Business Links Scheme (Hansard, 6 April 1995)

The Minister of State, Department of Trade and Industry (Earl Ferrers)
Yes, my Lords. The business links programme has substantially exceeded our expectations. Our target was to have 50 business links open by the end of 1994; in fact, there were 61. This has now risen to 75, and we have approved plans for a further 146. By the end of next month more than 100 business links should be operational, and we are well on course towards our target of a national network of more than 200 outlets, covering all parts of England, by the end of this year.

§ Lord Haskel
My Lords, I congratulate the Minister on putting so much effort into a good Labour Party idea. It was in our manifesto. Can the Minister give us a breakdown of the numbers which he gave us? As I understand it, the system is a hub and spoke network where central offices with all the resources are connected to satellite offices by video conferencing. Can the Minister give us the total number of business links offices planned, broken down between hubs and the satellites?

Earl Ferrers
My Lords, that is, even for me, too complicated a question to answer immediately. The noble Lord is quite right. There are hubs and spokes. The numbers I have given are the outlets. If he wishes for the details of the hubs and spokes, I shall certainly find out and let him know.

§ Lord Clark of Kempston
My Lords, does my noble friend agree that this scheme is particularly helpful to small businesses? Does he further agree that the measures introduced by this Government over the years have brought great benefits to small businesses? We have the lowest small business corporation tax rate and the last Budget eased the payment of PAYE and VAT. There was also a slight reduction in the employers' contribution for national insurance.

Noble Lords
Question!

§ Lord Clark of Kempston
My Lords, it is a question. All these measures have been successful in bringing down unemployment.

Earl Ferrers
My Lords, my noble friend has asked some fascinating questions, with all of which I agree. There are 3 million companies in the United Kingdom. Ninety-six per cent. of those employ fewer than 20 people. Small firms are a vital part of our economy. My noble friend is quite right that we have as a government tried to help small firms and we have succeeded in doing 316 so. That is part of the reason why unemployment has come down. That is also a fundamental part of the reason for business links, which are there to help small firms to expand as well as to help other firms too.

§ Baroness David
My Lords, as the Government seem to be planning to give all their help to small businesses through business links, it is important that there should be continuity. Can the Minister give an assurance that business links will not have to survive without central government support?

Earl Ferrers
My Lords, I am quite happy to answer that point because I think it is a very important one and one that is open to quite a lot of misunderstanding. The Government have undertaken to pump prime, which means giving sufficient funds for business links to find new premises, install IT and telephones and so forth. We have allowed £38.5 million for that in 1995–96, £34 million in 1996–97 and £27.7 million in 1997–98. That is one side. The other side is that there will be help available to business links via the TEC enterprise support budget, the business links' special advisers such as design councils, export councils, innovation technology councils and other services. That amounts to £50 million and is in addition to the pump priming. That will continue and there will be a rolling three-year programme so that every year people will be able to know what is available during the course of the next few years.

§ Viscount Waverley
My Lords, how much importance is accorded to the business links programme in supporting existing or future exporters?

Earl Ferrers
My Lords, that is one of the prime purposes of business links. Anyone who applies will have access to export counsellors. The DTI is co-locating its export staff within business links. Chambers of commerce are also part of business links. One of the most important aspects is to encourage people to export. The Institute of Exporters reckons that out of 3 million companies only 100,000 actually export. We want to see that number increase.

§ Lord Monkswell
My Lords, are the Government aware that very many local authorities provide magnificent support for local businesses? Bearing in mind the need for continuity, will the Minister consider using local authorities as the lead authority in terms of these one-stop shops or business links schemes? As an ancillary mechanism of support and integration between local authorities and local businesses, will the Government consider the repatriation of the business rate to local authorities instead of setting it at a national level?

Earl Ferrers
My Lords, I cannot agree with the noble Lord's latter point and so the answer to his question is no. The noble Lord also asked whether we would regard local authorities as lead partners. Business links are a partnership, of which local authorities are a part. So also are the TECs, the chambers of commerce, enterprise agencies and other agencies. The whole point is that there should be a partnership where all work together to provide one single outlet and one single service.

§ Lord Weatherill
My Lords, is the Minister aware that there is a very successful business link in my former constituency of Croydon? If the noble Lord, Lord Haskel, wishes to see this splendid Labour idea working under a Conservative Government he might like to come to Croydon and I shall accompany him. Is the Minister further aware that it is linked with an enterprise agency which has already established 1,700 new businesses and created 5,000 jobs? It is a splendid idea.

Earl Ferrers
My Lords, I am grateful to the noble Lord for his support of business links. I believe that the concept of business links is one of the most exciting things that has happened in this country from the point of view of businesses for years. It will enable businesses to have access not only to advice but also to a uniform database. Eventually they will be connected up with our posts overseas as well. If the noble Lord, Lord Weatherill, finds that successful, I am delighted. And I would be delighted if he would like to take the noble Lord, Lord Monkswell, out for a day—

Noble Lords
Haskel!

Earl Ferrers
My Lords, the noble Lord, Lord Haskel! The noble Lord can take him off too!

§ Lord Haskel
My Lords, is the Minister aware that Croydon is a Labour authority?

Earl Ferrers
My Lords, it is lucky that Labour has one.