NEWS

Simon Hughes Opposition Deputy Chief Whip (Commons) 10:40 am, 8th March 1995

I am grateful for the opportunity to speak in this debate and pay tribute to the hon. Member for Dover (Mr. Shaw) for raising this subject. My researcher tells me that we have never had a debate on the Prince's Youth Business Trust and that it has been mentioned only once in a written question. That is odd and sad, but I hope that we shall correct it today.

May I say at the outset that hon. Members are united by the fact that your immediate predecessor, Madam Speaker, since stepping down from his job as Speaker of this House, has become involved in the trust. The House, and especially hon. Members in the Chamber today, therefore can all feel associated with the initiative.

The hon. Member for Dover raised this topic not to ask for something but to tell the House how extremely good the scheme is. I want to share that main message with him, although at the end of my brief speech I shall express my real concern about the trust's ability to do as it wants in south London, given the circumstances in that area.

I am glad to have an opportunity to speak for two reasons: first, because in my parliamentary party's team I am responsible for looking after the interests of young people, urban and looking after urban issues; and, secondly, because my constituency has one of the highest unemployment rates in the United Kingdom.

It is no pleasure to have a constituency with the fourth highest rate of unemployment in Great Britain and the fifth highest in the UK—west Belfast has a higher unemployment rate—with 7,500 people unemployed. According to the latest figures, male unemployment is 28.5 per cent.; female unemployment is 12.8 per cent.; and the average rate is 28.1 per cent.

So anyone who gives unemployed people, particularly the young, an opportunity to be employed, engaged, resourceful and independent is extremely welcome and hugely necessary. About 1 million young people in the age group which we are discussing are currently registered unemployed, so the potential for helping people who need such initiatives is huge.

The hon. Member for Dover gave some figures, and I shall try not to repeat much of what he said. But the figures he gave are extraordinary: the trust has helped some 23,000 people in 18,000 newly formed businesses, two thirds of which are still trading. Compared with the normal fall-out rate among small businesses, that figure is exceptional, if not unique.

I agree with the hon. Gentleman that the fact that the money is given in loans or grants, and that advice is given free of charge by experienced business people—advice is given at the beginning and advisers remain available to the young people—appears to make the trust the biggest business consultancy of its type in the world. The fact that the aid and assistance is free is extraordinary.

I am sure that the trust would not mind if the debate served to tell a few people out there who might he interested in being advisors to come and join it, so I am happy to plug for more advisers: please contact the main office. In a second, I shall be as crude about telling people how to contact the trust, because we are here to promote a good thing.

I am much more "wised up" on the trust than I was a year ago, not because I was not aware of the trust before, but because the trust has recently made a particular effort to communicate to hon. Members. Initiatives have been made here and in another place.

I was among hon. Members from both sides of the House invited to Buckingham Palace in December by the Prince of Wales to be briefed on his trusts' work. That briefing helped to explain the complication that there is a family of prince's trusts, of which the youth business trust is only one. It is important to clarify that point. The trust that we are discussing, which is for business start-up, covers England, Wales and Northern Ireland, and a similar trust exists for Scotland.

I pay tribute to the fact that the Prince of Wales has taken initiatives to set up organisations that reach out to and work with those in the community for whom extra help, support, advice and finance can make all the difference. May I list the whole family of prince's trusts so that it is clearly on the record? It comprises the Prince's Trust and Royal Jubilee Trusts; the Prince of Wales's Advisory Group on Disability; the Prince's Trust Volunteers; the Prince's Scottish Youth Business Trust, which is the sister organisation to the Prince's Youth Business Trust; the Prince of Wales Business Leaders Forum; Business in the Community; Scottish Business in the Community; and the Prince of Wales's Committee.

I shall now make a crude plug for the Prince's Youth Business Trust. People can express their interest to area boards, but the trust's address is 5, Cleveland place, London SW1. The telephone and minicom number is 0171 925 2900, and the fax number is 071 839 6494. Cleveland place is at the back of St. James's square. If anyone thinks that that is a posh address, as it is, the area board addresses are often much less posh. In any case, people have only to telephone. Another interesting statistic is that the third of businesses which are not still trading have not necessarily failed. Half of those involved in them have decided to opt for self-employment, and the trust has therefore acted as a stepping stone. Another good aspect is that the trust operates as a last resort. That may not happen in every case, as it is not perfect, but it seeks to help when people have been turned down by banks and cannot get going with help from elsewhere.

It is a bit like going to the European Court, in that one must exhaust the domestic remedies first. People must have exhausted their normal financial possibilities first. The trust also sets the precondition that beneficiaries are not from well-off backgrounds, and that resources, buildings and training schemes would not normally be available to potential beneficiaries.

The figures relating to beneficiaries are telling. A pie chart in the last report shows that 9 per cent. of those helped were young offenders; 10 per cent. were from ethnic minority backgrounds; and 5 per cent. were young disabled people. Those are all above-average percentages.
The chart also shows that 41 per cent. of those helped were female. Although not half, that figure is good, given how often such schemes are skewed in favour of males. Moreover, no area of the country gets much less than 5 per cent. of the money—Northern Ireland gets 4.8 per cent. The area that received most was the north-west, so funds are not metropolis-centred either.

