Business

Trade and Industry written question – answered on 10th July 2006.

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Photo of David Evennett David Evennett Opposition Whip (Commons)

To ask the Secretary of State for Trade and Industry how many businesses in Bexley borough (a) started up and (b) ceased trading in each of the last nine years; and if he will make a statement.

Photo of Margaret Hodge Margaret Hodge Minister of State (Industry and the Regions)

Value added tax (VAT) registrations and de-registrations are the best official guide to the pattern of business start-ups and closures. DTI data on the number of VAT registrations and de-registrations in Bexley borough in each year from 1997 to 2004 are shown in the following table. Data for 2005 will be available in autumn 2006. For comparison, the start of year stock of VAT-registered businesses is also given.

VAT de-registrations and registrations 1997 to 2004
Bexley borough 1997 1998 1999 2000 2001 2002 2003 2004
Registrations 650 580 560 590 620 540 570 535
De-registrations 490 490 435 505 505 475 535 560
Start of year stock 4,415 4,575 4,665 4,795 4,875 4,995 5,060 5,100
Note:

Due to rounding, the stock at the beginning of the year, plus registrations during the year, minus de-registrations during the year, may not exactly match the stock at the start of the next year.

Source:

Business Start-ups and Closures: VAT Registrations and De-registrations 1994 to 2004, Small Business Service, available from the Library of the House and also at http://www.sbs.gov.uk/vats.

VAT registration and de-registration data do not capture all business activity. Businesses are unlikely to be registered if their turnover falls below the compulsory VAT threshold, which has risen in each year since 1997. Similarly, businesses that de-register will not necessarily have closed. Only 1.8 million out of 4.3 million businesses (42 per cent.) were registered for VAT at the start of 2004.

In Bexley borough VAT registrations exceeded de-registrations every year except 2004. The proportional increase in the stock of VAT registered businesses from 1997 to 2004 was bigger for Bexley (16 per cent.) than for England as a whole (13 per cent.).

Regional disparities in start-up and closure rates can have their root in the different economic history and different opportunities available in each region. The Government's aim is for every region to achieve success and good economic growth, which is why increasing resources have been put at the disposal of each Regional Development Agency.

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