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Oral Answers to Questions

Volume 529: debated on Thursday 9 June 2011

Business, Innovation and Skills

The Secretary of State was asked—

Engineering and Manufacturing Careers

1. What steps he plans to take to encourage young people to take up careers in engineering and manufacturing. (57776)

8. What steps he plans to take to encourage young people to take up careers in engineering and manufacturing. (57784)

We are funding STEMNET, a programme that encourages young people to look at the possibilities offered by science, technology, engineering and mathematics—STEM—study and employment; we are providing a £180 million package that will see 50,000 new higher apprenticeships in sectors including STEM-related industries; and, of course, the main incentive is good manufacturing jobs, which is why I welcome the announcements yesterday and today from Nissan and BMW of large new investments in British manufacturing industry.

I obviously welcome my right hon. Friend’s interest in both areas and the interest of organisations such as Engineering UK, which has a fantastic route map on its website, showing exactly what one has to do to get from school into engineering. May I encourage Ministers, however, to work with the Department for Education to ensure that, as part of the engagement between employers and schools, we also have one-to-one and face-to-face careers advice for school leavers, so that they receive personalised support in the choices that they make?

Yes, my colleague is absolutely right. Indeed, I was at the Royal Academy of Engineering during the week, talking about how we strengthen that interface between education and the engineering industry, and as regards the careers service my colleague the Minister for Further Education, Skills and Lifelong Learning has already written to schools, reminding them of their statutory responsibilities under the new careers service as it develops.

Does the Secretary of State agree that careers advice should start at age 12, be delivered by experienced professional and independent advisers, and be available throughout every year of education?

Again, my colleague is absolutely right. The careers service is fundamentally important. My Department and, in particular, my colleague the Minister for Further Education, Skills and Lifelong Learning are talking to careers professionals about how to roll out a properly accredited system of careers advice and, indeed, about co-locating careers advice with the Department for Work and Pensions and Jobcentre Plus in order to ensure that the service is properly integrated.

Does the Secretary of State agree that Members should set an example to young people with an interest in manufacturing, and will he encourage all Members from all parts to join the campaign Made by Britain, whereby we find innovative, imaginative and new products in every constituency in the country and put them in a virtual Crystal Palace to show that we can still do manufacturing in this country?

The hon. Gentleman has already described his scheme to me, and it sounds an exciting project. I have identified several potential candidates in my constituency, and it sits alongside many other very good initiatives that are taking place, including for example the engineering prize, which is being launched with the support of leading UK companies.

I join the Secretary of State in welcoming the tremendous news this week of the excellent investment from BMW Mini and Nissan. That of course builds on the initiatives of the Automotive Council, which has been so successful and was set up by the previous Labour Government. Also set up by the previous Labour Government was Manufacturing Insight, an organisation dedicated to bringing young people into engineering and manufacturing, which this Government have scrapped unfortunately. Why did the Secretary of State make that decision?

I am not sure I should take lectures on manufacturing industry from a representative of the party that presided over the biggest decline in manufacturing of any major country, but none the less the hon. Gentleman is right that there are some good legacies. One of them is the Automotive Council, which works extremely well and contributes very positively to the supply chain. I welcome that.


2. What steps he is taking to reduce the burden of administration on employers offering to take on apprentices. (57777)

George Sand said:

“Simplicity is the most difficult thing to secure in this world”.

Nevertheless we are working with employers and their representatives to challenge the requirements and processes imposed on employers taking on apprentices. We have identified a number of areas where we will streamline or remove unnecessary bureaucratic processes, demonstrating that the Government are absolutely committed to beating bureaucracy and to breaking down barriers wherever we find them.

I thank the Minister very much for that. Does he agree that, to many people, high-quality vocational courses will offer a far better route to gainful employment than a meaningless degree somewhere?

For too long we have assumed that the only route to accomplishment is through academic prowess. I believe that practical, technical and vocational competence not only serves economic need, but instils the purposeful pride that enriches lives, cements communities and builds a better Britain.

A director of Sirus Automotive who lives in my constituency would like to take on apprentices, but he has had his grant of £129,000 from Advantage West Midlands cut. Will the Secretary of State look into that to see why, as this is committed spending, his grant cannot be paid to him so that he can take on more apprentices?

I will be more than happy to look into that matter on behalf of the Secretary of State. It is absolutely right that that where there are barriers of the kind that I mentioned a moment ago, we identify and overcome them. I would be happy to talk to the hon. Lady on that basis.

Green Investment Bank

3. How many jobs in low-carbon industries he expects to be created by the actions of the green investment bank. (57778)

The green investment bank will be a key element in financing investment in the green economy. It is not possible to estimate the number of green jobs it will help to create, but this sector in the UK is already substantial and employed around 910,000 people in 2008-09. A total of £3 billion of funding has been made available to the green investment bank from 2012 and could mobilise an additional £15 billion in private sector investment.

I thank my right hon. Friend for his answer. Will he consider locating the green investment bank in the most excellent city of Brighton and Hove?

I thank my hon. Friend for his question. I know from other interventions of his deep and genuine interest in environmental issues. We already have quite a long bidding list for cities that wish to attract the green investment bank, and I am very happy to add Brighton to it.

The answer to the last question is no.

The potential for low-carbon industries comes not only from the green investment bank, important though that is, but from the skills base and getting businesses ready to take this opportunity. What are the Government doing to ensure that throughout the UK the skills base will be there and business will be able to take advantage of the potential of the green investment bank—particularly, of course, when it is situated in Edinburgh?