Interestingly, in passing, we are talking about what the hon. Member for Dover rightly says is the main area of business in our society. I gather that 90 per cent. of businesses in our country–as the Minister must know better than I–employ fewer than 10 people, and 70 per cent. employ fewer than five people. Small businesses are what Britain is about. For whatever reason, the age of coal mines and docks is past.

It is good that we produce vibrant earners and vibrant survivors. It is important to ensure that young men and women–I pay particular tribute to the latter on International Women's Day–have the skills to be part of the work force, to earn for themselves and to earn for Britain.
The Government have been helpful. They have, I think, said that they are paying £2,500 a person, up to a total of £10 million, for three years, starting this year, but only if the person continues to trade after 15 months, and there must be matching funds. I hope that that will be sustained and never reduced. As the hon. Member for Dover said, more money would be welcome.

I do not think that the hon. Member for Dover mentioned that another good deal was recently secured with the clearing banks—the "Banks Directory". They will match other funds for the hest businesses, on preferential interest rates. That means that those businesses may be moved to the support of the banks, releasing Prince's Youth Business trust moneys to work with other people. That is very good news.

I have witnessed the work on the ground, as others have. I visited, like Jeremy White, chief executive of the trust, the firm that features pictorially in the most recent annual report. That firm is imaginatively called Michenuels, named after the three lads who are the partners—Miguel, Henroy and Michael, whom we met. They are furniture makers and restorers. They had done some work; they were unemployed; they had come together and were now restoring furniture.

They were in a little estate business start-up unit on the borders of my constituency, on the Deptford-Bermondsey border. They seek more premises. They want to obtain premises on the main road, so that they can sell their wares. They are enthusiastic, vibrant, go-ahead and ready to storm the world. If anyone has any furniture that they need restoring, they should go to Michenuels, because they will do a good job. That is exactly the type of business that we should be interested in.

I shall now mention local circumstances and make my specific request to the Minister. In south London, 40 per cent. of new businesses are started by members of the ethnic minority community, and I am told that 33 new businesses have been set up in or near my constituency by the Prince's Youth Business trust. I am told that south London will receive £62,000 from the trust this year in grants and £250,000 in loans. Good money is entering an area with one of the highest unemployment rates in Britain.

Madam Speaker, you know as well as anyone that one should never write off a district simply because it has traditionally suffered from high unemployment. People living in such districts are not less skilled or less talented. By contrast, one probably needs to be more streetwise, bright, sharp-eyed and bushy-tailed if one lives in a grotty estate in the middle of south London, or Liverpool, Leeds or Bradford, than if one lives on the white cliffs of Dover, looking out over lovely views. If the success rate in south London is that more than 80 per cent. of PYBT businesses continue to trade after three months, and more than 60 per cent. are still going after three years, that is good news indeed.

The Prince's Youth Business trust relies heavily on business start-up schemes, and business start-up courses run by the local enterprise agencies are the precondition to that working. Young people, when they are in the scheme, also need the enterprise allowance money—that is the way in which they fund themselves, so that they are supported for what is now six months and was 12 months.

There is a significant worry that enterprise allowance might be removed—I flag that up. If it is, it will pull the rug from under the scheme altogether. I say to the Minister: please may we have a guarantee today, or will she speak to her colleagues and give a guarantee later, that, as long as the present Government are in office, the enterprise allowance will not be removed?

The immediate additional problem is that, since the South Thames training and enterprise council went into liquidation at the end of December 1994, no one can claim enterprise allowance in the South Thames TEC area, and there are no business start-up courses. Suddenly, because the TEC was the servicing agency, there is a closed door. There is no way in, and that is unacceptable. It is unacceptable that the Prince's Youth Business trust, the door to opportunity for many people, is closed as a result of the way in which Government and the TEC have been sorting out their business.

I initiated, and we have had, an Adjournment debate, thanks to you, Madam Speaker, about the South Thames TEC, but that matter must be sorted out soon. The people knocking at the PYBT door in south London are now not receiving an answer, because the TEC is not there. My last general request to the Minister is, will she please not only sort that out so that we may get into the slipstream again, but also put money back into TECs? Cutting TEC funding–—137 million was cut last year—is bad news, because it reduces enterprise allowance and reduces business start-up schemes. I repeat my specific request to the Minister; will she please not leave south London as the one area of the country that, because our TEC has folded, is unable to benefit?

I end with a quote from the boss, which he wrote in the forward to this year's annual report. The Prince of Wales said:

Helping just one person to start their own business, thus taking them off unemployment benefit, saves the country thousands of pounds each year. But the benefits of our work go far beyond the merely financial. As I often see, starting a business not only restores the self-confidence of the individual, but can also play a part in helping to shore up the fabric of the community in which they live and work. I hope that we can all say amen to that.

I say to the hon. Member for Dover, the debate is welcome. I hope that the whole country gets the message, and that many more young people hear about the scheme as a result of his initiative and, Madam Speaker, your choice today.