An incentive scheme to encourage councils to promote start-ups could backfire, an accountants association has warned.
From April 2005 rateable income from new businesses will go to local authorities instead of the Treasury, which means those authorities who encourage start-ups will benefit more.
The scheme gives new businesses a share of the rates generated but the Association of Chartered Accounts (ACCA) has said it could fail unless safeguards and monitoring are put in place.
In the rush to create new businesses, some start-ups with little realistic chance of success could receive support and public money.
It called for a set of rules to be drawn up because if these businesses were to fail they would leave unpaid debts and put other established firms at risk.
Wednesday April 16 2003
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