Rt. Hon. Helen Liddell - Former Minister for Energy and Competitiveness in Europe (Jul 1999 - Jun 2001)

The Franco-British Club For Higher Education And Training In Entrepreneurship

The two Ministers saw a new website (www.fb-entrenet.org) that enables people to access French and British organisations that offer education or training in entrepreneurship with opportunities for bilateral contact or joint qualifications. Leading entrepreneurs Nigel Corby and Yves Ducrocq said that the club was the ideal vehicle for building new business relationships between smaller firms in the two countries.

M. Pierret, distinguished guests.

I take particular pleasure in being here today to join with you in launching this Franco-British Club for Higher Education and Training in Entrepreneurship.

As you know, the Club forms part of the actions of the joint Ministerial Task Force on Entrepreneurship that was initiated by Tony Blair and Lionel Jospin in March 1998.

My colleague, David Simon, began the work for the UK and I wish to thank him for having worked so closely with you, M. Pierret, in ensuring that our Prime Ministers? intentions bore fruit.

I also wish to thank those members of the academic community in France and in the UK who have collaborated in setting up the Club thus far. There is much more work to do, but I think that an excellent start has been made.

I suppose in this gathering I can be reasonably confident that most people will have seen the report of the Global Entrepreneurship Monitor which shows the UK and France lagging behind in entrepreneurial activity, after the USA, Canada and Israel.

Our countries show a significantly lower rate of new business start-ups and quarterly growth in GDP, compared to the leading nations, and a marginally lower employment rate.

Whether one agrees with the GEM conclusions or not, there does seem to be a marked difference in attitude and culture towards entrepreneurs and entrepreneurship in these three countries which consistently attract the interest of commentators. I am sure that this difference was uppermost in the minds of Tony Blair and Lionel Jospin when they launched the Ministerial Task Force.

The Task Force has considered the importance of access to finance for entrepreneurs and the availability of finance; it has looked at regulation and taxation; it is also considering how e-commerce will impact on the way that people will be able to work in completely novel ways to bring new ideas and products to a truly global market.

But, it is in this field of education and training of entrepreneurs, where the two countries have found much in common. Frankly, some may have been surprised at how much was already in place in terms of linkages between universities; but these links are very much ad hoc and not really very well known. The interest that has been shown so far in putting this Club in place demonstrates that many people, on both sides of the Channel, want to see links strengthened, opportunities for working together made easier, and the process opened up for wider access. I said at the beginning that I regarded my presence here as a particular pleasure. That was not just a feeble attempt to be charming. Prior to entering Parliament, I was Chief Executive of an organisation charged with redressing the poor level of business start-ups in Scotland. So I know this subject from the sharp end.

I have earned many scars trying to develop new business ideas, putting management teams together, seeking out any available source of start-up finance.

And I have earned the deepest scars trying to commercialise ideas out of our universities, especially trying to convince some of our brilliant innovators that a business plan is not a fruitless waste of computer time.

I have looked on in awe at how our competitors on the other side of the Atlantic have left us standing when it comes to developing business ideas, especially as spin-outs from colleges and universities.

The establishment of this Club is a major step towards addressing those ambitions. A Club of this type is virtually unique, as well as "uniquely virtual" because much of its influence and impact will occur through the virtual media of the Internet and distance learning technologies.

And it has to succeed.

We face global competition that takes no account of national tradition or standing. Those who cannot compete with the best in the world go out of business. Both our countries suffered the consequences of the reality of that statement. But we have it in our hands to turn things round.

Our two countries are already becoming mutually interdependent to a degree that would have been thought impossible not very long ago. In 1996, the UK accounted for 18% of all foreign investment in France - worth nearly £14billion - and France is the sixth biggest investor in the UK with some 1,300 French companies investing nearly £9billion.

I do not need to remind you that some parts of France have a significant influx of Britons; for our part, we are delighted to see French people coming to the UK because they complement our way of doing things. And that statement stands regardless of the excesses of the tabloid press.

The club itself is not a purely hard-nosed business relationship; it is a way of developing an understanding of each others? strengths and weaknesses - in a very open way - so that we can learn from each other and help each other to improve.

So why do we have to do better?

Last January, the Financial Times published a survey of Business Schools that included a ranking of the world?s top 50 business schools.

