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Business, Innovation and Skills

Volume 609: debated on Tuesday 3 May 2016

The Secretary of State was asked—


1. What assessment he has made of the adequacy of availability of broadband to businesses in Yorkshire and the Humber. (904763)

3. What assessment he has made of the adequacy of availability of broadband to businesses in the north-east. (904765)

I recently announced a joint review by the Department for Business, Innovation and Skills and the Department for Culture, Media and Sport of business broadband to ensure that businesses are able to access the affordable, high-speed broadband that they need and deserve. More than 250,000 homes and businesses in Yorkshire and the Humber, and more than 100,000 in the north-east, have superfast broadband available for the first time thanks to the Government’s investment programme.

I thank the Secretary of State for his response. If the Department is on track to meet its targets, why does Ofcom analysis predict that by 2017, when 95% of all UK premises will have superfast broadband, around 18% of small and medium-sized enterprises, including many in my constituency, will not? Why are so many businesses being left behind, and does the Secretary of State accept that his plans show a lack of ambition?

No, I do not. I hope that the hon. Lady will recognise that superfast broadband coverage throughout the UK has increased from 45% of the country in 2010 to almost 90% now, and that we are fully on target to reach 95% by 2017. It is important that we keep looking at new ways to extend coverage through fixed wireless and mobile, and that is exactly what we are doing.

A senior adviser at the Institute of Directors has said that they expect the Government to meet the universal service obligation, but that is only because the bar is set so low. How are the Government going to provide the physical infrastructure to maintain Britain’s position at the forefront of digital innovation in business? Will the Secretary of State also answer the question about the lack of provision for SMEs, which he did not address?

We are extending broadband coverage throughout the country and it includes hundreds of thousands of SMEs, including in the hon. Lady’s constituency. We are on target, and she may like to know that our USO is twice as high as is recommended in the EU. Already, despite the fact that there is more work to do—I am the first to accept that—we have wider coverage than most of our large EU partners, we have higher average speeds and we have the lowest average price.

The Ofcom solution to the desperately poor penetration of fibre to premises in the UK is to open up access to BT’s ducts and poles, but that would require reasonable rates of access as well as a clear network map of those ducts and poles. What can the Secretary of State do to make sure that BT complies with those requirements?

I have read Ofcom’s report carefully and met Ofcom a number of times about that issue, and I have every reason to think that BT will comply. If that does not happen, of course we will look at what action we can take.

Regional Growth

We are absolutely committed to regional growth. We recently launched a further round of growth deals, and the March Budget highlighted the Government’s support for the midlands engine. It includes a £250 million midlands engine investment fund, new enterprise zones, and a devolution deal for Greater Lincolnshire worth £450 million.

One of the keys to growth in the black country part of the west midlands, which I represent, is greater collaboration between business and further education colleges. Halesowen College and Sandwell College both excellently serve my constituency. Will the Secretary of State agree to meet the principals of Halesowen and Sandwell Colleges to talk more about how to reduce the skills gap in the black country, to promote further growth in the region?

I agree absolutely with my hon. Friend. One of the reasons we have seen a 50% fall in his constituency is that he has been promoting just that type of collaboration. I enjoyed visiting Halesowen College with him last year to learn about the advanced science, engineering and technology centre, and of course I will be more than happy to meet him and college representatives.

Will the Secretary of State join me and other Leicestershire MPs as well as many throughout the world in congratulating Leicester City football club on winning the premier league yesterday? Does he agree that this will boost jobs not just in Leicester but in the midlands region, and not just for those interested in football but for those in tourism? Does he accept that rather than Red Leicester, it is actually Blue Leicester?

I like the sound of Blue Leicester—I like it very much—but let me congratulate the right hon. Gentleman and, most of all, his constituents on their stunning victory last night, which I think the whole nation is celebrating. I suggest he make the most of it while he can.

Regional growth and the midlands engine are reliant on businesses such as those in Cannock Chase that are investing and exporting. I visited a business in Cannock on Friday that is looking to grow, but faces difficulty in getting access to finance from the bank it has banked with for years, and this has resulted in its switching banks. Will my right hon. Friend outline what measures the Government have taken to improve access to finance for small and medium-sized businesses?

