HM Treasury News Release
106/97                                        11 September 1997 
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        VENTURE CAPITAL TRUSTS: A SUCCESS STORY

The success of the Venture Capital Trust scheme was praised today
by Geoffrey Robinson, Paymaster General, in a speech to a Venture
Capital seminar in London. He stressed that the Government was
keen to work together with VCTs to develop the scheme and make
it even better.

He said:

"The Government has made it abundantly clear that it wishes to
see an increase in productive investment in industry. I want to
congratulate you all on the way you have responded to the Venture
Capital Trust scheme. Eighteen VCTs have raised over 360 million 
Pounds in the first two years of the scheme. Over 50% of funds have 
been invested in industrial products and services, including some
high-tech companies. Over 60% of funds have gone into early stage
and expansion investments. This is a good start. 

I am sure you will play your part in sharpening the focus of the
scheme. We would like to see a concentration of your investment
effort on the businesses that are going to help the economy grow.
That means identifying sectors of the economy with exceptional
growth potential and where small firms can move in and succeed
more quickly than larger firms. 

This is, of course, only one element in a much wider picture. The
Government is committed to the development of a dynamic and
successful  economy. But if it is to play its part effectively
it needs to be open to ideas from the private sector and
particular from those who are at the cutting edge of
entrepreneurship and enterprise finance. We have established an
Enterprise and Growth Unit in the Treasury, not least to act as
a channel for such ideas and to ensure that the Treasury itself
is part of the productive partnership we want to develop between
the public and private sectors."



Notes to Editors

The Venture Capital Trust scheme was introduced by the Finance
Act 1995 to take effect from 6 April 1995. 

2.   It is designed to encourage individuals to invest in smaller
trading companies not listed on the Stock Exchange, through
Venture Capital Trusts which are listed. The aim is to provide
such trading companies with funds enabling them to develop and
grow.

3.   The Chancellor announced in his 2 July Budget that he wanted
to sharpen the focus of the scheme. The Inland Revenue are
currently taking views from interested parties.