7 UKTI Effectiveness and Efficiency
Introduction
177. The memoranda we received on UKTI performance
has been mixed but the headline is one of achievement. When it
works well, it appears to work very well. For example, the UKTI
recently won the Excellence in Export Development Initiatives'
Award for the Best Trade Promotion Organisation from a Developed
Country at the 8th World Conference of Trade Promotion Organisations
in Mexico City.[213]
In a similar vein, UKTI also won the award for the best Pavilion
at the Shanghai Expo.[214]
178. While these examples are to UKTI's credit, it
faces a challenging period ahead, in which it will need to continue
to improve its performance in the context of reduced resources.
179. UKTI asserted that efficiency savings have constantly
been sought and claimed that over the last three years it cut
the average cost of assisting business by 25% from around £14k
to around £10.5k. It also told us that over this same period,
the satisfaction of its trade customers had remained steady, and
the number of businesses who had recorded improved performance
as a result of working with UKTI had increased. UKTI argued that
together this demonstrated that it was becoming more efficient
and effective while maintaining the standard of service to its
trade customers.[215]
PIMS
180. UKTI performance is now measured by the PIMS
system (Performance and Impact Monitoring Survey). PIMS measures
the impact of UKTI trade services on the companies using them,
and UKTI's performance in delivering those services. The surveys
are carried out by an independent market research company and
comprise quarterly telephone surveys of a statistically representative
group of users of UKTI services.[216]
UKTI told us that the survey questions cover both qualitative
and quantitative business benefits; financial benefits; access
to information and contacts not otherwise available; improvements
to overseas marketing strategy; and their assessment of the quality
of, and overall satisfaction with, UKTI services.[217]
181. Approximately 4,000 businesses are interviewed
each year. An annual survey of UK exporters who have not used
UKTI services is also carried out, as an additional way of assessing
the difference UKTI's services can make to companies.
182. The PIMS survey covering 2009-10 showed that
UKTI helped some 23,600 UK businesses and concluded that British
companies attributed an additional £5bn to their bottom line
profits as a result of working with UKTI, up from £3.6bn
the previous year.[218]
The £5bn additional profit reported by UKTI clients represents
over £35bn additional UK exports generated as a direct result
of the support UKTI provided.[219]
183. According to UKTI analysis this represents a
£19 benefit to the UK for each £1 of Government spend
on UKTI trade services. The UKTI strategy announced that this
had been increased to £22 for each £1 in the last 12
months.[220]
184. Data from the survey also found that:
- 41% of companies reported new
or safeguarded jobs as a result of using UKTI trade services.
- 67% of UKTI customers reported significant business
benefit from upgrading their approach to overseas markets, gaining
access to contacts and information not otherwise accessible, and
overcoming legal or regulatory difficulties or cultural differences
affecting access to opportunities overseas.
- 39% of UKTI clients expect substantial growth
over the next five years compared with 23% of other UK exporters.
Some 87% of UKTI trade clients expect at least moderate growth,
compared with 78% non-user exporters.
- On average, UKTI trade support generates an additional
£65k of research and development (R&D) per trade client.
This reflects the role trade support can play in increasing the
UK's overall innovation capability and R&D.
- Some 53% of all businesses assisted through UKTI
trade services improved their business performance as a direct
result of UKTI support.
- Around 70% of businesses assisted reported improved
productivity and competitiveness.
- Users of UKTI services are much more likely than
non users to be in high growth markets (61% vs. 44% for non users);
are more likely to plan to increase exports in response to the
depreciation of Sterling (47% vs. 37%); and are more likely to
have benefited from the depreciation overall (33% vs. 25%).[221]
185. The PIMS system was subject to scrutiny as part
of the National Audit Office 2009 value-for-money report on UKTI's
Trade Support in 2009.[222]
The NAO found that:
UK Trade & Investment is making good progress
against its targets and has in place a robust system (PIMS) of
assessing delivery.[223]
It also noted that "UK Trade & Investment
has put in place extensive arrangements to obtain regular and
systematic feedback on the quality of its services".[224]
186. In addition, as part of its annual work on reviewing
the appropriateness of departmental performance measurement systems,
the National Audit Office concluded that the UKTI performance
measurement system (PIMS) merited the NAO's highest assessment.[225]
187. We welcome the positive assessment of UKTI's
trade services work as set out in its PIMS performance measurement
system. The fact that the PIMS system is highly rated by the National
Audit Office gives greater credibility to the PIMS results. While
we cannot confirm the accuracy of the claim that UKTI generates
£22 benefit for each £1 of Government spend on UKTI
trade services, it is clear that UKTI does provide a service valuable
to UK companies.
