Small Firms (Hansard, 19 December 1984)

§ 4. Mr. Dicks
asked the Secretary of State for Trade and Industry what contacts he has with Ministers responsible for small firms' matters in other countries.

§ The Parliamentary Under-Secretary of State for Trade and Industry (Mr. David Trippier)
As the Minister with responsibility for small firms I have met several of my opposite numbers in other countries and in October I attended the eleventh international small business congress in Amsterdam, which is attended by Government Ministers and others concerned with small firms from all over the world.

§ Mr. Dicks
What account do the Government take of other countries' policies when they are considering policies for small business in this country? Will my hon. Friend give an example of a country which has a particularly good approach to the problem?

§ Mr. Trippier
We can certainly learn from the experience of other countries, although it is often difficult to replicate that experience exactly, because of the different circumstances that may prevail. However, we can still learn a great deal from the United States, particularly with regard to its attitude towards risk taking.

§ Mr. Grylls
Has my hon. Friend had an opportunity to study loan guarantee schemes for small firms in other 280 countries? If so, does he know of any other country in the free world which effectively charges up to 18 per cent. on the guaranteed part of loans, which is the result of the changes that he has made to the loan guarantee scheme?

§ Mr. Trippier
I particularly studied the loan guarantee scheme when I visited Amsterdam in October. Our loan guarantee scheme is close to that scheme, and is closer to that scheme than to the equivalent scheme in the United States. I also noticed that the Dutch Government were extremely worried about the losses involved in the Government loan scheme — as the Dutch call it — and were possibly going to intervene with the banks to try to reduce the heavy loss rate.

§ Mr. Kenneth Carlisle
Does my hon. Friend agree that other countries may have much to learn from us on the subject of policies for small businesses? Does he know that the enterprise allowance scheme is widely welcomed? Is he convinced that there are sufficient funds to meet the demand resulting from that good scheme? Can my hon. Friend give us some figures for the enterprise allowance scheme's success rate in creating jobs?

§ Mr. Trippier
I am grateful to my hon. Friend for his comments, but I think that he is suffering from the delusion that the Department of Trade and Industry is responsible for the enterprise allowance scheme, when it is not. However, we have an input through the small firms service, for which I am responsible, in monitoring the success of the enterprise allowance scheme. Indeed, that scheme is widely acknowledged to be a success. I understand that at present the enterprise allowance scheme's failure rate is about one in five, compared with a one in three failure rate for small firms generally.

§ Mr. Skinner
Is the Minister aware that in the short period that this Question Time has lasted his hon. Friends have asked for support and subsidies for farmers, support for small firms, and support for Japanese car factories? How does that compare with the fact that the Prime Minister and each of the Ministers on the Front Bench is constantly—

§ Mr. Speaker
Order. The question is about small firms,.

§ Mr. Trippier
In the area of small firms the hon. Gentleman suffers from the delusion of adequacy. The truth is that his knowledge of that subject is incredibly sparse. Had he listened more carefully to the Back Benchers who asked me questions on the subject, he would have realised that they were not asking for support. The success of small firms does not necessarily depend on the supply of money. Assistance with marketing and financial control is equally important.