New Enterprise Allowance

As part of The Coalition Governments proposed strategy to support business start up and development, a fund of approximately £50m is expected to be available to enable the creation of up to 40,000 new businesses by 2013.

The New Enterprise Allowance (NEA) which is restricted to the long term unemployed, was announced by the Prime Minister to push the creation and growth of small businesses nationwide.

Launched initially in Merseyside this January with plans be rolled out nationwide from Autumn, The NEA will be available to twice as many people as was originally planned.

It will give people who have been unemployed and claiming jobseekers allowance for more than six months financial support for their early months of self-employment as well as access to a start-up loan and an expert business mentor to help guide them through the initial stages of the business start up process.

In order to claim the allowance they will need to develop a business plan, and secure the agreement of their proposed mentor that it is viable.

The Prime Minister has emphasised The Governments commitment to continued business support by ensuring all people who find themselves unemployed but still have the desire and drive to look at self employment as a viable option will have the advice support and mentoring they will need.

Part of this support will address barriers that stop budding entrepreneurs living in social housing starting a business from home. A high percentage of small businesses start at home, whilst over 6 million adults in England live in social housing, fewer than 20,000 of them run a home-based business. The Government has proposed plans to work with landlords to remove red tape around home working and therefore encourage more tenants to start up.

Details of the NEA can be found in the Bigger, Better Business Document and at www.bis.gov.uk. Or follow this link: http://www.bis.gov.uk/assets/biscore/enterprise/docs/b/11-515-bigger-better-business-helping-small-firms.pdf