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Oral Answers To Questions

Volume 404: debated on Thursday 1 May 2003

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Trade And Industry

The Secretary of State was asked

Trade Liberalisation


If she will make a statement on the latest developments in the Doha round of talks on trade liberalisation. [110624]

Since we launched the Doha development round in November 2001, progress has not been as fast as it should have been. In particular, we still have to conclude an agreement on trade-related aspects of intellectual property rights and access to medicines, and far more progress needs to be made on agriculture.

In other areas, however, progress has been more encouraging. The European Union submitted its general agreement on trade in services offer to liberalise trade in services earlier this week, and detailed negotiations are continuing on non-agricultural market access in the hope of reaching an agreement on the scope of negotiations by the end of May.

I am grateful to the Secretary of State for that honest answer. Does she agree that the Stuart Harbison Doha round proposals to phase out export subsidies would bring worldwide gains of about $100 billion a year, which would be especially helpful for third world countries? Was she therefore surprised and concerned that the French Minister. Herve Gaymard, said in a speech last month that he is

"profoundly opposed to such a course of action and … channelling all … efforts into … making this fail"?
Will she assure us that she will resist any attempt by the French to scupper such an important humanitarian proposal for trade liberalisation?

I entirely agree with the hon. Gentleman. The gains to the developing world and to the world as whole—including the developed world—from a successful trade round will be enormous at this time of economic downturn. It is important to succeed in the round and to demonstrate that we have made progress by the time of the mid-term ministerial in Cancun in September. The hon. Gentleman will also be interested by President Chirac's recent proposals on preferential treatment for countries in sub-Saharan Africa. We welcome the fact that his statement recognised the enormous damage caused to farmers in developing countries by export subsidies on agricultural products.

I hope that the French Government will support the process of reforming the common agricultural policy because that will be essential if we are to make a better proposal in the Doha round.

Where is the evidence that liberalisation and privatisation benefits third world countries? Surely the examples of Rwanda and Tanzania a few years ago and the recent failed attempt to privatise water in the third world tell us something about the sins of over-enthusiastic neo-liberalism.

Nothing in World Trade Organisation rules or the general agreement on trade in services requires either developing or developed countries to privatise any of their public services, including water. Indeed, the GATS offer that the EU has just published explicitly excludes our public services and public utilities. Attempts to privatise water in developing countries had nothing whatsoever to do with GATS or the WTO.

Although I agree with my hon. Friend that it is extremely important to get the phasing of market opening in developing countries right and to accompany that with appropriate measures for governance and effective regulation, we only have to compare the experience of African countries with that of many countries in south-east Asia over the past 30 years to appreciate how trade in a more liberal world economy that can be made fair as well as free benefits poor people in poor countries.

Does the Secretary of State agree that what would have been difficult negotiations will be made more difficult by the rifts between the United States and some countries in western Europe? Does she agree that the best position for a free-trading country such as the United Kingdom to adopt is to be even-handed in criticising and condemning both the totally unacceptable protectionist interests in Europe that have prevented the EU from making a meaningful offer on agriculture and, equally, the aggressive unilateralism of the US that is manifested in its illegal action on steel and its continued refusal to put the developing world's wider interests in medical technology before the interests of its pharmaceutical companies?

The hon. Gentleman may remember that when the United States imposed tariffs last year on steel imports, including those from the United Kingdom, I condemned them roundly in the House and outside it. The steel tariffs are clearly unlawful under World Trade Organisation rules and I hope very much that the American Administration—I have said this to them privately—will not appeal against the ruling that found the tariffs contrary to WTO rules but will instead remove them at the earliest opportunity.

If I may, I shall send the hon. Gentleman a copy of my recent speech in Brussels setting out precisely the Government's views on the need to create a framework of rules for trade that is fair as well as free and tackling the highly damaging protectionism in Europe, especially in relation to agriculture, and in the United States, where it has arisen in relation to steel.

Does my right hon. Friend agree that progress on the Doha round depends on the trade rules, in particular the special and differential treatment rule and the multilateral rules framework. and that that will assist investment and competition? We cannot leave it all up to negotiations at Cancun. We must assist developing countries or we will lose the opportunity that we now have.

I agree with my hon. Friend. One of the things that we have discussed in great detail with the developing countries is the issue of special and differential treatment to ensure that the new round reflects the different stages of development that different countries have reached. The House will recognise that if we can make the necessary progress in the Doha negotiations, we will not only give a much needed boost to the world economy, but hold out hope to developing countries, which more than anything else want to earn and trade their way out of poverty rather than being trapped in dependence on aid.

