HC Deb 27 July 1988 vol 138 cc272-5W
Mr. David Shaw

To ask the Secretary of State for Wales if he will make a statement on the achievements of his Department and his policies in helping small businesses over the last 12 months compared with the previous 12 months; and if he will publish the performance indicators by which his Department monitors those achievements and the statistical results of such monitoring.

Mr. Peter Walker

[holding answer 19 July 1988]: This Department attaches high priority to the promotion of enterprise and to helping small businesses; a number of specific local initiatives have been directed at this. Both the Department and its sponsored bodies monitor and evaluate their programmes in order to assess their effectiveness. Performance indicators contribute to this process and some of these appear in the public expenditure White Paper and the annual reports of sponsored bodies:

Number of clients other than those attending start up courses provided with assistance
Start-Up Clients
1986–87 1,600
1987–88 1,900
Drive Projects
1986–87 128
1987–88 248

Mid Wales development grants
1986–87 3 429
1987–88 3 534
1 Total assistance offered £215,000.
2 Total assistance offered £278,000.
3 Mostly small businesses.
4 Total grants offered £641,337.
5 Total grants offered £1,102,180.

Training Commission

The Training Commission in Wales continues to focus its adult training programme to take account of small firms training needs. In 1987–88 financial year the commission spent £1,026,399 in Wales in assisting 6,816 people from September this year. Employment training, which is shortly to absorb the present training programmes for unemployed adults, will provide a comprehensive and flexible training programme aimed at providing the skills unemployed people need and employers want.

Advice and Information

We have made it a priority to improve the help available to small businesses and the self-employed through the small firms service, local enterprise agencies, jobcentres, and the many other public and private-sector sources of advice. Last October we launched the Gateway Network as a means of bringing together all these bodies to work co-operatively; last month we announced that the major banks in Wales had joined the Network. Work is in hand to establish a pilot "one-stop shop" in the Merthyr Tydfil area to facilitate the dealings that new businesses have to undertake because of regulatory requirements.

Small Firms Service

The Welsh Development Agency (WDA) administers the small firms service in Wales, which has continued to respond to a high level of inquiries. The figures for the latest two financial years are:

1986–87 1987–88
(i) Enquiries 38,808 42,869
(ii) Business counselling—first interviews 7,698 8,365
(iii) Business counselling—total interviews 8,689 9,924

Local Enterprise Agencies

The Department takes an active role in encouraging the development of local enterprise agencies and provides funding via the WDA for core activities and special projects. As part of my recently announced programme to revitalise the South Wales valleys, the Department will seek to strengthen the network of enterprise agencies and to provide for all parts of the area to be served by one. Moreover, the intention is to ensure that these agencies are of the highest quality and constitute the best enterprise agency system in the United Kingdom.

Local Link: Local Investment Initiative

We have just launched this new experimental scheme in the Bridgend area. It aims to increase the links between small firms looking for investment and investors who are willing to put money into business ventures in their own community.

Regional Enterprise Grant

This scheme, launched in April 1988, aims to encourage very small firms employing fewer than 25 people to invest and innovate. It has been generally well received. Despite a slow start the number of applications has picked up and is now showing an encouraging upward trend. The total number of applications received to date is 63 and they have a total value of approximately £710,000.

The Business Improvement Services Scheme

This was launched in 1984 and is directed at smaller companies—those employing 200 or less. It aims to encourage the development of new and existing businesses in those areas of Wales affected by the rundown in the steel industry. The scheme is a European regional development fund initiative with a total of about £9.2 million being allocated to Wales (of which £2.4 million is from the United Kingdom Government) for the period between December 1984 and December 1988. The scheme provides grants of between 55 per cent, and 70 per cent, to encourage eligible firms (which may be involved in most manufacturing and some service sector activities) to obtain specialist consultancy advice, develop new products and processes or research new markets. Over 850 offers of grant totalling nearly £3 million were made in the 12 months to 30 June 1988. This compares with just under 600 offers totalling £1.5 million in the 12 months to June 1987.

Enterprise Initiative Consultancy Scheme

Small businesses are the main target of the enterprise initiative consultancy scheme (administered by the Welsh Development Agency) which was launched in January of this year. There has been a very healthy response to the scheme in Wales. By 8 July, 472 applications had been received, of which 243 had been referred to the scheme contractors for allocation to consultants. There are of course no directly comparable figures for last year. The progress of the consultancy scheme is carefully monitored according to the guidelines established by the Department of Trade and Industry.

Regional Selective Assistance, Regional Development Grant

Small businesses have also taken advantage of the help available under more general industrial support schemes, principally regional selective assistance and regional development grants (applications for which ceased to be accepted after 31 March 1988). Between 1 July 1987 and 30 June 1988, 86 offers of assistance worth £6,248,000 were made to businesses and organisations employing fewer than 200 under the regional selective assistance scheme, compared to 78 offers worth £5,719,000 during the previous 12 months. For regional development grants, the equivalent figures were 1,088 offers worth £27,831,000 for 1 July 1987 to 30 June 1988 and 900 offers worth £26,167,000 for the previous 12 months.

The Valleys: A Programme for the People

The new programme for the South Wales valleys launched on 14 June 1988 includes a 15-point programme designed to encourage new and small businesses in the area. This covers additional investment support including two new loan schemes introduced by the WDA for small and very small businesses, the provision of more small factories and workshops, strengthened provision for enterprise training, improved advisory services and action to improve the standard of retailing.

The Craft Initiative

This initiative is designed to provide a comprehensive, professional and effective means of promoting the Welsh craft industry and its products and ensuring that craft-oriented businesses, both large and small, play their full part in the economic regeneration of Wales. The new co-ordinated package of assistance now available to Welsh craft businesses is head and shoulders above that available elsewhere.

Wales Tourist Board

In 1987–88 the Wales Tourist Board offered some £2.5 million of assistance towards 114 projects, estimated to generate £17.1 million private sector investment and create 417 new jobs. The greater part of such assistance was offered to small businesses, with the board offering streamlined processing for small projects. This facility is of particular value to small and new businesses, as are the advisory and marketing support offered by the board within the Principality.

The board has recently launched its framework development strategy highlighting opportunities for development for businesses of all sizes within the Principality, and further extending special schemes of assistance of particular value to small businesses.

Mid Wales Development (MWD)

MWD provides assistance to small businesses within its area; achievement for the years 1986–87 and 1987–88 are as follows:

Start-up courses—Number attending
Year Number
1986–87 339
1987–88 631

Enterprise Allowance Scheme

The enterprise allowance scheme in Wales continues to be a success. The number of entrants in the last two financial years were as follows:

Year Number
1986–87 5,639
1987–88 6,500

It is estimated that some 7,000 people will enter the scheme in the 1988–89 financial year. The results of a survey in March 1988 showed that of those that received an allowance for a full year, 74 per cent, were still trading 18 months after start-up, and for every 100 of these businesses, 71 additional jobs have been created.