HC Deb 21 April 1993 vol 223 cc313-4
10. Mr. Kilfoyle

To ask the President of the Board of Trade how many new small businesses have been established during the last 12 months for which figures are available, in the north-west region.

Mr. Neil Hamilton

An indication of the number of new businesses set up in the north-west can be obtained from VAT data. During 1991—the latest year for which figures are available—there were 21,000 registrations for VAT in the north-west. More recent figures are published by Barclays bank, which estimates that during 1992 there were 51,000 new start-ups in the north-west. The figure includes businesses with a turnover below the VAT threshold.

Mr. Kilfoyle

More than an indication of the state of the economy in the north-west are surely the Dun and Bradstreet figures for the year up to March 1993, which show that 5,046 businesses went under in the north-west in that time. Does not that give the lie to the claim propagated by the Tory party in the current county council elections in the north-west that it is the party of responsible economic management for the north-west?

Mr. Hamilton

There are 3 million businesses in Britain and even in times of boom, businesses cease trading and new businesses are created. Even at a time of recession, many businesses are coming forward to take up the opportunities which are increasingly available to them. Lower interest rates, a more competitive exchange rate and all the north-west's advantages make me optimistic for the future. It is a great pity that the hon. Gentleman and his Opposition colleagues always seem to talk down the region rather than capitalise on its strengths and advocate them as loudly as possible.

Mr. Hendry

Is my hon. Friend aware that most of the small and medium-sized firms in my constituency and throughout the north-west report strong signs of economic upturn? Does he agree that their continuing prosperity depends on the continuation of Government policies that deliver low inflation, low borrowing costs and freedom from the job-destroying social chapter?

Mr. Hamilton

I entirely agree with my hon. Friend. Were it not for the legacy of Labour party militancy on Merseyside it would be easier for us to advocate the advantages of the north-west.

Mr. Loyden

Will the Minister take note of the issue raised by my hon. Friend the Member for Liverpool, Walton (Mr. Kilfoyle) that many of the businesses that the Minister mentioned are opening, then closing after about six months? If he lived in the city or the region, he would understand that. Are the several hundred people selling cigarette lighters in the centre of Liverpool classified as small businesses?

Mr. Hamilton

It is a great shame that Liverpool has Members of Parliament like the hon. Gentleman, because if those watching our proceedings this afternoon regard him as typical of the city it is no wonder that we have difficulty in attracting people into it. However, in spite of the best efforts of people like the hon. Gentleman, we have been instrumental in attracting jobs to Liverpool, to places such as Wavertree technical park. We provided £6 million in grants, which has led to £30 million in private sector investment and the creation of 1,600 long-term jobs in the city of Liverpool.

Mr. Clifton-Brown

Does my hon. Friend agree that some new businesses that are started in the north-west do so with assisted area status aid? My hon. Friend will be aware that aid has already been granted to one business that has been relocated from my constituency to Wigan, with the aid of £1 million? I have written to my hon. Friend with details of another firm that is about to relocate to the north-west with assisted area status aid. Is it sensible use of Government money to give aid that involves a net loss of jobs—putting people out of work in one district and putting them into work in another?

Mr. Hamilton

I am aware of my hon. Friend's concerns. Such policies inevitably create difficulties from time to time. Some parts of the country have great disadvantages on account of historical change and transition from old-fashioned industries to new ones. My hon. Friend the Minister for Energy has discussed the case with me and I take his concerns seriously. We want to see economic prosperity in all parts of the country, and regional selective assistance plays a part in achieving that objective.