My hon. Friend raises a very important issue. I will highlight two things. First, there is the local growth fund: almost £8 billion has already been allocated, and the Chancellor talked in the last Budget of a further £4 billion by the end of this Parliament. There is also the launch of the midlands engine investment fund: hundreds of millions of pounds will be allocated to small businesses, including those in Cannock Chase.

But if we are to get all these visitors to Leicester, Nottingham, Derby and across the east and the west midlands and we are to get the midlands engine moving, will the Secretary of State talk to his colleagues about infrastructure investment more generally, because we are certainly losing out in the east midlands, with only £37 per head of rail investment compared with £294 per head in London?

The hon. Gentleman raises the important issue of infrastructure investment. It is because we have a strong economy that, under this Government, we have a programme of £300 billion of investment over the next few years. That of course includes the midlands, with the investment in the main line and in HS2. However, there is always more we can do, and I am very happy to hear new ideas.

Will the Secretary of State take this opportunity to praise the work of the local enterprise partnerships in promoting the economy of the west midlands, particularly the Greater Birmingham and Solihull LEP, of which Lichfield is a member? Will my right hon. Friend clarify, however, what will be the role of the LEPs and what will be the role of the midlands engine, which is about to appoint or has appointed a new chairman, in helping to promote the regional economy?

I join my hon. Friend in commending the work of LEPs throughout the UK, but especially that of the Greater Birmingham and Solihull LEP, not least because it covers my constituency. I have seen the work that it has achieved, particularly under its chairman, Andy Street, and it is very commendable. The LEPs will work with local authorities throughout the midlands to really fire up the midlands engine, which means co-operation on things such as infrastructure, trade and skills.

A couple of weeks ago, I asked the Prime Minister about the possible closure of the British Gas Oldbury site, with the loss of 700 jobs. In his reply, the Prime Minister assured me:

“We will make sure that a ministerial taskforce is available to talk to the company and the local community and to provide assistance in terms of retraining and other things.”—[Official Report, 20 April 2016; Vol. 608, c. 917.]

Imagine my disappointment on being told that there will be no ministerial taskforce, but that Ministers will have regular contact with a taskforce to be set up by the local authority. I do not think that that matches up to the assurance from the Prime Minister. There needs to be a real drive to keep or to replace these jobs, so when is BIS going to deliver on the Prime Minister’s assurance?

Job losses, whenever they are announced, are regrettable, as they of course are in this case, which is why we must do everything we can. I can tell the right hon. Gentleman that soon after the Prime Minister said that, the Minister for Small Business, Industry and Enterprise and the Minister for Employment had a meeting with a managing director from British Gas. I understand that the redundancies are not final yet—the consultation period is still going on—so let us hope that they are not as bad as those that have been seen. We will continue to do whatever we can, and that includes contact with the company.

Adult Skills Provision

4. What his Department’s strategy is for the funding of adult skills provision in FE colleges for the remainder of this Parliament; and if he will make a statement. (904766)

We are protecting the adult education budget in cash terms, extending subsidised loans to advanced learners and introducing an apprenticeship levy, so funding will be 40% higher in cash terms by 2020.

We are told that the adult skills budgets will be devolved to regions that have secured a devolution deal. Will the Minister assure me that those budgets will be ring-fenced and not subjected to cuts?

We will certainly be ensuring that the budgets are spent on skills training, but the whole point of devolving them is to give the local combined authorities the power to decide which are the skills priorities in their area, not to have them asking me for permission to spend on a skills need that they have identified.

Area reviews are an important way of understanding local adult education needs. Will the Minister be encouraging such reviews to look at the needs of women returning to work after caring responsibilities, so that they can use the further education sector to really develop their skills and add to the productivity of our country?

My right hon. Friend is absolutely right. One of the great opportunities in the apprenticeships programme is that apprenticeships are all age. For women who have perhaps taken a career break, or just want to change their profession, an apprenticeship is an opportunity to gain new skills while also earning an income so that they can forge a great career.

When will the Government be publishing guidelines on how skills budgets might be devolved in those areas where that devolution is being looked at?

