LIKE Gillingham Football Club, Medway was now in the UK's first division, a leading business forecaster told successful business people.

Speaking at the presentation ceremony of Medway Small Business Awards, Professor Richard Scase, of the University of Kent, said the fortunes of Medway reflected those of the Gills.

As a fan some 20 years ago, he recalled rust falling from the Rainham stand whenever the ball hit the roof. Things were a lot different at Priestfield these days, he said. "Just as Gilllingham has moved to the first division, so too has Medway."

The area no longer relied on the Dockyard and heavy industry, with "low morale, low training, low skills". Medway had been rejuvenated, with 8,000 small businesses and a diverse economy "locked into the global marketplace".

But he warned of looming dangers to its prosperity, including competition from India.

"By 2005, India will have more graduates in science and technology that the whole of the UK population. Half the largest companies in the world now outsource their software analysis and data processing as well as call centre activities to India."

Other problems for local business were low inflation coupled with rising insurance premiums for public, employee and employer liability, and the mounting number of regulations coming out of Whitehall and Brussels, 4,700 since 1997 alone.

He urged firms to remember the three Fs - "keep it fit, fresh and fun" - and the three Es - "enthuse, empower and engage".

It was important to spend more on training. The UK invested less on employee training that any other advanced country.

And if we wanted more young people to become entrepreneurs, successful business people should not hide away. "We've got to create a culture of enterprise, that entrepreneurs are local heroes who kids admire and want to imitate."

Prof Scase, who appears regularly on television and radio, repeated his controversial call for the replacement of Kent County Council by a number of unitary authorities like Medway.

"I wonder when we think of the future whether KCC will really exist?" he said. "Should KCC be broken up into a number of unitary authorities to give us that focus, that speed of decision-making?"