HC Deb 28 June 1976 vol 914 cc13-5
12. Mr. Rost

asked the Secretary of State for Industry if he will now bring forward measures to alleviate the problems faced by small businesses.

Mr. Alan Williams

I would refer the hon. Member to the measures announced by my right hon. Friend the Chancellor of the Exchequer in his Budget Statement and by my predecessor on 14th April in reply to a Quesion by my hon. Friend the Member for Coventry, North-West (Mr. Robinson).

Mr. Rost

When will the Government recognise that there is enough vigour and entrepreneurial enterprise in our small companies to make a much bigger contribution to the economy and to solving the unemployment problem if only the Government would provide the right incentives, or at leeast remove some of the disincentives? When will the Government provide the means to develop this real potential?

Mr. Williams

This mock indignation comes ill from Conservative Members, who could have done much more if they had wanted to do so during their period of office. I remember that when I used to speak on this very subject from the Opposition Front Bench I used to ask them to do more. I remind the hon. Gentleman that the Chancellor of the Exchequer has made alterations in corporation tax and capital transfer tax. We have set up a counselling arrangement on a pilot basis, and we are encouraging feasibility studies to see how far co-operative ventures in the provision of joint service can be undertaken. In fact, we have initiated a large number of measures specifically to help this sector, measures that Conservative Members did not consider.

Mr. Ioan Evans

Does my hon. Friend agree that one of the safeguards required is to deal with asset strippers? These companies move in and take over small companies producing efficiently and providing employment. They move in to get as much out of them as possible at at the expense of the workers in those companies.

Mr. Williams

That is a different aspect of the problem. My hon. Friend is right. The last thing that we want to see is a return to the predatory mergers and takeovers that we had on previous occasions when firms were taken over and milked dry and then both they and their employees cast aside.

Mr. Anthony Grant

Is the hon. Gentleman aware that one of the biggest predators of the small firms is the Government themselves? Is he further aware that one of the biggest problems from which small companies suffer is the burden of form-filling? Last year his Department alone put out more than 500,000 forms on 25 different subjects. Is the hon. Gentleman satisfied that all this form-filling and information collecting is necessary? Will he initiate a review throughout the whole of the Government to see whether this plethora of paper can be eliminated?

Mr. Williams

I remember that when we were discussing the Bolton Report and the hon. Gentleman was replying from this Front Bench to the debate I said that all the savings they had made, or were purported to have made, in improving the statistical requirement on small firms were wiped out by the voluntary introduction of VAT by the Conservative Government way in advance of any Common Market commitment.

Mr. Heseltine

The hon. Gentleman suggests that the Conservative Party did not do enough. Does he realise that we did not then have the highest rate of unemployment for a decade and the lowest level of investment for a decade? Will he now answer one question that his right hon. Friend the Secretary of State refused to answer? Will he tell us what impact the additional 2½ per cent. on bank borrowing in the last few weeks to sustain the present level of public expenditure has had on investment in small businesses?

Mr. Williams

I find it a matter of sadness that the official spokesman for the Conservative Party—[HON. MEMBERS: "Answer the question."]. I shall answer it in my own way. I shall not be beaten over the head verbally or in any other way by the hon. Gentleman. [Interruption.] If the hon. Gentleman does not want an answer, he need not have one.