§ Mr. FatchettTo ask the Secretary of State for Employment, pursuant to his reply to the hon. Member for Leeds, Central of 20 February,Official Report, column 464, if there is any basis by which he is able to estimate the number and location of jobs created by the loan guarantee scheme; and on what basis the net Exchequer cost of £450 per job is estimated.
§ Mr. CopeThe geographical breakdown of guarantees issued under the loan guarantee scheme up to 31 January 1989 is as follows:
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Number of guarantees Value £ million North East 977 30.18 North West 2,679 82.25 Yorkshire and Humberside 1,652 48.33 West Midlands 1,794 56.77 East Midlands 1,352 45.48 South East 7,778 280.55 South West 1,990 62.15 Scotland 1,533 46.79 Wales 1,010 31.56 Northern Ireland 278 10.01 Total 21,043 694.07 Information is not available that would permit reliable estimates of the number and location of jobs created to be estimated.
The net Exchequer cost is calculated by taking payments where guarantees are called, less premia received, and any later recoveries of guarantee payments. Deductions are made for savings in benefits and tax and national insurance payments in the first year after the loan is made, which are additional to those that would have occurred in the absence of the loan. The total number of additional jobs is estimated from surveys of loan recipients and banks such as that carried out last year by National Economic Research Associates.