Can government identify UK firms with export potential? The National Audit Office gives its verdict

Wed 15 Jul 2020
Posted by: William Barns-Graham
Trade News

export potential

A renewed cross-government approach to improving data held on UK businesses – to better identify those with export potential – is making progress, an official report has found.

The National Audit Office (NAO) this week published its report into the effectiveness of the Department for International Trade (DIT) and UK Export Finance (UKEF) in delivering services to boost UK exports.

DIT data

DIT’s data and sector-knowledge was described as “variable”, with emerging industries – such as renewable energy – being “less understood” compared with more established areas like aerospace.

To address this, sector teams within DIT are already working with counterparts in the Department for Business, Energy, Industry and Skills (BEIS).

DIT also hopes the forthcoming Trade Bill – currently at committee stage – will support data sharing between DIT and HMRC.

Digital offer

The NAO also noted that DIT plans to adjust its support so that it provides more “bespoke support” for larger businesses while directing smaller businesses to its digital services.

For smaller businesses, DIT is currently enhancing its digital offer to “include more specific guidance and an evaluation strategy to help it understand the costs of its digital services, how well they meet user need and where the gaps are”.

This follows a recent survey of DIT clients which found the services on its website were not meeting all the needs of UK businesses.

Export finance training for DIT staff

The report found there is scope for DIT and UKEF to work more closely together overseas.

UKEF relies on DIT staff to help identify potential customers, but NAO say these staff are “not finance experts” and may therefore “lack the skills to promote export finance”.

The report says DIT is aiming to “increase the number of UKEF staff overseas and has introduced training for DIT staff.”

This training includes the Award in Trade Finance course developed by the IOE&IT alongside DIT and UKEF in 2018.

Building on the export strategy

DIT and UKEF are also looking to develop a new export strategy building on the previous 2018 iteration, which was defined by its pledge to increase exports from 30 to 35% of UK GDP.

The report states that it is difficult to hold DIT accountable for the progress towards this target, partly due to the lack of timeframe given to it, but also due to factors outside of the government’s control which can affect export growth – including the coronavirus pandemic and the ongoing post-Brexit negotiations.

The NAO also reflected on the internal ‘export wins’ target, which the government met when achieving £24.4bn of ‘wins’ against a target of £20.91bn for the 2019-20 financial year.

It said the target has “limitations” due its focus on short-term support and it recommended that the department needs to do more to assess the impact of the longer-term support it provides.