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Topical Questions

Volume 518: debated on Thursday 18 November 2010

My Department has an important role in delivering growth and the coalition’s commitment to building a new and more responsible economic model while rebalancing the economy and bringing enterprise, manufacturing, training, learning and research closer together.

As the Lib-Dem Treasury spokesman in the last Parliament, the Secretary of State strongly criticised the Labour Government’s handling of the Lloyds TSB merger with HBOS, saying that the Lloyds shareholders had been sold a lemon. What does he say now to the 800,000 small Lloyds shareholders who have lost up to seven eighths of their investment, some of whom I have met in my constituency? What support will he give those who are now trying to win compensation?

First, I congratulate the hon. Lady, as I believe that last night she received the newcomer of the year award from The Spectator. On her specific question, she will be aware that the Chancellor of the Exchequer and I established the banking commission specifically to consider the structure of banking and how competition can be improved. It will undoubtedly take into account the particular position of that bank.

T3. I recently visited the Abington pharmacy in my constituency, where I switched on a robotic dispenser—[Laughter.] It delivers pharmaceutical products, and I switched it on rather than turned it on. Many successful small businesses such as that pharmacy struggle to get the banks to give them loans, and small and medium-sized businesses are suffering as a consequence. What can my hon. Friend do to encourage the banks to lend to small businesses? (24748)

No. 1: ensure that we enforce the lending commitments. No. 2: extend the enterprise finance guarantee—and the third action that I would encourage would probably be to leave those buttons alone!

T2. Thousands of medical students will be crippled by the increased tuition fees, and the submission by the British Medical Association to Lord Browne’s review appears to have been ignored. Does the Minister agree that those increases will deter young people from undertaking medical training? (24747)

We do not believe that our proposals will have any such effect. Obviously, I am in close contact with the Secretary of State for Health, and we are confident that we can continue to support medical training in a way that will provide the doctors that we need.

T4. Does the Minister agree that the true test of any education or training system is that the person concerned comes out better qualified and better equipped to be an active and employable member of society than they were before they went into it? Does he agree that the 50% target for universities did not work and was not right, and that we now need to value vocational training and apprenticeship schemes better? (24750)

My hon. Friend is right. That is why, as well as maintaining student numbers this year with 10,000 extra places, my right hon. Friend the Secretary of State and my hon. Friend the Minister for Further Education, Skills and Lifelong Learning have committed us to 75,000 extra apprenticeship places.

T5. Nissan is an important local employer in Sunderland and it has rightly said that “relatively modest” Government investment can rebalance the economy. That is crucial in regions such as the north-east. Does the Secretary of State agree with Nissan that if the Government do not fight for new business, it will simply go elsewhere? (24751)

One of the first decisions that this incoming Government made was to confirm support for the Nissan Leaf project. We continue to be in close contact with that company, which makes a valuable contribution to the economy in this country and the north-east, and we will maintain close relations with it.

T6. Students who complete degrees are rightly lauded as graduates at elaborate ceremonies that are all too often unlike those for people who learn valuable crafts. Does the Minister for Further Education, Skills and Lifelong Learning agree that we must do more to recognise the value and status of those who complete apprenticeships? (24752)

For too long we have conned ourselves that the only form of prowess that matters is academic accomplishment. We need, in the spirit of Ruskin and Morris, to recognise that practical skills matter too. I recommend that my hon. Friend read my speech to the Royal Society for the encouragement of Arts, Manufactures and Commerce on that subject. Signed copies are available, but I am told it is the unsigned copies that will be clamoured for in years to come.

In response to my hon. Friend the Member for Wrexham (Ian Lucas) and my right hon. Friend the Member for Leicester East (Keith Vaz), the Secretary of State gave vague assurances on intra-company transfers, particularly those that are vital to the future of Toyota on Deeside. When will he finally end the uncertainty that still hangs over this issue?

The Home Secretary will announce the results of the consultation very soon, and I am sure that it will give the hon. Gentleman the assurances that he wants on inter-company transfers.

T7. Will the Minister agree to meet a social enterprise in my constituency whose future is threatened by the draconian attitude of RBS, which seeks nearly £400,000 in penalties for a minor breach, even though a non-nationalised bank is willing to refinance its loan fully? (24753)

The Government are keen that banks should behave responsibly towards businesses, charities and social enterprises, and we continue to work with the banks to achieve that. For example, we are working with them to revise the lending code for micro-enterprises and we are publishing lending principles for medium-sized and larger businesses. We will continue to hold banks to account when they act unreasonably, and my officials will raise this matter with RBS.

In a letter that I received this morning from the Secretary of State, I was told that the funding for AgustaWestland

“has been provisionally allocated under the capital budget of the department over the Spending Review period”,

whereas the Sheffield Forgemasters loan was cancelled in June because its funding had been allocated during the current financial year. I thank the right hon. Gentleman for the speediness of his response, but as the Forgemasters loan was the only BIS investment that was dropped in June, why can it not be picked up again and allocated in the period of the forthcoming spending review?

Because those two projects have wholly different origins and outcomes. We have not made any commitment on the AgustaWestland project, which will be evaluated and negotiated in the proper way. As for Sheffield Forgemasters, the hon. Lady has been told on several occasions that if it and its supporters put in a bid to the regional growth fund, it will be considered alongside other projects.

T8. One in five lip-reading classes in England and Wales are threatened with closure next year. Will the Minister reclassify lip-reading as an essential skill rather than a leisure activity, making sure that the classes are accessible to the hearing-impaired and continue to protect their ability to communicate? (24754)

I entirely agree with the hon. Lady, who will know that I have been a champion of the disability lobby for many years, as the chairman of the all-party group on disability. I shall certainly look into this matter. She will know that we have protected adult and community learning in the Budget. Some £210 million has been protected because we know the difference it makes in changing lives and life chances.

