IOE and IT calls on government to simplify 'confusing' Brexit SME support fund with millions unclaimed

Wed 28 Jul 2021
Posted by: Noelle McElhatton
Trade News

The government’s £20m training fund to help SMEs adjust to new post-Brexit rules for trade with the EU was described as 'confusing' in parliament yesterday.

Just a third of the allocated funds – £6.8m – have been granted to SMEs due to the complexity of the application process, the FT reports.

The scheme, which closed on 30 June, had nearly 5,500 applications from SMEs with 4,376 companies offered grants, according to official data.

Average award

Labour MP Hilary Benn, co-chair of the UK Trade and Business Commission, revealed the figures in parliament yesterday, including the average award to SMEs of £1,555 rather than the maximum allowed of £2,000.

Benn described the SME Brexit Support Fund, administered by PwC on behalf of HMRC, as “an obstacle course” that “discourages applications by making SMEs jump through too many hoops for a very small return”.

IOE&IT call

While Benn and some trade bodies are urging government to expand the scheme, the Institute of Export & International Trade is calling for greater simplification of its requirements.

IOE&IT director general Marco Forgione said:

“I don't think the scheme as operated was fit for purpose because of the bureaucratic requirements. Either a much simplified scheme should be put in place or the funds used to enhance existing services such as Open to Export, which has successfully supported thousands of SMEs with their export requirements.”

Open to Export is a free online information service for SMEs founded by the IOE&IT, the Department for International Trade, the Federation of Small Businesses and Yell, now solely run by the IOE&IT to prepare businesses for exporting and expansion internationally.

'Time bomb'

Forgione added that many businesses were still not aware that they now have to complete customs declarations for goods moving from the EU into Great Britain “and that is a ticking time bomb”.

Other changes include new VAT rules for trade with EU states and a need to understand rules of origin to avail of tariff-free trade with the EU.

IOE&IT support

Applications are still being processed by PwC. The IOE&IT is providing support for SMEs grappling with the rule changes through specially-designed EU-GB trade courses and consultancy services