I know that the hon. Gentleman too has a long-standing and active involvement in environmental issues. He is right to say that it is not simply a question of investment but of skills. That is why, as part of the expanded apprenticeship programme, we have specifically set aside resources for those working in the green economy, particularly regarding the skills that are required to implement the green deal.

Employment Law

4. What steps he is taking to ensure that employment law supports business competitiveness, job creation and sustainable economic growth. (57779)

11. What steps he is taking to ensure that employment law supports business competitiveness, job creation and sustainable economic growth. (57787)

My Department is leading a comprehensive review of employment-related laws across Government to remove burdens from employers and ensure that our labour market operates effectively. Our consultation on resolving workplace disputes, for example, closed on 20 April, and we will be coming forward with our proposals in the autumn.

Does the Minister agree that there is a need to reduce employment regulation following Lord Young’s excellent report which talked about businesses operating within a climate of fear; and what progress is he making in reducing red tape in general?

I am grateful for my hon. Friend’s question. I met Lord Young to discuss his views, and he explained that in his meetings with business people they talked about the reality and the perception of red tape, particularly in relation to employment law. We are therefore tackling both aspects with our proposals to reform employment tribunals, our moratorium for micros, and the review of sickness absence and compliance and enforcement regimes. We also published the employers charter to show that the legal position is not as frightening as some employment lawyers would have firms believe.

Are other Departments fully engaged with the employment law review? Which Minister is leading this across Departments? Does the Minister agree that in order to address this issue fully we need all Departments, not just BIS, to be engaged with it?

I agree with my hon. Friend. We have written to other Departments that are going to work with us on this. It is very important that it is a cross-Whitehall review, and it will last the whole Parliament long because we are determined to make a real difference.

On a day when BMW announces £500 million of investment in Britain, safeguarding 6,000 jobs—the result of co-operation between the union Unite and a world-class company—is it not time for the Secretary of State to stand up to his backwoodsman Back Benchers, who would seek to demonise workers, and instead to celebrate modern trade unionism as a force for good?

I think the hon. Gentleman is referring to press reports of the speech by my right hon. Friend the Secretary of State to the GMB. I am afraid that if he reads that speech he will see that my right hon. Friend repeated the Government’s line, which has been the case since we were elected, that we wish to engage positively with trade unions. That engagement is paying dividends.

Does the Minister accept that it is counter-productive to create the impression that things such as maternity rights, employment protection, the minimum wage and health and safety laws are burdens on business and not essential to ensuring that companies operate in the best interests not just of their balance sheet but of their workers?

I refer the hon. Lady to the consultation that we published just last month on modern workplaces. We wish to reform maternity and paternity law, which we believe will be a win-win for employees and employers. It will produce better rights for families than the previous Government provided, and provide more flexibility for employees and employers so that they can have adult conversations about how such leave should be taken.

Bank Lending (Small Businesses)

Figures published in May by the Bank of England show that the UK’s five largest banks lent £16.8 billion to UK small and medium-sized enterprises in the first quarter. That fails to meet the targets in the Merlin agreement and is obviously disappointing. We will continue to monitor lending closely over the year. We reserve the right to revisit the agreement if banks continue to miss the targets.

Many small businesses in my constituency complain that when they ask banks about funding, they are told not to bother applying because it would only attract interest in their existing facilities and that those may well be withdrawn instead. What can the Government do to stop banks doing that and then claiming that they cannot meet the targets they have agreed to because of a lack of applications?

There is a lot of evidence that some banks are genuinely trying to change their culture of lending. I referred to that point in a productive exchange in the Business, Innovation and Skills Committee yesterday. The banks have come forward with a new code of practice to be operated through the British Bankers Association, which allows, for example, for a banking ombudsman to deal with complaints of the kind to which the hon. Gentleman rightly referred.

There is a genuinely difficult problem of trying to get highly over-extended banks to lend to small and medium-sized businesses. The Secretary of State was very critical of the previous Government’s performance on this issue. He said that the banks ran rings around that Government. Given that the first indications on Project Merlin show a £2.2 billion shortfall between what the banks are doing and what the Government agreed they would do, how would he describe the performance of his Government on bank lending?

Of the leading Merlin banks, two have met their targets, which demonstrates that the demand is there for banks that are able and willing to change their culture of lending. Of course, we have taken the previous Government’s arrangements further by bringing private banks that are not owned wholly or partly by the taxpayer into the agreement. They are undoubtedly taking it seriously, and we are making it absolutely clear that we expect the agreement to be delivered and that the volume of lending to SMEs will increase.

Will my right hon. Friend reassure us that he is ready to do a little more than just monitor this situation? In particular, he should not allow banks to get away with the excuse that the demand is not there, when it is the price of the loan and the terms attached to it that are so often too difficult for struggling small businesses who need the credit.

My hon. Friend is right that there is a problem of discouraged demand. We have just launched a major survey to drill down a little further into the complex facts of bank lending and to find out how serious the problem of discouraged demand actually is. However, this is not just a question of monitoring the situation. A key element of the Merlin agreement is that senior executives in the banks will have their remuneration linked to their performance on small business lending. I am currently insisting that they provide more information about how those incentives work.

The Secretary of State must realise that the Merlin agreement is a busted flush and that no good is coming from it. The continuing failure of the banking sector to meet the minimum targets, meaning that there continues to be no new net lending, is really not acceptable. As the hon. Member for Sevenoaks (Michael Fallon) has just said, the terms and conditions for the loans that are being made are often very penal. Can the Secretary of State get into that? There is no point in monitoring it; we want him to examine what is going on and to come forward with concrete proposals to improve the situation.

