Self-employment (Hansard, 17 November 1987)
HC Deb 17 November 1987 vol 122 cc907-8
11. Mr. Robert B. Jones

To ask the Secretary of State for Employment if he will make a statement on the increase of self-employment since 1983.

Mr. Cope

Self-employment has a very important role to play in the regeneration of the economy and in the reduction of unemployment. Since 1983 the estimated number of self-employed people in the United Kingdom has risen from 2.2 million to 2.7 million—an increase of about 23 per cent.

Mr. Jones

I am grateful to my hon. Friend for those encouraging figures. Can he confirm that they represent a substantial reversal of the post-war trend in self-employment? Can he also confirm that the enterprise allowance scheme is one of the main contributory factors in achieving such a substantial increase?

Mr. Cope

The numbers in self-employment fell in the 1970s and have risen from 1.9 million in 1979. Since the enterprise allowance scheme started, almost 290,000 unemployed people have been helped by it to start their own businesses.

Mr. Heffer

Is it not clear that part of the increase in self-employment has been in the construction industry, which has led to a position in which there is little training for craftsmen in the industry, safety regulations are being ignored, the cowboys are increasingly taking over and people are not getting a good deal? Is it not time that the Government faced the fact that lump labour in the construction industry is serious for its future, and is it not about time that it was stopped?

Mr. Cope

Lump labour is not a novelty of the period of this Government. Self-employment has grown and it is right that it should have done so.

Mr. Barry Porter

Is my hon. Friend aware that one of the reasons for the welcome reduction in unemployment on Merseyside is the fact that 6,000 people are in receipt of the enterprise allowance? Is he also aware that that figure was given out at the recent conference called "Business Opportunities on Merseyside" and at the launch of the small enterprise scheme, which my hon. Friend attended last Friday? Is it not a pity that no hon. Members from the city of Liverpool were present at either of those occasions?

Mr. Heffer

Not true. I was there, and the hon. Gentlman knows it.

Mr. Porter


Mr. Cope

I did not have the pleasure of seeing the hon. Gentleman at the function that I attended and to which my hon. Friend referred. If the hon. Gentleman was there, I am glad. The EAS is certainly playing its part in improving the employment figures on Merseyside — as it is elsewhere.

Mr. Sheerman

The Government must know that self-employment must be seen in the light of high unemployment. We all know that self-employment rises at times such as this, as it did in the 1930s, and as it has done over the past eight years. Despite the mood of self-congratulation in which the Government appear to be this afternoon, unemployment has come down by only a fifth of the amount by which it has risen by since 1979—so that is a marginal decline. The enterprise allowance scheme will be seen to have succeeded only if it moves on to more employment and success. The evidence shows that it does not do that. It is about time the Government learnt that we need training and investment in small business.

Mr. Cope

The enterprise allowance scheme provides that. Counting both the EAS participants and the people whom they employ, for every 100 entrants to the EAS, 122 people are working three years afterwards.

Mr. Patrick Thompson

In the context of unemploy-ment, does my hon. Friend agree that the increasing number of young people starting out in self-employment at an early stage of their careers is a welcome sign? Is it not a measure of the success of the Government's policy, and one of the reasons why increasing numbers of young people voted Conservative at the last general election?

Mr. Cope

It is a most helpful sign, and it shows that the enterprise culture is working.