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Enterprise Allowance

Volume 555: debated on Monday 10 December 2012

We have recently taken steps to increase access to the new enterprise allowance by extending eligibility to day one of an individual’s jobseeker’s allowance claim and increasing the number of mentoring places available by 30,000.

Take-up of the scheme in Yorkshire has been excellent, but how do we ensure that those considering taking it up are given the best possible advice on developing their nascent business ideas?

My hon. Friend is right to highlight take-up in Yorkshire. In his constituency, 40 claimants have started with a mentor, and so far 30 have started training. That is a good result—better than the national average—so clearly people in his constituency are getting good advice. We need to ensure that the quality of advice increases. We want more people to see self-employment as a way into the work force.

The Minister is right that more people should go self-employed; the problem with the way the system has been set up is that it assumes people earn the minimum wage for every hour worked, when that is far from the truth, as he will know. Will he assure me that he will make changes where they are needed to ensure that self-employed people can take advantage of the scheme and not be disadvantaged, which is a potential problem at the moment?

The new enterprise allowance is there to help people to make the transition from unemployment into self-employment. It is absolutely right to give them the support they need not just to earn the minimum wage but to go beyond that. We have seen some good examples of people taking up the new enterprise allowance who have started their own businesses and are now employing others.

I join my hon. Friend the Member for Skipton and Ripon (Julian Smith) in saying that take-up in Yorkshire has been excellent. Indeed, in my constituency there has been demand to access the scheme earlier, but one issue needs to be addressed. In many areas there is a lot of other potential support for businesses, but jobcentre staff are not necessarily aware of it. Can we ensure that the advice given is as tailored as possible, taking into account the various funding streams available locally?

My hon. Friend is absolutely right. The advice given is not given by Jobcentre Plus staff: we get private and public sector contractors in to give that support. We need to ensure that people setting up their businesses are signposted to other sources of advice and funding to give them the best possible start in getting their businesses off the ground.