A fifth of small to medium-sized businesses in the South East are "seriously impeding their survival chances" by failing to set themselves financial goals.

Almost 42 per cent said they needed more time for financial planning, had other priorities or were unsure how to go about it, according to a Government-backed study.

A similar number of businesses in the region refused to put any money aside for staff training at the beginning of the financial year.

The survey by learndirect business will make gloomy reading for ministers who are trying to create an economy built on knowledge, skills and entrepreneurialism.

The Department of Trade and Industry believes poor financial management and lack of training contribute to the collapse of 100,000 businesses every year.

Saj Minhas, regional workforce development manager at learndirect business, said it was "concerning" to see financial planning sidelined by so many businesses.

He said: "The survey highlights the necessity of developing core management and financial planning skills in a way that fits in with the time-poor business environment.

"Achieving this will help small to medium enterprises (SMEs) in the South-East not only to survive but also to grow.

"Employee development is important for all businesses and can bring various business benefits, including reduced staff turnover and increased productivity. We've found businesses can often find it difficult to commit to training due to concerns over time and cost. But training needn't be costly or time consuming."

Learndirect, which runs online training courses, said companies with fewer staff found it harder to devote resources to financial planning and staff development.

A third of companies with between ten and 20 employees admitted to never setting financial targets and almost 44 per cent failed to budget for training.

Learndirect business has set up an Online Advice Centre to help SMEs deal with financial and business planning at www.learndirect-business.co.uk/ grow