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Topical Questions

Volume 481: debated on Thursday 23 October 2008

Our Secretary of State has the Department firmly focused on working with business in this difficult economic period and on making sure that business comes out the other side of this period with the entrepreneurial strength and creativity for which British business is renowned across the world.

The best thing that the Government could do to help small businesses is get off their backs. If the Government do not do something to ease the taxation, regulatory and employment cost burdens on small businesses, many thousands of them will go to the wall and many thousands of people will lose their jobs. May I therefore suggest that one of the first things he should look to do is exempt small businesses from huge swathes of regulation that some bigger businesses might be able to afford, but many small businesses certainly cannot?

I agree that regulation can be a cost to businesses. We need some regulation because we operate in a society and a labour market with rules, but the Government make a significant effort to reduce administrative burdens. We have identified some £800 million of administrative burdens to be cut—for example, many small businesses no longer have to appoint a company secretary or have an annual general meeting, which saves costs, and we have made a number of other changes. The general point that the hon. Gentleman raises about regulation is fair, and the matter is one that the Government take seriously. We make a significant effort across Government to make sure that regulatory burdens are no greater than they need to be.

T5. On the need to look at regulation across Government, in a time of great economic uncertainty, the glass industry has begun to suffer. It is a multinational industry, but Ardagh Glass has already closed a furnace in Worksop, and United Glass is closing a plant in Harlow. All those factories are affected by climate change legislation, including the integrated pollution prevention and control directive and the climate change levy, which has been increased even before its first term has run out. They are also affected by huge gas prices and by the emissions trading regulations. All those pieces of legislation or regulatory burdens are dealt with by other Departments—either the Department of Energy and Climate Change or the Department for Environment, Food and Rural Affairs—but will my hon. Friend get together with colleagues across Government, as he has mentioned, to consider how to relieve that environmental taxation burden on industries such as the glass industry? (229236)

I know that the glass industry is important in my hon. Friend’s constituency. Overall, it is worth about £1.2 billion annually and provides about 28,000 jobs. He is right that climate change agreements and the EU emissions trading scheme cover the glass sector. We are obviously not going to reduce our commitment to climate change agreements, which are beneficial, or to the EU emissions trading scheme, which we strongly support, but he is right to point out the burden of some regulations, and I am certainly happy to meet him and talk to colleagues in the new Department for Energy and Climate Change about those issues.

T2. Is the £350 million that has been announced to help to train staff in small and medium-sized enterprises new money or warmed-up old money? (229233)

It is money that is part of the budget of the Department for Innovation, Universities and Skills to the period 2010-11. We decided to give priority to small businesses, which I would have thought all parties in the House would welcome. We have also announced that we will remove some restrictions on how that money is spent. We have refocused measures, so that there will be less regulation on how the money is spent and so that it can be used to help to provide bite-sized chunks of training for companies. Companies that face having to go on to short-time working can take the opportunity to retrain staff, rather than lay them off. That is a sensible thing to do during difficult economic times, and it will be welcomed by business.

T3. Since the Department is responsible for regional development agencies, will a Minister—any Minister—tell the House what exactly regional Ministers do? What is the point of them, apart from their acting as regional cheerleaders for the Labour party? (229234)

Regional Ministers play an important role in working with businesses in their local area in difficult economic times, as do RDAs. The other night, we debated in the House measures to help small businesses. RDAs are an important part of that work, because they can always move more quickly on information on the ground in local areas, and respond in a timely and appropriate matter.

As my hon. Friends are aware, it is just over two years since the collapse of Farepak and people are still looking for answers to what happened to their money. Two weeks ago in business questions, I asked about the report commissioned by the Government, and I was given an assurance by my right hon. and learned Friend the Leader of the House, who said:

“The fact that they are still waiting for the report is not acceptable. I thank him for raising the issue…We really do need to get the matter sorted out. I will work with the Deputy Leader of the House to make sure that we get some answers fast.”—[Official Report, 9 October 2008; Vol. 480, c. 419.]

When are those people going to get answers?

I am grateful to my hon. Friend for his question. I know that he and a number of other Members have continued to pursue the matter extremely closely. He will be aware that the companies investigation branch of the Department has been investigating what went wrong in that case and has completed its investigation. As my hon. Friend may know, legal advice is being sought to decide whether there are grounds for prosecution or disqualification.

T4. On the subject of the part-privatisation of Royal Mail, we were told a few minutes ago that Richard Hooper’s report on independent mail services was due to be published soon. When the Secretary of State appeared before the Select Committee on Tuesday this week, he said that he was contemplating giving additional work to that review team. Can the Minister say what additional work is planned and what impact that will have on the publication timetable? (229235)

The Hooper review is considering the changed context in which Royal Mail operates in terms of competition not only from other mail providers, but from other technologies. That competition has seen the volume of mail decline by 2 or 3 per cent. a year in recent years in this country and in others. The Hooper review must take all these changes into account in compiling its report, and that is exactly what the review team is doing.

T6. Further to the Minister’s statement yesterday on small businesses, does he agree that a consensus is emerging that the public sector could make a real difference to small and medium-sized enterprises if the entire public sector paid its invoices on time? Will the Minister confirm that central Government, local government, quangos and agencies will all pay SMEs’ invoices within 10 days? (229237)

The Government’s commitment to make payments within 10 days is an important one and we already monitor that through Department annual plans. The majority of Government payments are made within 10 days, but we want to do better. The regional development agencies, which each spend £750 million a year, have also committed to pay within 10 days. We are spending public money, and in matters of the public purse we need to ensure that we do so in a proper way. We must make sure that invoices are correct and that goods and services of the right quality have been delivered. Once those assurances have been provided, we need to get cracking and ensure that we pay promptly. That is important for small businesses facing cash flow problems. We are doing all we can to deliver that through the Government system.

I am sure my hon. Friend agrees that the creation of the Internet Governance Forum with a five-year mandate from the United Nations was a British diplomatic triumph, and that the creation of the UK Internet Governance Forum is a good example of co-operation between Government, industry and Parliament. Does my hon. Friend agree that the best way to promote international co-operation in the long term is to use the UK IGF to make the UK the safest place in the world to do business online?

I agree with my right hon. Friend, who makes some important points. I pay tribute to him for the work that he has done on the matter over many years. We are committed to ensuring the success of the multi-stakeholder Internet Governance Forum. It is largely due to his actions that the UK has taken such a leadership role in this area, and we will endeavour to continue to do that in the future. I am happy to work with him. As he knows, our noble Friend Lord Carter will meet him shortly to discuss these issues.

T7. The Minister will know that my constituency, Romford, has a wide variety of small and independent local businesses that serve our community, one of which is the Havering Christian bookshop. Many such organisations are struggling to survive in the present economic climate. What will the Government do to nurture and protect small businesses such as that? (229238)

In addition to the series of measures mentioned by my fellow Ministers, the hon. Gentleman may wish to check that the small business he mentions has sought to claim small business rate relief, a measure that is helping to reduce the administrative burdens on small businesses. It was opposed by his party but we have introduced it none the less, and it makes a real difference. If the business does not know how to claim, it should check the local council’s website, where the form should be shown.