News story

Double the number of businesses created by jobless in Scotland

Latest figures show 6,850 businesses have been created in Scotland under the UK Government's New Enterprise Allowance scheme.


The number of new businesses set up by jobseekers in Scotland taking advantage of the Government’s New Enterprise Allowance (NEA) has almost doubled in the past year, according to official statistics released by the Department for Work and Pensions (DWP) today.

A total of 6,580 new businesses have been created through the scheme in Scotland since it was introduced in April 2011, with benefit claimants becoming their own boss on 3,220 occasions in the last 12 months alone.

Across Britain almost 70,000 new businesses have been set up under the NEA scheme, which provides benefit claimants who have a solid business idea with seed funding and a business mentor.

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Figures show the most entrepreneurial benefit claimants are based in the North of England, however, the rise of 95.8 per cent in the scheme’s take-up in Scotland since March 2014 is by far the highest of all nations and English regions.

Glasgow City finds itself fourth in the top ten list of all British local authorities for NEA business starts, with a total of 1,060, not far behind Liverpool (1,270), Birmingham (1,100) and Sheffield (1,080).

The NEA helps jobseekers, lone parents and people on sickness benefits with a good idea to set up their own business. People on the scheme get expert help and advice from a business mentor who will help them to develop their business idea and write a business plan. If the business plan is approved, they are eligible for financial support payable through a weekly allowance over 26 weeks up to a total of £1,274.

DWP Employment Minister Priti Patel said:

Starting up in business successfully needs so much more than just funding – it needs the right support and advice at the right time, and we’re doing just that through the New Enterprise Allowance scheme.

We will ensure that every part of Britain, including Scotland, benefits from a growing economy and that everyone who works hard gets the opportunities they need to succeed.

The scheme has helped set up a wide range of new businesses across Scotland, including a vintage shop, art exhibitions and classes for adults and children with special needs and workshops that help homeless and disadvantaged people into a trade.

Fashion fanatic

Vintage fashion fanatic Jennie Grear started Beatroot & Lace Vintage Emporium as a way to combine her love of vintage clothing and collectables, with a way of earning money around her childcare needs. After finding out about NEA and getting in touch with an advisor at A4e, a provider of the scheme, Jennie started sourcing items for her Glasgow based shop. Jennie now sells her goods online and at a Vintage Bazaar.

She said:

The help I got was invaluable. My plan had just been to buy stuff and sell it. I hadn’t made up a business plan or thought about financial projections. I am dyslexic so would have found it really hard to do that on my own.

Art inspired

Art enthusiast Rebecca Scott used NEA to help exhibit her own nature-inspired drawings in Glasgow galleries, while boosting her income with workshops for school children and adults with special needs. Through the help of the scheme Rebecca has become director of a social enterprise Art on Scotland and her work is sold in the city’s Art Village and Calder Crafts Gallery. Her art workshops are delivered on behalf of East Ayrshire Council and she hosts popular furniture up cycling workshops.

Rebecca said:

“I am really happy with how things are going now. I feel in the best place I’ve ever been. I love working with children and adults with learning difficulties, many of whom do not have regular access to creative activities and I can see how much they get out of it.

Training opportunities

Finding herself homeless at the beginning of last year, Phyllis Anderson rebuilt her life thanks to the NEA. Phyllis of Largs, North Ayrshire, set up The Indigo Sun Training Company after being inspired by the tragic stories of people she met while living on the streets. Her company aims to reconnect disadvantaged people with their communities and empower them to start up their own businesses. Phyllis provides training opportunities in traditional skills such as stained glass, jewellery making and wood turning to people of all ages. She is now mentoring new start-ups and launching a line of organic cosmetics and a children’s fantasy book.

Phyllis said:

I met other homeless people and I was deeply moved by their stories. I felt that I had enough experience behind me to get myself back on my feet, with the right support.

Scottish Secretary David Mundell said:

The New Enterprise Allowance is part of our long-term economic plan which gives working people the chance to get on, at every stage of their lives. Thanks to the scheme thousands of people in Scotland have realised the hugely rewarding success of becoming their own boss.

Great credit must also go to the NEA mentors - they have been able to inspire confidence in budding entrepreneurs many of whom will create more jobs, add to the backbone of our recovering economy and provide a better, more prosperous future for the whole of the country.

Find out more about the New Enterprise Allowance

Published 24 June 2015