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Small Firms

Volume 951: debated on Monday 12 June 1978

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28.

asked the Chancellor of the Duchy of Lancaster if he is satisfied with the progress he has made in his policy of assisting small firms.

Yes, Sir, but I expect to make further progress in the months ahead.

Does the right hon. Gentleman believe that the further tax on employment, the prices and credit squeeze and the rise in interest rates, all aimed at transferring resources from the private sector to help to finance the State's overspending, will make a major contribution to helping the small firms sector in this country? What is he doing about it?

First, I doubt whether there are many impartial authorities who would accept the hon. Member's summary of the consequences of the Chancellor of the Exchequer's recent actions. My main reply to the hon. Member, however, is that the welfare of small businesses depends intimately on the general success of the economy. The Chancellor of the Exchequer's measures were wisely designed to achieve a strengthening of the economy, and particularly its monetary aspects. For these reasons, I would expect the economy generally to be all the more confident as a result of those measures and that small businesses will get their share of that benefit.

Is my right hon. Friend aware that many small businesses, especially in fish processing, believe that they should be able to take advantage of the temporary employment subsidy? Has he had representations on this? If not, will he consider discussing with my right hon. Friend the Minister of Agriculture, Fisheries and Food how the level of temporary employment subsidy can be reduced to include these small firms?

The fish processing industry has been singularly reticent in its correspondence with me. I must confess that I have had no such representations. In the light of my hon. Friend's comment, I shall certainly take this matter up with my right hon. Friend the Minister of Agriculture, Fisheries and Food.

What progress has the Chancellor of the Duchy of Lancaster been able to make to help small businesses to obtain insurance cover for their products, particularly for those who are trying to open up markets in the United States? Is he aware how difficult this is?

If the hon. Gentleman will specify more particularly what insurance cover he is talking about, I shall be very happy to look into it. We have done our best to extend the facilities for insuring certain risks with regard to exports, but we are talking of a very wide range of subjects. I can assure the hon. Gentleman that if he gives me particulars—

The hon. Gentleman has done so. I cannot recall immediately the reply that I have given to the hon. Gentleman or whether it has yet been through the official processes so that I can look at it myself. I can promise the hon. Gentleman that I shall take up any such points that he has made, and with even greater zeal any points that he makes in the future.

Does my right hon. Friend appreciate that the additional resources made available in the Budget to the Development Commission are much appreciated because many of us believe that the Development Commission has a very important role to play in providing small industrial premises in rural areas, thus supplementing the advance factory programme of the Department of Industry? Will he, therefore, do everything possible to encourage the Development Commission to continue its very good work in this area?

I am grateful to my hon. Friend for his encouraging comments. I completely share the view that he has expressed. I shall certainly do my best to encourage further achievement by the Commission.

Is the Chancellor of the Duchy of Lancaster aware that slaughterhouses and abattoirs for which renovation grants are sought to comply with EEC regulations are eligible only if the grants are for more than £25,000? Whether or not he is aware of that, will he do his utmost to help my constituency slaughterhouse in Chatteris which needs £10,000, because it is ineligible under the current criteria for grant-aid?

I am encyclopaedically interested in the problems of small firms. I must confess that I am not encyclopaedically erudite in the area which the hon. Gentleman mentioned. I shall certainly look into this to see whether I can give any useful help to these gentlemen.

29.

asked the Chancellor of the Duchy of Lancaster what representations he has had since the Budget from representatives of small businesses on the effects of the Budget on small businesses.

In general, representatives of small businesses have warmly welcomed the measures in my right hon. Friend's Budget. But most feel that we have not reached the limit of what can be done to help small firms through the tax system.

Is the Chancellor of the Duchy of Lancaster aware that I must congratulate his private office on its efficiency, because a copy of the reply which he has just given reached me on the Letter Board before he or I had arrived in the Chamber?

How can he give me an answer of this kind in view of the recent Budget? The right hon. Gentleman talked about not having reached the limit of the concessions that can be made to small businesses. The Chancellor of the Exchequer has just imposed new burdens upon small businesses. If he has had to bring in this kind of Budget, how can he have any scope for giving more advantages to small businesses beyond what has already been done? This is urgently required because small businesses require further help, but how can the Chancellor do it in view of the situation which now obtains?

The hon. Gentleman will not expect me to comment upon the timing of replies. Unless he had a prophetic prescience not given to me, I took his Question to be referring to my right hon. Friend's Budget and not to the recent financial measures that were taken. That Budget was replete with very important concessions for small businesses. It was very warmly welcomed by most responsible people in that area. The recent financial measures were in no way specially burdensome on small businesses.—[HON. MEMBERS: "Oh."] I said "specially". In other words, they fell upon the big and the small with total impartiality, unlike the Chancellor's Budget where there was special, partial and favourable treatment for small businesses. Therefore, I think that the hon. Gentleman is mistaken in supposing that in some way these recent measures would be specially harmful to small businesses. On the contrary.

The hon. Gentleman asked where the money would come from for further measures. I cannot prejudice the Chancellor of the Exchequer's decision next year—

but the hon. Gentleman will appreciate that the recent measures, which were mainly directed to monetary achievement, would result in a considerable accretion of revenue from indirect sources, namely, the national insurance contribution, in the next financial year. The hon. Gentleman may rest assured that the Chancellor has by no means come to the end of the consideration of reasonable potential tax concessions to small businesses.

I welcome the measures to help small businesses announced by the Chancellor of the Exchequer in his April Budget, but can my right hon. Friend say what progress has been made about the consideration of some better loan guarantee facilities for small businesses and what conversations he has had or is having—particularly in the inner city and new town areas—about the provision of small premises for those who want to start small businesses?

With regard to the latter part of my hon. Friend's question, he will appreciate that I am not departmentally concerned with it. But I can assure him that I have been in close touch with developments in the inner cities with a view to ensuring that that problem receives adequate emphasis, namely, the provision of premises to smaller firms which are liable to be squeezed out in much modern development. I am glad to be able to say that I and my right hon. Friend the Chancellor of the Exchequer have given considerable encouragement to developers to provide these premises. I am confident that the period ahead will see much better treatment for small firms with regard to premises than has been their experience over the last decade.

If we can have shorter answers, I may be able to call another two Questions.

30.

asked the Chancellor of the Duchy of Lancaster what recent consultations he has held concerning the level of personal taxation as it affects the prospects of small businesses.

I continue to receive representations on this matter from a variety of sources and I continue to bear them in mind.

Does not the Chancellor of the Duchy of Lancaster think it odd that, in view of his present position, he felt unable to support attempts to reduce the burden of personal taxation when the matter was before the House?

No. This is a question of timing—the proper time, the proper place and the proper amount.