• Max Bradford
Business Development

The Government is committed to fostering the development of New Zealand businesses, Business Development Minister Max Bradford said today when announcing a reshaped Business Development Programme.

"The new programme will focus on helping SMEs (small to medium sized enterprises) improve their business skills and management capabilities, as well as fostering enterprise and innovation," Mr Bradford said.

"It will be a far more effective way of helping SMEs to prosper than the current programme, by being more flexible to meet the regional and changing needs of small businesses, less administratively cumbersome and better value for money.

"SMEs make a significant contribution to our economy. It's important these businesses are able to develop new skills to compete effectively in the global trading environment."

Mr Bradford said the new programme will mean a move to a more focused system of the Government contracting business assistance experts to design and provide services for their local region, and in some instances nationally, rather than the current network of 21 regional Business Development Boards (Crown Owned Entities).

An open tender process will begin in the next several months, with the Boards ceasing to operate as Crown Entities on December 31 and the new programme up and running early next year. It is expected there will be a range of contractors.

"In this way boards that have a real commitment to their communities will be able to participate in the tender process," Mr Bradford said.

"The boards have made a significant contribution to small business development in New Zealand and successfully assisted many companies," Mr Bradford said.

"However, they have historically focused on administering grants to fund various activities aimed at assisting firms. Small businesses face different challenges in today's environment, and accordingly the Government recognises the need to change the way it addresses these needs," he said.

"At the same time, the current Crown Entity structure for the Boards has become increasingly inflexible and prescriptive. This has both affected the programme's effectiveness and value for money."

Mr Bradford said an extensive review of the programme had found there are more effective, more flexible and less bureaucratic ways of Government providing real help to SMEs.

He said a wide range of organisations and individuals had been consulted during the review of the programme. More than 100 submissions from enterprise agencies, businesses and interest groups were considered.

"There is strong support among those consulted for the new programme because it will also be more responsive to the needs of different businesses, and of those in different regions," he said.

"Staff and members of the existing boards will be well placed to be involved in the reshaped programme, along with other business assistance experts, and I encourage them to move into the new environment."

Mr Bradford said funding for the Business Development Programme remained the same as that announced as part of the Budget this year - $12.4 million for the current Government financial year, and $12.4 million for 1999/9000.