it ought
to be seamless when it says, "What you need is HMRC doing
this, but you need to tell the banks this". Have we got that
one-stop shop in place?
Holly Bonfield: There is a one-stop
shop, yes.
Q23 Tony Lloyd: Yes, but does
it work?
Holly Bonfield: I think it is
beginning to work. There were major changes in April 2007, when
Business Link reinvented itself and has moved on significantly,
but perceptions from people who have not had anything to do with
it are that it is still pre-April 2007. There is always more that
it can do, as people who have not been helped by Business Link
still have a poor perception of it, whereas people who have are
very different. We have done a recent survey—Business Link,
the CBI and the FSB—which showed that the perceptions of
Business Link have improved and that it is more valued, but also
that 80% of businesses go to their accountant for advice in the
first place, not to Business Link. That is a huge proportion.
Damian Waters: I think you used
the phrase, Holly, "There is a lot of noise," and it
is hard as well for businesses to cut through and get that precise
message. Holly is right that those who have used Business Link
have been very pleased with the service, but sometimes they almost
find their way there by accident, because they are confused by
all the messages that are available and coming out. There could
be a great effort from all of the agencies to focus their attention
on producing information that points people in the direction of
Business Link and tries to cut down on the sort of background
rumble which, unfortunately, is there.
Holly Bonfield: This is the survey
that was done jointly with FSB, the CBI and Business Link, which
you might want to take a copy of. In fact, the figure is that
50% of people go first to their banks, not 80%.
Q24 Rosie Cooper: May I ask another
general question? I understand the Chamber of Commerce review,
which I will come to, but who else do you think should be delivering
in times of emergency? For example, the Chamber of Commerce indicated
in evidence that it thought the regional development agency had
a strategic role and, therefore, it was difficult to deliver.
Expanding on that, who else should be involved and can make it
happen more quickly?
Damian Waters: It is right that
the RDA has a strategic role, and Business Link is essentially
the delivery agency, but there is a role for lots of organisations
to play to make sure—a bit like with the messages going
out—that there is not all background noise. Local authorities
and local councils have important roles to play, but they have
to be playing the same game as the RDA. If everybody is doing
different things and moving in different directions, that makes
the problem worse. Professional advice organisations can also
help in that process but, again, there has to be an effort to
make sure that it is a joined-up process.
Q25 Rosie Cooper: Who would do
that, then?
Damian Waters: Good question.
Q26 Geraldine Smith: What do you
think of the Joint Economic Commission, because you were saying
earlier that it didn't really help much? Is it just a talking
shop?
Damian Waters: When it was launched,
we were very pleased with the objectives; the motivation behind
it was very good. The evidence, from attending four out of the
five—I think that Holly has been to the same amount as me,
as has Chris—is that, sadly, it has become an organisation
that is good at sharing information with itself. In terms of action
for the North-West, I am not sure that I could write a top five
actions that the JEC has delivered on behalf of the North-West.
A good example of this, which Holly referred to earlier, occurred
at the November meeting. The Regional Minister said that she would
write to all authorities in the North-West and encourage them
to adhere to the 10-day payment pledge. Eight months later and
around 80% of them are still not adhering to it. Part of the problem
is that the Regional Minister and the JEC can only encourage and
enthuse about activity, but fundamentally they don't have any
real power to force people to do anything.
Q27 Geraldine Smith: So, what
do you think of the role of Regional Minister? Is it helpful,
can you see any impact that the Regional Ministers have?
Holly Bonfield: We didn't meet
the Regional Minister until the beginning of the JEC, even though,
as private sector partners and CBI members, we had invited her
to talk to us some time before that; she did not take us up on
that. We welcome the new Regional Minister and hope that we will
meet him very soon. It is important that he makes links with organisations
such as ourselves.
Geraldine Smith: Yes, all the way.
Damian Waters: The question is
whether the Regional Minister can go back to London and Whitehall
and wield any influence and power. Based on experience, I have
to say that that is not the case.
Q28 Geraldine Smith: So, is the
JEC worth while? Should they continue, and if they should, what
can they do better? How can we improve it?
Damian Waters: My personal feeling
on behalf of the CBI is that it is coming to the end of its natural
life anyway. Maybe a new Regional Minister will have new ambitions
for the JEC and will stimulate new life into it, but my feeling
is that it is dying a natural death. Maybe Phil Woolas will reinvigorate
it in some way; we will wait and see.