Registration Officers


If she will make a statement on the employment rights of registration officers.[110626]

The Parliamentary Under-Secretary of State for Trade and Industry
(Nigel Griffiths)

The Government agree that all workers should have protection.

May I first declare an interest, as the honorary patron of the Society of Registration Officers in England and Wales?

Today is the sixth anniversary of the Labour Government. For most of that time, I have dealt with six different Ministers, four at the Treasury and two at the Department of Trade and Industry, attempting to win right of access to employment tribunals for registration officers. Section 23 of the Employment Relations Act 1999 provides that that can be done by order. The registration service is about to undergo a major reorganisation and registration officers are likely to become local authority employees. Does my hon. Friend agree that it is important to have the measure in place before that happens? Has he any news that I can give to registration officers at their annual conference in Wales on 14 May?

The Government are studying more than 400 responses to the consultation document, considering how best to proceed, and setting deadlines. My right hon. Friend the Secretary of State made it clear last month that all new employment legislation must be implemented by 6 April or 1 October. We will work with the Office for National Statistics so that those deadlines can be adhered to.

Does the Minister agree that although tremendous progress has been made in improving employment rights for British workers, it is still a national scandal that many millions of them will take this bank holiday Monday off without pay? Does he believe that employment rights need to be improved to ensure that all British workers can enjoy the same—

Inward Investment


What the total sums of manufacturing inward investment were in each year since 1999.[110627]

The total stock of manufacturing inward investment in the three years of 1999 to 2002 was £63.3 billion, £69.7 billion and £92 billion.

I thank the Secretary of State for that. Is she not concerned that the net figures show that we are losing out and that foreign investment into this country is not going ahead? Is she not also concerned that, at the same time, companies such as Dyson, Royal Doulton, Black and Decker and even Corus are downsizing, closing down or escaping abroad? Is she not worried that all that contributes to the fact that more than 500,000 people have lost their jobs in the manufacturing industry in this country? What representations is she making to the Chancellor to improve the lot of manufacturing in the United Kingdom?

Every job loss and every decision by a company to reduce its employment or to relocate outside the UK is of course a matter for great regret. However, the hon. Gentleman is ignoring the fact that the latest UN report on world investment confirms that the UK is the No. 1 destination for foreign direct investment in Europe. That investment is particularly important in manufacturing, and I am delighted to say that at the end of 2002 foreign direct investment in the UK was significantly higher than a year before.

One factor in location and investment decisions is the fact that the UK is outside the single currency. The hon. Gentleman may not welcome my saying this, but the impact of that on investment, jobs and trade is one of the issues that we will take into account in making our decision on membership of the euro.

Will my right hon. Friend join me in thanking and congratulating the Canadian food manufacturer, McCain, which has invested heavily to make Scarborough its European base and gone on to great success? It has also been involved in innovation and development, proving not only that it richly deserves its recent Queen's award for industry but that it is a flagship company, which is telling other companies in north America just how important it is to invest in places in Britain such as Scarborough and Whitby.

My hon. Friend is absolutely right, and I am delighted to take this opportunity to congratulate the company and all those who are helping to make Scarborough an excellent location for inward investment. That underlines the fact that under the Chancellor's stewardship the UK remains one of the best places in the world in which to set up and grow a business. It is also one of the most attractive countries in the world, second only to the United States, for foreign direct investment.

Does the Secretary of State accept that her final comment to my hon. Friend the Member for South-West Hertfordshire (Mr. Page) rather spoiled what had hitherto been a reasonable answer? Is she not aware that the high level of bureaucracy and over-regulation and the high social costs that are imposed on manufacturing, particularly through the European Union, are having a direct impact on that industry, and that many jobs are moving away from Europe and the UK for that reason? Is not the right hon. Lady somewhat concerned that our manufacturing base, for which investment is clearly very important, is shrinking because of over-regulation, high taxation and heavy on-costs, many of which are imposed because of the EU?

I am extremely concerned to ensure that this country has a strong, successful future in high-technology, high value-added manufacturing. That is why one of the first things that I did as Secretary of State was to bring together industrial leaders and trade unionists to help us to put in place the first manufacturing strategy for the UK for 30 years. As a direct result, we have established throughout all the English regions a highly successful manufacturing advisory service, which is already helping small and medium-sized manufacturers to improve their productivity and profitability. Although manufacturing jobs continue to be lost, not only in this country but in every other industrialised country, we are also growing new manufacturing industries, particularly in biosciences, which will help to create good jobs.

I also draw the hon. Gentleman's attention to the fact that every international benchmarking survey shows that our business environment is one of the best in the world, and we will continue to improve the regulatory environment to keep it that way.

