THE programme set up to deliver a lifeline to Northern Ireland’s struggling entrepreneurs has been inactive for almost six months after becoming embroiled in a legal dispute over who should run it.
The Detail can also reveal that Invest NI have spent over £250,000 on advertising The Go For It programme since September – which is when the scheme stopped being fully functional.
The business start up scheme had been hailed as one of its biggest success stories, providing help and advice to budding entrepreneurs under the banner of the ‘Start a Business Programme’
However a challenge over the legitimacy of the tendering process means the Go For It programme has been dragged into a legal quagmire that has effectively rendered it inoperable.
With the programme now in limbo and legal costs growing by the day, one of Northern Ireland’s most popular business initiatives has been left impotent.
The Go For It programme had been previously run by consultancy company Enterprise NI (ENI), who had run similar programmes for Invest NI for over 20 years.
ENI is the organisation representing the network of Local Enterprise Agencies in Northern Ireland. Under the banner of the new Business Start-up Programme they were awarded the contract by Invest NI in April 2009 to run The Enterprise Development programme. It consisted of two main elements:
• The Go For It Programme, targeting individuals who are considering starting a business;
• And the Growth Programme, aimed at established companies with the ability to expand through exports.
The Go For It strand of the Enterprise Development Programme concentrated on delivering client business plans and mentoring packages involving financial market planning and legal advice.
Statistics from Invest NI show that from 1 April 2011 to 30 September 2011, 1,895 business plans were delivered through the Start up strand of the Enterprise Development Programme.
However, on the 6th September 2011 it emerged that the Go For It contract had been awarded to accountancy firm KPMG in partnership with Scottish-based company The Go Group.
KPMG had previously been commissioned by Invest NI to carry out an audit of their work from 2006 to 2011.
On the face of it, this looked like standard business practice as EU rules require the contract to be put to tender. However, The Detail has obtained documentation that shows on the 16th September 2011, 10 days after Enterprise NI lost the £5m contract, it began legal proceedings.
Documents obtained by The Detail show that Enterprise NI issued a statement of claim against Invest NI and the Department of Finance and Personnel in relation to “the award of the contract for the management and delivery of the ‘start a business programme’ whereby it awarded the contact to the Go Group.”
A declaration was made by Enterprise NI citing that the decision was unlawful and reached in a manner that was in breach of the requirements of the Public Contracts Regulations and EU law, as well as the tendering contract between them and Invest NI.
Since then, the scheme has been left inactive.
In a statement provided to The Detail Invest NI said: “Invest NI is prevented from delivering a fully functional business start programme as a direct result of the legal action undertaken by Enterprise Northern Ireland, but is responding to start up enquiries including those generated through the Go For It helpline.”
Last week the High Court in Belfast heard from senior counsel representing Invest NI that it had no intention to exclude the Go Group from delivering the Start Up Programme.
A three day trial is due to be held in March.
THE GO GROUP
As the legal process continues some politicians are asking questions about the issue.
Earlier this week Sinn Fein Fermanagh MLA, Phil Flanagan received a response to a written assembly question tabled to Enterprise Minister Arlene Foster MLA, concerning The Go Group’s business dealings.
The Minister said: “I am aware that Invest NI decided to award the contract for the new Business Start Programme to a consortium including the Go Group based in Glasgow.
“To the best of the knowledge of the Department and Invest NI the Go Group voluntarily withdrew from a number of procurement competitions due to allegations of breach of confidentiality by one person within that organisation. This matter is currently being considered in the course of ongoing litigation.”
Speaking to The Detail Mr Flanagan said: “I haven’t received a full response from the Minister in terms of dealing with The Go Group’s past. She has outlined concerns around Enterprise NI’s under performance and concerns she had around its governance arrangements, but I’m still waiting for the more interesting answers which deal with the party awarded the contract.”
Soon after it was announced that The Go Group had won the contract along with KPMG, questions were asked about why a company from Scotland was being tasked with helping Northern Irish companies.
