§ 27. Mr. Patrick Thompson
asked the Secretary of State for Trade and Industry if any community-based investment funds have been set up to take advantage of the business expansion scheme.
§ Mr. Trippier
The first community-based fund—called the "Valleys of Enterprise Trust"—has just been set up in Rossendale, and will seek to make investment of between £20,000 and £100,000. A number of others are in preparation. In addition, several of the funds which have sought approval under the business expansion scheme rules have indicated that they would be seeking companies for investment in a particular area or community.
§ 38. Mr. Batiste
asked the Secretary of State for Trade and Industry if he is satisfied that sufficient investment under the business expansion scheme is going into high risk ventures.
§ Mr. Trippier
Most of the funds approved under the business expansion scheme are still in the process of evaluating potential investments and we do not as yet have information about other individual investments under the scheme. It is, therefore, too early to say to what extent investment under the scheme is being made in high risk ventures. However, I am grateful that my hon. Friend has raised this point because we do hope that investors, taking advantage of the generous tax relief available under the scheme, will consider investment in high risk ventures so that a reasonable number of business start-ups and high risk, but potentially high growth, companies will gain support.
We shall therefore be monitoring developments closely but the feedback I have already gained indicates that the business expansion scheme will provide an important addition to venture capital and will be a substantial incentive to outside investment in high risk ventures.