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Mr. Letwin: I want to ask my hon. Friend a question that is absolutely specific to Scottish Enterprise and that I neglected to draw to the attention of the Minister earlier. Is he aware that of the approximately £3 billion that Scottish Enterprise has so far consumed, total investments--apart from those in property--amount to some £51 million, showing that some £2.95 billion has not gone into investments currently held?

Mr. Swayne: I thank my hon. Friend for that intervention, which is highly pertinent at this time.

My hon. Friend the Member for Beaconsfield (Mr. Grieve) pointed out that, as the state has taken on greater and greater activities for itself, it has displaced the activity and responsibility that would otherwise have come from individuals and their families. The state has reduced the incentive to save by funding such activities through taxing savings, income and, very importantly, inheritance--so much so that the diffusion of wealth throughout the population no longer exists to fund the activities of venture capital. That is why this Bill which requires the state to provide funding is before us today.

6.2 pm

Mr. Russell Brown (Dumfries): Follow that, as they say. Unlike my hon. Friend the Member for Ayr (Ms Osborne), let me tell the hon. Member for West Dorset (Mr. Letwin) that I shall be catching a train this evening and, like Cinderella, hope to be home before midnight.

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I welcome the opportunity to support the Scottish Enterprise Bill which will provide financial cover for various activities over the next two years. Thereafter, as has been said, that will become the responsibility of our Scottish Parliament. Naturally those resources filter down to local areas. For an area such as my constituency, which has seen significant job losses over recent months, any additional support that may flow from these moneys will be welcome. Hon. Members have spoken of the major role played by Scottish Enterprise and, like them, I welcome the new network strategy document thatwas announced earlier this week by my noble Friend Lord Macdonald of Tradeston.

Only this week 20 job losses in heavy engineering and a further 80 job losses in the polyester film manufacturing business in my constituency were announced. The ICI site that offered about 800 manufacturing jobs during the summer of 1997 will by the middle of this year offer only 350 jobs. The collapse of the Asian market and the decision of multinational companies to change their portfolios and abandon certain manufacturing sectors can have a devastating effect on rural areas. Dumfries, Galloway and the Scottish borders have felt some of these devastating consequences during the past 12 months.

Given that in recent months we have had about 600 job losses announced in my locality, it comes as a surprise to many people that unemployment figures do not show significant increases. I do not want to play down job losses because losing a job is a personal tragedy for anyone. However, far from the significant job losses being shown in an increase in unemployment, compared with this time last year, the statistics show a 3.7 per cent. reduction in people seeking employment and claiming jobseeker's allowance; compared with two years ago, the reduction is 20.4 per cent.

After the numerous job losses, my noble Friend Lord Macdonald of Tradeston visited our locality.

Mr. Moore: I know that the hon. Gentleman will develop his point, but does he agree, given our similar experiences of rural issues in the south of Scotland--the hon. Member for Galloway and Upper Nithsdale (Mr. Morgan) is also here--that when people lose their jobs, they are forced to leave the area? That artificially suppresses the unemployment rate. Does he agree that many of the worst recent job announcements have yet to kick directly into the statistics?

Mr. Brown: I agree to some extent. People in the hon. Gentleman's area may leave the locality to seek employment elsewhere, but that is not necessarily so in my constituency. He said that some job losses had yet to kick in, but my figures relate to people who have become unemployed and are a true reflection of what is happening.

The position has undoubtedly been helped by the excellent performance of Dumfries and Galloway enterprise company. Like so many such companies, its assistance is welcome in difficult times. Rural areas cannot attract inward investors who would bring 400 or 500 jobs at a stroke to one place. I therefore believe that it is even more important for the local enterprise company to spread its financial resources over as wide a variety of activities as possible.

According to its most recent annual report, my local enterprise company, which also covers the constituency of the hon. Member for Galloway and Upper Nithsdale

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(Mr. Morgan), provided information and assistance to 247 companies and helped 271 businesses to start up. The general public often miss such figures. It assisted 45 exporting companies and advised four potential inward investors. It supported 28 food, 27 forestry and 73 tourism businesses.

In such a large rural area, the importance of the ability to support 750 companies in training their staff cannot be overstated. Such training, in programmes such as skill seekers and training for work, helped some 230 long-term unemployed people attain employment. That is an excellent step forward for those who have fought so long and hard to find employment. It is also worth mentioning that 20 companies committed to the Investors in People standard during that year.

Dumfries and Galloway Enterprise is involved directly in the delivery of the new deal in my area. As a member of the strategic partnership formed to deliver the initiative, it is leading on the management and delivery of the employment option and the full-time training and education option. It sees its role in the new deal as an increasingly important part of the economic inclusion activity.

I mentioned previously that 271 new businesses had started up. That element of entrepreneurship continues to be a strong feature of the local economy in rural areas. Rural areas depend on small and medium-sized businesses. The launch of a new business start-up programme has proved invaluable to so many people who have been seeking opportunities to start a business.

The importance of tourism in rural areas can be shown by the numbers employed in that sector. Almost 10 per cent. of the area's work force is employed in the industry and last year we saw the development of a partnership that established our area's first integrated tourism strategy, in which a comprehensive vision for the industry's development was set out.

The ability to offer market research, exhibition support and overseas promotional literature assisted the previously mentioned 45 exporting businesses in the locality. In what is clearly recognised as a difficult time for export companies, the enterprise company's intervention is expected to have led to a growth in direct sales of just less than £1 million. That activity, along with other activities that my hon. Friends and hon. Members have mentioned in the realms of property and environmental improvements, as well as assistance to a significant number of property-based initiatives, has shown just what can be done in rural areas by local enterprise companies.

The Bill offers the opportunity to support through Scottish Enterprise a significant amount of economic activity that might otherwise never happen. I hope that hon. Members on both sides of the House see fit to support it.

6.11 pm

Mr. Laurence Robertson (Tewkesbury): I am rather amazed to find myself talking at this hour about the Scottish Enterprise Bill.

Mr. David Marshall: So are we.

Mr. Robertson: With a name like Robertson, I am perhaps entitled to offer one or two words on the Bill.

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When I looked at the Bill I was even more amazed. The thing that caught my eye was the extraordinary amount of money that we are talking about--not just the extra £1 billion but the almost £3 billion that has already been spent. I welcome the removal of Ministers' ability to increase the amounts by statutory instrument, but I want to make a short speech that my hon. Friend the Member for West Dorset (Mr. Letwin) might describe as a probing speech. I wish to ask a few questions and seek clarification.

I am concerned that responsibility for Scottish Enterprise will pass to the Scottish Parliament. It is not a matter of whether the Scots, the English, the Welsh or people from Northern Ireland are competent to deal with their own affairs, but the amount of money is so enormous that it inevitably comes from the United Kingdom taxpayer. Should not the United Kingdom Parliament have some control over it? If Labour Members feel that the money is well spent and benefits the people of Scotland to such an extent, would they be happy for the people of Scotland to provide it in its entirety? If they are, I suggest that the Scottish Parliament would need to increase the tax in Scotland by more than the 3p in the pound by which it is entitled to increase tax. I wonder whether it would have been better to delay introduction of the Bill until the Scottish Parliament was up and running. The responsibilities would have been clearer.

Mrs. Fyfe: Does the hon. Gentleman realise that so far he is presenting only one half of the equation? If all the investment effort is successful, the jobless figures will fall and therefore unemployment benefit costs will fall, which will benefit the United Kingdom taxpayer.

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