HC Deb 23 June 1998 vol 314 cc824-6
3. Mr. Desmond Browne (Kilmarnock and Loudoun)

What level of support the Scottish Enterprise network is giving to indigenous companies, with particular reference to small and medium businesses. [45572]

The Minister for Education and Industry, Scottish Office (Mr. Brian Wilson)

Scottish Enterprise's budget for 1997–98 amounted to £466 million and supported programmes predominantly aimed at assisting indigenous small and medium enterprises. Scottish Enterprise resources devoted to foreign direct investment during the same period amounted to £40.2 million.

Mr. Browne

I thank my hon. Friend for that reply. I welcome the recent initiative to support and set targets for the survival of small businesses. My recent experience of campaigning for whisky jobs in my constituency has led me to the conclusion that the best results are obtained when the local enterprise companies work in partnership with the local authority, the local work force and the private sector. Will my hon. Friend consider putting in place, or encouraging, mechanisms to ensure the delivery of that initiative through local partnerships?

Mr. Wilson

My hon. Friend is right: partnership is the way forward in each area on all aspects of economic development. Our strategy directions to Scottish Enterprise, Highlands and Islands Enterprise and the network are to work closely with local authorities and other partners to get a coherent approach in every area. As my hon. Friend says, we have increased the target for new business start-ups in Scotland to 10,000 a year, which is building on the existing strategy for the development of small and medium enterprises. We think that that is achievable and partnership is the way forward.

On his initial point, I congratulate my hon. Friend on the excellent campaign that was strongly based on partnership and effectively defended whisky jobs in Kilmarnock. Unfortunately, an equally well-run campaign was not so effective in the short term in Dumbarton. Last night, with my hon. Friend the Member for Dumbarton (Mr. McFall) and all the partners to which my hon. Friend referred, I had a meeting to find out how the problem could be remedied so that we can deal with the proposed J and B closure, which is to take effect in 2000. We will achieve that through partnership.

Mrs. Eleanor Laing (Epping Forest)

The Minister likes to appear to be the friend of small businesses, as he has just said. How can he possibly expect us or the people of Scotland to believe that he wants to defend small businesses when he and his colleagues continue to defend the irregular practices of direct labour organisations that provide unfair competition to small businesses in their area, and Ministers refuse to take action against them?

Mr. Wilson

As a former small business man, I do not expect the hon. Lady to accept anything I say. However, I draw a distinction between that and expecting the people of Scotland to accept what I say.

Mr. Brian H. Donohoe (Cunninghame, South)

The Minister will be aware of today's announcement of 250 job losses at Volvo bus in Irvine. He may not be aware that, last week, 40 redundancies were announced at Phoenix Cables and that, next week, there may be 600 job losses at Digital in Irvine. Can he give us some indication of what should be done in the Irvine area? Does he remember that when the previous Administration wound up the development corporation, I predicted that, rather than attention being focused on job attraction, such events would become the norm?

Mr. Wilson

The Volvo decision does not take effect until 2000 and involves an international restructuring. The initial loss of jobs will be in Germany and in Austria. I hope that measures can be put in place before then and that market conditions will be such that the job losses may not happen in Irvine in 2000, although there are difficulties there.

I do not join my hon. Friend in pre-empting the announcement by Digital Compaq. Everyone knows that the company is restructuring world wide, but we should wait for the outcome of that. In the spirit of my reply to my hon. Friend the Member for Kilmarnock and Loudoun (Mr. Browne), we must work together wherever there are job losses and for whatever reasons they happen to ensure that damage is limited in the short term and that new measures are taken to bring new jobs in the longer term.

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