Small businesses across Cornwall are set to be hit hard if the new Government fails to replace the support they receive from the EU, according to a new Federation of Small Businesses (FSB) report.

Cornwall is the only region in England classed as “less developed” by the EU, which has dedicated €4.3 billion to developing the competitiveness of UK small firms in the six years to 2020. The Cornwall and Isles of Scilly Local Enterprise Partnership (LEP) has been allocated €590 million as part of the same funding round, more than any other LEP outside of London.

The FSB is calling on the new Government to ringfence current funding for business support schemes via a streamlined Growth Fund before the Brexit process completes. The fund would bring together a domestic replacement for EU funding and the Single Local Growth Fund (SLGF). There is currently no regional development spend budgeted at the national level beyond 2021.

The new ‘Reformed Business Funding: What small firms want from Brexit’ report finds that the majority (77%) of small firms in the south west that have applied for EU funding believe it has benefitted the region. More than half (59%) believe business support should be prioritised by any EU funding replacement. Among applicants for EU-funded schemes across the region, almost a third (29%) seek grants to deliver skills and training.

The report also uncovers the need to more effectively promote these opportunities in future, with four in ten (39%) small firms that have not applied for EU funding stating that they are unaware of opportunities to do.

Martin McTague, FSB national policy director, said: “Failure by the new Government to ringfence funding to support small businesses could mean a real shock to the Cornwall economy. Our report highlights a number of groundbreaking programmes currently operating across the region. The jobs and growth these initiatives create will be at risk if funding is pulled.

“Of course, more must be done to streamline and effectively promote business support in Cornwall. Brexit marks an unprecedented opportunity to reform the schemes on offer to small firms. We urge the new Government to seize that chance as it looks to develop an industrial strategy that promotes growth across all regions of the country.”