That is exactly what I am doing, as I explained to the right hon. Member for Wolverhampton South East (Mr McFadden). Before the hon. Member for Coventry North West (Mr Robinson) writes off what we are doing, he should consider the undoubted benefits that have already flowed from it. The banks have put £2.5 billion into the business growth fund to provide equity, which is the kind of issue that he was exercised about when he was a Treasury Minister. That problem has now been dealt with.

The Forum of Private Business is calling for a return to the traditional bank manager model, and some banks are in fact now doing that. What can we do to encourage banks to give small businesses individual attention, increase the autonomy of bank managers to make decisions and get rid of the culture of “computer says no”?

My colleague puts the point extremely well. What we are dealing with is not a short-term problem but the long-term issue of how to change the culture of banks. One bank in particular, Lloyds, which I think I mentioned yesterday, already has SME lending on its monthly board meeting agendas, and the system of incentives is being changed to create more of that type of relationship management. Crucially, there are new banks entering the market that have exactly the focus that she describes. Competition, ultimately, will help to solve the problem in a major way.

We were told that monitoring would be carried out with the assistance of the Bank of England, yet the Governor himself said in March:

“We’re not monitoring. What we are doing is putting up on our website the data that banks submit after a fairly cursory plausibility check.”

The Secretary of State also mentioned CEO pay, which we were told would be linked to the lending targets, yet he failed to check how that would be delivered before he finalised Merlin. Is it any wonder that the banks are already failing to meet their obligations, when the Secretary of State waved through an agreement without teeth?

First, I congratulate the hon. Gentleman on his new role on the Front Bench. He is a very articulate commentator on economic matters, and I look forward to exchanging views with him.

The Bank of England plays an important role in the monitoring process. Of course the banks’ data are aggregated, but the Bank provides an independent assessment of progress under the agreement, which is important to the credibility of that agreement. Of course, it has pointed out that there has been a failure of lending in the first quarter.

On the wider question of meeting lending objectives, we were assured when the Merlin agreement was signed that senior executives’ incentives would mean that their remuneration was significantly greater than the share of small business lending on their balance sheets. We are now trying to establish in detail exactly what that means for individuals, and we have insisted that more lending be forthcoming.

Offenders (Skills)

6. What steps he plans to take to provide relevant skills to offenders to enable them to find work when they leave prison. (57782)

16. What steps he plans to take to provide offenders with relevant skills and training in order to help them find work when they leave prison. (57794)

On 18 May, to great acclaim, I launched “Making prisons work: skills for rehabilitation”, the report on offender learning that I commissioned last summer. It sets out a substantial programme of reform to increase the positive impact of offender learning on reoffending rates and on former prisoners’ capacity to reintegrate successfully into civil society.

The Minister will be aware of the good work of National Grid in providing work opportunities to offenders upon release. Does he recognise the common complaint that too many offenders have not been trained with the right work skills to make them employable on release? What are the Government going to do about that?

Yes, I do recognise that, which was why, in the review that I published, we put the emphasis on employability skills. For someone to leave the life of crime, another life must pay for them, which means getting and keeping a job. I met National Grid this week, actually, to discuss skills issues, and I congratulate it on its work and my hon. Friend on championing the issue.

Does my hon. Friend agree that the longer the period for which an offender is able to benefit from training programmes, the more likely it is that they can acquire the skills necessary to find work when they leave custody?

I learned early on never to stray outside my purview or pitch above my pay grade. Suffice it to say that progression is critical, so what people learn in prison must be progressive. They must be able to take up and complete their studies when they leave, so that they can get qualified, get a job and get on.

In Strangeways, in my constituency, which I have no reason to think atypical, 80% of prisoners are illiterate. Would not the biggest impact that this or any other Government could make be to have an intensive literacy programme for prisoners? That is the best way to get them back into work.

Yes, I agree. If the hon. Gentleman studies my report, he will see that prior attainment tests, which ensure that what we do in prisons matches real need, and the concentration on core skills that he describes, are critical in ensuring value for money, but also in ensuring that people get value from what we spend. I agree that core skills are critical, and they will form an important part of what we do from now on.

Citizens advice bureaux have successfully piloted financial capability projects to aid the rehabilitation process. What plans does the Minister have to roll out that provision, because it could play a vital role in reducing reoffending rates?

I suspect that the hon. Gentleman has studied that matter rather closely. If he would like to come and speak to me and my colleagues about that particular aspect of offender learning, I would be happy for him to do so. He is right that those life skills, as well as the core skills and the employability skills that we have described in this short discussion, enable people to reintegrate into civil society in a way that is good for them, but also good for all of us because we must tackle recidivism.

Bank Lending (Retford)

7. What discussions he has had with representatives of banks on the performance of banks in lending to businesses (a) in Retford and (b) nationally. (57783)

I regularly have discussions with senior representatives from all the major banks, as well as smaller and specialised lenders, at which we discuss their lending to small businesses, but sadly, not yet in Retford.

As the Secretary of State knows, Retford is the barometer of his Government’s success or failure with the economy and the news is not good, because small businesses are being bled dry by the banks, which are failing to lend. When they do lend, they do so at excessive costs, including the excessive use of invoice financing. It will be too late for small businesses if the Secretary of State does not wake up and do something about that as they will go out of business. What will he do?