What effect does the Secretary of State think that higher national insurance contributions, the climate change levy, the pensions tax and the provisions of the Employment Act 2002, which came into effect last month, will have on inward investment? Will she confirm that six years to the day since Labour was elected, the Government have produced the worst trade deficit since records began in 1697, the second worst fall in business investment since records began in 1966, a halving of the productivity growth rate achieved under the Conservative Government, the worst strike record for over a decade, and the destruction of more than 2,000 manufacturing jobs every day since this Prime Minister moved into 10 Downing street?

I know that the increase in national insurance contributions will help to secure the huge improvements in the national health service that everybody in our country, including employers, wants. I know that the climate change levy and the climate change agreements are already delivering measurable improvements in energy efficiency throughout manufacturing, thereby helping to reduce costs. I know also that the new regulations on family-friendly working that we introduced last month will give employers the benefit of access to a more flexible and highly skilled work force.

I regret the fact that the hon. Gentleman chooses to talk down the British economy and British manufacturing as he has done today. As he well knows, thanks to the decisions made by my right hon. Friend the Chancellor six years ago, ours is one of the fastest-growing major economies in the world; and our manufacturing companies, despite the very tough global conditions they face, have succeeded in keeping up and, indeed, increasing the exports they send to the rest of the world. The hon. Gentleman should congratulate them on that.

Regulatory Impact Assessments


What procedures she has in place to audit regulatory impact assessments after implementation of (a) legislation and (b) regulations.[110633]

The Parliamentary Under-Secretary of State for Trade and Industry
(Nigel Griffiths)

The accuracy of RIAs is currently being considered by the National Audit Office, with the Government's full support. If the hon. Gentleman has an approach that would further improve the assessment without increasing the bureaucracy, the House would be delighted to hear it.

Given that the Government have imposed £20 billion worth of additional regulatory costs on business since they entered office, I hope that the Minister agrees that it is essential that the costs to business of any additional regulations or legislation be accurately assessed. The fact is that business confidence in the current system of RIAs is, rightly or wrongly, low. Does he agree that to increase business confidence in the current system and to improve the quality of policy making, there should be a system of comprehensive post-implementation audit of RIAs, to determine how accurate they are?

The facts do not bear out the hon. Gentleman's statement. He should tell that to the 373,000 businesses that started up last year or the 1.7 million businesses that have started up in the past six years, with the best survival rates for a decade. In referring to the £20 billion figure, he contradicts his own Front Benchers, because that figure includes the cost of the minimum wage, which they now support, and the cost of paid holidays and paid pensions, which people should not have had to wait until the 21st century to get. The facts are plain: we have a robust method of assessing RIAs. What he suggests is a bureaucratic and burdensome further appraisal of RIAs, which we reject.

My hon. Friend will know that the Public Accounts Committee has considered this question. Does he accept that any RIA should take into account the positive impact on profit of measures such as the working families tax credit, which reduces the real cost of wages to business, along with form filling, and legislation that gives £10,000 tax-free profit to partnerships that become incorporated? Does he accept that we should examine the impact of legislation on profit and growth in the round, not simply focus on a bit of red tape?

My hon. Friend is right. It is a vote of confidence in the handling of the economy that so many small and medium-sized enterprises—1.7 million—have started up in this country in the past six years, and so many large companies have expanded, as Honda did when it opened a second plant in Swindon in 2000–01. It is recognised across the economy that the handling of our economic affairs by the Government, the Department of Trade and Industry, and the current Secretary of State in particular, is second to none.

Given that the burden of regulation, whatever the intrinsic merits of some of that regulation, tends to be disproportionately large upon small and medium-sized enterprises, will the Minister undertake, as I previously urged the Secretary of State to undertake, a review of the merits of the Regulatory Flexibility Act 1980 and the Small Businesses Regulatory Enforcement Fairness Act 1996 in the United States, for the simple and compelling reason that that country has a vastly superior record to any other in the generation of new private sector employment?

The hon. Gentleman makes a good point. My right hon. Friend the Secretary of State has looked closely at the United States in the respect that he requests. No one in the House would disagree with him when he asks that regulations and their impact be considered proportionately. I, as the Minister with responsibility for small businesses, accept that while larger companies have lawyers and accountants who can examine regulations in detail, smaller companies cannot afford them. I would rather the larger companies employed people who invented and developed products, not lawyers.

Renewable Energy


What further action she is taking to communicate to Ofgem the policy of her Department on renewable energy; and if she will make a statement.[110635]

My ministerial colleagues and I, and my officials, have regular meetings with Ofgem to discuss a range of issues.

