Roger Trapp: It's official - the SBS is a waste of time

The Small Business Service was set up to help entrepreneurs - it has done the opposite

When the Small Business Service (SBS) was set up, back in 2000, its stated aim was to provide "a voice at the heart of government" for small companies. Six years later, those companies have certainly heard a lot about "enterprise culture" and encouraging entrepreneurs, but they'd be hard-pressed to agree that they have been able to get across their concerns in Whitehall.

Far from being the over-arching representative of smaller businesses, the agency seems to many to have been caught up in various initiatives that various governments and ministers have launched at various times with the aim of promoting enterprise.

It is, of course, difficult to quantify how successful the organisation has been at providing support in terms of advice, grants, networking and the rest. But even Alistair Darling, the trade and industry secretary, seems to have accepted that the arrival of a fresh agency has done little or nothing to reduce the confusion caused by the presence of Business Links, which were, of course, previously supposed to provide the "one-stop shop" for support offered by the SBS. Which is why he is planning to streamline it by transferring its financial support programmes to the regions and reducing its policy work. He also wants it to have a closer relationship with the Treasury, on the grounds that access to the source of finance would help give it the influence it has hitherto lacked.

For the British Chambers of Commerce, the development that emerged last week comes not a moment too soon. At the end of last month, it launched a withering attack on both the Government and its creation. The SBS was made responsible for delivering the Government's action plan for small business under seven themes, ranging from building an enterprise culture, through improving access to finance for small business growth to developing better regulation. And research conducted by the chambers shows that small businesses across the country believe it has been almost entirely ineffective in this role.

Only in one area - encouraging more enterprise in disadvantaged communities and under-represented groups - did businesses see an improvement.

The picture painted under the other headings is almost uniformly depressing. A quarter of respondents believed there had been a decline in Britain's enterprise culture; 27 per cent felt the business start-up market had worsened; 42 per cent said their experience of government had worsened. Most damning of all, perhaps, 93 per cent of businesses saw no improvement in regulation and policy, with over a half believing it had deteriorated.

Put like that, it is little wonder the chambers concluded the agency should be axed. David Frost, director-general of the British Chambers of Commerce, said: "Since the SBS was set up, £79.3m has been ploughed into it. In our view, much of that money has been wasted."

He then called for the development of regional and local solutions that were business-driven and business-led. Mr Darling's proposal to transfer the financial support programmes to the regions goes some way towards that. But it is clear that business groups are looking for further-reaching changes.

The Forum of Private Business feels there is a need for a culture change within Whitehall. The CBI, traditionally seen as the voice of big business, went further, calling for a revamped SBS to be given the power to audit government departments' work affecting small and growing businesses.

Of course, it is easy to say that part of the problem stems from policy-makers having to deal with what is there already and to add on features as best they can. But there is presumably nothing to be lost by scrapping it and starting completely afresh. After all, according to the research findings, nobody would be worse off. But then, Gordon Brown, who has taken the lead in driving the enterprise culture, appears to have other things on his mind just now.