Holly Bonfield: The third objective
was to bring forward some infrastructure projects to bring some
money into the area. We do not see any evidence of that. That
is certainly something that the JEC could have done. I have a
document here about JEC achievements, and there are nine bullet
points concerning support for business. I don't think any of those
have happened because of the JEC, they were all happening anyway;
different organisations in the North-West were getting together
to make those happen. What the JEC thinks it has achieved does
not necessarily reflect what it has achieved.
Chris Fletcher: It is that question
of additionality. Would those things have happened without the
JEC? Maybe, maybe not. From the point of view of where it is and
where it should be, it has fulfilled its purpose up until now
but I think that it needs to reassess its actual purpose and take
that forward.
Q29 Geraldine Smith: Do you think
the RDA has made a big difference? I keep hearing very positive
comments about the RDA from all sorts of people that I would not
expect. They seem to have performed quite well through all of
this.
Damian Waters: What it did well
was very quickly look at priorities, restructure some of its budget
lines and try to put some real help out into the economy. I think
they have also played a key role in speaking on behalf of the
North-West; Steve Broomhead has done a good job of being optimistic
without being foolish in his pronouncements. It is important when
we are in a period of doom and gloom that we have someone in the
region who is optimistic. Specifically, the RDA has done well
in promoting Business Link in the region. That has made a difference.
Q30 Geraldine Smith: Finally,
how are the Learning and Skills Council and Jobcentre Plus dealing
with this?
Damian Waters: It is unfortunate,
at a time when we need an organisation with some surety and future,
that the Learning and Skills Council know that they will all be
losing their jobs in a few months' time—that has probably
taken their eye off the ball a little bit. I would say that the
vast majority of our members have no contact with the Learning
and Skills Council, but those that do have found it helpful. Again,
most of my members would not have any contact with Jobcentre Plus.
Holly Bonfield: We have had very
little discussion with the Learning and Skills Council. We have
probably attended meetings when they have been there, but they
have never approached us and did not take up our offer of working
with them on sector skills councils, which would have been useful.
They have not given a great deal of evidence in terms of our members.
Q31 Tony Lloyd: Specifically,
you have been quite critical about the role of local government,
at least in terms of the question of late payments. First, is
that still a major issue your members are experiencing? Secondly—and
it was Damian or Holly that made this point—the local authorities
could be the first bit of the one-stop shop approach to people
seeking advice; are they doing that? Importantly, you made the
point that regional Ministers cannot order local government to
do something, and quite rightly, constitutionally, orders cannot
be given in that way. What would you like for us to be saying
about the role of many different local authorities in the North-
West, and what could they do which would be helpful to not just
your members, but also to the regional economy?
Damian Waters: I mentioned earlier
that there is a role for them to play. I am not sure whether local
authorities are necessarily the first one-stop shop.
Tony Lloyd: A part of, perhaps.
Damian Waters: Yes. They have
a role to play in creating a much stronger connection with Business
Link and to work closely with them so that if people do come,
they can then be referred to Business Link. There are obviously
huge economic influences on the region and there are processes
that local authorities can buy into, particularly with procurement.
That can help drive the regional economy. Over the last couple
of years it has been a case of throwing the baby out with the
bath water. It used to be the case that there was a lot of local
procurement and many purchasing managers, and a streamlining of
that has led to some of the good relations with local suppliers
being lost. We would encourage local authorities to look at how
they can use their purchasing powers to drive forward some of
the economy.
In terms of being cheerleaders for the region,
our experience suggests that the North-West is a little ahead
of other parts of the UK in terms of the growing economy. The
local authorities have a huge role to play on a national basis,
in talking up the region and acting collectively on behalf of
the North-West. This would give some confidence back to the area.
Holly Bonfield: We need local
authorities to think local and to think small. As Damian mentions,
in terms of procurement we need them to think about how they can
get small businesses involved in contracts with them and to consider
how any of the things they do impact negatively on small businesses.
This can be in terms of simple things such as parking within small
towns. The local authorities have been involved in discussions
about business simplification and have been represented on the
transitional management board. You will know that the vast array
of offerings has been reduced significantly to bring some sort
of order and sense to support for businesses. We worry that local
authorities might move away from this and set up their own business
support that is different from this, after all the work that has
been put in, because there is not the resource to monitor it.
