HC Deb 14 July 1975 vol 895 cc1051-3
24. Mr. David Mitchell

asked the Secretary of State for Industry whether he has any further proposals to assist small businesses; and if he will publish proposals on this subject before the Summer Recess.

Mr. Gregor Mackenzie

The needs of small businesses are kept constantly under review but there are no proposals for providing special assistance as of this moment in time. As soon as there are such proposals I shall, of course, inform the House.

Mr. Mitchell

Is the hon. Gentleman aware that repeated assurances have been given that proposals would be forthcoming but that all that has happened so far is that, instead of helping small businesses, the Government have clobbered them? There is the increased corporation tax, the introduction of capital transfer tax, the fear of the wealth tax, two rates of VAT—the list is endless. The Community Land Bill is eroding their credit base—

Mr. Speaker

Order. A supplementary question is not endless.

Mr. Mitchell

Although all this damage has been done to small businesses, the Minister has no proposals to assist them in spite of assurances which have been given.

Mr. Mackenzie

Apart from the problems I have to deal with in the Post Office, this sector causes me more trouble than any other. As I have often said in the House, the needs of small firms are kept constantly under review. In the short term, relief on stock appreciation to compensate for the effects of inflation was introduced last year by my right hon. Friend the Chancellor of the Exchequer. In the longer term, small businesses will benefit from the measures to control inflation which the Government have recently announced. The hon. Gentleman can be assured that we shall look—as we have been looking—at every conceivable way of assisting smaller companies.

Mr. Heffer

Does my hon. Friend agree that the one sector of the mixed economy that needs assistance because of liquidity problems and because it does not benefit much from the Industry Act is the small business sector? Is it not time that the Government had another look at small businesses with a view to devising a scheme to assist them, especially with liquidity? Would not this be a way to increase employment, since small businesses provide a great deal of employment?

Mr. Mackenzie

When the Opposition were in power it was always their policy not to treat the small firms sector in isolation. Their policy was that no special measures should be accorded to that sector which were not accorded to larger companies. The Labour Government now have to look at that policy with great care because we are concerned that some small firms have problems which cannot be resolved by the normal measures which the Government have taken. I can only hope that the measures we are introducing to control inflation will help. If any further proposals come forward, we shall certainly give them the most sympathetic consideration.

Sir John Hall

Does the Minister agree that the greatest discouragement to the expansion and development of the small business is the introduction of capital transfer tax in its present form? Out of his well-known concern for the future of smaller businesses, will the hon. Gentleman make representation to his right hon. Friend the Chancellor of the Exchequer to modify appropriately the capital transfer tax provisions in the next Finance Bill?

Mr. Mackenzie

I can, of course, give no assurance on behalf of my right hon. Friend the Chancellor of the Exchequer. Suffice it to say that in the course of the most recent discussions certain con. cessions were made which I believe to be of some value to the small firms sector.

Mr. Lane

In developing the positive side of the Government's anti-inflation policies, will the Minister keep in mind the message of recent research that, compared with other countries, too few of the working population in Britain are engaged in productive industry? As the hon. Gentleman tries to help small businesses, will he give extra encouragement to those which are concerned with manufacture and export?

Mr. Mackenzie

We try to give all the assistance we possibly can to the smaller companies whether they be in service or manufacturing industries. Counselling is provided by the small firms information centres, which were set up with precisely that in mind.

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