R3, an insolvency body, recently indicated that one in 10 companies are not prepared for the VAT increase in January. The Federation of Small Businesses in the north-east has highlighted a Kingston university study finding that small and medium-sized companies in the north-east will shed jobs. What action will Ministers take to deal with the VAT increase in January?

The whole point of making sure that the increase does not come during the Christmas period is that that is the most difficult period for most businesses. The increase is being made at the end of that period so that businesses can make the adjustment. Unlike what happened with the VAT change under the previous Government, we have given businesses a full six months and more to prepare. If there are particular cases to discuss, I am happy to talk to the hon. Gentleman.

T9. It is not too early to say that the ability of further education colleges to innovate has been strangled by targets and the dead hand of bureaucracy. Does the Minister plan to free colleges and make them more responsive to student and employer demands? (24755)

I have already mentioned our schools strategy, and we will free colleges for the first time from the hoop-jumping, bean-counting, form-filling, byzantine regime that the previous Government imposed upon them. They will be free to serve their learners, free to do their best and free to be their best.

According to the Government’s new skills strategy, local enterprise partnerships will have no powers over skills. Our people’s skills are the biggest factor in holding back economic development, and Professor David Bailey says:

“Make no mistake, this is a big blow”.

What will the Minister do to give powers over skills back to LEPs?

I think that the hon. Lady needs to read the document more closely, although I appreciate that she might not have had time to do so. We are very clear that colleges should work with local communities, engage with employers through local enterprise partnerships and react to their learners’ needs. The system will be driven by the needs of learners, framed by the needs of our employers and engaged with the local community in a way that the previous Government could not even have dreamed of.

The Secretary of State mentions that one of his key responsibilities is growth. North Lincolnshire council in my constituency recently gave planning permission for a major development that offers an opportunity for a renewable energy cluster. Will he visit the area in the near future so as to understand the full potential that it offers?

I have a long queue of engagements, but I shall add that to the list. It sounds a very promising opportunity.

Based on the equality impact assessment that I am sure the coalition Government have carried out on their higher education proposals, what will the impact of cutting the higher education teaching grant by 80% be on women?

Many part-time students are female, and it is already clear that our proposals to give a proper student loan entitlement to part-time students for the first time, in order to help with their fees, will particularly benefit women. We will publish the full impact assessment alongside our White Paper.

I welcome the steps that my right hon. Friend is taking to increase the number of student places at universities. He mentions increasing the number of part-time courses, and that is vital, but will he urge institutions to be more innovative in their approach to study?

My hon. Friend is right. One of the main objectives of our reforms is to allow greater diversity of provision, which means more short two-year courses and more part-time opportunities. We want to see a new freedom for universities to innovate, and those possibilities will arise as a part of our reforms.

The £1.4 billion regional growth fund is clearly grossly underfunded, and if we had taken the advice of Ministers today we would have spent it 10 times over already. Did the Prime Minister give my constituents false hope yesterday, when he suggested to me that they should go to that fund for housing regeneration?

As you can see, Mr Speaker, we are very keen to answer this question.

Absolutely not. Every area can bid, and the opportunities are clear for every constituency. There are also opportunities for the private sector, but the key point is that when funds are tight, we have to remind ourselves that the reason why is sitting on the Opposition Benches.

May I plead with the employment Minister and his boss to delay the implementation of flexible working, shared parental leave and the expansion of legislation on the right to request training, in order to give British business a holiday from new employment legislation in 2011, and allow it to focus on job creation and growth?

I may be about to disappoint my hon. Friend, because he will know that the coalition has some very expansive plans to promote the right to request flexible working for all employees, and to develop a new system of flexible shared parental leave. We believe that when we publish our plans and consult on them in the new year, he, and many businesses, will see that they are actually ways to promote business growth and enterprise.

We have learned this week from the papers that the Secretary of State is participating in the “Strictly Come Dancing” Christmas special. [Hon. Members: “Hurrah!”] Does that mean that his policy towards business and the economy is “Slow, slow, quick, quick, slow”?

I have been taught to dance “Quick, quick, quick, quick, quick”, and that is what I will be doing, both in my Department and on the Christmas show.

I understand that Lord Young is examining the impact of employment law on the growth of small business. Will my hon. Friend work with Lord Young to identify whether there are ways of modifying employment law for small businesses, particularly those that are family owned, and employ small numbers of people?

I have already met Lord Young to discuss his review, and I will be working with him. The House will want to pay tribute to Lord Young for his award yesterday as peer of the year.

I welcome the commitment, given by the Under-Secretary of State for Business, Innovation and Skills, the hon. Member for Wantage (Mr Vaizey), in response to my first question, to setting up structures to access European regional development funding. Will the Minister confirm that money will be available to get the projects together to do that?

The officials are dealing with that issue at this precise moment. Once we have an answer, I will come straight back to the hon. Gentleman.

In my constituency, small businesses have historically been able to visit our local Crown post office to collect their mail early in the morning. Now the Post Office has informed those businesses that in future they will have to pay £225 per month if they want to collect their post before 8.30 in the morning. Will my hon. Friend encourage the Post Office to drop that additional burden on small business?

As my hon. Friend knows, such issues are operational matters for the management of Royal Mail, but I will certainly raise that matter with them.

May I press the Minister on when exactly he spoke to the Department of Health about forgivable loans for medical students?

I have had several discussions with the Secretary of State for Health, and our proposals will ensure that we continue to be able to fund medical students in Britain.