HC Deb 02 August 1976 vol 916 cc1191-2
8. Mr. David Mitchell

asked the Secretary of State for Industry if he will take action further to assist small firms to take advantage of the assistance provided under Sections 7 and 8 of the Industry Act 1972, as recommended by the recent reports of the special working parties set up to examine problems facing the major sectors of British industry.

The Minister of State, Department of Industry (Mr. Alan Williams)

Small firms established in assisted areas are already eligible for regional selective assistance. Section 8 of the Industry Act, however, requires that enterprises assisted should be of significance in a national context. The reports of the sectoral working parties are being considered.

Mr. Mitchell

Is the hon. Gentleman not aware that the Chancellor of the Exchequer's 2 per cent. increase in national insurance contributions by employers will take over £200 million out of the small business sector? Does he recognise that small businesses will be able to get on much better with their job of producing if they are left alone, and if they have less taxation to pay and less interference from the Government?

Mr. Williams

The hon. Gentleman seems to be overlooking the fact that if the alternative course, which is apparently favoured by the Opposition, were followed and a further £1,000 mil- lion were taken back in cuts, plus the sum currently being cut from defence, many small firms might be wiped out as a result.

Mr. Maurice Macmillan

Does the hon. Gentleman realise that there have been three attempts to sell the shares of private companies this year, all of which have failed due to lack of money among investors? Does he appreciate that it is not reasonable for him to blame the CBI for this, and that blame should be attributed to policies that have reduced almost to nil the possibilities of new investment in small and growing firms?

Mr. Williams

The right hon. Gentleman still has to face the fact that the alternative was to allow further slippage in sterling, which would damage firms large and small, or to undertake further cuts, with the consequence to which I referred in reply to a previous question.

Mr. Tom King

The Government constantly tell us of the great interest they have in small businesses. Will the hon. Gentleman tell the House what consultations he had with small businesses about the introduction of this employment tax?

Mr. Alan Williams

Of course, there were no specific consultations with small firms, but they are spoken for. As the hon. Gentleman is aware, the CBI has its own unit, which speaks for small firms, and I have recently had consultations with representatives of this unit.