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Topical Questions

Volume 583: debated on Thursday 26 June 2014

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

In September, the Portsmouth warship yard, where many of my constituents work, will shut. That will leave the Government without a plan B for warships if the referendum goes the wrong way. The work force will be dispersed before there is an alternative user and the shipyard’s role in providing manufacturing apprenticeships across southern England will be lost. Will the Secretary of State look to delay the closure until the referendum is over, until there is a new user and until there is a credible plan for training manufacturing and engineering apprentices in southern Hampshire?

The maritime industries are, of course, crucial in Portsmouth, as they are in the right hon. Gentleman’s Southampton constituency. On the approach we are adopting, a Government group led by the Minister of State, my right hon. Friend the Member for Sevenoaks (Michael Fallon) is as rapidly as possible finding alternative commercial users, working with the Ministry of Defence. I welcome in particular the very exciting Ben Ainslie project and my colleague is working closely with Rear-Admiral Stevens to develop the Solent maritime industries.

T2. Fylde has a significant amount of advanced manufacturing companies, including BAE Systems and Westinghouse Nuclear Fuel. May we have an update on what steps are being taken to increase the number of highly skilled apprenticeships in the advanced manufacturing sector? (904495)

Absolutely. Through the trailblazer process, we are putting employers in charge of the training involved in apprenticeships, to make sure that, in addition to the big increase in numbers we are seeing, we increase the quality of training so that all young people have the opportunity to use an apprenticeship as an alternative to university in order to reach their potential.

Does the Secretary of State think it is acceptable for a Government Department to increase reporting requirements twelvefold for businesses?

I am not sure what the hon. Gentleman is referring to, but as the Minister of State, my right hon. Friend the Member for Sevenoaks said a moment ago, we have taken considerable action drastically to reduce the regulatory burden on business.

I am talking about the disgraceful burden being heaped on the one in five self-employed people in this country who will be in receipt of universal credit. Those businesses are being required to report their income not once a year, but every single month. Their earnings are being computed on a completely different basis from the assessment carried out by Her Majesty’s Revenue and Customs for tax purposes, and the minimum income they will be assumed to have is for 35 hours a week at the minimum wage. That is unjust and unworkable and it does not reflect how those businesses work. Why has this ministerial team sat back and allowed the red tape baron—the Work and Pensions Secretary—to erect this barrier to aspiration?

I would have thought that most reasonable people would welcome the growth of self-employment and entrepreneurship that is happening under this Government. I think they would also probably welcome the fact that the benefits system demands maximum integrity.

T7. Do Ministers agree that a central part of the long-term economic plan is the delivery of skills to the increasingly innovative and research-oriented manufacturing sector? (904502)

Yes. As my hon. Friend may know, I am a fan of the long-term economic plan. In fact, I have found a copy in my pocket if he wants one. Skills are a vital part of our long-term economic plan, because there is no doubt that, if we are not only to maximise our economic capacity in the future, but to make sure everyone in this country fulfils their potential, we have to deliver on the skills that employers need.

T3. Britain has a crisis in finding young people willing to study engineering, yet I have received an e-mail about a 19-year-old who has been offered a place on a pathways to apprenticeships engineering course. He will get access to £30 a week living allowance, but he will lose his unemployment allowance and he cannot access student grants. He may well not be able to take up the course. What are the Government doing to ensure that there is joined-up action across Departments for young people who want to study crisis employment subjects? (904497)

I recognise the problem that used to exist. The introduction of traineeships has tackled that. It is now possible for someone to go on a traineeship while still receiving their jobseeker’s allowance, because we have tackled the 16-hour rule for traineeships. If the hon. Lady writes to me about the individual case, I will make sure it is taken into account.

At the Mighty Middle conference held by GE Capital and the Reform think-tank this week, mid-sized companies from across Britain were exceptionally positive about the Government’s long-term economic plan. What more can we do to celebrate and assist those mid-sized companies?

Mid-sized companies are absolutely central to the Government’s industrial strategy. We are working with them to develop supply chains in the car industry, aerospace and the various energy sectors, and to support access to finance, training and innovation. They have a great deal of potential, as they do in countries such as Germany, where the Mittelstand are better developed than they are here.

T4. May I draw the Minister’s attention to the excellent “The state of the coalfields” report produced by the Coalfields Regeneration Trust? The report has highlighted particular problems, including a legacy of high and persistent youth unemployment, especially in the NEETs group of those not in education, employment or training. I also draw to his attention an excellent organisation in east Durham, the East Durham Employability Trust. What additional support can be put in its direction? (904498)

I have seen the report on the future of the coalfields. On the issue of NEETs, I would point out that yesterday’s figures show that the number of people not in education, employment or training is at a record low since the series of statistics began in 1994. I have no doubt that there is much more to do, because any young person not in education, employment or training is one NEET too many. The fact that the number of NEETs is at a record low shows that the economic plan is working.

On the issue of new EU legislation, does my right hon. Friend agree that it would benefit British business if the EU adopted the same one-in, two-out rule that the UK Government apply?