Ofgem has committed itself to producing regulatory impact assessments, including environmental impact assessments for all significant new policies, and following the White Paper on energy policy, we are revising the statutory guidance that we give Ofgem on both social and environmental issues.

I welcome that answer. Given that the early days of the new electricity trading arrangements, which were introduced by Ofgem, were characterised by serious problems, especially for smaller electricity developers such as those in the renewables and combined heat and power industry, will my right hon. Friend make it a priority for the new chair and chief executive of Ofgem that they seek to understand the needs of the renewables industry, and that they make accelerating the modernisation of the grid and sorting out some of the problems facing the CHP industry key priorities?

Yes, I have already made precisely those points to Ofgem, and they will be reinforced in the new guidance to which I have referred. In addition to the work of the regulator, the renewables obligation, which by 2010 will be worth about £1 billion a year to the industry, and the new carbon emissions trading scheme, which we will bring into effect in about 2006, will both help to accelerate the development of the renewables industry that we need to deliver sustainable energy to domestic and business consumers in Britain.

One of the bolder claims set out in the energy White Paper was the stated ambition to achieve 20 per cent. of Britain's electricity sources from renewable energy by the year 2020, though it was not clear whether that was a commitment, a target or an aspiration. However, in recent weeks the Minister for Energy and Construction has indicated that if the Government do not look as though they are on target to achieve this, whatever it is, the situation will have to be reviewed. On a scale of nought to 10, how confident is the right hon. Lady that she can achieve this aspiration?

I made it clear when I published the White Paper, and in a statement to the House, that I believe that our intentions to achieve both our climate change objectives and our energy efficiency objectives are achievable, by a massive increase in energy efficiency throughout the economy and by a substantial increase in renewable energy. There is no doubt that it will be tough. That is why we are putting in place not only the renewables obligation but the new carbon emissions trading system, which will be part of the Europe-wide trading system and hugely important in securing these goals. I believe that we can do it. I do not propose to start giving odds on that, and of course we shall keep the situation under review to ascertain whether the policies that we are putting in place are working or whether they need strengthening or changing.

I agree that it s important for Ofgem to play a role and for us to continue to develop our renewable energy sources. However, does my right hon. Friend agree that it is important also to deliver the new generation of clean coal technology, which can play a significant role in helping us to meet our Kyoto targets, and also provide many new jobs in constituencies such as Doncaster, North?

I entirely agree with my hon. Friend, which is why we are supporting the cleaner coal technology programme, which is worth £25 million over three years. That will help us both to reduce carbon emissions and to ensure that there is a future for the excellent British coal industry.

Just precisely how does one communicate an aspiration as policy? Is not the truth that the right hon. Lady's renewables aspiration is unachievable? She has just terminated the future for nuclear electricity and she expects the end of coal, leaving just natural gas, thus ushering in a new dash for gas as the energy Minister rushes from Norway to Russia, Algeria, Iran and Angola to try to secure our future energy supply. No wonder he is not here—he must be dealing with the emergency that now exists over our future single source of energy, thanks to her having an aspiration instead of a policy.

I am not sure quite what the hon. Gentleman's question is. It is a great pity that he mocks the very real policy challenge facing our country as we shift from being an exporter of energy to an importer of energy which means, as we said in the White Paper, that energy policy will become an increasingly important part of our foreign policy. We must ensure both that we have the right infrastructure and the regulatory climate to get the necessary security of supply for gas from different parts of the world such as we have enjoyed for oil. However, as I have just said in response to an earlier question, by stepping up substantially our efforts on energy efficiency and securing a much larger share of our electricity from renewables, we will indeed be able to achieve both security of supply and our climate change targets.

Will my right hon. Friend give an undertaking that the environmental impact assessments to which she has referred will take into account whether or not wind farms are to be sited in areas of outstanding natural beauty? Will she also look at the concern of a number of people that the location of wind farms close to rivers and the seaside can harm the ecosystem? In particular, can she get her officials to look at the proposed wind farm in County Londonderry, which has united elected representatives there and in County Donegal who are concerned about the impact on the area's fragile and precious ecosystem and salmon stocks?

I am not aware of the particular application in County Londonderry, but of course I shall ensure that my hon. Friend the Minister for Energy and Construction looks at that. However, the issues to which my hon. Friend the Member for Thurrock (Andrew Mackinlay) referred are already taken into account when considering an application for wind farms or, indeed, other developments. I would just tell him, as I have told environmental organisations, that people cannot on the one hand say that they want more renewable energy and, on the other, campaign against every specific proposal for an increase in renewable energy in different parts of the country.