That will depend on when exactly the devolution deal is done. As the hon. Gentleman will be aware, in our own area of Greater Lincolnshire that deal is reasonably well advanced; in other parts of the country, the deals are less well advanced. Fundamentally, it is pretty simple: we want authorities to be commissioning from their local colleges the adult skills provision that they believe their area can benefit from.

Although the budget is enhanced, it is only a finite amount. Given that, it is important that it is targeted at where it will have the most effect. Does the Minister agree that those funds are best targeted at young adults, the low-skilled and those actively seeking work?

I agree with my hon. Friend that those will often be the best targets. What is even more important is that his local combined authority and those of other hon. Members are best placed to identify the particular groups or industries with particular needs, and then respond accordingly.

Further education colleges in Scotland are the largest providers of apprenticeship education. Will they therefore be exempt from the apprenticeship levy?

The apprenticeship levy will apply to all employers throughout the United Kingdom with a payroll bill of more than £3 million. Of course, there is absolutely nothing to prevent any employer in Scotland that is paying the levy from putting pressure on whoever is in government in Scotland after this Thursday to make sure that they increase their investment in apprenticeships, as we are doing in England.

Tucked away in the autumn statement was the Government’s admission that they will be cutting—their term is “efficiencies”—£360 million of adult skills non-apprenticeship funding between now and 2020. Does the Minister not see that there is a paradox in the Government going hell for leather on English and maths for young people’s apprenticeships while failing to ring-fence funding for basic skills, when England has 9 million people of working age with low literacy and numeracy, and we are ranked bottom in literacy and next-to-bottom in numeracy among 23 developed nations? Last year, the Government cut the adult skills budget across England by 18%. Now they have scrapped plans for advanced post-24 skills. Why is the Government’s key White Paper addressing technical skills shortages being delayed? Is all this a strategy or a wing and a prayer?

There was a lot of detail in the hon. Gentleman’s question, but not a lot of clarity, so here is the clarity: we are increasing total funding available for further education by 40% in cash terms during this Parliament. He talks about last year because he does not like this year, and that is because this year’s spend tells the story of a Government investing in skills for the future.


We have removed employers’ national insurance from apprentices under the age of 25, and are introducing an apprenticeship levy for larger employers, which will increase the budget for apprenticeship training in England to £2.5 billion in 2019-20.

To mark national apprenticeship week, I visited Silentnight in Barnoldswick, whose award-winning apprenticeship scheme has already created over 40 full-time jobs. Does the Minister agree that companies such as Silentnight, which is seeing real year-on-year sales growth at the moment because of its apprentices, are great examples to employers across Pendle and the rest of the UK?

I particularly welcome the example of Silentnight in my hon. Friend’s constituency, because it is really important to understand that apprentices add value to their employers—they are not just receiving training; they are also adding value. We consistently hear employers saying that apprentices bring energy, ideas, enthusiasm and new contacts to their businesses.

It is becoming increasingly clear that the systems and processes needed to implement the apprenticeship levy are far from ready. Many see it as a tax on jobs. The Scottish National party has tabled an amendment to the Finance Bill to seek a full review, and the CBI has called for a radical rethink. I am grateful to the Minister for meeting me and representatives of the oil and gas sector recently. He well knows the continuing issues with double charging. Will he heed these calls and delay implementation of the apprenticeship levy until the systems and processes are ready and business has been fully engaged?

No, we will not be delaying, because for decades no Government adequately gripped the problem we have in this country, which is that businesses invest too little in skills development. That is what holds our productivity back. As it happens, since the CBI’s survey, and since other surveys of the same kind, we have published a detailed technical guide for employers on how the apprenticeship levy will work. I encourage the hon. Lady and her constituents to look at it. If they have any further questions I am happy to answer them, but the levy will be coming in in April 2017, and we will be fixing Britain’s skills problems.

On Friday I attended an event to mark the first anniversary of the extremely successful Care Academy, which is a unique collaboration in my constituency between Petroc College and the Northern Devon Healthcare NHS Trust. In effect, it provides apprenticeships for young people wanting to get into the health profession. Will the Minister join me in congratulating the excellent students who have been through the Care Academy in the first year, and does he agree that it is an extremely worthwhile programme for the future?

