HC Deb 10 May 1995 vol 259 cc738-9
10. Ms Coffey

To ask the President of the Board of Trade what assessment he has made of the survival rate of micro-businesses in their first year of operation. [21951]

Mr. Page

To avoid placing undue burdens on small firms we use administrative sources to monitor survival rates of new businesses.

Recent estimates of the survival rates of new, mostly micro, businesses have been produced by Barclays bank. For the period 1989–1993, it estimates that on average 77 per cent. of start-ups were still trading after their first year of operation.

Ms Coffey

As the Minister is aware, the enterprise allowance scheme, which last year in Stockport enabled 350 people to set up their own businesses, has disappeared in a cloud of smoke into the single regeneration budget. There is no DTI funding for business links to give help and financial support to start up businesses. What advice, apart from do-it-yourself, can he give my constituents who will lose the benefit of the enterprise allowance scheme, and what proposals has he to help small businesses and people who prefer self-employment to benefit?

Mr. Page

As the hon. Lady said, the single regeneration budget provides some start-up support to help unemployed people into self-employment. She made the valid point that the first moments after any birth are the most fragile. There is a fond belief that running a small business is easier than running a large business, but that is not so. The important point is that survival rates for smaller businesses would be much better if those wishing to start them went along to business links and took strong advice on the viability of their financial package before going ahead. What is even more important for small businesses is a stable economic environment in which they can plan with certainty.

Mr. Sykes

One of the greatest challenges facing small businesses in 1995 is the over-burdensome and over-zealous enforcement of regulations by petty bureaucrats across the country. A year ago the House passed the Deregulation and Contracting Out Act 1994, at which time the Government promised to introduce a system of appeals to help small business people. What has happened to that procedure?

Mr. Page

My hon. Friend is absolutely right to refer to the fact that we introduced that Act. We shall consult on how better to advance that to help small businesses.