MPs call on Government to help South West€™s small businesses through the downturn

First report by the new South West Select Committee

MPs on the South West Select Committee published their first report today (Monday 3 August 2009) looking at the impact of the downturn on the region.

The Members of the Committee have welcomed Government efforts to keep businesses afloat and retain skills , but say more still needs to be done to help the South West's small and medium sized businesses get through the recession. The MPs are also are calling on Ministers to take care that initiatives designed in Whitehall are appropriate to the South West.

The Committee warns that unemployment in the region has risen higher than the national average and that the full impact of the downturn on housing and family finances is yet to be seen. It says the Government must provide resources to those working on the front line providing advice to the vulnerable - and that it should do more to encourage the public to seek advice earlier before their difficulties become acute.

The report says that the new role of Regional Minister could serve a useful purpose of taking the concerns of the South West to the heart of Government. However, the MPs urge the Minister to do more to convince people that the role carries real weight and influence by publicising identifiable progress in mitigating the impact of the recession. The Committee is also calling on the Regional Minister to continue to work with partners to increase the number of affordable and social homes in the region.

Chair of the Committee Alison Seabeck MP said:
"I am grateful to all those who contributed to this wide ranging report. The evidence of innovative working across sectors to meet the challenges faced by the recession was clear.

"There were however still demands on Government to continue to look at models of support to business in operation elsewhere as well as a demand for an on-going commitment to those bodies offering advice to people at risk of losing their job or their home."

The South West Select Committee is recommending that:

€ More is done to help firms explore other options before making people redundant.

€ The Government reviews the impact of the ProAct wage subsidy scheme introduced by the Welsh Assembly.

€ More affordable homes are provided in the region.

The Committee's first report says the impact of the recession on personal finance has been marked. It warns that the number of requests being dealt with by the Citizens Advice Bureaux in the South West has risen higher than the national average. And raises concerns that they are being overwhelmed by the number of people seeking help on debt, housing, redundancy and benefits.

The South West is often perceived as having a rural economy dominated by tourism and agriculture. In fact, it is heavily dependent on manufacturing, construction, distribution, retail and financial and business services. It also has a very high proportion of small and medium sized enterprises.