There is a transition board, but once there is simplification
and a reduced number of schemes in place there will not be the
monitoring to make sure it stays that way. It may mushroom again.
We need local authorities to make sure they do not move in that
direction.
Chris Fletcher: It is an interesting
topic at the present moment, from the point of potential city
region status for Greater Manchester and what that may imply in
a possible different way of working there. That would give statutory
powers to the local authorities to enable them to do something
slightly different. From my own personal experience of dealing
with local authorities, they have recognised the issues and worked
as best they possibly can to assist with businesses. I am speaking
from a Greater Manchester perspective. They are keen on working
on the procurement issues but, unfortunately, a whole host of
different regulations come with that. They are sometimes imposed
on both parties and they have to marry them up, which delays the
process and frustrates people. Would local authorities form part
of the one-stop shop? They probably would, but to echo what Holly
said, the danger is that it gets a bit like knotweed—you
go through the process of stripping out various layers of different
elements of support, turn your back, and within five minutes people
have put extra layers in. That has got to be part and parcel of
where we go forward. Local authorities do have a part to play
but it has to be in a way that is sympathetic to business needs
and is easily understandable.
On the previous question about the LSC and Jobcentre
Plus, one of the key gripes from our members is the sheer complexity
of the different levels and number of organisations offering basic
services, which they need to access. The fear is that, given an
unfettered approach, local authorities could revert to that, too.
So it has to be done in a constructive way for the benefit of
all.
Q32Tony Lloyd: May I mention cities and
city regions and then we will probably be at the end of the session?
Chris has said that city regions could help with co-ordination
and strategic view, at least from the Greater Manchester perspective.
For those of you that represent a wider North West brief, it is
positive from some perspectives, but does it have downsides in
terms of co-ordination and planning?
Holly Bonfield: It does have potential
downsides because it gives particular power to Manchester, possibly
to the detriment of other parts of the North-West. If we look
at the North-West from the RDA—the complete North-West—point
of view, then there is consistency. However, as we move towards
more local levels, we potentially lose that consistency and have
a fragmented view. It may be that Manchester takes on a greater
power that will make other areas in the North-West lose out. We
don't know that yet, but it is certainly a danger.
Q33Rosie Cooper: As someone who represents
West Lancashire, when I am asked where it is I describe it by
saying, "If you draw a big circle around Preston, one round
Liverpool and another round Manchester—that bit in the middle
that nobody wants, nobody cares about, is where I represent."
Moving away from a North-West perspective to big city region perspectives
leaves places like that out on a limb. I appreciate your comments.
Do Chris and Damian agree with that?
Damian Waters: There are some
advantages to city regions but there are disadvantages. It necessarily
introduces an element of competition—city regions will be
competing against each other for resources and power. As a Merseysider
whose office is in Manchester, I can see that there is enough
competition between the city regions of Liverpool and Manchester
as it is. I am not sure city regions would encourage greater harmony
between those two cities; in fact, they would probably encourage
greater competitiveness, which, in one way, might make them more
efficient, but there are likely to be people in the North West
who lose out. Certainly, from a North West perspective, Greater
Manchester and—if you call it this—Greater Merseyside
loom over Preston, Carlisle, Lancaster.
Q34Tony Lloyd: May I make a different
point? I hear your note of depression and, as a Mancunian, what
I am about to say may sound terrifically arrogant. However, the
truth is, the leading part of both the diversity and dynamism
of the North-West economy does rest in that part, on which most
jobs in the North-West ultimately depend. We can split the North-West
up into competitive zones if we wish. I think that would be foolish.
Damian Waters: With all due respect,
if you look at economic growth and contribution to GVA on economic
lines rather than on the Greater Manchester region or the Liverpool
region, you would have a North Cheshire region. North Cheshire,
in fact, contributes more to the North-West economy than either
Greater Manchester or Merseyside—and parts of it falls into
both categories.
Tony Lloyd: I think we could argue long
and hard on that.
Chairman: The tolling of the bell has
reminded me that it is 12 o'clock and our time has, sadly, come
to an end. May I take the opportunity to say thank you for your
evidence today and for your previous written evidence?
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