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77% of firms feel let down by DTI

The Trade and Industry Secretary faces embarrassment next month at a conference for small to medium-sized enterprises (SMEs), where she is the keynote speaker.

In a survey of 300 managers of such enterprises, only 23 per cent say Patricia Hewitt's department does a good job in creating the right framework for business to thrive. This is despite 63 per cent saying the Department of Trade and Industry's actions are very important for their business. Fewer than 6 per cent think the Government is doing enough for the sector.

Ms Hewitt will be grilled by entrepreneurs at the Smarter Business 2003 conference, to be held at Earl's Court from 3 to 5 June. The organisers commissioned the research from KPMG, the accountancy firm. The findings will be announced tomorrow.

She will also face questions about the Government's muddled policy on the euro. The survey reveals that 60 per cent of the businessmen want the UK to join the currency. Although Gordon Brown is sceptical about entering the euro in the near future, Tony Blair has pushed for the whole Cabinet to set the policy.

However, almost half the survey sample say they are confident about prospects for the UK economy.

"We're working hard to make the DTI more responsive to the needs of business," Ms Hewitt told The Independent on Sunday. "We've also done a lot to improve the tax structure for business. In particular, the extension of the flat-rate VAT scheme means nearly three quarters of a million small businesses could now save up to £1,000 a year on their VAT bill, while small firms with profits of less than £10,000 pay no tax at all."

She has also set up a panel of businessmen and civil servants to create a strategy for the SME sector.