188. Reductions in its budget and resources will
put additional pressure on UKTI in maintaining its current performance
levels. While we recognise that UKTI will have to do more with
less, we believe that the Government should keep a close eye on
PIMS data. Any significant reduction in the satisfaction levels
of companies with UKTI's services will have to be addressed at
the earliest opportunity.
Inward Investment
189. Unlike its export activities, the efficiency
and productivity of its inward investment services are not measured
by an independent organisation. UKTI undertakes analysis of the
effectiveness of its inward investment network, providing an assessment
of its performance. Its latest figures stated that:
- Nearly half—758 of the
1,619 inward investment projects landed by the UK in 2009-10—were
assisted by UKTI.[226]
- Of these, nearly 80% agreed that UKTI (or its
RDA delivery partners) had a significant, favourable influence
on the decision to locate or expand in the UK, or on the scale
or scope of the project.[227]
190. UTKI explained that an assessment that it had
assisted in the decision made by a company was arrived at by satisfying
a set of criteria, populated by data from investing companies
and agreed with UKTI's partners in the English Regions and the
Devolved Administrations. Other data analysing the decision to
invest, made by companies assisted by UKTI, is taken from PIMS'
inward investment survey, October 2010.[228]
191. The contracting out of the delivery of inward
investment services will make it more difficult to assess the
performance of UKTI in this area. However, that does not mean
that it is any less necessary. The PIMS system of monitoring export
support should be assessed as a possible vehicle for the monitoring
of all inward investment services.
AWARENESS OF UKTI
192. While UKTI's performance monitoring has concluded
that it provides a good service, surveys conducted by business
organisations indicate that the UKTI still has a lot of work to
do. Andrew Cave from the FSB said he found it "staggering
how few businesses are aware of what UKTI can do for them".[229]
A recent FSB survey of its members found that while 45% of its
members had used a high street bank for business support and 44%
had used Business Link, only 6% had used UKTI services.[230]
The Government recognised itself in the Plan for Growth that:
Small and medium sized enterprises, in particular,
say that they have difficulties in obtaining support, advice and
the required financing needed for accessing overseas markets.[231]
193. UKTI said that it had made considerable efforts
to raise awareness of services through its website and through
appropriate marketing activities, and through organisations such
as Chambers of Commerce and trade associations, links with banks
and through press articles.[232]
It further highlighted a variety of outreach events based on regions,
markets and sectors which were designed to enable companies to
meet UKTI staff based in the UK and overseas, who could provide
them with more detailed help.[233]
194. On a more positive note Alexander Ehmann from
the IoD told us that when its membership was asked about their
preferable mode of trade advice the responses demonstrated that:
UKTI was the preferable mode of advice for 27%
of our overall membership. We were second, as the IoD, at 9% and
then the Chambers at 7%.[234]
195. We are concerned that although companies
that use the services of the UKTI value them, only 6% of SMEs
in the FSB have accessed UKTI services. We recognise that the
UKTI is trying to reach out to these SMEs but we believe that
more proactive work can and should be done. This needs to be addressed
if the Government is to fulfil its growth aim of getting more
SMEs exporting.
213 UK Trade & Investment, Britain open for
business, May 2011, p 9. The Trade Promotion Network is hosted
and managed by the International Trade Centre, a joint agency
of the United Nations and the World Trade Organisation. Back
214
UK Trade & Investment, Britain open for business, May
2011, p 64. Q 163 Back
215
Ev 134 Back
216
Ev 142 Back
217
Ev 142 Back
218
Ev 142 Back
219
Ev 142 Back
220
UK Trade & Investment, Britain open for business, May
2011, p 6 Back
221
Ev 143 Back
222
Ev 143 Back
223
Ev 146 Back
224
Ev 146 Back
225
Ev 146 Back
226
Ev 143 Back
227
Ev 143 Back
228
Ev 143 Back
229
Q 105 Back
230
Ev 179 Back
231
HM Treasury and Department for Business, Innovation and Skills,
Plan for Growth, March 201, p 57 Back
232
Ev 147 Back
233
Ev 147 Back
234
Q 107 Back
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