DTI Enterprise Initiative (Hansard, 14 April 1988)

§ Lord Young of Graffham
My Lords, the response has been excellent since the January launch. Fifty-seven thousand requests have been received by phone or coupon for the enterprise initiative booklet, of which some 300,000 have now been distributed. We are on course to achieve the target I set in the White Paper of 1,000 consultancy projects per month.

The Viscount of Oxfuird
My Lords, I thank the Minister for that reply. Is he in a position to tell the House which of the development consultancies among those listed have been the most popular?

§ Lord Young of Graffham
My Lords, these are still early days. Of the applications we are processing, just over half have been in marketing, some 12 per cent. in design, and some 18 per cent. in quality. Among the smaller amounts were for business planning and financial information systems which we have launched only recently. All are significant areas in which smaller and medium-sized British companies can profit to some advantage in improving the quality, design and marketing of their products.

§ Lord Williams of Elvel
My Lords, I welcome the initiative. Can the noble Lord tell the House how consultants for small and medium-sized businesses are selected? By what criteria are they selected? Is he not aware that the business in general—and I speak as one who spends some time in consultancy—is not very commercially attractive to the large consultancy firms?

§ Lord Young of Graffham
My Lords, I am not certain that it is not attractive to the large consultancy firms. It is certainly attractive to the specialist consultancy firms. As the original announcement made clear, we have appointed principal contractors in each of the areas. For example, the Institute of Marketing is the principal contractor for all the marketing consultancies; the Design Council is the principal contractor for the Design Council; and 3Is enterprise support is the principal contractor for those on business systems. Those firms are responsible for the lists of contractors and they contract with us. They are also responsible for supervising the results.
The department looks independently at the results of the consultancies. However, the first consultancies took effect only at the beginning of this month. The period until now has been used to organise and arrange them. As the months pass we shall watch closely to see the results.

§ Lord Taylor of Gryfe
My Lords, will the Minister give the geographical distribution of the inquiries? Will he say how many which are government-assisted are from the South-East and how many from the less-advantaged areas such as the North-East and Scotland?

§ Lord Young of Graffham
My Lords, although these are early days I can give the example that as a proportion the application in the North-West considerably outnumbers the number of companies in existence there. I know that close to the noble Lord's heart is the cause of Scotland. Some 6 per cent. of the applications so far received come from Scotland. I am not sure of the number of companies in Scotland. I shall inquire. However, I do not believe that we are much out of line.

§ Lord Williams of Elvel
My Lords, I am sorry to press the Minister further on the criteria on which consultancy firms are to be charged. I understand that these are early days. But can we have an assurance that consultancy firms which are not properly qualified will be excluded by the department from consideration in these initiatives?

§ Lord Young of Graffham
My Lords, not only by the department. They will have to be vetted first by the Design Council, the Institute of Marketing, by PERA and by the other main contractors. That is part of their responsibility as specialists. They must then be selected by the individual company which wants the consultancy. In most cases they are paying either half or one-third of the actual costs and they will be severe critics of the output. I have undertaken that we shall look at each complaint, if we receive complaints, about the output and the work of contractors. If such cases exist, then we shall, in that way, quickly compile a blacklist.