'Cash for tech SMEs' Bill hit by Blair's timekeeping

A Bill that aims to boost the amount of cash given to UK technology small businesses and encourage innovation by home-grown start-ups may be stymied as parliament runs out of time.

The Procurement of Innovative Technologies and Research Bill, based on existing US legislation, was put before the House of Commons yesterday during a debate on the Finance Bill.

Anne Campbell, Labour MP for Cambridge, who proposed the Bill told silicon.com the reaction to the Bill has been "very positive so far" but expressed her concerns that measures to help tech companies in the budget could turn out to be "just sticking plaster" rather than a long term boon to the industry.

Campbell said she would look at ways to amend the Finance Bill if that was the case and will soon be sending copies of the Bill to key ministers, including Trade and Industry secretary Patricia Hewitt.

The Bill mandates a US-style system of soft partnerships between government and industry, whereby Whitehall would tender for companies to create a solution to a specific business need, rather than the old system of grants.

"It should be recognised that we need different procurement procedures - they're fine if you're buying rubber bands or large IT systems, not for procuring research and development," Campbell said. "I wouldn't say grants are no good but at a different stage - businesses want secure and stable funding."

While the government already has a system in place to push innovation for small and medium-sized enterprises (SMEs), government departments can opt out of the system. Campbell's Bill aims to put an end to that, with all departments with R&D budgets over £20m obliged to use SMEs for 2.5 per cent of the work. Each contract will not exceed £500,000 and all intellectual property would remain in the hands of the SME that developed it.

However, Campbell said the Bill may not get a reading within the current session of parliament due to a lack of time, although the Cambridge MP said she will consider re-introducing it in the next parliamentary session or working to amend the Finance Bill.

While UK politicians debate the best strategy for SMEs, the EU is sticking to its guns on the issue of funding. It will be putting its hands in its pockets for the usual grant system with €2.3bn of cash available for small firms under its Sixth Framework Programme.