It is encouraging that the one-in, two-out rule, or the one-in, one-out rule, is increasingly being adopted by other member states, including France and Spain. I shall visit Brussels next month to urge the Commission to redouble its efforts to remove unnecessary directives, and to make sure that where new directives are proposed, they fully take account of the needs of small businesses, which are most likely to create the jobs we need in Europe.

T5. More than a third of winning bidders in the regional growth fund’s first round have now withdrawn, while others have waited about two years to receive any money at all. Is this all part of the Government’s long-term economic plan? (904500)

It certainly is not. There are many reasons why some RGF bidders withdraw—because they do not get the planning permission they were anticipating, their main board does not give final approval for the plant, or they are not prepared to put in private sector money alongside the regional growth fund grant. Any money that is not used is of course put into future rounds of the fund. It is important that we carry out the necessary due diligence and check before taxpayer money is handed over.

The Business Secretary gave us the welcome news that the local growth fund will come on stream next year. Infrastructure is the key to allowing local businesses to develop. Will there be enough money in the local growth fund to improve and upgrade the A64 along its whole route from York through Malton to Scarborough?

I am afraid that my hon. Friend will have to be patient for a few weeks longer before we announce the local growth deal for the local enterprise partnership covering her constituency, but I am aware that that is one of the projects that the local enterprise partnership wants to prioritise.

T6. When the Prime Minister returned from the G7, he painted a very positive picture of progress in establishing public registers of beneficial ownership in the overseas territories and Crown dependencies, but the real picture is that only half of them have started or concluded their consultations. This is an opportunity for the Secretary of State to show off his leadership skills, so what work is he doing with the Foreign and Commonwealth Office to make some real progress on this issue? (904501)

We will have an opportunity to discuss this in detail, because an open register of beneficial ownership will be one of the elements in the small business Bill. Britain will pioneer work in this area. Of course there are issues with our offshore territories. We are not a colonial power that can send in gunboats to solve these problems; we rely on persuasion, and that is what we will do.

What does the Secretary regard as his finest achievement in office? What is his main goal for his last year in the Department?

There is a very long list of achievements that would bore the House considerably were I to dwell excessively on it, but the set of advances that we have made in giving business a long-term perspective through the industrial strategy, the collaboration with business and the associated work that we have done on access to finance, the build up of apprenticeships and the developments in innovation through the Catapult make up a considerable legacy of achievement.

Two thirds of students on disabled students allowances are dyslexic. Cuts to DSAs affect both the students and the institutions, and penalise both. Will the Secretary of State think again about reversing these cuts?

Let us be clear. We are consulting widely on these changes. The main change is that people should only be supported with extra services, rather than, for example, getting laptops indiscriminately, as they do at the moment. We are talking directly to the representative groups involved and students will not lose out by these changes.

Every one of the 14 letters that the Governor of the Bank of England has written to the Chancellor explaining why the inflation target has not been met has mentioned the rising input cost of resources. What are the Government doing to tackle the problems of input resource price spikes and to incentivise infrastructure in the circular economy to cope with that?

I think that the hon. Gentleman is referring specifically to energy costs, which has been the main issue in the inflation of raw material inputs. My colleague the Minister of State, my right hon. Friend the Member for Sevenoaks gave a very full answer in explaining the compensation mechanisms that we are introducing to offset them.

Will the Minister update the House on the progress made in tackling non-compliance by employers who fail to pay apprentices the rate they should?

We wrote to the Low Pay Commission on its remit for next year. One of the things we have asked it to look at is the apprenticeship rate for the national minimum wage. We are aware that there are a lot of concerns, particularly about non-compliance in paying the national minimum wage for apprentices. The system is quite complex and often employers find it difficult to navigate. We have asked the Low Pay Commission to work out how the system could be simplified to ensure better compliance by employers.

A recent Which? investigation found that ticketing companies can add up to 37% to the face value of a ticket for music and theatre events in booking and delivery fees. Given that the market is dominated by a handful of big players, is the Minister confident that consumers are getting a good deal?

We have done a lot of work on ticketing. As I am sure the hon. Gentleman is aware, we discussed this issue a number of times during the passage of the Consumer Rights Bill. The Department has been working with the Department for Culture, Media and Sport to look at the issue and a number of things are being done to try to tackle ticket touting, while trying to ensure that we still have a vibrant market so that individuals who buy tickets and want to resell them because they cannot attend an event are able to do so fairly and openly.

Like a number of MPs, I have taken on an apprentice, something that has been recommended by the Minister, but as a small employer this has only been made possible by the Liverpool chamber of commerce, which provides all the training, development and support for James, my apprentice. Under his proposed reforms, how does the Minister expect MPs to take on apprentices and provide the same high standard of training and support and administer training budgets? How much time does he expect us to take on this?

I am delighted to hear that the hon. Lady has an apprentice. I now have two apprentices and the House has an apprenticeship scheme that the Clerk has been instrumental in bringing forward. Under the new system we will make sure that small businesses and small employers, including MPs, can take on apprentices, and training providers will have a role to play just as they do now in helping with bureaucracy.

I do not expect it to take any more time than it does at the moment and I am sure that it will be just as valuable for the hon. Lady and for other MPs as it will be for small businesses across the land.