Business

VICTORIA — It can’t be said
often enough or loudly enough:
the most important ingredient of a
healthy economy is the small-
business sector.

In British Columbia there are
about 105,000 small firms with
fewer than 20 employees. That’s
about 92 per cent of all companies
operating in the province.

Small business creates 96 per
cent of all new jobs, and foots 40
per cent of the B.C.’s private
payroll. Annual gross revenues
generated by small business
exceed $37 billion.

“Small business people, once
the unsung heroes of any economy,
are emerging as the best hope for
the future,’ says John Bulloch,
president of the Canadian Federa-
tion of Independent Business.

Considering the importance of
small business, its demands on
government have been modest,
and even those modest demands
have been largely ignored.

smail business needs more than reports

Bulloch has told governments
for years that grants and loans
aren’t the answer to the problems
that plague small businesses. Sub-
sidies, he says, don’t work. A
better tax structure does.

Bulloch gets support for that
view from some unexpected quar-
ter — Gerard Janssen, NDP critic
for small business development
and former president of the
Alberni Chamber of Commerce.

“The Canadian Chamber of
Commerce has urged governments
for years not to give help to small
business by way of grants and loan
guarantees. There are better ways,
like a better tax system,” Janssen
says.

A recent government task force
report touches on some of the
problems that plague small busi-
ness in British Columbia. The task
force was jointly chaired by

‘Unlike big industry, which has
never been bashful about
demanding government handouts
— right down fo full-scale financial
bailouts — small business doesn’t
ask for special favors. What if does
want is a good climate in which fo
operate’

Unlike big industry, which has
never been bashful about demand-
ing government handouts — right
down to full-scale financial bai-
louts — small business doesn’t
ask for special favors. What it does
want is a good climate in which to
operate.

Socred MLAs Ivan Messmer
(Boundary-Similkameen) and Dan
Petersen (Langley).

The report says a lot of small
businesses start up with too little
capital, owe too much money, pay
too much interest on borrowed

money, cannot afford new equip-
ment, and, for all these reasons,
tun a high risk of going under.
But after identifying all the
problems, the task force falls back

on the old solutions which,
according to the Canadian Cham-
ber of Commerce and the Cana-
dian Federation of Independent
Business, simply don’t work.

Introduction of a new loan guar-
antee program for start-up firms
and replacement of the regional
seed capital program with a selec-
tive loan guarantee program are
two of the recommendations put
forth by the task force to help
small business.

There is a problem with loan
guarantee programs. Since they are
delivered by financial institutions,
the result is often that banks and
trust companies will not even
consider financing a venture
unless it has the blessing of a loan
guarantee.

Other recommendations in the
report call for the removal of the
six-pet-cent sales tax on machin-
ery and equipment purchased by
small businesses and withdrawal
of the federal Goods and Services
Tax (good luck).

TReview Wednesday, March 14,1990 — B10 |

with our most important economic
sector, but falling abysmally short
of offering workable solutions.
Small businesses deserve better
than that.

It seems we have yet another
report telling us what’s wrong

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