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Government `fails' local enterprise.

Byline: By Graeme King

Entrepreneurs in the North are the most disillusioned in the country with the Government's attempts at creating an enterprise culture, a new survey has shown.

A total of 59% of the region's self- made business people believe that Tony Blair and company give a "low or no" priority to entrepreneurship, according to Ernst & Young's seventh annual Enterpriser survey.

The figure is the highest across the country in the UK-wide survey and is even worse that last year's poll, which revealed 58% of North-East entrepreneurs felt the UK had no more of an enterprise culture than it had five years ago.

Yesterday George Cowcher, chief executive of the North-East Chamber of Commerce, said he understood the sentiment. He said: "I think there are a lot of words that come out of the Chancellor about entrepreneurship but it's not always reflected in Government action.

"We've seen difficulties with employment legislation and difficulty in the fragmentation of support to entrepreneurs in getting started.

"Other issues are skills ( getting the right people for your company; transport; red tape and regulation; and the whole issue of business support, with re-configuring Business Links and changes coming from April 2007. We need to know what happens in the meantime."

For the survey more than 100 entrepreneurs across the North of England were interviewed about the challenges they face, their views on the economy and the Government and their growth plans for the next 12 months.

Suggesting ways that the Government might improve the situation, Northern entrepreneurs quoted more tax advantages (33%) and a reduction in red tape (29%) as the top two initiatives which would support entrepreneurial business.

And more so than in any other region, entrepreneurs in the North called for easier access to funding, more support for skills, training and development and provision of more advice for their businesses.

Mark Hatton, managing partner at Ernst & Young in Newcastle, said: "It is clear from this research that entrepreneurial businesses in the North-East would like a lot more support from the Government. It is disappointing that in the pre-budget report, middle-sized businesses were once again largely overlooked by the Chancellor."

The disillusion with the Government spread to Chancellor Gordon Brown's handling of the economy.

Nearly half of those questioned were pessimistic about the UK economy providing a stable environment for their business to make medium to long-term investment decisions in the next 12 months.

However, the pessimism came despite 66% of entrepreneurs reporting an increase in turnover in the last 12 months and 68% of them believing their business's turnover will grow in the year ahead.

Paul Campbell, a board member of the Entrepreneurs Forum, said: "I think the mood of entrepreneurs in the region is optimistic and upbeat ( except in retail. People feel this is a great place to do business, and getting better all the time.

"In Government, there is a furious concentration on trying to do things to help entrepreneurs ( which has not been there before to such an extent. Of course, there are still many things which irritate entrepreneurs in the application of Government policy ( and everyone thinks there is still far too much regulation."

Liz Smith, assistant regional director of the CBI in the North-East, said: "Recent research has highlighted sustained regional disparities in start-up rates and this must be addressed.

"Further research is needed to focus on the causes and implications of business `churn' and ensure that support for small businesses doesn't just focus on the start-up market but enables businesses to survive and grow past the critical three-year period."
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Copyright 2005 Gale, Cengage Learning. All rights reserved.

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Publication:The Journal (Newcastle, England)
Date:Dec 21, 2005
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