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Small Businesses

Volume 124: debated on Tuesday 15 December 1987

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To ask the Secretary of State for Employment how many small businesses are currently trading in the United Kingdom; and if he will make a statement.

The best estimate available of the number of small businesses currently trading in the United Kingdom is from VAT information. At the end of 1986 there were an estimated 1,468,000 businesses registered for VAT, 96 per cent. of which are thought to be small under the definitions laid down by the Bolton committee. At the same time there were an estimated 2,677,700 self-employed people in the United Kingdom, many of whom were not registered for VAT.More significant is the fact that during the seven years 1980 to 1986 the number of businesses registered for VAT in the United Kingdom increased by 13·9 per cent., which represents an average net increase of around 500 firms per week. Regional estimates for 1980 to 1985 show that the number of firms registered for VAT increased in every region and country of the United Kingdom.Such figures reflect the efforts this Government have made to promote a more vigorous enterprise culture and the various measures they have taken to stimulate the development of new businesses and self-employment.


To ask the Secretary of State for Employment if he will make a statement on the policy of his Department on the purchase of goods and services from small businesses.

The purchasing policy of this Department places special emphasis on the role of small firms in achieving value for money. This policy is set out in guidance and training to all the Department's staff who now have greater discretion to use commercial suppliers since we have signed new customer agreements with the central procurement agencies.More generally, as Minister responsible for small firms, I am concerned to promote their role in Government purchasing as a whole. Small firms can face particular difficulties when trying to break into these markets but to overcome this the Department is encouraging simplified procedures for Government purchasing and improved information such as the small firms service's booklet "Tendering for Government Contracts."


To ask the Secretary of State for Employment if he will make a statement on the progress of the small firms service.

The small firms service through its information and counselling arms works to promote viable and profitable small businesses. In 1986–87, in England, it handled 283,537 inquiries and gave 38,210 counselling sessions. With the development of local enterprise agencies, it is increasingly developing its counselling activities with established businesses.Copies of the annual report on the service for 1986–87 were placed in the Library in July.