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Economic policies will give SMEs opportunities to grow Creating the right environment for SMEs to thrive in a renewed Welsh economy is at the heart of the Welsh Assembly Government’s new approach to economic development. Economic Renewal: A New Direction, which we launched last week, stresses the central role of SMEs to the prosperity of the nation. SMEs account for more than half of total employment in the Welsh economy. They are at the heart of our approach to economic renewal. However, how we support them is changing. We are taking a new direction – moving away from working directly with individual businesses and towards enabling economic growth through infrastructure investment and smarter use of our policy levers. This is fairer and better for SMEs – although we don’t have the resources to reach all of them individually, we can and will concentrate on interventions that will benefit all businesses. We will now be focusing our support on six sectors. Each of the six sectors has a different mix of business types, both large and small. That’s why we are developing separate sector plans with flexible funding available to deliver them. Through our new approach we will help SMEs to grow both by fostering favourable conditions and infrastructure, and by enabling the creation of new markets and opportunities. Economic Renewal: A New Direction will help SMEs in the following way: Investing in high quality and sustainable infrastructure SMEs will benefit from infrastructure improvements, especially next generation broadband, and we will still be able to assist in helping businesses meet their premises needs in areas of Wales where the market will not deliver. There will also be significant opportunities arising from our all-Wales approach to energy efficiency. The three pillars of this approach are market making, supply chain development and industry engagement. Making Wales a more attractive place to do business The policies we are addressing as part of this priority – planning and regulation, as well as procurement and the health of our workforce – are those that have bigger impacts on SMEs than on larger businesses. This is because SMEs lack the resources to deal with bureaucracy and find it harder to cope with reduced capacity or the absence of their workforce. Our commitment to improve effectiveness and efficiency, looking particularly at the cumulative effects on businesses, will yield major benefits for SMEs. Broadening and deepening the skills base SMEs are likely to rely even more than larger businesses on the education system to provide the skills they need because they are less able to invest in bespoke training or deliver it in-house. Mindful of this, we are committed to working in partnership with businesses to link skills provisions to industry needs. Encouraging innovation Our end-to-end approach to Research & Development (R&D) is all about linking SMEs into the commercialisation chain. We are seeking to increase R&D investment by linking research councils, universities and large corporations – but this is not an end in itself. The other end of the approach involves enabling SMEs to buy, licence or otherwise exploit the intellectual property that this further investment will generate. And we want to encourage innovation at all levels of the economy including SMEs. Targeting the business support we offer Focusing on sectors does not mean working exclusively with large companies. Each of the six sectors has a different mix of business types, and that’s why we are developing separate sector plans with flexible funding available to deliver them. A key part of the sectors approach is looking at developing supply chains within Wales. This is a critical component of working with anchor companies – making sure Wales reaps the benefits of these relationships in terms of markets for our SME base as well as direct employment. Supporting and encouraging entrepreneurship We need to create a greater awareness of the opportunities and benefits of entrepreneurship in order to encourage more people to start businesses, as well as assisting established entrepreneurs. Our aim is to attract and retain skilled individuals with the entrepreneurial spirit to contribute to Wales’s success. The Assembly Government will place increased focus on high-potential start-ups that are of high quality in terms of jobs and incomes. On top of this, the Assembly Government will still have a role in providing information to businesses. Online content and services will be developed to meet the needs of businesses. For SMEs, a web-based approach is a more flexible way to engage with Government because information and services are available around the clock. As we establish this new framework, it may mean that fewer SMEs have direct contact with us on a transactional basis. However, as well as benefiting directly from our interventions, SMEs will be fully involved, individually and through representatives, at a strategic level in making sure we deliver on our commitments, and that we are open and responsive to their needs. |