The hon. Gentleman’s constituency may well be a barometer of Government performance, but he has obviously overlooked the fact that in it, 19 businesses were offered loans, backed by the enterprise finance guarantee, totalling almost £2 million. That is help in a purely practical sense.

The hon. Gentleman makes a specific point on types of financing. Because of the difficulties of lending against property, the emergence of forms of lending against assets or future transactions is actually a positive diversification of finance.

Green Investment

9. What assessment he has made of the potential effect on economic growth of green investment; and if he will make a statement. (57785)

The green economy will make a major contribution in the longer term to economic growth, because of the stimulus it provides to demand in green activities. However, energy-intensive industries are also an important part of our economy.

The Secretary of State referred in his answer to the contribution that traditional heavy industries such as the Clydebridge steelworks in my constituency, which manufactures significant components of offshore wind turbines, can make to green investment. However, given his comments, what reassurances can he give to the House that the introduction of measures such as the carbon floor price will not disadvantage energy-intensive industries, which could have a significant effect on green growth in the economy?

The hon. Gentleman is absolutely right to draw attention to that problem. I have had extensive discussions with the steel industry, and also with the ceramics and chemicals industries, which can be affected by precisely that problem. My colleague the Secretary of State for Energy and Climate Change made it clear in his recent statement that we are looking at a package of measures, in consultation with industry, that will hopefully help it to deal with the higher costs of electricity.

The Secretary of State recently announced the green investment bank, but obviously the capitalisation amounts are very small. Will he assure the House that small companies in Thirsk, Malton and elsewhere will qualify for capital loans from the green investment bank?

I would not regard £3 billion as a small capitalisation—it is very substantial, and hopefully it will mobilise an additional £15 billion in this Parliament from the private sector. There is a question over how we develop the capacity of that bank, but the hon. Lady is right that we must take account of the ability of small companies to participate in the supply chains of the big bids that will undoubtedly be made under the GIB proposals.

Our embryonic solar power industry has huge concerns about the Government’s current policy on feed-in tariffs. If the Minister cannot assure me that he has consulted industry representatives, will he consult them?

I have had consultations with the industry, although of course the primary responsibility rests with my colleagues in the Department of Energy and Climate Change. There is a particular problem with the large-scale solar power suppliers because of the subsidy element and the ability of Government to continue to support it, but certainly small-scale solar providers are helped under the feed-in tariff arrangements and we are looking at the wider implications for the industry.

Does the Secretary of State share my concern that the large-scale bioethanol plant in my constituency has been taken offline for a number of months, and will he do everything that he can to support the anti-dumping action being taken by the bioethanol industry? Will he also ensure that the Department for Transport does not repeat the mistakes of the previous Government in dragging its feet on implementing renewable fuel obligations?

My colleague has been assiduous in supporting this important activity in his constituency. I am well aware of the problem, which is low-cost ethanol coming from the United States and apparent dumping practices—although that remains to be established. I have made representations to the European Union, which of course deals with trade policy matters, to ensure that this is properly dealt with under our trade policy instruments.

Regional Growth Fund

10. What progress has been made on the second round of allocations from the regional growth fund; and if he will make a statement. (57786)

The second round of the regional growth fund is worth just under £1 billion and bids must be received before 1 July 2011. Applicants are able to attend a series of road shows, which offer specific advice and support to prospective bidders. These road shows have been well subscribed with some 1,100 people already having applied.

I thank the Minister for that answer. The black country did not receive a single penny from the first round of the regional growth fund, and smaller regional development agency grants have been withdrawn. Can he reassure me that the needs of local businesses in the black country will be taken into account in the second round?

I cannot pre-empt the panel’s decisions, because they must be based on merit, but I am sure that some excellent bids will come from the black country area. I encourage the hon. Lady and applicants from the area to speak to the RGF team to enable them to hone their applications and ensure that they have a strong chance in the second round.

Despite backing from the local enterprise company, a bid submitted by CP Holdings, the Sir Trevor Osborne property group, to the first round of the regional growth fund, supported by Derbyshire county council and High Peak borough council, was rejected—in my view incorrectly. What support and help are available now as the group bids in the second round to restore The Crescent, which is a grade I listed building in Buxton, and turn it into what would be Britain’s first and only genuine spa hotel, creating employment and wider economic benefits across the area?

My private office might be less than happy if I suggest I should visit, so I probably should not, but I can say that it sounds like an important bid. It also sounds as if improvements were needed for the second round, and I encourage the applicants—perhaps accompanied by my hon. Friend—to talk to the RGF team so that they can hone their bid and the spa can be successful in the future.

Has not the regional growth fund story so far been one of too far, too fast, with the RDAs scrapped and funding shredded by two thirds? Now it is too little, too late, as local enterprise companies have been denied RDA assets or proper bid resources, in whole areas of England small businesses have been excluded from a 10-times oversubscribed first round, and no extra money has been put in the budget—we would have given £200 million more from a bankers’ bonus tax. The rejection letter that nine out of 10 RGF applicants received from the Department told them that they could

“request limited feedback on your unsuccessful bid”.

What new limited feedback will the Minister’s officials have for those missing out this time?

I have already spelled out to the House the opportunity for prospective bidders to make applications to renew their bids, and they are doing that now. I am sorry that the hon. Gentleman thinks that that does not have any merit. It is fascinating to be criticised by the Opposition for going too fast. The first round was successful, and we levered in some £2.5 billion of private sector investment—a 5:1 ratio on public investment. If the Labour party is not happy with that, it needs to re-examine its priorities.

