§ Mr. Amess
To ask the Secretary of State for Employment (1) if he will list those Government measures of particular help for small businesses since 1979;
(2) if he will publish in the Official Report those Government measures of particular help to small businesses which are the subject of current legislation or are planned; and if he will make a statement.
§ Mr. Eggar
Since 1979 Government policy has been to create and foster a climate in which small firms can flourish, by minimising the compliance burdens of taxation, regulation and red tape, and by putting in place a complementary range of fiscal, financial and advisory measures.
The principal Government measures of particular help to small businesses include: a range of tax reductions and structural reforms to improve the incentives and rewards for successful small business owners. For example the basic rate of income tax has been reduced from 33 per cent. to 25 per cent., the small companies rate of corporation tax has been reduced from 42 per cent. to 25 per cent., and the nine higher rates of income tax, ranging from 40 per cent. to 83 per cent., have been reduced to one higher rate of 40 per cent.; the loan guarantee scheme, introduced in 1981, which provides a Government guarantee for loans by banks to small businesses; the business expansion scheme, introduced in 1983, which provides tax relief on investments made in shares of unquoted companies of up to £40,000 a year; the enterprise allowance scheme, introduced in 1983, which provides an allowance of £40 per week to previously unemployed people to make up for loss of benefit in their first year of self-employment; a range of training opportunities developed by the Training Agency, now included in business growth training, which take account of the training needs of new and growing 377W small firms; the provision of information and confidential advice and counselling through the small firms service and the rural development commission, and through substantial support for local enterprise agencies and other advisory bodies, including the princes youth business trust; the enterprise initiative, launched by the DTI in January 1988, which offers access to specialised consultancy in key business areas.
These and other measures have been highly successful in creating and maintaining a framework for enterprise and the growth of the small business sector, which continues apace.
The Employment Act 1989 has prepared the ground for the introduction of training and enterprise councils (TECs) by the end of 1990. TECs will be responsible for the delivery and development of training and other support for small businesses.
§ Mr. Amess
To ask the Secretary of State for Employment if he will make a statement on the achievements of his Department and his policies in helping small businesses over the last 12 months and in 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. Eggar
The growth of the small business sector itself is the best indicator of the success of the Government's policy towards small business. In 1988–89 the net increase in the number of VAT-registered businesses was 64,000, an average of just over 1,200 a week.
The performance figures for the measures operated by my Department in 1988–89 are as follows:
The small firms service answered over 281,000 inquiries (an increase of 6 per cent. on 1987–88), handled over 30,000 new counselling cases (an increase of 12 per cent. on 1987–88), and conducted over 43,000 counselling sessions (an increase of 10 per cent. on 1987–88);
The usage of the loan guarantee scheme has increased from 1,234 small businesses in 1987–88 to 2,292 in 1988–89. The total loan value increased from £46.23 million to £64.76 million. Improved procedures under the scheme include simplified procedures for loans up to £15,000 and an increase in the maximum loan size from £75,000 to £100,000.
The number of entrants to the Training Agency's enterprise programmes, the business enterprise programme and the enterprise element of employment training, have increased by 22 per cent. from 43,489 in 1987–88 to 53,003 in 1988–89.
The number of entrants to the graduate enterprise programme rose from 155 in 1987–88 to 1,150 in 1988–89.