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Enterprise Development Fund

Volume 450: debated on Wednesday 11 October 2006

To ask the Chancellor of the Exchequer how many businesses have (a) requested and (b) received assistance from the enterprise development fund in each year since 1999. (84787)

I have been asked to reply.

An accurate assessment of the number of businesses that have requested assistance from the enterprise fund in each year since 1999 could only be determined at disproportionate cost.

The number of businesses that have received finance as a result of programmes supported by the enterprise fund in each year since 1999 are set out in the following table.

Number of businesses

1999-2000

4,279

2000-01

4,312

2001-02

4,350

2002-03

3,992

2003-04

6,100

2004-05

7,270

2005-06

6,109

Total

36,412

To ask the Chancellor of the Exchequer how much was allocated to the enterprise development fund in each year since 1999; how much has been awarded from the fund in each such year; and if he will make a statement. (84788)

I have been asked to reply.

There is no enterprise development fund in DTI/SBS.

Following a review of SME finance markets, The enterprise fund (not the enterprise development fund) was created in 1999. This was designed to improve access to equity investment support, for SMEs with growth potential, and to improve the small firms loan guarantee.

The following table sets out Government’s total investment in SME equity programmes.

£

Allocated (committed)

Awarded (drawn down)

1999-000

2000-01

20,000,000

20,000,000

2001-02

37,375,000

2,100,000

2002-03

59,650,000

11,889,329

2003-04

23,875,000

28,367,661

2004-05

5,000,000

31,123,908

2005-06

-

22,898,829

Total

145,900,000

116,379,727

“Allocated” is the total amount of money committed for investment by Government, and “Awarded” is the total amount of funds drawn down against these commitments.

Venture Capital (VC) funds have an investment period of between five to six years. On signing the Limited Partnership Agreement with each investor, the Fund will typically draw down 10 per cent of each investor’s total commitment in the first instance and access further moneys as and when they are requested. Typically VC funds will not make their first investment until several months following the Funds’ launch. Investment levels tend to peak in years three to four.

The number of loans guaranteed, their value and that of the demands made against the guarantee in each year since 1999 are set out in the following table.

Loans guaranteed

Value of loans (£ million)

Value of demands (£ million)

1999-2000

4279

206.00

38.95

2000-01

4312

240.46

34.43

2001-02

4269

254.70

44.93

2002-03

3916

269.00

50.00

2003-04

5966

409.30

52.68

2004-05

7130

481.30

57.42

2005-06

5957

422.10

76.10

Total

35,829

2,282.86

354.51