British Manufacturers

The coalition Government passionately believe that modern manufacturing is vital if we are to grow and rebalance the economy. That is why, for example, we are investing more than £50 million in the manufacturing advisory service; substantially expanding the number of apprenticeships, as the Secretary of State pointed out; and actively backing manufacturing research and development through our £200 million programme of technology innovation centres.

Next week marks the topping-out ceremony for the first building at the Bristol and Bath science park, which is a £300 million high-value manufacturing centre in my constituency that will generate more than 5,000 new jobs. Will the Minister congratulate the science park on its current progress? What assurances can the Government give the park that we are absolutely committed to high-value manufacturing?

I am delighted to be able to do that. In fact, I was able to do so earlier this week, when the Department launched a new showcasing of composite technology. The national composites centre based at the science park in my hon. Friend’s constituency is an excellent example of UK technological excellence. We have invested £16 million in that centre, and it has our full support and encouragement.

There are clearly changing economic times right across the United Kingdom. What help is there for the British manufacturing industry to take advantage of new green opportunities? Harland and Wolff in Belfast has invested £17 billion in marine wind turbines. Can the Minister assure us that what has happened at Harland and Wolff can happen across the United Kingdom?

Absolutely. The point is that we are not only seeking to invest through technology innovation centres but ensuring that our investment in, as it were, the software—the staff, the apprenticeships and the skills—is brought together. That combination of work on the technological side and in skills is crucial. Harland and Wolff is a good example.

Tata Plant (Scunthorpe)

13. What steps he plans to take to support those affected by job losses at the Tata plant in Scunthorpe. (57791)

Of course, we were very disappointed to hear the news. It will be a worrying time for the workers affected, but I reassure the hon. Gentleman that the Jobcentre Plus rapid response service and the Skills Funding Agency are working with Tata Steel to support workers at the Scunthorpe plant.

I thank the Minister for his response. It would be good if he or the Secretary of State could come to Scunthorpe to see the situation first hand. Will the Government be bidding for European globalisation adjustment funds, for which the situation in Scunthorpe is eligible?

I pay tribute to the hon. Gentleman for his efforts. He has met the Minister of State, Department for Business, Innovation and Skills, my hon. Friend the Member for Hertford and Stortford (Mr Prisk), and I am sure that he welcomed the announcement by my right hon. Friend the Secretary of State of the taskforce, on which the hon. Gentleman is serving. It is for the taskforce to come up with ideas not just for the regional growth fund but for European funding. If the taskforce can put together a bid, I am sure that it will get the Department’s support.

Members of Parliament across north Lincolnshire are working together closely on this important issue, which affects all of our constituents. Does it not demonstrate that the creation of a pan-Humber local enterprise partnership, which was recently agreed, is a positive step forward? We now need to send in our application and hopefully get Government approval for this pan-Humber LEP in order to support the renewables industry.

We were delighted to be able to announce yesterday the decision on a new Humber estuary local enterprise partnership, which I am sure will play a positive role. I am sure that my hon. Friend would not expect me to say whether the enterprise zone will be awarded, but clearly the taskforce and the LEP are in a good position to represent that area.


In the Budget, we announced a further 40,000 apprenticeship places targeted at young unemployed people. That will be the catalyst for sustained joint working by the National Apprenticeship Service and Jobcentre Plus to maximise apprenticeship opportunities through contact with employers and client referral.

With business organisations and colleges in Great Yarmouth and Norwich doing their best for people in Norfolk and Great Yarmouth, what can the Minister do to ensure that the most disadvantaged people there continue to have good access to community learning?

I am pleased to be able to tell my hon. Friend in the House that the National Apprenticeship Service will be delivering training on apprenticeships to Jobcentre Plus staff in Great Yarmouth on 22 June. I would like to invite him to be there on that occasion to see just how we can make available to people the kind of opportunities that he has championed with such vehemence.

What is the Minister’s strategy for getting more girls into apprenticeships in science, engineering and technology, where they are woefully under-represented?

I share the hon. Lady’s concern about that, and I have met the National Apprenticeship Service specifically to discuss opportunities for girls in such subjects. She will know that the wage return on apprenticeships in those areas tends to be higher than in other areas, so there is an added disadvantage to the fact that young women tend not to go into STEM subjects—science, technology, engineering and maths. I am working on that, and will report back to the House further on progress.

15. What assessment he has made of the potential effect on economic growth of the provision of apprenticeship places; and if he will make a statement. (57793)

Our research suggests that completed intermediate and advanced apprenticeships both deliver net economic benefits in excess of £100,000 over the learner’s lifetime. The 170,000 apprentices who started in 2008-09 will therefore generate an additional £13 billion for the economy over their working lives.

The National Foundation for Educational Research has shown that the young apprenticeships scheme has been highly successful when it comes to GCSE results and progress into further education, training and, crucially, apprenticeships. If the Minister agrees that apprenticeships are such an important part of economic growth, will he reconsider the Government’s decision to scrap the highly successfully young apprenticeships scheme, which is good for young people and the economy?

The hon. Gentleman is a diligent member of the Select Committee on Education, and he will have heard me say to that Committee just yesterday that I am keen to ensure that the best of what we had in the young apprenticeships scheme is carried forward in ongoing work. There were cost-effectiveness issues, as I am sure he would acknowledge, but employers, learners and parents say that there was good value in some of what the scheme did. We will take note of that and move forward on that basis.

