Small Businesses

Part of Prayers – in the House of Commons at 10:35 am on 15th May 1987.

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Photo of Mr Roger King Mr Roger King , Birmingham, Northfield 10:35 am, 15th May 1987

This Adjournment debate on small businesses is extremely appropriate, because if there is one section of the economy in which the Government have been successful above all, and they have been successful in most, it is in assisting the development of small firms and businesses.

Since 1979 a record number of new businesses have been created. That has not happened by any accident: it has been brought about by the favourable economic climate and by people who have adopted an attitude which perhaps we had lost over the past half century. They realised that the opportunity exists for them to create what they wish to create easily and ably. Perhaps it is also now generally accepted that a self-employed person is not some sort of crook who is trying to deceive the tax man but someone who has an important role to play in our economy. He may create his little business employing just himself, whether as a decorator or a plumber, and develop it into something more substantial by building on his business experience and reputation within the community which he serves. To be self-employed—at one time, perhaps, denigrated—is now a respectable, laudable occupation. Such people can feel proud indeed to play their growing and important part in our economy.

The Labour party has always believed first and foremost in spending wealth, but it has paid little attention to the role of creating it. Unless we create wealth, we have none to spend. Over the past eight years the Government have been successful in creating the wealth which we can now spend on, for example, increased National Health Service expenditure. It is now running at record levels in real terms, let alone in money terms, and that has been brought about because more than any Government in the past we have paid attention to the role of the wealth-creating sector.

The wealth-creating sector is not merely big business. Many big businesses have had to rationalise and change their outlook. The huge number of small businesses created since 1979 has increased the Exchequer take from industry and commerce through paying their taxes which can then be redistributed in our social welfare benefit systems.

The legacy bequeathed to us in 1979 was a hopelessly unproductive economy. Let me make no bones about it. From the last war we inherited sloppy industrial relations and sloppy management and somehow the belief, still, that the world owed Britain a living. This Government had to take dramatic decisions. They had to say that the feather bedding must stop because we no longer had an empire or a Commonwealth and that we must make our own way in an increasingly competitive world. The Government had to make some very difficult decisions affecting many of our old established industries. Of course, that is nothing to be ashamed of.

From time immemorial the trade unions have been shouting for investment. Some of the leading trade unionists asked how could we compete with the rest of the world, including the Germans, the Japanese and the Americans, with outdated manufacturing processes and lack of investment in industry. They also pointed to the failure by management to spend the money necessary to introduce the new equipment when, in the eyes of the trade unionists, that money was going into the pockets of shareholders in the form of profit taking.