Small businesses play a significant role at the heart of our communities; they create wealth and sustainable employment opportunities for local people. Profits and investments made by them tend to stay within the communities where they are based. So rather than plunder small to medium sized entrepreneurs from Bristol, we need to grow and sustain our own small business creators in Newport and across Gwent and to make our towns and cities business SME friendly.
For too many years economic development in Wales has been focused on large scale development of what can be best described a single egg solutions, which promise much and deliver significantly less, the focus should be on developing small to medium size local businesses, which are significantly less likely to up sticks and leave for perceived greener pastures and fresh applications of development grants.
This focus on attracting large-scale single source enterprises, which promise much but deliver significantly less than anticipated, is short sighted in the extreme. The LG development near Newport, was a good example of an expensive disaster / fiasco [please take your pick] which promised the usual total of 6,000 jobs - accrued significant public funding - which was committed by the then Welsh Secretary, William Hague, yet never delivered anything like a third of what was promised.
A combination of what can best be described as fantasy island economic assessments, a fatally flawed business case and a forthcoming Westminster election led to one of the spectacularly duller decisions of recent years being made, something that ended up costing us millions of pounds worth of public money. The WDA has in truth not really consistently delivered anything like long-term economic stability and much needed long-term job opportunities to our communities that it should have done.
European funding opportunities (soon to be a thing of the past) have been seriously wasted, where are the significant tangible assets, beyond some visibly badged infrastructure projects that you can literally put your hand on like improved communications (rail, road, broadband infrastructure, etc) that can bring long term benefits to our communities.
Amongst the questions that should have been asked is how much money has been scammed (and scammed may be the key word) into dubious training programmes and questionable educations programmes that fail to deliver the necessary skills that workers and potential workers need to make a decent living in the modern economy?
Back in the day the Plaid driven One Wales Government made significant efforts and attempts to think and act differently when it came to economic development and support for small to medium sized enterprises. This is the only real thing that will put wealth into our communities, and develop and sustain longer-term employment possibilities.
Attracting branch factory operations of a relative short-term duration might get some headlines but it does not help to sustain and develop our economy. We really do need to think differently and focus economic development priorities on smaller local businesses who will be rooted in our communities and offer more flexible employment opportunities.
Friars Walk in Newport is a welcome exception to the last thirty five years, when across the south east, we have seen the commercial hearts of many of our communities (including Newport) seriously damaged (if not ripped out) as a result of a combination of aggressive policies pursued by the larger retail chains and exceptionally poor decision-making on the part of local government and central government indifference.
When combined with the rapid growth of unsustainable, ill-thought out and more than questionable out of town and edge of town retail developments which leave next to no place for the smaller local businesses and retailers and deprive consumers of real choice. When you factor in parking charges, business rates and the effect of the closure of high street banks and post offices in many of our communities and you begin to see why many of our smaller businesses and local shopping centres are up against it.
Local small businesses as well as trading with us the consumers also trade with each other - so the community gets twice the benefit. Money spent by and in local businesses spends on average three times longer in the local economy than that spent with chain stores which is instantly lost to the local economy which in times of recession our communities can ill afford.
Our National Assembly needs to have the power to vary business taxes in order to help boost our businesses, as well as encourage investment in skills and the tools of their businesses and their workers. If we are going to make Wales a nation of aspiring entrepreneurs and to encourage and enable them, our communities and our economy to flourish we need to encourage the development of community owned social enterprises.
It should be pretty clear to most people that before and after the banking crash - the present financial market and its institutions have failed over recent years to supply sufficient venture capital for the SME sector in Wales. One step forward would a venture capital fund for Wales, which should be established by, but independent of the Welsh Assembly Government
Such an independent venture capital fund could raise capital and deliver investment through a co-investment model, with approved private sector partners to our SME sector, where such investment would make a real difference. More of the same old twaddle from Whitehall and Cathay’s just simply won't do at all, vastly expensive one egg, one basket schemes to generate the seemingly standard 6,000 jobs, just won't do.
What we need is fresh thinking and action from the new government - more than just talk, we need some concrete steps to encourage growth, boost manufacturing industry, support our small to medium sized enterprises and an end to the business rates and that's just to start with. Otherwise it will just be a case of same old, same old with ill thought out public sector cuts which will do nothing to boost our communities, our economy and that’s one thing we cannot afford.