The issue of apprenticeships is important for the whole House, and for that reason the Backbench Business Committee has at short notice scheduled a debate on apprenticeships this afternoon. Does the Minister welcome the fact that the issue will be debated this afternoon?

Any opportunity that this House provides me to champion the cause of apprenticeships is to be celebrated, and celebrated this afternoon it will be.

Adult Learning Provision

17. What steps he plans to take to target adult learning provision on those who most need support. (57795)

It is a joy to answer successive questions, Mr Speaker.

Support for those in greatest need is the key priority for this Government and our skills strategy. We have protected funding for basic skills and provision for the unemployed, we have targeted entitlements to help those in most need, and we are reforming adult and community learning to engage better with disadvantaged people.

I thank my hon. Friend for his answer. One of the most disadvantaged groups of people in society are those who were failed by the academic system in their youth. This Government have set their stall out to ensure greater social mobility. What will my hon. Friend do to ensure that those in that group fulfil their potential under his plans for the future?

This Government, against all expectations and in the most difficult financial circumstances, protected the budget for adult and community learning. It is no wonder that Alan Tuckett of the National Institute of Adult Continuing Education said:

“The adult and community learning safeguard is a key platform on which the Big Society can be built.”

This Government, true to their word, defended adult learning—the people’s policy, the people’s Minister, and the people’s party.

The Minister has said that it is a key priority for this Government to provide support to those most in need. Sadly, the changes to funding for ESOL—English for speakers of other languages—will take support away from those most in need. The Government have promised an equality impact assessment. When will we see it, and if it is as bad as many of us fear, will he delay the proposed changes?

The hon. Lady highlighted these matters in an Adjournment debate, as the whole House will know, and she has made a consistent case on the subject. I did indeed ask for a further impact assessment, because I want to be sure that what we are doing is fair as well as cost-effective. We will bring the results of that assessment to the House before the summer.

Part-time University Course Fees

19. By how much on average he expects fees for part-time university courses to change between 2011-12 and 2012-13. (57797)

The majority of institutions have not yet set their fees for part-time courses for 2012-13, so it is too early to tell what average fees will be. From September 2012, eligible new part-time students will have access to loans to cover the cost of their tuition—extra support for part-time students that has been widely welcomed.

I welcome the introduction of loans for part-time students, but for lone parents that often means the loss of income support as a result. Moreover, they will be required to begin repaying those loans before they have completed their academic studies. Will the Minister look again at the proposals, to ensure that no lone parent is financially disadvantaged and put in the position of being unable to complete their course?

Our proposal has been widely welcomed. We believe that the number of people who will benefit from support while they are engaged in part-time study will increase from 60,000 to 175,000. Of course, people will repay their loans only when they are earning more than £21,000 a year.

Can my right hon. Friend tell the House whether the Office for Fair Access has the power to block fee levels set by universities if they do not agree to access targets?

The Office for Fair Access has the power to refuse to permit fees higher than £6,000 if it believes that a university is not doing everything possible to broaden access and if it is not satisfied with its access agreement.

Fees for part-time students are set to rise significantly, and there is growing concern that the quality of higher education in our universities will suffer as Government cuts begin to bite. The Public Accounts Committee has confirmed this week that the Government’s sums no longer add up, and a considerable number of would-be students are likely to be turned away from university this summer because of Government cuts in student places. The Government are chaotic, incoherent and incompetent. Are we not now watching “Fawlty Towers” in Whitehall, with the Minister and his boss the Basil and Manuel of the Government?

Let us be clear: the previous Government were planning cuts in higher education support. Under our plans, there will be extra cash going into universities by the end of the public spending period, compared with the amount going in now, and it will be going into the universities based on the choices of students and the courses that they wish to study. That is the right way for money to reach the universities. The hon. Gentleman should recognise the importance of a vision of universities that provides extra cash and respects student choice and the autonomy of the universities.

Topical Questions

My Department has a key role in supporting the rebalancing of the economy and business to deliver growth while increasing skills and learning.

The Government are forcing Advantage West Midlands to engage in a fire sale of £108 million-worth of assets. They are blocking councils from gaining those assets and barring local enterprise partnerships from retaining them, yet they have seen fit to gift Boris Johnson with London Development Agency assets. Why can they not do the same for high-need, high-unemployment Birmingham?

There is no fire sale of regional development agency assets. There was always a process of disposal of those assets by the RDAs themselves, and roughly 20% of their assets are likely to be sold. The others are being passed on through the different channels, which the hon. Gentleman knows about.

T2. The Minister will be aware of the outstanding Truro and Penwith college, which is based in my constituency. In recognising the new opportunities to expand its provision of higher education, he will also be aware of the constraints on the ability of further education colleges to award degrees. At the moment, they need a university partner. What support can he offer to excellent FE colleges to enable them to award high-quality degrees? (57802)

I support the excellent work of FE colleges in providing higher education in Cornwall and elsewhere. I am concerned, as is the Secretary of State, by reports that some universities might be threatening to end their partnerships with FE colleges without good reason, but I reassure my hon. Friend that FE colleges are indeed eligible to apply for their own degree-awarding powers. In addition, our White Paper will propose making it easier for FE colleges to access a wider range of external degrees.

I welcome the good news from Nissan and BMW, which, despite the Secretary of State’s curmudgeonly response, built on Labour’s support for those companies’ investment in the UK. In 2006, he was very clear when he said:

“The DTI, and its army of Sir Humphreys, should be scrapped.”

