Financial TimesBanks enlisted to boost take-up of skills scheme for small businesses

May 3, 20220

High street banks have been enlisted to boost demand for the UK government’s flagship scheme to raise productivity among small businesses by pointing their clients towards management training courses.

The move comes after concern that too few businesses are signing up to the Help to Grow scheme, formally launched by chancellor Rishi Sunak in August last year to help SME leaders to improve their skills in areas such as financial management and marketing.

Just over 2,500 businesses have enrolled in the scheme so far, with another 800 registered, according to the Chartered Association of Business Schools, the body representing management training providers.

However, take-up of the scheme has been slower than business groups expected, suggesting the government might struggle to meet its target to give access to 30,000 companies by 2025.

The first bank enlisted by the Chartered Association of Business Schools to help boost enrolment is NatWest. The bank, which has about 1mn small business customers, has started promoting Help to Grow among clients looking to expand their operations.

Help to Grow was launched by Sunak as a way to address sluggish productivity among small and medium-sized enterprises which economists have highlighted as a key barrier to growth.

Through the scheme, the government offers a 90 per cent discount on the £7,500 tuition costs of the management course, paid for by a £200mn Treasury subsidy.

Rishi Sunak at Aston University Business School, which is taking part in the running of Help to Grow
Just over 2,500 companies have enrolled in the scheme launched by chancellor Rishi Sunak, suggesting the government could struggle to reach its target of 30,000 by 2025 © Simon Walker/HM Treasury

Other banks are expected to become similarly involved later in the year. Barclays and HSBC have already started to promote the training scheme to their small businesses clients. So far, 57 business schools have been approved to teach the management course.

Andrew Harrison, NatWest’s head of business banking, said that Help to Grow was aimed at SMEs that were in a growth phase, adding that the government’s 30,000 target was “realistic” given that several hundred thousand companies were ready to scale up their operations.

“Not everybody wants to grow rapidly or is able to grow rapidly,” Harrison said, but noted there was still a “very large group” with growth opportunities. 

Martin McTague, national chair of the Federation of Small Businesses, applauded the scheme’s aim of helping SME owners to sharpen their management skills but said that entry requirements were too restrictive. Under current rules, businesses with fewer than five employees do not qualify.

“Efforts to increase take-up are welcome,” McTague said. “Dropping that requirement to two employees would put the initiatives on a much better footing to make a substantial impact among the micro-community businesses on which our recovery will depend.”

The Department for Business, Energy and Industrial Strategy, which oversees the scheme’s rollout, said: “We are continually updating the scheme to increase its effectiveness.”

“Feedback from participating business leaders has been very positive so far, and we urge businesses to sign up if they haven’t already for support in reaching new customers, boosting profits and expanding.”

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