To ask the Secretary of State for Work and Pensions

(1) what consideration he has given to the provision of welfare waivers for people starting their own businesses using micro-credit; and if he will make a statement;

(2) what representations he has received on the provision of welfare waivers for people starting their own business using micro-credit; and if he will make a statement.

The Secretary of State had a meeting on the 13 July with representatives of the Grameen Scotland Foundation at which a proposal to introduce the ‘UK Enterprise from Welfare Transition Scheme’ to help people into self-employment was discussed. Part of the proposal was to waive or disregard micro finance and the income generated during participation on the scheme across the current benefit system for the first two years of participation.

While the Government welcome initiatives to improve the take up of self-employment as a route out of benefit dependency, it has no plans to introduce specific disregards for this proposal.

However, we are clear that more needs to be done to encourage and help unemployed people to see self employment as a viable route off benefits and into financial independence. We have therefore introduced the new enterprise allowance (NEA). The NEA provides mentoring and financial support in the form of a weekly allowance and small loan.

The NEA is just one element in our wide ranging programme of welfare reform, a major part of which is universal credit and the introduction of the Work programme, both of which will provide more flexible ways of supporting people into sustained work including self-employment.