Lord Young comes in to bat for small businesses

Lord Young, the new "enterprise czar" appointed by David Cameron, was today on collision course with another of the Prime Minister's advisers, Sir Philip Green, over how quickly government pays small business.

Green had suggested abolishing the current target of paying small businesses within five days as part of his plans to strip costs out of government. Young said: "Yes, the Government could use its power and could squeeze small businesses and get some cash in — and we would end up with no businesses. That's not what government's about."

His stance was welcomed by the Federation of Small Business, whose Stephen Alambritis said: "We not only want to see government paying small firms early but also we want to encourage big companies to pay their small suppliers quickly."

Alambritis also wants Young to tackle the distribution of government and state contracts.

He said: "At least 25% of all government contracts should go to small or medium enterprises against the current 16%. In some areas it is much worse than that with only 1% of the Olympic Delivery Authority contracts awarded to small businesses."

Alambritis would also like a clampdown on unfair competition from superstores.