§ Mr. David ShawTo ask the Secretary of State for Employment if he will make a statement on the achievements of(a) his policies and (b) his Department in helping small businesses over the last 12 months as against 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. Forth[holding answer 22 July 1991]: The Government continue to place a high priority on helping small businesses, through improvements to the business climate, through deregulation and other measures and through specific programmes of support and assistance. Despite the difficult economic climate the latest statistics on VAT registration show that there was a net average increase of around 800 businesses per week during 1990.
Measures operated by my Department to assist small businesses include the loan guarantee scheme, which enhances smaller firms access to finance. In the 12 months to 30 June 1991, a total of 3,297 loans were guaranteed to a value of £82 million.
Continuing efforts are being made to improve the access of small firms to Government contracts. The publication and distribution of booklets designed for both Government purchasers and small firms which identify purchasing needs, Departmental contacts and give guidance on improving Government purchasing procedures is an on-going activity. In this area we have also commissioned a study of small firms perceptions of supplying central Government Departments with a view to further improving our policies. My Department continues to publicise its own contracts and there is a departmental guide for those companies who want to tender including small firms. Managers are encouraged to use local small firms in devolving the purchasing function and budgets when appropriate.
My Department continues to address the problems faced by small businesses because of the late payment of commercial debt. During 1990, my Department obtained support for prompt payment from most of the United Kingdom's top 100 companies. In addition, I offered to take up, on behalf of individual small businesses, cases of late payment by the top 100 companies or Government Departments. This year, we have begun an examination of the Government's own departmental record on the payment of bills and are preparing a new guidance pack on payment and debt collection in co-operation with the Institute of Credit Management.
The Department also continues to pursue its policies of reducing the burdens on business. In addition to maintaining a close interest in domestic deregulation. I also seek to ensure that EC legislation does not impose unnecessary burdens, with the circumstances of small businesses very much in mind.
532WMy Department has successfully passed responsibility for running a range of measures which assist small businesses to training and enterprise councils. The TECs have a great deal of flexibility and are tailoring assistance to meet the needs of their local economy.
The small firms service existed to provide high-quality information, advice and counselling to new and established small businesses. It dealt with 317,000 inquiries, and gave more than 50,000 counselling sessions to more than 36,000 clients in its full year of operation. Its functions have been transferred to TECs, although the London centre is still operational under a specific arrangement with TECs in the London area. TECs have plans to make significant improvements to this service so that it will be even more effective in meeting local needs.
Business and enterprise training evolved in the period 1990–91 out of the business growth training programme which had been introduced in the previous year. It enables TECs to offer a wide range of business training to help meet the needs of small businesses and owner-managers. The range is varied and includes tailored packages of advice and counselling, financial support, subsidised consultancy support and business skills training. More than 100,000 owner-managers were assisted in the period.
The enterprise allowance scheme provides an allowance in the early months of trading and on-going support to unemployed people who start their own businesses. It helped more than 60,000 people in the period. From April 1991, TECs have been able to adapt the scheme to suit local economic needs. Early indications are that TECs are placing greater emphasis on increasing the quality of the businesses they support to improve their chances of survival.
The enterprise training element of employment training and the business enterprise programme help unemployed people to prepare for business start-up through the provision of targeted training in all the basic aspects of business. In many cases TECs started to adapt these programmes into integrated packages of support for people who wish to start up in business, together with the enterprise allowance and local business counselling. More than 18,000 people were helped by the business enterprise programme in the period, and in the first three quarters of the period more than 12,000 people entered the enterprise training element of employment training.
My Department continues to make substantial grants available to Business in the Community, local enterprise agencies and the Prince's Youth Business Trust amongst others. To take the Prince's Youth Business Trust as an example, my Department agreed to match private sector donations, up to £40 million, received by appeals up to 31 March 1990, to support young people who want to set up their own business.
The Department monitors all its programmes and also commissions external evaluations which are published. In May 1991 we published "Small Firms in Britain" which was sent to all Members of Parliament. This report surveys developments in the sector, includes key statistical indicators and outlines overall Government policy towards small firms.