§ 1. Mr. Lennox-Boydasked the Secretary of State for Industry upon what conditions enterprise agencies will be granted approval for contributions made to them to be eligible for tax relief.
§ 15. Mr. Stanbrookasked the Secretary of State for Industry what arrangements he is making for the registration of local enterprise agencies for the purpose of tax relief for which his Department is responsible; and what is the starting date for agencies to apply.
§ The Under-Secretary of State for Industry (Mr. John MacGregor)My Department welcomes the fact that contributions to local enterprise agencies will now be eligible for tax relief. The conditions for approval are set out in clause 42 of the Finance Bill 1982. The arrangements for giving approval by my Department will be as simple and straightforward as possible. Whilst approval cannot be granted until the Finance Bill is enacted, any agency trust or other form of organisation is welcome to notify my Department before then, and we shall process the applications speedily thereafter.
§ Mr. Lennox-BoydIs my hon. Friend aware that in many parts of the country, including the Morecambe and Lancaster area, companies are getting together to have discussions to decide whether to form a local enterprise trust? I appreciate that approval of such trusts cannot be given until the Finance Bill becomes law, but can my hon. Friend give some further indication of the means by which those organisations would get the approval for donations given to them to be eligible for tax relief, as that would give a helpful stimulus to the discussions that are now taking place?
§ Mr. MacGregorI am very much aware of the large number of firms, local authorities, chambers of 592 commerce, and others that are getting together in enterprise agencies. There are now about 100 giving substantial help and advice to small businesses. I know of the agency in my hon. Friend's constituency. The tax relief gives them a further fillip, and I hope that it will encourage many more to join into enterprise agencies. With regard to further details, we have produced a fact sheet on tax relief which is available through the Library, through small firm centres and through the regional offices. Any company interested in getting tax relief should get a copy of that fact sheet.
§ Mr. StanbrookIs my hon. Friend aware that we in Orpington are also eagerly awaiting the introduction of the scheme? Meanwhile, will he prevail on our right hon. and learned Friend the Chancellor of the Exchequer to ensure that the Inland Revenue relaxes the stringency of its normal conditions for this type of enterprise?
§ Mr. MacGregorIn this case the Department of Industry will be giving approval to the enterprise agencies, which will then automatically qualify for tax relief. Provided that the aims are met, which are fundamentally to assist enterprises, and especially small businesses, I very much hope that those in that category will qualify.
§ Mr. McNallyAs the scheme moves to fruition, will the Minister not lose sight of the word "simplicity"? The success of the schemes has been that they have cut through red tape. This scheme will be successful if it is simple for companies to give money to such operations. I urge him please not to lose sight of the need for simplicity.
§ Mr. MacGregorI entirely agree with the hon. Gentleman and I assure him that we shall endeavour not to do so. The objectives are simply stated. In the first instance the requirements about the constitution and accounts of the enterprise agencies will be quite simple. Thereafter they will have only to submit annually an audited statement of accounts.
§ Sir William ClarkWill my hon. Friend comfirm that if approval is given and subsequently revoked there will be no retrospective: disallowance of the expenditure made by a company to the enterprise?
§ Mr. MacGregorRevocation will occur only where an approved organisation fails to comply with the conditions of approval. If that happens, the reclaiming of tax relief must be a matter for the Inland Revenue.