§ Mr. WallerTo ask the President of the Board of Trade, pursuant to the Government observations on the fifth report of the Trade and Industry Committee on business links—House of Commons 301 of Session 1995–96—what steps the Government have taken to reduce bureaucracy and relate funding to outputs; and what targets he intends to set for each business link. [12030]
§ Mr. PageFrom 1997–98, each business link will have a single budget for the core services that it is required to provide and my Department will make its contribution to the cost of business link services against proposals set out in the relevant training and enterprise council business plan for meeting the needs of the area. Funding will no longer depend in a mechanistic way on the precise levels of activity on each service, but each business link partnership will need to meet targets related to(a) the fees paid to the business link by assisted businesses, (b) the number of businesses with at least one employee using business link services and (c) the number of businesses that have an established fee-based relationship with the business link. The numerical targets for each business link will depend on local circumstances such as how long the business link has been operating.
These targets reflect the fact that business links are commercial organisations operating in the private sector, although with a public purpose. If they are to be credible in providing business advice to their client customers, it is particularly important that they also operate commercially. Charging helps the assisted business to appreciate the value of the services provided and helps business links to generate additional funds so that the business link can increase the volume, quality and range of services it offers. In order to ensure that all business links make progress in this area, I have decided to set a minimum level for fee income from assisted businesses. Consequently, by their fifth year of operations—or by 1998–99 for business links that will reach their fifth year in 1997–98—business links should be earning at least 25 per cent. of their income from the assistance they provide to businesses. In earlier years, they will he expected to be making clear and defined progress towards this target. This approach gives business links considerable freedom in deciding how to charge their customers, while ensuring a broad minimum overall level of income from assisted businesses across all business link areas.