Trade Balance (Eu)


What the balance of trade with the European Union was in (a) the latest 12 months for which figures are available and (b) the equivalent period 10 years previously. [110636]

In 1992, the United Kingdom's trade in goods and services with the European Union was worth £163 billion. The deficit then of £5.4 billion was worth just over 3 per cent. of the UK's total trade. In 2002, our trade with the European Union was worth nearly £300 billion. The deficit of just under £14 billion was worth 4.7 per cent. of the UK's total trade.

Is the Minister not genuinely worried about her balance of trade figures? The adverse balance of 2002 was the worst ever, particularly as it was recorded at a time when we had a positive balance with many parts of the world. As our trade with Europe used to be positive in certain years before we joined the EEC, could the right hon. Lady try to conduct an inquiry to find out what exactly has gone wrong? In particular—and I mean this very sincerely—could she try and find out whether the reason why we cannot sell as many goods to Europe is the misery and unemployment associated with membership of the single currency?

I know that the hon. Gentleman gets very excited about matters European, but I point out to him that the increase in the trade deficit over the past year or so is a result of the fact that we in Britain have enjoyed and are enjoying relatively good GDP growth. We are continuing to grow, whereas demand in the major continental economies has been disappointing.

I also point out to the hon. Gentleman that more than half our trade is with the European Union. The proportion has steadily increased over the years since we joined the Common Market, and is now about three times as much as the trade that we enjoy with the United States.

Does my right hon. Friend agree that for business in regions such as the north-east, which rely on EU countries for 78 per cent. of their exports, the nightmarish policies advocated by the hon. Member for Rochford and Southend, East (Sir Teddy Taylor) would be disastrous?

My hon. Friend is right. If we were to pull out of the European Union and join the North American Free Trade Agreement, as some of the wilder Eurosceptics propose, it would be disastrous for jobs, investment and trade, and it would hit hard not only my hon. Friend's constituents but all our constituents.

Post Office Card Account


What assessment her Department has made of the impact on the profitability of the Post Office of the current level of take-up of the Post Office card account. [110638]

The Department has made no such an assessment. The Post Office card account is one element of the Post Office's strategy to restore the network of post offices to profitability. The strategy requires the Post Office to develop new, higher value activities such as banking and other financial services, which is made possible by the Government's investment in technology in every post office in the country.

I thank the Minister for his response and encourage him to undertake such research. Does he agree that a seven-stage application process for a Post Office card account acts as a deterrent, as does the lack of information about the account? That will lead to lower take-up, which will affect the profitability of the Post Office and post offices, and could lead to further closures, such as the threatened closure of Westmead road post office in my constituency.

Many people are applying for Post Office card accounts. I do not agree about the difficulties that the hon. Gentleman believes exist. As we take advantage of the implementation of universal banking, which went live on 1 April, as planned—I recall Opposition Front Benchers expressing some scepticism about that, but it was delivered on time—people will be able to continue to collect their benefits in cash at the post office, as we always promised, through a bank account or through the Post Office card account.

The key for the Post Office is that universal banking services will allow post offices to offer services to a new generation of customers. Sub-postmasters in the hon. Gentleman's constituency should consider the new opportunities that universal banking offers them. For example, since last week, every Barclays bank current account holder can obtain cash at any post office in the country, using their existing bank card, so 10 million Barclays current account holders have a new and compelling reason to go into their local post office. The post office will, of course, receive a payment for every such transaction, and once customers are in the post office, they will buy other things there. That is the way forward for post offices in the hon. Gentleman's constituency. Other banks will have a similar arrangement, and what the hon. Gentleman—

I accept what my hon. Friend says as he waxes lyrical. We must rebuild the network, but the biggest single problem is the relationship between the Department for Work and Pensions and sub-post offices. It is difficult to pretend that it is not off-putting if people have to go through the Department for Work and Pensions to get to the sub-post office. There is another bizarre twist. We know that, under the network reinvention programme, there must be some closures, but in my area we seem to be saving rural post offices, whereas those in the more urban areas are being sacrificed. That is unacceptable. People are worried about whether they will have access to the Post Office card account. Will my hon. Friend comment on that?

I gather that, so far, nearly 100,000 people have requested a Post Office card account. There is a difference between rural and urban areas. Quite a few urban areas have 15 or more post offices within a one-mile radius, and, as my hon. Friend rightly says, there is no longer the business to sustain such a dense network. However, 3.5 million people in the UK do not have a bank account, many of whom would be better off with one, and the process of changing to benefit payment through automated credit transfer gives each of those people the chance to consider whether they would like to open a bank account. That is the purpose of the arrangements that we have put in place, and for that reason there is merit in them.