It is well known that we have huge skills needs in the care sector and the NHS, and that kind of academy is exactly what we need to see more of, so I am delighted that my hon. Friend’s constituency, Petroc College and others are setting an example.

The Minister will know that the number of BIS staff working on the apprenticeship programme is due to fall massively by 2020. What assessment has he made of his Department’s capacity to deliver the apprenticeship target?

The number of BIS staff who will be working on the apprenticeship programme will fall, but only because we are setting up a new, independent institute for apprenticeships that will take over many of the jobs that are currently undertaken by BIS staff. That institute will be in the control of the employers who are paying the levy. I think that is the right way to do it and I hope that the hon. Gentleman will welcome it.

Businesses such as Rotork, BMT and Designability in Bath have taken on hundreds of new apprentices since the scheme first started, enabling young people to gain the best qualifications for a really great career. Does my hon. Friend agree, however, that although the Government are doing a great deal to encourage older people into apprenticeship schemes, a cultural shift is required to encourage even more into the scheme in the future?

I think my hon. Friend is right about that, because there is a common misconception that apprenticeships are somehow only really appropriate for school leavers, whereas the reality is that they offer opportunities to people at all stages in their lives, and indeed at all stages in their careers. It is not just for new recruits to an employer; it can be for somebody who has been working for an employer for several years but has discovered that they have the potential to develop.

Employing People on the Autistic Spectrum

6. What discussions he has had with the Secretary of State for Work and Pensions on the support and guidance for businesses on employing people on the autistic spectrum. (904768)

Through our one nation reforms, we are committed to a labour market that allows everyone to fulfil their obligations and opportunities wherever and whoever they are, including those with autism. That is why the Prime Minister launched the Disability Confident campaign, and why we have continued to spend over £100 million a year on the Access to Work scheme, helping over 36,000 people with disabilities into work. We have published guidance to employers on employing people with autism, and my hon. Friend the Minister for Skills and my right hon. Friend the Minister for Small Business, Industry and Enterprise recently met Autism UK and the all-party group on autism.

The autism employment gap is much larger than the disability employment gap, with only 15% in full-time employment and 26% of graduates remaining employed. We are losing the potential that people with autism spectrum disorder can offer to our economy. What specific programmes and support will be provided to employers and jobseekers to close this startling gap, and will the Government produce disaggregated data to evidence progress?

The hon. Lady makes an important point, and I pay tribute to her work on this. As I said, we are investing substantially in this area, and through the Disability Confident campaign, we are actively engaging with employers of different sizes and sectors to promote access to work for people with autism. We launched the latest part of that campaign on World Autism day, on 2 April. We do not think that quotas are the right way to go. We want to encourage employers and we want those with autism to know that good employers will recognise and reward their skills.

Many skill-based jobs are perfect for people suffering from autism, with computer coding and programming being a prime example, given the rigid structure of the work. Will the Minister work with me to help promote coding within Cornwall and to support people who wish to get involved in skill-based work?

I would be delighted to work with my hon. Friend and with other Ministers in the Department for Business, Innovation and Skills and the Department for Work and Pensions, and I commend him for his leadership on this excellent initiative.

When will the Government follow the example of Leicester City football club and try to get into the premiership on this question? There are so many talented people on the autism spectrum desperate and waiting for a job, many of them in regions such as Yorkshire, yet we are faced with uncertainty for everyone—apprentices, people with autism—because of this great cloud that is the possibility of our leaving the EU. No one is investing or hiring.

Even for me, it would be a stretch to delve into the EU on this question. The Government are investing £100 million a year in the Access to Work scheme, helping 36,000 people with disabilities into work, so we are absolutely committed to this agenda. People with autism have a lot to offer in the workplace, and we are serious about giving them opportunities.

April is Autism Awareness month, and earlier this month, The Economist led with an article on how the talents and skills of people with autism and on the autistic spectrum are potentially being wasted. It said that if businesses were encouraged to take more friendly approaches to recruitment and to deploy the appropriate skills, we could have many more people in the workplace. We had a fascinating and moving debate last week on autism, during which many Members shared moving experiences of their own children, including my hon. Friend the Member for Angus (Mike Weir) and the hon. Member for Berwick-upon-Tweed (Mrs Trevelyan). Will the Minister meet me and a cross-party delegation to discuss how we can get businesses properly to mark the number of people on the autism spectrum and how we can work together more across the House?

