Trade Secretary Patricia Hewitt today announced a radical package to reform DTI business support, worth up to £1billion per year. In future business support will be directed where it can be seen to drive up productivity to increase prosperity in key areas: enterprise, investment, innovation and skills - and where there is clear evidence of market imperfection.

The plethora of existing schemes will be replaced by a much-reduced number of streamlined offerings based on strategically driven principles. All existing business schemes will close as they come to the end of existing legal and contractual obligations, with most ending over the next two years.

All business support will be rigorously monitored and analysed to measure whether it has achieved its objectives and offered value for money. Evidence from this analysis will help the newly formed Investment Committee target business support funds so that the wider economy benefits.

The system is being radically restructured as a result of feedback from key stakeholders, consulted on the role of the DTI and its delivery of Business Support as part of last year's DTI review. The old system of support was criticised for having too many schemes with overlapping objectives making it confusing for business. Standards of schemes varied across the regions and strategic objectives were often unclear.

The new, better targeted system will be introduced to make it easier and more convenient for businesses to apply for support. It includes:

• An Investment Committee to co-ordinate the department's approach and make recommendations on where and how the money will be spent. The Committee will be independently chaired by Fields Wicker-Miurin, a business member of the DTI's Executive Board and former venture capitalist. It's purpose will be to maximise the productivity gains from businesses support expenditure.
• An online Knowledge Bank, will provide information on the business help available, not just from DTI schemes. It will include links to regional Business Support schemes and local initiatives. This will make it much easier for businesses to identify the best type of business support for them.
• New software will allow customers to find out what business support is available to them on the basis of their needs. For example, if the customer needs to find ways of improving their product development, the software will tell them about Business Support hat may help them.
• Quicker decisions will be made through greater automation of the application process.
• Greater consistency and better service will be available across the country.
• Closer working with the RDAs and other business support providers to align government provision.

Trade and Industry Secretary Patricia Hewitt said: "As I said when we started our review of business support - the status quo is not an option. We are not going to do anything unless it can be shown to help British prosperity and we will only intervene if it can be shown to help. We have cut through the myriad of confusing, conflicting - and sometimes ineffective schemes - to create a tighter, more targeted, evidence based approach to business support."

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