HL Deb 19 January 1998 vol 584 cc213-4WA
Lord Hylton

asked Her Majesty's Government:

What proportion of their total aid and development budget is being used for loans, training and indirect support for the smallest businesses and service providers in developing countries (a) in 1997–98; and (b) in 1998–99. [HL31]

Lord Whitty

In 1997–98, DFID will spend about 1 per cent. or £20 million of our total expenditure on support to micro and small businesses in developing countries. It is difficult at this stage to confirm a figure for 1998–99 (since a number of large projects are awaiting approval), but the proportion of aid spent in this way is likely to continue to increase as our micro enterprise development programme scales up in India, east and southern Africa.

These projects tend to be small in size and management-intensive. We currently have over 200 projects, 50 per cent. in Africa and about 40 per cent. valued at £250,000 or less. The majority of these projects develop intermediary institutions to provide sustainable support to micro enterprise. This requires very little capital expenditure but absorbs considerable time and technical and administrative resources. We believe this strategy yields the greatest impact.

In addition, about 10 per cent. (or £13 million) of funds to the transition countries of central and eastern Europe and the former Soviet Union goes towards support to the small-scale business sector.