I was going to invite the hon. Lady to seek an Adjournment debate, until I realised that in fact she had had it.

I will restrict my answer, Mr Speaker. The right meeting would be with the Secretary of State for Work and Pensions, whose Department leads on this issue, and with the Ministers for Skills and for Small Business, Industry and Enterprise. We are actively engaging with all the relevant charities on this issue.

I hope that the hon. Lady is content with that answer, although, whether she is or is not, she has had it.

Digital Industries

7. What assessment he has made of the potential effect of a UK withdrawal from the EU on the UK’s digital industries. (904769)

With your permission, Mr Speaker, I would like to take Question 7 with Question 14, if that is okay.

We think that leaving the EU would be an absolute disaster for Britain’s digital industries.

It would be okay, if the hon. Member for Sedgefield (Phil Wilson) were here, but he isn’t, so it isn’t, but we will proceed unabashed by his absence, because we have the right hon. Member for Newcastle upon Tyne East (Mr Brown).

The digital sector is very important to the north-east of England, as my hon. Friend the Member for Sunderland Central (Julie Elliott) made clear earlier. Some 25,000 jobs are now directly involved in the sector. What reassurance can the Minister give the House that there will be market access arrangements with our partners in the EU in the event of a no vote?

I am afraid that I cannot give the right hon. Gentleman that reassurance, and that is what really worries me about our leaving the EU. Not only does the digital industry provide the 25,000 jobs he mentioned but overall it represents about 7% of the UK’s gross value added. We are at the heart of negotiating the digital single market, which will give our digital industries even more opportunities, and that is why we must stay in.

I was at a breakfast meeting this morning with digitech companies from Vancouver in British Columbia that are here on an inward trade mission, looking at investing in the UK. Does the Minister agree that this dangerous and damaging remain campaign, which is based wholly on a fear of leaving the European Union that is not justified, is going to do great damage? Has he done any assessment of how much damage is being done to investment by the talking down of this country by those who want us to remain in servitude to the EU?

I hear what my hon. Friend has to say, but I wish the leave campaign would stop running this terrible fear campaign. I am confident that we are going to stay in Europe and continue to attract investment. I am pleased to hear that our Canadian trade envoy, to which I gather my hon. Friend had access, shows us how even as members of the European Union, we can still negotiate and engage globally with many other countries. Being a member of the European Union does not prevent us from working with countries outside the EU, and the leave campaign’s fear campaign has to stop saying it does.

On Sunday, the European Union slashed roaming charges by 75%, and they will be abolished altogether next year. That is a huge boost to British businesses with European ambitions as well as to Leicester City fans, now with Champions league travel to plan. The UK is Europe’s biggest digital economy. We buy and sell more online than any other country. Would the Minister like to estimate how long it would take him, even with his fabled charm, to renegotiate all our international digital agreements in the event of a Brexit, and what our £118 billion digital economy would do in the meantime?

I think it would take ages—it would take absolutely years to renegotiate. I recently returned from a G7 meeting in Japan, proving again that the leave campaign’s fear campaign is completely wrong. I was able to spend some time with the European vice-president, talking about the great opportunities that the digital single market presents. It was a lot of fun. We want to be part of that digital single market—growing for Britain.

Steel Industry

Global overproduction and reduced demand have caused steel prices to collapse, eroding the profitability of steel producers across the world. We have acted decisively to help UK steel companies by delivering lower electricity prices, tackling unfair trade, updating procurement guidance and introducing flexibility in emissions regulations.

One of the main issues in the current steel crisis is time. The Greybull deal took nigh on 12 months, and that time was allocated to ensure that a better buyer, as opposed to the original potential purchaser, came forward. What has the Secretary of State done and what conversations has he had with Tata to ensure that it will be a responsible vendor and allow enough time to encourage not just buyers, but the best buyers, to come forward? Where does he see strip and tube in the future? Does he still see Tata remaining in situ in some form in both those sectors?

