HC Deb 25 July 1989 vol 157 cc650-3W
Mr. David Shaw

To ask the Secretary of State for Scotland 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. Lang

[holding answer 24 July 1989]: Small firms continue to play an important and dynamic role in the regeneration of the Scottish economy. Small firms also continue to benefit from the comprehensive schemes of support that the Government have introduced. In the main, these are delivered through the Scottish Development Agency, the Highlands and Islands Development Board and from the Industry Department for Scotland, where policy responsibility lies. In addition to providing services specific to Scotland, the SDA, HIDB and the Industry Department for Scotland are responsible for the delivery and monitoring in Scotland of United Kingdom services on behalf of other Departments, including the Department of Employment and the Department of Trade and Industry. During 1988, there was a net increase of over 3,400 in the number of registered companies in Scotland. Between January 1980 and January 1989 there was a net increase of some 20,000 or over a half in the number of companies registered in Scotland. VAT returns indicate that between 1980 and 1987 the number of new businesses operating in Scotland showed a net increase of 13,400.

The following describes the services available to small firms in Scotland during the periods 1987–88 and 1988–89 and some of their achievements.

Regional Assistance

IDS made offers to small firms in Scotland of regional selective assistance of £4 million in 1987–88 and £12 million in 1988–89. Under the revised regional development grant scheme, approvals to small firms amounted to £48 million in 1987–88 and £70 million in 1988–89. Information on the grant offered to small firms under the original RDG scheme is not available. Under both the investment and innovation elements of the regional enterprise grants scheme, some £2 million was offered to companies in Scotland in 1988–89.

Better Business Services and Better Technical Services Schemes

During the periods in question, the BBS scheme was administered by IDS, SDA and the HIDB. The scheme allows small companies to have access to subsidised professional business advice and in 1987–88 some 9,597 offers of assistance were made with an associated value of £2.9 million. In 1988–89 some 6,804 offers of assistance were made with an associated value of £3.1 million. The BTS scheme was available in Strathclyde and part of Tayside region and allowed small companies to have access to subsidised professional advice of a technical nature. In 1987–88, 1,720 offers were made with an associated value of £1 million. Support under the BTS scheme ceased on 31 March 1988.

Scottish Development Agency

SDA support for small business includes the provision of financial assistance, premises and a wide range of advisory services, including the small firms service in Scotland and the administration of DTI's consultancy initiatives, under the enterprise initiative. Under the consultancy initiatives, some 1,235 consultancy projects were undertaking during 1988–89. It is estimated that Scotland accounted for 10 per cent. of total GB expenditure on this scheme, compared with a 6.9 per cent. share of eligible firms. During 1987–88 the SDA had contact with 19,125 small companies. Some £2.7 million was invested in 692 small firms creating or safeguarding some 800 jobs. In addition, some 875 small companies received assistance with the costs of attending promotional events. Sixty small companies were provided with technical advice, while 30 received assistance with market research studies. In the year 1988–89, the agency had contact with 19,250 small firms. Some £1.8 million was invested in 92 small firms creating or safeguarding 1,600 jobs. In addition, 925 small companies received assistance with the costs of attending promotional events. Eighty small firms were provided with technical advice while 40 companies received assistance with market research studies.

Highlands and Islands Development Board

As well as delivering the small firms service in its area, the HIDB undertakes a wide range of activities in support of business, most of which are small, to help them overcome the difficulties of operating in this peripheral and rural part of the United Kingdom. The measures taken include financial support to business, provision of factories and assistance with business advice and training. In 1987–88, the board approved 1,063 offers of financial assistance with an associated value of £14.4 million. This generated private sector investment of some £42.3 million and created or safeguarded 2,700 jobs. For the period 1988–89, the board approved 1,220 offers of financial assistance with an associated value of £25.3 million. This generated private sector support of £44.4 million and created or safeguarded 3,300 jobs. In the period 1987–88, the HIDB completed 6,090 sq m of factory floor space. In this period some 2,920 jobs were housed in HIDB factories. In the period 1988–89, the HIDB completed 12,553 sq m of factory floor space. In this period, some 3,130 jobs were housed in HIDB factories.

Local Enterprise Trusts

Local enterprise trusts have proved to be an important catalyst in fostering the enterprise culture in Scotland. The Government have continued to demonstrate their recognition of the valuable role played by the trusts, and the SDA provided financial support of £1.04 million to the 40 enterprise trusts in 1987–88, the latest year for which figures are available—an increase of over 46 per cent. over the previous year. This has triggered a further £3.28 million from the other public and private sector partners. During 1987–88 trusts in Scotland had contact with 25,000 clients from which 3,800 small businesses were formed. Companies assisted by enterprise trusts created some 9,000 new jobs. The SDA bases its financial assistance on its appraisal of each trust's annual management plan which contains details of the previous year's projects and objectives for the oncoming year.

Deregulation

The Scottish Office has responded fully to the deregulation initiative. This participation has resulted in an improved awareness within SO Departments of the needs of business and has led to a more systematic approach to assessing the financial and other burdens imposed on business by regulation. Scotland was the first area in the United Kingdom to set up a pilot Government business shop which provides small businesses with a single access point for advice on dealing with Government regulations. It is hoped that, with the co-operation of other participating regulatory Departments, the Government business shop will be permanently established in Glasgow once the pilot period has ended.

Public Purchasing

Earlier this year, the SDA, assisted by IDS, held two seminars on MOD procurement. These events attracted over 400 Scottish companies and as a result over 70 companies participated in face-to-face discussions with MOD procurement staff. SDA will be embarking on a further series of seminars dealing with public purchasing issues in the near future.