Small Businesses (Hansard, 26 January 1976)

§ 3. Mr. Luce
asked the Secretary of State for Industry whether he will review the position of small businesses in the United Kingdom, with a view to removing obstacles to expansion.

§ The Minister of State, Department of Industry (Mr. Gregor Mackenzie)
Business expansion is dependent chiefly on a general expansion of trade which would benefit firms of every size and which the Government can best promote by their efforts to restore the health of the economy and to counter inflation. The particular needs of small firms are kept under review and taken into account in all our policies.

§ Mr. Luce
Does the Minister accept that the small businessman has a key role to play in terms of innovation, creating wealth, providing employment and sustaining his individual independence against the State? If so, when will the Government take urgent action to remove the iron curtain of obstacles against either starting or expanding small businesses, ranging from penalising taxation, heavy rate demands and shortage of 7 working capital to unnecessary paper work? When will the Minister take a lead?

§ Mr. Mackenzie
The present Government, like previous Governments, have been and are concerned about the health of small firms. However, the health of any small firm is dependent on the health of the larger firms in both the public and private sectors. We certainly take these matters into account in framing our policies.
On the specific point about taxation, the hon. Gentleman will know that over many years consideration has been given by the Chancellor in framing his Budget proposals to the difficulties of small firms. This is borne out by the corporation tax provisions and special provisions relating to capital transfer tax. The Department has set up a number of small firms information centres, counselling services, and so on, which are of considerable value to people in business now and to those who want to start small businesses.

§ Mr. Blenkinsop
Is my hon. Friend aware of the extremely valuable and successful work done by some of the new towns and local authorities in encouraging small businesses and industries?

§ Mr. Mackenzie
Yes. I think that we should pay tribute to the many local authorities that recognise the needs of small businesses. The Development Commission, the new towns and local authorities do a very useful job in this respect.

§ Mr. Tom King
The Minister said that the Government were keeping the situation of small businesses under review. Is he aware that bankruptcies among small firms are now double what they were for the previous year? The problems of small businesses are now obviously acute. May we see a more active programme than merely keeping their situation under review?

§ Mr. Mackenzie
The number of small firms have been reducing markedly over many years, irrespective of whether my party was in power. My Department is always concerned to assist small businesses in every possible way. Tribute has been paid by some organisations responsible for small businesses for the cooperation, guidance and counselling services that we give.

Mr. Hooky
On a point of order, Mr. Speaker. I have been informed within the last two or three minutes that the Secretary of State answered Question No. 17 with Question No. 1. In the circumstances, would you be prepared to call No. 17 in its normal order?

§ Mr. Speaker
No. Hon. Members must be here at the beginning of Question Time.