The hon. Gentleman is right about the importance of time for securing a viable long-term future for the Tata strip business. I have had a number of discussions, as have my officials, with Tata. It has been very straightforward in being reasonable about time—of course, it does not have an unlimited amount of time, but it has shown through the long products business that it understands that things take time.

I congratulate my right hon. Friend on his approach—particularly to Tata and Neath Port Talbot in south Wales, but also to Celsa Steel in Cardiff. Some £76 million has already been given in compensation to high-energy users and the Government are projected to spend, I hope, £100 million this year. Will my right hon. Friend confirm that and clarify what future support we can give to high-energy steelmakers?

My hon. Friend is absolutely right to raise the issue of Celsa Steel, which has made a substantial investment in the UK, employing hundreds of people, and we want to see that continue. The price of electricity is very important to Celsa and other steel producers. We have already extended the compensation available and we have announced that we will move towards exemption, which I think will help Celsa and many others.

I thank the Secretary of State for attending the Thursday sitting of the Select Committee, which is conducting an inquiry on steel. He may recall that I asked him about the maintaining of confidence. There is growing concern that firms are not supplying to Tata facilities because they fear that the steel business may go into administration and they will not be paid, and credit insurance is being withdrawn. Businesses that supplied SSI do not want to get their fingers burnt twice, and customers, especially those with long-term horizons, are looking to Tata’s competitors for alternative provision. What further firm steps will the Government take on the matter of credit insurance to ensure that word goes out, loudly and with clarity, that this is a viable operation and firms can supply to and buy from Tata with confidence?

I thank the hon. Gentleman for his Committee’s work on this matter, which is helpful to the debate and enables us to look more closely at the position. As for the question of suppliers to Tata, and, indeed, large customers, I have already written to, or asked officials to write to, all the suppliers and customers of Tata Steel strip products. We have contacted the largest suppliers and the largest customers, as has Tata, which has given its reassurance on this point as well. However, I think that the main reassurance I can give relates to the approach of the Government, who are doing all that they can to secure a long-term, viable future for the business.

I would argue that Tata Steel in Corby is a vital component of the midlands engine. Bearing in mind all the commercial sensitivities, will the Secretary of State update us on exactly what point has been reached in the discussions that are taking place with the aim of securing its future?

My hon. Friend’s approach is commendable, as is the work that he is doing in Corby to secure Tata Steel’s future. As I hope he understands, there is a limited amount that we can say about what is a very commercially sensitive process, but let me reassure him that we are doing everything we can.

Does the Secretary of State agree that it is of strategic importance to the economies of Wales and the wider United Kingdom to keep the blast furnaces in Port Talbot operational following any future takeover? Will he consider introducing a steelmaking-specific enterprise incentive scheme, as advocated in the management buyout option, to provide the fiscal incentive that is required to safeguard steelmaking in Wales?

I agree with the hon. Gentleman in that I, too, want to see a future for steelmaking in Wales, and we are doing everything that we can to help with that. He mentioned the management buyout proposal. We are taking a very careful look at that, and would, of course, be willing to work with those involved.

What action is my right hon. Friend taking to help UK steel suppliers to win Government contracts, and to ensure that small and medium-sized enterprises in the supply chain benefit from those opportunities?

That is a good question. As my hon. Friend will know, we have already changed procurement rules so that they can take economic and social factors into account. We are also making the pipeline of deals much more visible, and targeting that at SMEs in particular.

Carwyn Jones, the Labour First Minister in Wales, who is at Port Talbot again today, had a package of support in place immediately after Tata’s announcement of its intention to sell. Now that the UK Government have belatedly woken up and followed that lead, how confident is the Secretary of State that Tata’s true intention is to be responsible? It took over a year to sort out long products, and Tata wants this to be done and dusted—including due diligence—by the end of June. Does the Secretary of State think that that is a realistic prospect?

We are working with the Labour First Minister and his Government. Both Governments understand just how important this is, and I think it is also important for us to continue to work together. As for the question of timing, I believe, as I said earlier, that Tata is sincere in its commitment to a reasonable time frame and a reasonable process. I have no reason to think that that will not be the case. Tata continues to show flexibility, and I hope that things stay that way.

