Environment and Planning C: Politics and Space

The launch of the Small Business Service in the United Kingdom stimulated a review of small business policy and support in the United Kingdom. The Service inherited a substantial number of policies and initiatives which have been criticised for their poorly stated aims and overall lack of coherence. The authors examine justifications for small business policy in Britain and the role of research in small business policymaking. They suggest that research has had relatively little impact, and some reasons why this has been the case. They also suggest ways of setting a small business research agenda—raising standards and ensuring the independence of research. Attention is given to the evaluation of small business policy and initiatives. It is argued that currently this is not sufficiently independent or rigorous, and the authors suggest remedies. Both quantitative and qualitative evaluation approaches are examined in order to redefine good practice. The overall aim is to suggest how the Small Business Service can be better supported by research and evaluation, enabling it to function more successfully than its predecessors.

The broad focus of this paper is the divergence of implemented policy from intended policy in UK small business support. The Small Business Service (SBS) is the United Kingdom's most recent attempt to provide coherent support for small business. With its structure of local franchisees and multiagency partnerships, the SBS is part of the United Kingdom's Modernising Government agenda, which aims to provide ‘joined-up’ and responsive public services. However, it is not always easy for policymakers to execute new plans in the form in which they were intended. Street-level bureaucracies develop where those who implement complex policies amend them to make them easier to apply in practice. This paper investigates the UK Business Links' Personal Business Adviser (PBA) service. The paper draws on data from a focus group often PBAs and subsequent survey of the 175 PBAs in England and Wales conducted in summer 1998. The experience and tacit knowledge of PBAs provides the expertise for a bespoke support service to small businesses. Business advisers have both technical expertise and closeness to delivery that confers the power to amend small business policy. This tacit knowledge confers powers akin to a ‘street-level technocracy’. Thus, policies that do not carry PBA support, such as targeting, are unlikely to be implemented effectively. A new approach to small business support has been formed from the difficulty in controlling PBAs through performance indicators, which appear to have distorted the intended policy, and the Modernising Government agenda. The new SBS devolves the operation, but not all control, of business advice from the national SBS to local Business Links. PBAs will play a major part in the network mode of governance of the new SBS franchisees.

Launched in 1999/2000, the new high-growth start-up programme is part of a shift in small and medium-sized enterprise (SME) policy in the United Kingdom away from a narrow focus on supporting established businesses with growth potential, to include start-ups and other types of SME. In this context, the authors consider some of the policy issues surrounding the design, development, and implementation of the new programme, with the aid of results from in-depth research in the East Midlands region. After a brief description of the new enhanced support programme for high-growth start-ups, and the policy context in which it was introduced, the authors review the support needs of this type of business and how the new programme might contribute to addressing these. In the final section they consider some of the wider policy issues raised by the programme in terms of the extent to which: first, effective regional models can be developed to encourage widespread participation by appropriate private sector organisations; second, access to appropriate finance, including seedcorn and venture capital, can be increased for high-growth-potential start-ups; third, universities are able to contribute to the generation of new business activity and become integrated into regional business support infrastructures; and fourth, the enhanced support programme is tuned to the needs of the target group and is effectively delivered.

The authors assess empirically the impact on firm performance of a state-subsidised training-loan scheme for small businesses (the Small Firms Training Loan Scheme). To achieve this assessment, a longitudinal sample of firms that received loans from the leading lender under the scheme, Barclays Bank, and a control sample of otherwise similar nonparticipants with Barclays accounts were studied. The authors present and apply a panel-data methodology for estimating the impact of the scheme on firm growth, which is able to take into account nonrandom selection onto the scheme. The main empirical findings are that participants are both more likely to survive and to grow faster than nonparticipants.

