Kevin Horne, chief executive of enterprise agency Nwes, ponders the upheavals of the past 12 months and their effects on local business.
This last year has been a busy one for Nwes. We've made a major move to innovative online support through our new Start & Grow platform, significantly extending and improving access to both funding sources and the range of flexible, tailored business support that we provide.
Logistically, this year we have grown, merging with two other enterprise agencies – NBV in the East Midlands and London Small Business Centre – giving us the scale, breadth and access to skills and specialisms to enable us to continue to provide the right offer, high quality support, training and workspace to entrepreneurs and enterprises, reaching 35pc of the country's population.
In the wider economy, lending to businesses was higher this year than in 2016, but while lending to small and medium-sized enterprises (SMEs) is still increasing, the rate of increase has fallen by 1pc. The willingness of the banks to lend and business confidence levels are likely factors, as is Brexit.
The change in interest rates is yet to have an impact but this, too, is likely to have influenced business confidence this year and moving forward. The increase of 0.25pc after a long period of low rates is modest, but there is real concern that it will be followed by further rises, knocking confidence in the short term and slowing growth prospects.
The British Business Bank, a government initiative to help businesses access the finance they need to grow, is now active although its impact during 2017 has mainly been felt in the Midlands and North. The bank is also the new home of the Start-Up Loans scheme – a real success story that has lent in excess of £358m to more than 50,000 businesses. Nwes has been part of this success story. As the Start-Up Loans Company local delivery partner, Nwes has distributed £4.3m to 341 businesses in 2017.
Brexit, of course, has been the big business story of the past year. The referendum has been and gone, but, as we approach the end of the year, the impact is only just starting to be felt.
As 2017 comes to an end we still do not have any clear idea about the terms on which we'll be able to do business with our most important trading partners, the countries of the European Union.
Even the soaring FTSE 100 is a result of simple currency effects; because Sterling has fallen against the US dollar and many constituents of the index are multinationals that do most of their business outside the UK, a big slice of their profit originates overseas. So they appear to make more money when Sterling is comparatively weak.
This means that businesses of all sizes have faced uncertainty and operational challenges.
Clearly, there's a lot of activity in Whitehall relating to the transition to new domestic arrangements. The loss of the European Regional Development Fund (ERDF) – which funds much of the business support landscape in areas such as start-ups, growth and competitiveness – is something that will need to be carefully managed to ensure that businesses don't suffer.
Back in May, the government announced the successor to ERDF – a 'UK shared prosperity fund' – to address inequalities between the home nations. But no one really knows what the fund will look like yet or how much funding will be available in this region. It will probably be either:
•A convergence-type fund, helping more deprived parts of the UK to catch up with the Greater South East, in which case there could be less money for this area.
A pot focused on the main engines of economic growth, including the Greater South-East.
A combination of the two.
So, we eagerly await the Industrial Strategy white paper, which will set the agenda going forward.
Whatever happens, Nwes and other sources of support such as the Growth Hubs, will still be there. We're constantly reviewing our offering to ensure that we can attract sufficient funding to provide the relevant, accessible and high-quality support that entrepreneurs and established businesses tell us that they need.
In the meantime, the eagerly-awaited Start & Grow platform is up and running, the Start-Up Loans scheme continues finance growth and ERDF-funded projects continue to provide business grants – so, make sure you get your share while it's still available!
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