The Government is scrapping the Help to Grow: Management mentoring scheme in its current form from the end of May.
Rather than use business schools to deliver mentorship and business strategy advice to small business owners, the business department intends to rely on volunteers.
And it has put an £8 million-a-year contract to outsource the running of this new volunteer scheme out to tender, in a move which has left small business experts scratching their heads.
>See also: Government to launch £520m Help to Grow scheme for SMEs
Help to Grow: Management has had poor take up since it was launched last August. The Help to Grow management training scheme aims to support up to 30,000 small businesses over three years. But according to the tender document seen by The Times, only around 750 mentor relationships were formed in the first six months of the programme.
Each small business has to pay £750 to get this soon-to-be-voluntary mentorship, which is a disincentive for a small business facing an unprecedented perfect storm of increased National Insurance contributions and skyrocketing energy costs.
The Department for Business, Energy & Industrial Strategy (BEIS) expects 4,000 businesses to have enrolled in the programme by next month.
And the tender document also disclosed how patchy Help to Grow: Management mentoring has been across the regions, with no businesses in Northern Ireland having taken part in the scheme as yet and only 125 businesses expected to take part from the northeast of England from next month to March 2023. This is compared to a thousand businesses in London and the southeast of England.
Sole traders excluded from Help to Grow: Management
The Association of Accounting Technicians has pointed out that 90 per cent of small businesses are currently excluded from Help to Grow: Management because they employ fewer than five people. Three quarters of the UK’s 5.5m SMEs have no employees at all, according to the AAT.
Martin McTague, national chair of the Federation of Small Businesses (FSB) said: “However Help to Grow: Management ends up being delivered, we would like to see the scheme’s eligibility expanded to encompass a much wider group of small firms. The current requirement that businesses participating in the scheme must have five or more employees excludes nine out of ten small firms, many of which would benefit from the opportunity of subsidised management training.
McTague said he was disappointed that it had taken the Government so long to agree a plan for the scheme. Feedback from those who had participated in the current business-school version of the scheme has been “very positive”.
Indeed, according to the leaked tender document, 89 per cent of those who’d taken part said they were very or fairly satisfied with it.
The business department was unavailable for comment, as was the Chartered Association of Business Schools.