The basic message was incontrovertable: the Americans provide business education that is perceived to be world class. There were only three European institutions in the top 22 - the rest were solidly American. Training managers, updating their skills, unleashing their creativity is not an optional extra to the Americans. It is essential.

If Europe business schools are not perceived as world class, then our businesses face the future with a handicap. These schools are where our best managers are trained. It is not that our business schools are bad - many are very good; but they are not the best. We need to remedy that.

Tables of economic indicators usually show our two countries in the middle rank - much like our business schools. We each have a few star companies, but by and large we perform at a level that is just about adequate, but no more, against global competition.

If European countries are to meet the challenge of sustainable growth and employment, we must deliver a positive environment for our entrepreneurs in large firms and small. We must help our companies to innovate, small firms to grow, large firms to source management from our local economies.

Commissioner Liikanen agrees. He sees a direct link between Europe?s poor performance in beating unemployment and our failure to generate enough new small enterprises and to encourage young people to become entrepreneurs. Without radical change in the business environment, Europe will continue to lag behind.

We need to streamline the process of business creation and make it administratively easier to start up new businesses.

We need better access to finance so that small firms and high tech high growth companies in Europe have at least as good access to private capital as their counterparts in the United States. And that will require all of us to assess our attitude to risk.

We need an education system which, as well as providing students with core skills that can compete with the best, promotes a greater understanding of entrepreneurship and the self confidence to take a chance.

We need to recognise that the key to the future for many of our small businesses lies in access to technology. We need to find ways of delivering that access and encouraging use of new technologies like the internet and electronic commerce.

Through all of this, we must ensure that our businesses are not burdened with unnecessary regulation. I want to see all new European regulation independently appraised for its impact on small businesses and certified as small business friendly. But that will all be pointless if we do not have people with the drive to start these businesses and the skills to grow them.

Europe cannot afford to stand still. We need to take action if we want the EU not only to catch up with the United States but to become the most advanced knowledge-based economy in the world in the 21st century.

We need to see ourselves in a global context, benchmarking against the very best. We need to learn from our competitors and identify the actions we need to take to become world-beaters.

We have an historic opportunity to push the agenda forward at the Special Summit on Employment, Economic Reform and Social Cohesion in Lisbon next March.

The Summit will give us an opportunity to give new impetus to Governments working together to identify best practice in developing the environment within which businesses can succeed. To concentrate our minds on what creates jobs rather than on what destroys them. To look to the jobs of the future as we acknowledge the disappearance of the jobs of the past.

We need to ensure that people in business, and those thinking of setting up their own firms, get high quality advice and help when they want it and in a form that fits their needs. This is the simplest way of helping businesses survive those critical first years. Work from the OECD shows that Britain

and France have fairly similar track records in this respect, but that our survival rates are well behind Germany, Denmark and Ireland.

The quality of the management team is a major factor for venture capitalists who are thinking of investing in a small firm. If we can raise management quality, we will attract more investment, improve our SME survival rate and produce better goods and services into the bargain.

That is why this Club is so important.

It offers an opportunity to break out of a cycle of underperformance in too many small firms; to give actual and intending entrepreneurs not just a vision of something better, but ways to tackle their problems; ways to learn from each other; routes to expand markets; help to understand the reality of operating in a different environment, a survival test for when times get tough. Both managers and young people need to understand what it takes to be enterprising, so that our entrepreneurs now and in the future can pilot their businesses and master the new technologies which give firms a competitive edge.

And our young people need to see setting up a business as a viable career option.

So I am delighted that so many of you have made the journey today to Lille. But this is only the beginning. To get real benefit from this club, you will have to invest time, effort and money. I know that all of those are in short supply. But the alternative is to see a further decline in the capabilities of both our countries to compete in the toughest markets.

I know that I speak for Christian Pierret as well when I say that we wish you "bon voyage" but that we shall both be following your journey with intense interest; and that we look forward to meeting you again in the UK when the club is fully operational and hearing reports of your success.

Other speeches by Rt. Hon. Helen Liddell - Former Minister for Energy and Competitiveness in Europe (Jul 1999 - Jun 2001)

(the following are available from the archive)
• BNES/BNIF Nuclear Congress 2000 (06/12/00)
• Energy Industry & Market Restructuring (19/11/00)
• Launch of the 3e's Initiative (21/09/00)
• Offshore Northern Seas 2000 Conference (23/08/00)
• Energy Policy Conference National Assembly (19/10/99)