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Sustainable Development Technologies

Volume 457: debated on Thursday 22 February 2007

3. What assistance his Department gives UK manufacturers seeking to develop sustainable development technologies. (122134)

The DTI is working with business to encourage the development of sustainable development technologies and sustainable consumption and production practices. This support covers a wide range of activities including support of the UK science base, the technology programme and our joint work with the Department for Environment, Food and Rural Affairs on sustainable consumption and production.

Does my right hon. Friend agree that we are right to focus support increasingly on clusters of manufacturers and their supply chains by sectoral activity? If she does, and bearing in mind our ambitious target for renewable energy, does she agree that there is an urgent need to expand our base of clusters for renewable energy? If she is with me so far, could she bear in mind for the next time we meet that Stafford is an excellent location for such a cluster, because of its 100 years of experience in power and its existing experiences with solar, wind and biomass, and because we have the only factory in the whole of the UK manufacturing transformers, with worldwide experience in transmission and distribution?

I agree with my hon. Friend that clusters are an important way to provide strength and build key capacity in such areas. I congratulate him on the work that he is doing in his own constituency to try to ensure that Stafford develops such a cluster and I have no doubt that in his discussions with the regional development agency and in our considerations through the technology strategy we will bear in mind the strong case that he makes.

Following the excellent question from the hon. Member for Stafford (Mr. Kidney), and the Minister’s reply, with especial reference to sustainable production, I seek her advice and assistance, and that of the Government. Earlier this week, AstraZeneca, the largest employer in my constituency, announced 700 job losses at its manufacturing site in Macclesfield. I am pleased to say that the job losses will be spread over three years, but one of the reasons the company gave for that decision was the cost of energy. Can the Government give any advice or assistance on that question, because the shedding of 700 manufacturing jobs in a high technology industry such as pharmaceuticals is a very dangerous and unfortunate development?

I share the hon. Gentleman’s concern about the loss of jobs in his constituency, although I would draw his attention to the fact that we perform well in the pharmaceutical sector. The Government need to continue to provide the conditions that will enable that to continue into the future. That means providing the right business environment and ensuring that we invest in research and development so that we have the innovation necessary to keep us one step ahead.

The hon. Gentleman is also right to draw attention to the fact that energy prices last year did create difficulties for many sectors of industry. That is why my right hon. Friend the Secretary of State referred to the steps that we have taken to secure energy supply for this winter and beyond and, through the energy White Paper, to bring down energy prices so that we remain internationally competitive in manufacturing, especially in areas such as the pharmaceutical industry.

May I point out to my right hon. Friend that perhaps the most sustainable source of energy actually lies within the earth’s crust, but that historically this country has underdeveloped and under-researched geothermal energy sources? I ask my right hon. Friend to work with the construction industry and other Departments with a view to promoting that source of energy within new construction, which will help not only our carbon footprint, but companies such as Forkers in my constituency that are at the cutting edge of geothermal technology.

My hon. Friend is right to draw attention to this important source of conserving energy and sustainable development. Indeed, I am working with the construction industry to look again into what further steps we can take around sustainability in construction to ensure that we conserve our energy resources. We support, and are in various ways investing in trying to promote, geothermal capacity.

The Minister said that she is encouraging sustainable technologies development, so can she explain why the DTI’s supplemental budget published this week shows that she has cut research council funding by £68 million?

I simply draw the hon. Lady’s attention to the statement, which shows that that is an underspend. It is money that was not spent, which we are drawing back into the remaining overcommitments in the Department’s budget.

One of the ways in which the Minister’s Department supports renewable technology is through the low carbon buildings programme, which is so successful that it runs out of money every month. As a result, people who miss the cut-off date have to apply again the next month. As that does not encourage householders to apply under the scheme and is destructive of industry, will the Minister consider providing more funds for the low carbon buildings programme, so that we do not have that arbitrary cut-off period every month?

I understand that my hon. Friend has tabled a question that may be reached later this morning. Up to 2008, we are providing £12.8 million to meet the issues that he has raised.

Is the Minister aware that the director of the Renewable Energy Association has described the programme as descending into farce? At the beginning of each month when the allocations are opened, they close after shorter and shorter periods. This month, they closed within hours of opening on 1 February. The scheme was set up to encourage the development of renewable technologies in this country, but how can that possibly happen when the scheme stops and starts as it does?

This is a demonstration programme—we have demonstrated its success and will build beyond that into the future.

In answer to the previous question, the Minister mentioned the potential for carbon capture technology. There is an exciting potential development at Peterhead, but it is apparently being put in doubt because of the delay in the Government’s announcement of financial support for this technology. Can she tell us when a decision will be made and announced on support for carbon capture?

I question the hon. Gentleman’s assertion that there has been a delay in our decision making on how we can better promote carbon capture. That is not the case. We are pursuing, with all the vigour that we can, the important issue of conserving our energy resources.

Limited Companies

The number of company insolvencies in England and Wales in 2006 totalled 17,819, while 190,742 companies were struck off the Companies House register.

I am grateful to the Minister for that response. Does he acknowledge that many of those companies were small companies? Given that small companies are the driver of the British economy, does he agree that any new tax on small or medium-sized companies would be a retrograde step? What discussions has he had with his counterparts at the Treasury about the possibility of a new local business tax resulting from the Lyons review? Would he oppose any such tax?

The hon. Gentleman is asking me to anticipate the outcome of the Lyons review and to make pronouncements before it has been completed. We are in close touch with the Treasury on all business matters, and it is certainly the role of the DTI to provide business support. We do that through Business Link, which is attracting a great deal of interest and received more than 700,000 hits last year from businesses, helping them to stay in business and to develop. We have also published our better regulation simplification plan for all businesses, and the small business forum is part of the ministerial challenge panel that I chair, and helps to ensure that small businesses can survive in today’s competitive market.

Does my hon. Friend agree that the figures that he has given to the House provide only a partial picture of what is going on in UK business, because much business formation consists of sole traders and partnerships, rather than limited liability companies? To put the matter in context, will he tell the House how many limited liability companies were registered during that period, to give us an in-and-out measure?

My hon. Friend is describing the positive position of British business, and I can tell him that the three-year survival rate—a key indicator—for businesses registered in 2002 was 71 per cent., and that three-year survival rates have been increasing since 2000. The number of registrations at Companies House has exceeded the number of deregistrations each year between 1995 and 2005. That is a very positive image of British business.

With both individual and corporate insolvencies now on the increase, is it not the case, as my hon. Friend the Member for The Wrekin (Mark Pritchard) said, that the small business man is increasingly feeling the heavy weight of this Government’s regulations and stealth taxes and, in many cases, simply closing up shop?

The hon. Gentleman gives me the opportunity to say a little more about the Government’s priority of better regulation. We are the first Government to quantify administrative burdens and publish the results, and we have committed ourselves to a 25 per cent. reduction by 2010. Business has always identified the administration burden as one of its top priorities. The DTI’s contribution to the £2 billion of savings that we have identified to be achieved by 2010 is £700 million a year, and we are working closely with all levels of business to ensure that we are addressing this issue. If the hon. Gentleman has any suggestions for improvements in better regulation, he can either hit the better regulation website or drop me a line. I will be very happy to hear from him.