Budget (Small Businesses)

Oral Answers to Questions — Treasury – in the House of Commons at 10:30 am on 29th March 2007.

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Photo of Philip Hollobone Philip Hollobone Conservative, Kettering 10:30 am, 29th March 2007

If he will visit Kettering to discuss the impact of the Budget on small local businesses.

Photo of John Healey John Healey The Financial Secretary to the Treasury

Treasury Ministers regularly visit all parts of the country. We are always ready to discuss with local business the beneficial impacts of reforms in the business taxation system. Having checked my diary this morning, I confirm that I currently have no plans to visit Kettering.

Photo of Philip Hollobone Philip Hollobone Conservative, Kettering

I am afraid that it was not the Minister who was invited, but the Chancellor of the Exchequer.

People in Kettering, particularly members of the East Northamptonshire branch of the Federation of Small Businesses and my constituent Mr. Steven Bellamy, who has written to me about this matter, would like the Chancellor to tell them in person about the bad effect that the rise in the small business corporation tax rate will have on their small service sector businesses over the next three years. If the Chancellor and the Minister will not come to Kettering, may I bring a small delegation of business men from Kettering to see them at Westminster to talk about this?

Photo of John Healey John Healey The Financial Secretary to the Treasury

The hon. Gentleman's constituent will be one of those who has benefited from the cut in the jobless rate by more than a quarter in the past 10 years, and his business might well be one of the more than 800 new businesses in Kettering since 1997. If he studies the Budget, he can tell his constituent that the revenues from increasing the small companies rate are entirely recycled to small businesses. I urge him not to make the mistake that Mr. Osborne made yesterday by saying that 3.4 million of 4.3 million small businesses are not limited companies. They will benefit from the capital allowances and the new annual investment allowance, as well as from the cut in personal income tax made in the Budget.

Photo of Kitty Ussher Kitty Ussher PPS (Rt Hon Margaret Hodge MBE, Minister of State), Department of Trade and Industry

If my hon. Friend does not have time to visit Kettering, perhaps he will go a little further north and visit Burnley to reassure small businesses in my constituency that the Government will not at any point in the future pursue a double whammy of cutting taxes while at the same time attempting to raise expenditure, thereby threatening our macroeconomic stability.

Photo of John Healey John Healey The Financial Secretary to the Treasury

I do not think that a visit to Burnley is currently in my diary, but I dare say that I might be able to find a space for it. My hon. Friend is right. It is all very well for the Conservatives to call for more support for small businesses, but they voted against the small companies rate and against moves to take action against managed service companies. That leaves a hole of more than £1 billion a year in the finances, so the question for the hon. Member for Tatton is where he would make the cuts.