HC Deb 11 June 1980 vol 986 cc533-4
4. Mr. Henderson

asked the Secretary of State for Scotland if he will list the principal agencies and schemes operating in Scotland to encourage the development of small businesses ; and if he will make a statement.

Mr. Alexander Fletcher

Small firms are eligible for assistance under the Industry Acts. In addition, a range of advisory and financial services is provided specifically for small firms in Scotland through the following main agencies : the small firms information centre of my Department, the Scottish Development Agency, the Highlands and Islands Development Board and the Scottish Tourist Board. The Manpower Services Commission has sponsored courses for small firms and people starting in business. A number of voluntary and other bodies, including chambers of commerce, provide important services for small businesses.

Mr. Henderson

Is my hon. Friend aware that the small business sector appreciates the help that the Government are giving to it, but that there is particular concern about the level of interest rates? If these were reduced, not only would that reduce the influx of foreign money, which would help to control the money supply, but it would help to bring down the rate of exchange as well as giving encouragement to the small business community.

Mr. Fletcher

The Government are aware of the difficulty caused by the high rates of interest, but the No. 1 priority must be the fight against inflation, of which high interest rates are a symptom.

Mr. Grimond

Has the Scottish Office received a copy of a booklet entitled "Creating Jobs Through Community Enterprise" by Mr. John Pearce of the Paisley college of technology? If not, may I send the Minister one?

Mr. Fletcher

Yes. thank you very much.

Mr. Lang

Does my hon. Friend agree that one of the problems that small businesses are facing is that of high and increasing local rates? Does he agree also that the activities of spendthrift local authorities are effectively destroying jobs in small businesses?

Mr. Fletcher

My hon. Friend is right. One of the strongest complaints that the Government receive concerns the number of businesses that are struggling to keep going, not so much because of high interest rates, but because of the burden of local authorities' rate increases in Scotland, which is destroying jobs.

Mr. James Hamilton

Will the hon. Gentleman note what the CBI has stated, if he will not take note of hon. Members? It has stated clearly that unless interest charges are reduced as rapidly, and by as much, as is humanly possible there will be more liquidations? Is he aware that every day small businesses in Scotland are going into liquidation because of the Government's policy on public expenditure? Will he, for once, change the Government's policy and do something about the problem?

Mr. Fletcher

I cannot say too often to the hon. Gentleman that the No. 1 priority of the Government must be to reduce the rate of inflation. When that has been achieved, interest rates will fall.