May I relay to the Minister the very real anger of people in Watlington in south Oxfordshire who, like many others, face the closure of their post office? A problem that has been raised with me by the manager there is that housebound pensioners do not find it easy to depute another person to pick up their pension or any other benefit for them, which used to be possible with the old pension book system. What can the Minister do to address that problem and bring people back to the post offices to do their shopping so that post offices can continue to play a part in the life of the village?

We have ensured that those who are housebound can receive a second card with a separate PIN that will be available for use by a nominee. We would be concerned if large numbers of different people were obtaining the money, as that would be a rather insecure arrangement. One of the benefits of the changes that we have made is that the new arrangements will be much more secure than the old ones were.

Is the Minister aware of the line that the Post Office takes on these matters? I have been in touch with the Post Office in an attempt to save Hilltop post office in Dronfield and, while it says that it will note and carefully consider the points that I have made, given the contents of its letter I am not hopeful. It says that

"the introduction of Direct Payment options … undoubtedly, means fewer customers using our network of Post Office branches".
That is one of the arguments used for closures. I can send the Post Office the information that the Minister has just given about the wonders of Barclays bank accounts, which might help us save post offices in future, but would it not be of assistance if the Post Office card

could be obtained in a sensible and reasonable way by simply ticking a box in the same way that one can obtain a bank account?

We have put in place arrangements with Postwatch and provided substantial funding so that it can manage the consultation process. I encourage my hon. Friend and others who might be concerned about particular post office closures to raise their concerns with Postwatch.

There are many advantages in having a bank account that are not available through a Post Office card account, which is why we want people to take the opportunity of this change to consider whether they would be better off with a bank account, which would give them access to discounts on utility bills and so on. Many people, as we are seeing, are deciding that they want a Post Office card account, and no impediment will be placed in their way, but this is an opportunity for others to consider whether a bank account would help them.

Is not the truth of the matter that the Government do not want people to continue drawing pensions and other social security benefits in cash at post offices? How else can the Minister explain the constant denigration of the Post Office card account and the obstacles that are put in the way of people who wish to open one? He has been at it again today from the Dispatch Box. He is promoting Barclays bank and commercial bank accounts and saying that the Post Office card account is the second-rate option. Does he understand that that policy will make life difficult for thousands of elderly and vulnerable people and that it will threaten the survival of post offices throughout the country whose existence is often a lifeline for the communities that they serve?

I am disappointed; I thought that the hon. Gentleman was going to congratulate the Post Office on the successful implementation of universal banking on time, contrary to the fears that he expressed during Question Time a few weeks ago. I do not agree with his allegations. The Post Office card account is a very important element in the strategy, but it is only one element. In the past, the problem has been that the Post Office has locked into a declining market in which people simply want to cash giros. When people retire, more and more of them now want to carry on using the bank account that they have used throughout their lives. The £500 million investment that we have made, benefiting every post office in the country, has opened up that market to the Post Office and held out the prospect of a much more attractive commercial future for the post office network. I agree about the importance of post offices in our communities, which is why we have made such a substantial investment in their future.

Small And Medium-Sized Enterprises


What efforts her Department is making to improve productivity growth rates among small and medium-sized enterprises.[110639]

The Parliamentary Under-Secretary of State for Trade and Industry
(Nigel Griffiths)

Improving productivity is central to the Government's economic strategy. We have overtaken Japan and narrowed the gap with Germany to 4 per cent., our research and development tax credits are helping an estimated 3,000 firms to keep ahead of our competition and, last year, more than 1,000 of our brightest businesses were offered SMARTs—small firms merit awards for research and technology—of £47 million to help develop their products in the marketplace.

I am grateful to the Minister for those proud statements, but, despite all that, the truth is that under this Government productivity growth has halved. That has happened not least because of the fact that the Government impose 15 regulations every working day. Two years ago, as I am sure you will recall, Mr. Speaker, the Government passed the Regulatory Reform Act. We were promised that there would be 50 new regulatory reform orders immediately. Yet, two years later, only 12 orders have been enacted. What happened to the other 38? Will the Minister explain why his Department has managed to pass just one regulatory reform order in 24 months?

I can tell the hon. Gentleman that that was one more order than the Conservative Government ever got to grips with in their time. Indeed, who was it who said that 28 licences, certificates and regulations were needed just to start a business? John Major made that comment at the 1992 Tory party conference. It now takes a day to set up a business, it costs less than £85 and there is no longer a need for 28 licences, so we will not take lectures about bureaucracy from the Conservatives.

