It seems the DTI and Douglas Alexander (pictured) have been massaging the figures on the number of small businesses getting hooked up to the web to make an artificially rosy picture.

Disparity between figures published by the DTI (Department of Trade and Industry) and telco watchdog Oftel in October and November last year suggest the government may be exaggerating the proportion of small businesses connected to the internet.

The two reports show vast differences in the number of small businesses connected to the web. The DTI reckons 91 percent of small businesses were connected to the web by 2001, whereas Oftel's picture is a more parlous affair at 60 percent.

The reason for the gap is that the DTI doesn't call a business with between one and 10 employees a small business, but instead calls it a micro business. A small business, according to the DTI, has between 10 and 49 employees. But Oftel classifies a small business as having anywhere between one and 50 employees.

Dr Richard Wilson of the Institute of Directors said it was "disingenuous" and "wrong" to miss businesses with between one and 10 employees out of the small business category.

Businesses with up to 10 employees make up 86 percent of smaller firms, referred to as SMEs, or small to medium-sized enterprises, by the government, according to Oftel. By excluding these businesses from its small business category, the DTI has painted a picture far more rosy than Oftel's.

So for the DTI to state that 91 percent of small businesses are connected to the internet when this figure discounts the smallest of small businesses is at best misleading.

But the DTI insists there are good reasons for using the micro business category. "Some of the more positive action has happened in the micro business sector," a spokesperson for the DTI told PC Advisor.

The DTI's report, Business in the Information Age states that the proportion of micro businesses connected to the internet has increased from 67 percent in 2000 to 76 percent in 2001.

Oftel insisted that the sample for its own report, Business use of Internet — Oftel Small and Medium Business Survey, was carefully selected and weighted in terms of size of business, business sector and region to give a picture of smaller firms as a whole.

But when asked to comment on the difference between Oftel's figures and those in the DTI’s report, the telco-watcher became reticent. An Oftel spokesperson told PC Advisor: "It's for the DTI to say why they chose to do it that way."