The advent of the Small Business Service (SBS) has been accompanied by a renewed interest in ethnic minority enterprise. The content, nature, and efficacy of engagement processes with ethnic minority business (EMB) are likely to be important criteria for the granting of local SBS franchises, if the support needs of EMBs are to be successfully identified and responded to in the light of community and socioeconomic differences. This imperative has thrown into sharp relief unarticulated assumptions upon which policy towards EMBs has been, or should be, constituted. A review of these policy questions, and an assessment of the way forward, is long overdue. This is the key aim of the paper. In addressing this task, the authors draw upon a range of recent and ongoing studies of different facets of EMB activity, focusing in particular on the policy dimension. The discussion is divided into three main sections. First, there is an assessment of the support needs of EMBs. A key question is the extent to which such businesses are distinct from the general small firm population; and whether differences can be attributed to other factors, such as size and sector. This issue has implications for the delivery of business services; in particular, should services be delivered within existing ‘mainstream’ business support institutions, or through agencies predicated upon notions of ethnic differentiation? Second, issues and lessons from previous policy initiatives are considered. In particular, the role of specialist agencies, urban regeneration initiatives, and business-led organisations are assessed. After considering issues emerging from extant studies, part three identifies elements for a more coherent policy towards EMBs. Such a policy should include: clearer objectives; placing support EMBs within mainstream provision; an engagement strategy; closer integration between business support and regeneration policies; better access to finance; and more client-focused business support.

When the structure of local government in Great Britain was reorganised during the 1990s, considerable emphasis was placed by the government on the financial savings which would accrue to offset the costs incurred in making the changes. Previous work examined these expectations and found clear evidence that the ex ante estimates of transition costs given to the Westminster parliament were serious underestimates, and that the expected savings had not, at that time, materialised. This work was done at a time when it was known that some of the official data on transition costs would not be complete until after the close of the 2000/01 financial year. The author's primary purpose is to place on record what may be regarded as the final estimates of the transition costs in England, Scotland, and Wales. In addition, comparisons between the ex ante estimates of the costs of structural change and the ex post evidence concerning actual costs are updated. The discrepancy between these is such as to confirm the need for some form of independent scrutiny of new legislation at the time when it is being considered in parliament, to ensure that decisions are taken in the light of realistic assessments of the costs and benefits of proposed enactments.

In this paper we argue that large cities can benefit from higher levels of adoption of ICT (information and communication technology) among the population. We develop an analytical framework permitting the analysis, assessment, and comparison of urban ICT-adoption stimulation policies. The frame is applied to four types of ICT-adoption policy, pursued in different European cities: The Hague, Eindhoven, Helsinki, and Manchester. We conclude that adoption policies can be justified for a number of reasons, and may contribute to urban development in several respects. However, in many cases, policies lack effectiveness because crucial factors that determine ICT adoption are not taken into account. Also, in too many cases, public policies interfere with market initiatives. On the basis of our case studies, we conclude that the most effective policies are not only problem driven but are also opportunity based and integrated: this includes infrastructure provision, content development, and resource building among low-adoptive groups.

Increased awareness of shortcomings in both provision and maintenance of public services is triggering new approaches to policymaking and service delivery. Conventional debates over public versus private service provision obscure the multiple configurations possible. We consider the effectiveness and desirability of an alternative approach to public-service provision of water and wastewater services, specifically the Border Waterworks program, which has helped deliver water-related services to economically disadvantaged communities (colonias) along the US – Mexico border. We explore some issues that emerge when nonprofit organizations take on functions of governments and service providers, and examine the conditions under which the provision of water and wastewater infrastructure can be advanced by nonprofit organizations. We conclude that the general effectiveness of Border Waterworks was thanks to its ability to adapt to local circumstances and respond to situations as they arose in the context of the numerous problems in colonias. We also conclude that nonprofit providers are most effective when they serve as catalysts that assist the public sector rather than when they provide public-service infrastructure on their own.

Aggressive internationalisation activities by global retailers frequently encounter, in addition to responses from indigenous rivals, the regulatory mechanisms of the governments of host or target nations. However, these public regulatory mechanisms are themselves in a state of flux, often as a function of internal conflict between government policy sectors. Internationalisation itself is also an agent of change and we illustrate this using the example of retail regulatory systems in Britain and the Netherlands at the time of Wal-Mart's entry into the EU. In both countries, an ambivalent stance by the central government was evidenced by the publication of reports by planning authorities and investigations by competition authorities.