Comments On Welsh Politics Page 2

Departments, and if there ever was a case of policy implementation gone completely and utterly insane these institutions are its incarnation. Wales is not a large country and has a population not dissimilar to a middle ranking English conurbation. Yet in each of the many counties in Wales there is at least one LEA and an Economic Development Department operating a range of schemes devised to attract business to a county in preference to its neighbours. It is quite obvious to even the meanest intellect that this involves absurd levels of duplication of roles, massive expenditure and, most unforgivably, confusion for the end user of the system, the entrepreneur. Take, for example, a simple trip from Holyhead to Wrexham. It's really not very far but it necessitates passing through no less than six counties and consequently the catchment areas of scores of so-called business support people. Perhaps we have simply lost sight of the plain fact that business people make money and part of that money pays for the politicians and civil servants who between them produce nothing. The difference between earning and merely being paid is not, one feels, appreciated in the corridors of power.

  A few examples of these agencies in action might be illuminating. A marketing grant application was made to Denbighshire, and had to be made quickly as the county's allocation of funds for the year in question was almost fully accounted for. Bearing in mind that the application was made on 10 April and the year began only on 6 April several questions beg to be asked, such as what, exactly, do all these people do all year? Anyway, the application was refused, on the grounds that the supplementary questions had not been answered. On enquiry it was discovered that those supplementary questions were contained in a letter that had not been sent to the applicant. On a separate occasion an enquiry was made by telephone to a council economic development department to see if there would be any grant aid in a particular situation. The answer was negative. But, a few short hours later the associated LEA called back and advised that for the claim to be dealt with a meeting with the LEA's Chief Executive was necessary. The applicant drove to the meeting, a round trip of 28 miles, merely to be told in person that no help was available. On yet another occasion, seduced by the details in an explanatory leaflet, an application was made for an employment grant. It was declined on the grounds that "job" meant someone employed by the business, the partners in the business apparently not having "jobs" within the meaning of the scheme although this was very carefully not explained in the leaflet. The reason for this is really quite clear: at the end of the year or whatever the relevant period might be, the scheme administrator could say to his superiors "we had hundreds of applications and gave the money to these five cases." In this way he has, in his own civil service mind, justified his time and his very comfortable salary, whereas had the leaflet explained all the conditions he would have been forced to say, at the end of that same period, "er, we only had five applications all year and approved them all in no time."

  There is a very strange qualification criterion for grant aid, and that is that the business must demonstrate that it will not go ahead without that aid. Fair enough, one might think, given that it is taxpayers' money and it should be applied where it's most needed. But grants are paid retrospectively. Thus they can only be paid once the business is up and running. These two states are mutually exclusive and therefore, logically, it is impossible to qualify for any grant.

  Even when there is allegedly beneficial communication between agencies the end user is unlikely to benefit. Take the example of a food business wanting a loan. On applying to the WDA the business was told that, yes, the WDA had a loan scheme and lots of money, but it didn't cover food businesses. But Denbighshire had a loan scheme that did cover food businesses. An application to Denbighshire led to the revelation that the scheme existed but didn't have any money. The loan was never received. As an aside, that same business applied to the WDA for funding when an expansion opportunity arose. The business was in some difficulty but taking advantage of that opportunity would have opened up economies of scale and it would have survived, safeguarding 24 jobs, and created at least 12 new jobs. Funding was refused as it was required for working capital, according to the WDA's definition, when it was actually required for the purchase of machinery. The firm closed a few weeks later and 24 jobs were lost. The wholesale customers transferred to other producers, who did not make any increases in their workforces, while the retail customers simply had to make do with supermarkets where no extra jobs were created. Of the 24 employees, some are still unemployed while others have found employment. Some of the most skilled employees have taken jobs in different fields and their skills have been lost.

  So where does all this leave our entrepreneur? Well, it depends on where he is and where he wants his business to be. If he wants to run his business locally, he can access the business support organisations easily enough, although the chances of finding just one person capable of telling him what he wants to know are, frankly, nil.

  He'll be told about courses, about whatever financial help might be available, but he won't be told about all the conditions, at least until he's built the availability of grant aid into his financial projections. Then he'll find out that he can't have any money after all.

  He might get some help with preparing a business plan, but he would be wise not to rely on that help being worthwhile - he should ask whoever is helping him about their history.

  It's unlikely that he'll find someone who has ever run a business. We can add another to the list of improbable but true quotes: "I know what I'm talking about, I've been a business adviser all my life" being something once said by someone who had never known anything other than salaried employment. After all, if the adviser has never experienced the elation of success in business, or the stomach-churning that comes with not being able to meet bills or pay the wages how can he possibly be of any help to someone entering that daunting arena for the first time? Given the quality of people occupying positions within the business support organisations our man will be lucky if he's not completely confused and put off by the experience. Indeed, it is not unknown for people to conclude that the entire system exists (a) to explain why there's no help available, and (b) to deter anyone from creating a new business.

  Of course, if he lives in, say, Conwy and wants to establish his business in some other place, let's say Cardigan, the local people won't have the slightest interest in helping him. It's also likely that those in his chosen area won't be too enthusiastic because it's hard when someone isn't in a position to react to a summons to the adviser's office. If he's in this situation he's on his own.

  We might spend a moment thinking about what our man definitely won't be told. He's unlikely to have the insurance requirements of his proposed business explained to him (and who is going to explain the basics of, among other things, public liability insurance, much less the ridiculous length of time he's going to be required to retain the certificate of insurance?), nor is he going to be told about how to find the right solicitor. And he absolutely will not, under any circumstances, be told to get himself a good accountant because good accountants are so much better at giving business advice than business advisers. If our man thinks about accountants at all he'll probably find somebody cheap, which might well be why, among the few firms of good ones, there are so many accountants in North Wales who do more harm than good.

  Latterly we have seen the introduction of Finance Wales plc, administered from Cardiff but we'll let that pass for now. What a golden, golden opportunity this was to get it right, but how very, very wrong it's been got. All that has been done is to introduce a raft of new schemes with complex new rules to add to all the other schemes with equally complex rules that we've already got. As a result, looking at the situation from the end user's perspective which those in charge of our business support network have clearly never done nor been able to do, there is yet another tier of confusion to add to that which already existed. By way of an example let us look at a typical - and real - new business to see who in the business support network that part
icular budding entrepreneur, we'll call him David, has had to deal with. Firstly there's a Business Support Executive from the WDA (1) who has really contributed little. The there's the manager of the appropriate WDA technical assistance programme (2) who has engaged a consultant (3) who can only operate once the go-ahead has been given by a faceless, behind-the-scenes official (4). The LEA provided a business adviser (5) who proved worse than useless, prompting a complaint to the LEA's Chef Executive (6) and was replaced by another business adviser (7) whose function it is to guide a grant application through to approval by the county council economic development department's rubber stamping official (8). David was guided towards an application for a specific WDA grant and this involved a meeting with a local adviser (9), who said he thought approval would be a formality, and correspondence with someone else in Cardiff (10) who said David couldn't have it. An application was also made to Finance Wales for a loan, declined by the manager (11) because his fund couldn't lend to service businesses (but since every