At the time Invest NI said it still planned to deliver the programme through a network of Northern Ireland accountancy and consultancy businesses – but Phil Flanagan isn’t convinced.
He said: “Invest NI really need to up their game. They’ve been given massive budgets by the Executive to create employment and try to improve the current economic position here and they’re not delivering on that.
“There are a number of questions that need urgent answers and clarity but my primary concern is that a proper service is provided to those people who want to start their own business or who want to expand their current business and at the minute they’re being left out in the cold.”
We contacted The Go Group but a spokeswoman said “because of ongoing legal proceedings we do not want to comment on this matter at this stage.”
A number of written assembly questions tabled by the UUP’s Basil McCrea to the DETI Minister at the start of this month raised concerns about KPMG’s involvement in the tendering process.
In a response the Minister said: "KPMG were appointed in December 2008 after a tender process to undertake the Monitoring Agent role in the Enterprise Development Programme. The terms of reference for this role included an ongoing quality assurance and an audit and activity verification role across all delivery agents, reporting to Invest NI on any non-compliance and identifying opportunities for continuous improvement. "
The Minister also confirmed that KPMG were asked, as part of their monitoring agent role for the Enterprise Development Programme (EDP), to produce a concept paper looking at payment structure and targets.
From the period of January to June 2011 the cost to Invest NI for this paper was £9,480 and was paid to KPMG as part of their Monitoring Agent fee.
Speaking to The Detail, Mr MCrea said he that he had still a number of outstanding questions surrounding these issues that he was awaiting a response on.
He said: “It is surprising that we haven’t had a full response given the importance of this particular programme to DETI.
“Northern Ireland depends on new start companies to actually provide the employment levels that we need. Quite frankly, we’re just not doing that at the moment and it’s a huge black mark as far as I’m concerned on the department and Invest NI.
“We’re at the point now where we’re asking who actually makes the decisions on the awarding of these contracts. “
A spokesman for KPMG said: “We have no comment to make on this matter.”
THE ADVERTISING COSTS
Invest NI told The Detail that in the absence of The Go For it programme there is still an interim service run by existing Invest NI staff that provides “one to one advice, business clinics and business plan support and is delivered through Invest NI’s Regional Office network.”
We can reveal that from September 2011 to February 2012 Invest NI has spent a quarter of a million pounds on advertising the Go For It brand, with a combination of media placement (£227,972) and media production (£21,902).
While DETI have said that Invest NI is not currently advertising or delivering a specific start-up scheme in connection with Go For It, Invest NI have confirmed that they are continuing to advertise under the wider ‘Go For It’ brand in order to “stimulate public interest in enterprise and business start.” Over £152,000 has been spent on TV advertising alone from September.
Mr Flanagan believes the current position taken by the department and Invest NI is a confusing one for anyone looking for help with a business.
He said: “The responses I’ve received from the Enterprise Minister is that Invest NI is currently not advertising for any start up programme of any kind. This is despite the fact that there are ongoing TV, radio and billboard advertisements encouraging people to phone a number for information and advice on starting their own business and when they do there clearly is a gap in the level of advice and support being provided to them.
“The advertising spend since September speaks for itself. It’s a massive amount of expenditure with very little return, we really have to question the value of it.”
Many of the written questions tabled by both MLAs surrounding the Go For It programme have yet to receive a response. The programme itself remains in limbo as the legal processes surrounding its future continue to rumble on.
Basil McCrea MLA believes it is essential that questions around the tendering processes are addressed in order to salvage the legitimacy of future programmes.
He said: “I know there are legal processes ongoing, but it is legitimate that people out there need to know what happened in this instance. Too often organisations hide behind the banner of ‘ongoing legal proceedings’ as a reason for not giving any information.
“The matter around this contract needs to be explored openly because at the minute there is no programme being provided to those people who are in desperate need of it. It appears that for the moment the department and Invest NI have their heads firmly stuck in the sand and that cannot be justified.”