North-east reaping benfits of Business and Enterprise North East
EVERY publicly-funded pound invested in one-to-one support for companies in Tees Valley by Business and Enterprise North East generates more than four times that amount for the local economy.
Independent evaluations of the work of BENE, which operates the Business Link advisory service, this week revealed that the agency was considerably more effective than sister organisations in London and the South-west - the only two that have so far gone through similar scrutiny - although it also has more direct involvement in administering investment funds, which may exaggerate the figures.
Nevertheless, 4,400 regional businesses benefited from intensive work with BENE advisors between 2008 and 2009, which boosted total company turnover by £73.2m and resulted in £7,047 additional gross value added (GVA) output for each - an extra £31.1m of net GVA for the wider economy.
By comparison, the London development agency achieved £2,471 of GVA per business and the South-west RVA £1,234.
GVA is a government-endorsed method of assessing economic impact.
The research, carried out by WME and commissioned by regional development agency One North East, which funds the BENE, showed that the advice services had simultaneously slashed costs by £2.3m, including reducing back office costs from 25% to 15% of overall expenditure.
The figures are important as agencies face up to criticism that much of the additional help for businesses pumped in to the economy during recession has gone to civil servants, rather than on front line help.
In the North-east, it also helped defend the RDA against likely Tory attempts to dismantle the regional business support framework, should the party win office this summer.
A more comprehensive report on the economic impact of BENE’s work on more than 26,000 businesses in the North-east is expected in June.