We take productivity very seriously, which is why we have introduced tax credits to support innovative SMEs with cash support worth up to 24 per cent. of their research and development and why SMEs' productivity as a proportion of large firms' productivity is increasing—it is up 1 per cent. in the most recent recorded figures to 93 per cent., and some SMEs are more efficient than large firms. We have taken the measures to increase productivity, and I noticed that the hon. Gentleman admitted in his supplementary question that productivity was improving.

Is the Minister aware that the Select Committee on Regulatory Reform has dealt with a large number of reforms this year? Is it not regrettable that Conservative Members very rarely turn up at that Committee?

I am not here to get involved in party politics, but I am sure that the House and a wider audience will have noticed the excellent point made by my hon. Friend.

Surely, if productivity was really improving that much, major plants would not be leaving the UK. My hon. Friend the Member for South-West Hertfordshire (Mr. Page) mentioned a number of plants that were moving out of the UK, but he did not mention Vauxhall, Dr. Martens, Wilkinson Sword and Coats Viyella. That is straightforward outward investment. Surely, we need improvements in productivity. How many more UK plants need to leave for the far east before the Government recognise that there is a crisis in manufacturing? Or will they rely on the SARS epidemic to save British industry?

I know a little bit about the far east because I have just returned from a trade mission there. One of the facts that the Opposition choose to ignore is that, for instance, more than 70 per cent. of Taiwan's inward investment in Europe comes to Britain. In Japan, 43 per cent. of inward investment to Europe comes to Britain. I mentioned Honda in answering another question. What about Ford and those other big manufacturers that choose to invest in Britain? They do so because we have made Britain the preferred choice for the world for inward investment to Europe.

British Manufacturers


If she will make a statement on measures in the Budget designed to support British manufacturers.[110641]

The Budget includes a number of measures that will support British manufacturers: in particular, the research and development tax credit, from which manufacturers already benefit; deregulatory reforms to ease the regulatory burden on small businesses; and further support to improve levels of skills throughout the UK work force.

Much of manufacturing business needs to use steel somewhere in its processes. There is little in the Budget for such businesses, who are deeply concerned about what has been happening at Corus and about the fact that the Secretary of State seems to have been totally complacent in response to those events. What are the Government's proposals for the future of the UK steel industry?

We are all extremely concerned about the job losses at Corus, which have been going on for some years, and the prospect of further losses in some parts of the company. As the hon. Gentleman would expect, I have been talking to the company, to the trade unions and to hon. Members who represent steel constituencies to ensure that we support that company and its outstanding work force in securing a successful future for the steel industry. That is of huge importance not only to the workers at Corus, for whom this is a time of enormous anxiety, but to the whole of our manufacturing industry. I welcome the fact that the new leadership at Corus is putting in place a strategy that is designed to return the company to profitability and to ensure that it remains at the heart of a high-volume, strategic and successful steel industry in the United Kingdom.

Minister For Women

The Minister was asked—

Public Health


How many discussions she has had in the past year with the Secretary of State for Health regarding women's public health issues.[110644]


How many discussions she has had in the past year with the Secretary of State for Health regarding women's public health issues.[110647]

My officials have been working closely with the Department of Health and other Departments to draw together targets to tackle gender equality, including in public health. My hon. Friend the Under-Secretary of State with responsibility for public health has ensured that women's needs are taken into account throughout our public health programmes, including those on breast cancer, cervical cancer and osteoporosis, and in our broader work on mental health, health inequalities and domestic violence.

I am grateful to the Minister for that answer. Does she accept the comments that were recently made by Professor Adler of the Royal Free University medical college, who said that levels of sexual disease in England have reached crisis point, and that the Government's current levels of funding for sexual health will not even cover the costs of a chlamydial screening programme, let alone other sexually transmitted diseases? In her forthcoming discussions, will she and her officials raise the need to consider further funding for the treatment and prevention of sexually transmitted diseases?

The increase in sexually transmitted diseases, particularly among young women, is a matter of enormous concern, and I will of course discuss it further with my hon. Friend the Under-Secretary.

The Minister will be aware that in 2001 heart disease killed 54,000 women—it was the single biggest killer. What work is she doing with the Department of Health on that subject; and does she have a view on whether the much-publicised "eat chocolate to get fit" campaign will help to reduce heart disease among women?

The hon. Gentleman is absolutely right to draw attention to the prevalence of heart disease and the number of deaths that it causes among women. As we know, heart disease is all too often seen as a male, not a female, disease, and in some tragic cases it is simply not diagnosed in women. The need to ensure that the medical profession pays attention to heart disease among women is an important part of the programme introduced by my right hon. Friend the Secretary of State for Health to improve services and to cut the rate of preventable death from heart disease.

