HC Deb 06 November 1996 vol 284 cc1222-3
2. Mr. Spring

To ask the President of the Board of Trade what level of financial support business link will receive this year. [523]

The Minister for Small Business, Industry and Energy (Mr. Richard Page)

My Department has made available a total of £130 million to business link this financial year, £81 million for business support services and £49 million for business link pump-priming.

Mr. Spring

Is my hon. Friend aware how valuable the services of business links are to many small and medium-sized businesses, especially in rural areas? Given the success of their services, will my hon. Friend assure the House that he is satisfied that the money expended is well spent?

Mr. Page

Without doubt, the creation of business link has provided a step change in the quality of support for the small business man and woman. Across the country, business links are helping to create many jobs, and I expect greater things from them in the future. With any success story, there are bound to be some setbacks, and I was disturbed to hear of the recent difficulties of Wirral business link. The board of directors recently identified evidence that indicated that there had been irregularities involving sums in the order of £600,000. The board has dismissed its managing director, begun civil proceedings to recover the money and appointed a major firm of independent accountants to conduct a thorough investigation.

Mr. Harvey

Will the Government reconsider their policy of cutting public funding for business links after three years? Cannot the Government see the obvious danger that business link will suffer badly if funding is taken away just as it is up and running and beginning to fulfil its potential? While the Government may be right that some private sector funding will be available, what evidence have they that it will be enough? Why, in principle, should not the public sector continue to contribute to that work?

Mr. Page

I do not wish to upset the hon. Gentleman, but the Government have no intention of cutting off funding for business link. As I said in my answer to my hon. Friend the Member for Bury St. Edmunds (Mr. Spring), some £81 million will be provided for business support services. The pump-priming will come to an end after three years, but the business support services will remain. Business links will therefore have a firm base from which to carry out the rest of their operations, which will include charging for some of their services.

Sir John Cope

Will my hon. Friend send his good wishes to the south Gloucestershire business link, which is being launched tomorrow by the south Gloucestershire chamber of commerce of which I am the honorary president, because it will further extend the number of businesses that can benefit from that excellent service?

Mr. Page

As my right hon. Friend would expect, I do extend my best wishes to that latest addition to business link. Already the statistics emerging from business link are most encouraging. More than a million businesses are registered, and we are helping 8,000 to 9,000 businesses every week. The numbers are growing and the success is starting to show. I am now telling business link that the figures are good, but I want output figures and I want to see how profitable are the companies that it is helping, how many jobs have been created and the companies' export figures. I am looking for hard and practical results from business link.

Mrs. Roche

We all support the principle of the one-stop shop that lies behind business link—indeed, it was in our 1992 manifesto—but how can the Minister and the Government escape responsibility in connection with Wirral business link, when it was one of only three business links in the country accredited by a DTI-appointed board for systems, including its own financial accounting systems? The British taxpayer has lost £600,000. Does not that show that the DTI's internal auditors were right to criticise the Deputy Prime Minister for exposing both business link and the Department to financial embarrassment?

Mr. Page

I share the hon. Lady's concern about any business link that does not operate to the highest possible standards, but unlike her I shall not shoot from the hip until a full independent inquiry has taken place and I have the facts to hand. May I help her to understand how the accreditation process works? It is designed to ensure that the quality of service to the customer is up to standard and to examine financial procedures within the business link—but it is not an audit of those finances. There is a fundamental difference between the two.