The Conservative Party’s Small Business Task Force, chaired by the former Dragons’ Den judge, Doug Richard, last week set out proposals to overhaul the business support system. This is not before time.

 The report estimates that there are 4.4 million small and medium sized enterprises (SMEs) in the UK. This means that 99.7% of enterprises are classed as small and medium. Correspondingly, almost half of the UK workforce is employed by one of these organisations and 48.7% of the UK’s turnover is generated by SMEs. These numbers merely confirm what has been said before, that small and medium sized companies are the lifeblood of the country. But in that case, why are the financial services and government support offered to these companies so utterly appalling?

The current system is shambolic or, as Richard describes it, “confusing and out of control”. It involves over 3,000 different schemes run by 2,000 public bodies. Despite this, just 4.4% of small businesses use government business support schemes and of those who do, under 1% were satisfied with the service they received.

Vincent McKevitt, founder of salad bar chain Tossed is one such dissatisfied customer. “The SFLG is a joke,” he told Growing Business. McKevitt was left disgruntled after the Small Firms Loan Guarantee scheme rejected his application, seemingly for no good reason. “It’s a good business; we already have public recognition, I graduated in the top five of 600 people [McKevitt achieved a first in his business degree from Nottingham] and the business was profitable in the first year. If they won’t give it to me then who will they give it to?”

The difficulties faced by the Tossed founder are not uncommon, and were touched upon in the report. Doug Richard laid out a number of recommendations including improving access to finance for SMEs. Richard also proposed the creation of a single, national web-based Information System which would replace Business Link and provide a one-stop-shop for information for entrepreneurs and small and medium sized companies. Richard said, “These recommendations would enable the UK once again become one of the best places to do business.”

However, can it really be that easy? If it were that simple how come it has taken the government two years and £3m on its simplification programme, yet the only tangible progress is that it has scrapped 10 of the 3,000 schemes.

One thing is for certain: the government needs to start putting its money where its mouth is and get its act together. The recent Global Entrepreneurship Monitor (GEM) found that interest in entrepreneurship is on the wane and the current economic downturn won’t be doing much to inspire the innovative start-ups that fuel much of the UK’s annual turnover. The government should be removing the obstacles dissuading companies from starting up, not wrenching them up a notch or two.

© Crimson Business Ltd