Then he was offered the job of running it, and said that it would be the Department for growth. How is the Department for growth getting on?

The Department for growth is getting on extremely well. The right hon. Gentleman seems to have forgotten that a change took place after 2006, and that my Department was amalgamated with the one that he used to run. He might want to speculate as to why we took it under our wing. Certainly, growth is taking place. There is rapid growth now beginning to take place in manufacturing and exports. That is a consequence of this Government’s determination simultaneously to get on top of the fiscal deficit and to rebalance the economy, and that is happening.

Actually, the old DTI was merged with my Department. The truth is that in the past year the Office for Budget Responsibility has lowered its growth forecast three times, long-term unemployment has been at its highest since 1997, retail sales are down, construction is in the doldrums and consumer confidence has been at record lows. Is it not the truth that the Business Secretary has wrecked support for the regions, cut consumer protection when prices are rising ahead of wages, talked tough and delivered nothing on bank lending, bungled higher education and produced a growth plan so unconvincing that it is being rewritten as we speak? The Business Secretary is wrong, is he not, to think that his Department cannot make a difference. It could. It is not just the Chancellor who needs a plan B, is it?

The right hon. Gentleman has a short memory. He does not seem to appreciate that the failed model of growth that we inherited was not simply a question of the budget deficit, as we had a massive problem with consumer debt, which inhibits consumption; we had a massive property bubble, which collapsed; and we had a banking system, the largest in the developed world, that collapsed on us—and we are having to dig our way out. A major rebalancing of the economy is having to take place. It is difficult, it is painful, but as I said in response to the earlier question, that rebalancing is now occurring through the growth of manufacturing and exports and through business investment, which is where it needs to be.

T4. Small businesses are the engine of growth and jobs for our economy, and all the time that owners and managers spend dealing with red tape is time taken away from expanding their businesses, so what have the Government done to reduce regulation on small businesses? (57804)

I assure the hon. Gentleman that we are spending a huge amount of time on tackling red tape through the red tape challenge, and I can report to the House a little victory. On bank holiday Monday, I attended the EU Competitiveness Council to argue for an exemption for micro-entities from various accounting rules under an EU directive. I am sure that the House will be pleased to know that that exemption passed the Council.

T3. According to the Office of Fair Trading, self-regulation of debt management companies is not working. Does the Minister agree that it is time for the Government to act to protect vulnerable consumers? (57803)

The hon. Gentleman is quite right. He knows that I met him and other members of the all-party group on debt and personal finance to discuss that very issue. He will know of my concern about it, which was shared across the meeting. When we respond to the call for evidence on consumer debt and personal solvency, we will have a lot to say about that very issue.

T5. We all welcome the fantastic news from Nissan and BMW, but we want to see automotive investment in the west midlands. Will the Minister assure the House that he and his officials are doing all that they can to attract automotive investment into the west midlands? (57805)

I am delighted to be able to give my hon. Friend that assurance. He is an assiduous campaigner for the automotive industry in the sector. I am meeting him and other Members in a week or so to discuss the issue. It is important to remember that we have seen improvements in the investment for Jaguar Land Rover, that discussions are going further forward and that investment in 1,500 skilled engineering jobs has taken place. What matters in that context is remembering that under the last Labour Government, 1.7 million people came out of the manufacturing work force—a change that we need to bear in mind when we hear criticism from Opposition Members.

T6. Given the public outrage at the “quick buck” strategy at Southern Cross, the Financial Times says that the future of 31,000 elderly people is in jeopardy. Will the Secretary of State investigate the conduct of the directors and consider whether regulation should be extended to ensure the financial stability of companies that care for our parents and our relatives? (57806)

My colleague the Secretary of State for Health has made it absolutely clear that no resident, whether publicly funded or self-funding, will be left homeless or without care. In other words, the residents will be given priority and the Government have taken the responsibility to ensure that they are protected. As to the company itself, it had a long-standing failed business model. The Minister of State, my hon. Friend the Member for South Holland and The Deepings (Mr Hayes) has been in touch with the banks to ensure that the credit is properly managed in this critical period so that it happens in an orderly way. There is no way in which we can bail out the company, but I have asked my officials to look carefully at the business models of companies that provide public services to ensure that they are stable and that the responsible sector regulators are able to act appropriately.

As the House knows, this was a contentious issue, but I was able to bring together all the parties involved and they acted with professionalism, goodwill and good faith. This week the Institute for Learning announced that, with the support of the trade unions and the employers—the colleges—a settlement has been reached. I know what you are thinking, Mr Speaker: “Blessed are the peacemakers.”

T7. Is the Minister aware that many thousands of jobs in Scotland depend on defence contracts? What steps is he taking to ensure that the present constitutional uncertainty in Scotland does not undermine the ability of Scottish firms to bid for Ministry of Defence work? (57807)

Both my Department and the MOD are mindful of the importance of the long-term contracts to which the hon. Gentleman refers. We are working hard on that, and we have no intention of being distracted.

Every day by which the creation of a groceries code adjudicator is delayed is a further day on which farmers, growers and food producers in this country and in the developing world go to the wall. What reassurance can Ministers give me and, indeed, the House that they will make every effort to ensure that a proposal which has cross-party support is implemented as quickly as possible?

My hon. Friend, who has campaigned so vigorously and successfully on this issue, will be delighted to know that we published the draft Groceries Code Adjudicator Bill just before the recent recess. We hope that it will be scrutinised by the Select Committee and will attract interest across the House, and we hope to introduce the formal Bill on the basis of that scrutiny.

