HC Deb 09 February 1981 vol 998 cc587-9
8 Mr. Garel-Jones

asked the Secretary of State for Industry if he is satisfied that sufficient accommodation is available for new small businesses.

Mr. MacGregor

As a result of actions taken by the Government, I am pleased to say that the availability of premises for new small businesses is improving to meet the continuing high level of demand.

Mr. Garel-Jones

I am grateful to my hon. Friend. Will he expand on a reply that he gave earlier to the hon. Member for Huddersfield, East (Mr. Sheerman) and tell the House more about the role being played by the English Industrial Estates Corporation? Will he tell the House what impact, if any, the changes in the Finance Act 1980 to the industrial buildings allowance have made to the availability of small units?

Mr. MacGregor

The Coopers and Lybrand study, which my Department commissioned, found that dominance of the public sector in this part of the market had led to little provision in recent years and had made it unattractive to private investors. The corporation has now involved the private sector. In addition to the extra £5 million that the Government have made available for small firm units, agreements to a total value of £30 million, including the £5 million, have been concluded with the private sector. These will provide upwards of 1,500 small units in the assisted areas.

The Coopers and Lybrand report and the increase in the industrial building allowance for small units from 50 per cent. to 100 per cent. has led, according to a recent survey, to a greater number of smaller industrial units being built by the private sector than has been the position for many years. Small units can make a valuable contribution to local economies and it is encouraging to see this progress.

Mr. John Garrett

Does the hon. Gentleman agree that his reply was a load of eyewash? Whether accommodation is available or whether it is not, the fact is that small businesses are going bankrupt at a record rate due to high interest rates and lack of demand, which is the fault of the Government of whom he is a member.

Mr. MacGregor

The large building programme for small units is being filled by many demands from small firms and there are many small firms being created at the same time as others are in difficulties. One of the principal reasons for high interest rates is the high level of Government spending that the hon. Gentleman wants to see further increased. That would further increase interest rates and thus more adversely effect small firms rather than reverse the trend.

Mr. Dover

Will my hon. Friend ensure that my right hon. and learned Friend the Chancellor of the Exchequer is aware of the success of the taxation allowances and press him to give further allowances on larger buildings in the forthcoming Budget?

Mr. MacGregor

I am sure that my right hon. and learned Friend has noted the success of the scheme for small firms. Obviously I cannot pre-empt what my right hon. and learned Friend might wish to do in his Budget.

Mr. Robert C. Brown

Is the hon. Gentleman aware that there was a time when we used to seek the active intervention of the English Industrial Estates Corporation to build advance factories? Is he further aware that in the Northern region we have more than sufficient industrial space lying empty, as a result of the Government's policies, to take up all the unemployment in the region?

Mr. MacGregor

Our experience with small units and experimental workshops has been extremely encouraging. As the world recession lifts and as the economy picks up it will be possible for many more estates to take advantage of the facilities that are being provided.