The Minister will probably be aware that yesterday there was an immensely successful conference in Parliament on endometriosis, which was attended by the Under-Secretary of State for Health, my hon. Friend the Member for Salford (Ms Blears). It was organised by the all-party group on endometriosis, the National Endometriosis Society and the SHE Trust, and proposed a programme of work to raise the profile of that condition, which affects 2 million women in this country. Would she be willing to meet a delegation from the all-party group to discuss that programme?

I am aware of the conference and I congratulate everyone who was involved in organising it. The National Institute for Clinical Excellence is already considering how it can improve advice to GPs on an extremely painful and common condition. I am sure that my hon. Friend the Under-Secretary of State for Health would be delighted to receive a deputation on such an important issue.

Has my right hon. Friend considered the specific problem of secondhand smoke in her discussions with the Secretary of State for Health on women's public health issues? It carries additional risks for women of increased lung cancer and heart disease. What proposals is she examining to tackle that problem? Has she considered the possibility of a ban on smoking in restaurants and cafs?

My hon. Friend makes an important point. Of course, he has a Bill on the subject. The increase in smoking among young women is especially worrying not only for their health but for that of the children they will have. My right hon. Friend the Secretary of State for Health is considering my hon. Friend's proposal for a ban on smoking in all public places. Those of us who are not smokers welcome the opportunity to enjoy smoke-free environments.

The Minister recognises the importance of sex education in schools in helping to deter immature and promiscuous sexual behaviour and reducing unwanted teenage pregnancies. What discussions has she held on the subject with her colleagues in the Department for Education and Skills?

I have discussed the matter with colleagues in the Department of Health and the Department for Education and Skills for some years. It is clear from experience not only here but in other countries, including the Netherlands, that the best way to ensure that young people do not engage in risky and premature sexual behaviour is to enable them to have an open discussion about not only sexual activity but the emotions and relationships associated with it and the desirability of a strong and loving relationship within which sex can take place.

Equal Pay


If she will make a statement about the Government's targets for equal pay.[110645]

The Government are working to reduce the gender pay gap through a variety of measures, including equal pay reviews throughout the civil service by the end of April, working with the Equal Opportunities Commission to promote equal pay reviews by other employers, introducing an equal pay questionnaire as part of the Equal Pay Act 1970 and providing trade unions with additional funding for training representatives in equal pay issues.

I thank my right hon. Friend for her reply. Doubtless she is aware that, despite the Equal Pay Act, which a previous Labour Prime Minister, Harold Wilson, effected in 1976, women who work full time earn only 81p for every pound that men earn and women who work part time earn only 59p for every pound that men earn. More worryingly, within three years of graduation, women earn on average 15 per cent. less than their male counterparts.

Does my right hon. Friend agree with the Fawcett Society that unless the Government set firm targets, at the current snail's rate of progress, it will take 75 years before equal pay for women is truly achieved?

My hon. Friend is right about the shocking extent of the continuing pay gap. However, in order to reduce it, we need to take action, especially on the problem of low pay from which so many women suffer. The introduction of the national minimum wage on top of Barbara Castle's Equal Pay Act has already meant significant pay rises for nearly 1 million women. I am delighted that, a few weeks ago, I was able to announce further increases in the national minimum wage for this year and next year, following the Low Pay Commission's recommendations.

At the top of the labour market, far too few women have access to the best paid jobs. Tribunal cases in the City have shown that even those women who get to the top do not receive equal pay. The cases that are being brought for equal pay for work of equal value—

The Minister for Women has just commended the civil service's progress towards achieving equal pay targets. In the light of that, how does she explain that only 19 of the 93 Government Departments or agencies conducted an equal pay review by the deadline last Wednesday, despite being given a year to do it?

All Government Departments are undertaking equal pay reviews. Those that have not completed them will shortly do so and put in place action plans to ensure that the equal pay gaps revealed by the reviews are closed. With the involvement of ACAS, we have put in place the new grading structure and phased pay rises that will ensure that the women as well as the men in the Department receive fair pay.

Following that answer and the Government's initiative in trying to deal with the unacceptable gender pay gap through independent audits, can the Minister say how many corporations have agreed to conduct or have carried out independent, rigorous assessments of the type that she is seeking? How many of the rather limited number of public sector reviews passed the test of being independent and rigorous?

The Equal Opportunities Commission and the Government are monitoring the take-up of equal pay reviews in the private sector. When we have that information, we will, of course, publish it. In the civil service, we have sought independent assistance in ensuring that reviews are carried out properly. They have revealed serious problems of unequal pay and we are putting in place the action needed to put that right.