T8. May I return the Minister to the issue of regional development agency asset sales, about which there is considerable concern in my constituency and throughout the north-west? Can he answer the question put to him earlier by my hon. Friend the Member for Birmingham, Erdington (Jack Dromey)? If assets can be gifted to Boris Johnson and London, why can they not be gifted to the rest of the country? (57808)

Let me clarify the position. The London Development Agency had already been merged into the Greater London Authority, so the process position was very different from that involving the RDAs. We have ensured that we are able to represent that. I understand the concern, but we are working with local enterprise partnerships, local authorities and local businesses to ensure that they are involved in the regenerations. I have discussed the issue with a number of the hon. Gentleman’s hon. Friends who have constituency interests in it, and I continue to listen to and work closely with them.

May I ask the Secretary of State to look into the Edexcel science modules taken by young pupils? Some of those modules are seriously flawed, which may put people off studying science and technology for life.

I will undertake to discuss the matter with my right hon. Friend the Secretary of State for Education, because my hon. Friend is absolutely right. We do wish to encourage young people to study science at school, college and university.

Growth, which was mentioned earlier, does not seem to be happening in the north-east of England. Workers at the H A Interiors factory in my constituency have not been paid for nine weeks— although I understand that they were paid their April wages yesterday; I will have to check that. Can the Minister help the company in any way? At least under Labour the workers got their pay.

I have already corresponded with the hon. Gentleman on the matter. He is right: we should be concerned first and foremost with the welfare of the workers and their families. I strongly emphasise the need to ensure that ACAS continues to be involved in the process. I hope that my letter to the hon. Gentleman and the news that some of the first payments have apparently been made will prove encouraging, but let us keep the dialogue going.

I draw Members’ attention to my registered interest in small businesses.

The enterprise investment scheme, which was introduced by the last Government and has been greatly enhanced by the present Government, has increased investment in our early-stage businesses, largely because it provided tax relief for equity investors. Will Ministers consider discussing with Treasury officials whether similar tax incentives can be provided for debt investment in venture capital and early-stage businesses?

We have made important reforms to the EIS. The technical reform to which my hon. Friend has referred has been and continues to be examined, but no decisions have been made.

We have heard from the Secretary of State’s own mouth that Project Merlin has fallen at the first hurdle. We also now know that one of the promoters of the business growth fund, Santander, has withdrawn from the fund. What impact will that have on Project Merlin, on the business growth fund, and on growth and investment in the United Kingdom?

The business growth fund is an extremely promising initiative, filling a gap in capital markets that has been left empty pretty much since the 1920s: the provision of equity for rapid growth mid-cap funds. The £2.5 billion fund is committed to by the main banks, and Santander wishes to pursue its own initiative, which is additional to the fund. The business growth fund is a great success. It was launched in Birmingham—I was there a few weeks ago—and it will achieve a lot for British industry.

I noted the Business Secretary’s earlier answer citing the STEMNET project. I hope he is also aware of the work of I’, whose events reach over 10,000 students, with funding of less than £9 per student drawn from charitable and business sponsors. Will he learn from the success of this initiative as a model for the online engagement of students with the futures they could realise through science, technology, engineering and maths?

That is a very imaginative suggestion which I certainly undertake to pursue—and will, perhaps, discuss at the Cheltenham science festival this weekend.

One in 10 people in the north-west of England works in manufacturing, whereas just 3% in London work in manufacturing. The sharp fall in the purchasing managers index last month showed that all may not be well with UK manufacturing. Will the Secretary of State or the Minister therefore confirm that UK Trade & Investment will publish annually the regional impact of its work, so that we can be sure that Government policy works for all economies in Britain?

We will go further than that: we are making sure that UKTI is focused like a laser on small businesses in the manufacturing sector. That is why we are changing the budget and the structure, and making sure that in the regions outside the south-east there is a strong network—a strong set of roots—so that we can support manufacturing more effectively than the Labour party did in 12 years in office.

I recently met business leaders from the Coventry and Warwickshire chamber of commerce. They are extremely heartened by the current review of regulation and red tape, but they are keen to know when there will be tangible changes. Will the Minister therefore tell the businesses in my constituency when they can expect to see tangible progress from this welcome review?

I will be delighted to do so. Not only have we got the moratorium exempting small businesses from future regulation, but we have cut by 70% down to 46 the 157 proposals, many of them legacies from the past Government, and only 11 of them will cost business anything at all. We are ending the gold-plating of e-regulations, and we are changing the approach so that we sunset regulation in the future. Each of those steps will make a difference, and I will make sure that we report back to the House each and every year.

Back in February, the House debated the problems caused by high-cost credit and agreed to consider a cap on the cost of credit. Following that, 15 MPs from across the House wrote to the Minister responsible asking for a meeting to discuss how we might take that decision forward. Five months later, during the recess, he responded, stating that he was too busy to meet us. As the number of people borrowing from these companies rises in all our constituencies every month, will the Secretary of State show some respect for the House and respond to this legitimate issue by agreeing to meet us?

May I congratulate the hon. Lady on being the Member of Parliament who wants to meet me more frequently than any other? She omitted to tell the House not only that I have met her twice and that she failed to provide the evidence backing up her arguments for which I asked, but that I have met other Members of the House from the coalition parties who are campaigning on this issue, such as my hon. Friend the Member for Chippenham (Duncan Hames) and the hon. Member for North Swindon (Justin Tomlinson).