Business Start-ups

We have a growing and healthy economy, which is good for all business, but which, in particular, encourages people who want to start up their own businesses. We are looking at ways in which we can improve, for example, practices for self-employed people, which is also very helpful. Our start-up loans scheme has provided more than 37,000 loans worth over £210 million.

In my constituency, the number of registered businesses increased by about 10% between 2014 and 2015. As I am sure my right hon. Friend will agree, that is very welcome. I recently visited Streetly Vets, a new business that has been set up by two sisters in my constituency. Does my right hon. Friend agree, however, that the first few years of being in business can be some of the most challenging, and will she assure me that the Government are doing all that they can to support new and small businesses?

I absolutely agree with my hon. Friend that it is the first few years that are the trickiest. If you can jump that hurdle, you can achieve almost anything; you can certainly make sure that your business will grow. I have explained about the start-up loans that we do, but the other great achievement of this Government in the past 12 months is our work on cutting business rates. This has been the biggest ever cut in business rates, reducing the burden by £6.7 billion, which will benefit 900,000 smaller properties. That is very good news, especially for small businesses.

Small businesses might like to start up in the town centre of New Ferry in my constituency, except that footfall has gone through the floor and the Co-op and Lloyds bank are now closing. Who should my constituents blame for the dereliction? Is it the Tory Ministers who withdrew from regeneration, or is it the absentee landlords who bought up property and are now nowhere to be seen?

I really do not think it is as simple as that. It is unfortunate that when bad news is delivered it is often turned into a party political football. There are all sorts of reasons why a number of high streets continue to have difficulties. Equally, there are all manner of solutions that can be used to turn them around. I would ask the hon. Lady to look at some of the successes of Conservative, Labour and indeed Lib Dem councils in helping and supporting their high streets. Most importantly I would suggest that, rather than talking down her high street, she should be talking it up.


10. What steps the Government are taking to increase take-up of apprenticeships among (a) people with disabilities, (b) care leavers and (c) other disadvantaged groups. (904772)

We want to ensure that apprenticeships are accessible to the widest possible range of people. We are promoting reasonable adjustments for disabled learners and fully funding apprenticeship training for young people aged 19 to 24 with an education, health and care plan and for care leavers up to the age of 24.

As the Government already have targets to increase the proportion of black and minority ethnic apprenticeships by 20%, does the Minister not agree that they should do the same for people with disabilities and for care leavers?

I agree that we should do all that we can, and we have made it a huge priority to help more individuals with learning difficulties and disabilities to take up apprenticeships. We have done this by providing guidance for individuals and working with employers to help them better to understand what more we can do. Our apprenticeship revolution will leave no one behind.

21. Is the Secretary of State aware that the Construction Industry Training Board, which is based in Bircham Newton in my constituency, has been excellent at encouraging people with disabilities to take up apprenticeships? Can he confirm that when the CITB’s existing levy is merged with the apprenticeship levy, it will still have sufficient funding to carry on with its excellent programmes? Will he come up to Bircham Newton to visit the CITB at some stage during his tenure? (904784)

My hon. Friend is absolutely right to raise the good work of the CITB in this regard, and when the apprenticeship levy is introduced from April 2017, we can make sure that it continues to have the funding available to do the same kind of work.

Tax Returns

12. What discussions he has had with the Chancellor of the Exchequer on the potential effect on small and medium-sized enterprises of proposed changes to filing of tax returns. (904774)

I talk to Treasury Ministers on a continuing basis, and in my ministerial role I am more than happy to take up the cause of small businesses. I met representatives of the Federation of Small Businesses only last week and they reiterated their concerns about the proposals, but of course this is not a mandatory filing every quarter; it is effectively good bookkeeping. They raised their concerns and I am more than happy to listen to them and, most importantly, to represent them to the Treasury. Also, a consultation is taking place, so there is always room to make sure that we continue to do the right thing.

I am glad that the Minister is listening. My constituent Sheila Knight is the director of a small local business and she is very concerned about the proposal to make businesses submit data quarterly to HMRC. She says:

“It will cause a huge amount of extra work, expense and worry for absolutely no benefit. Like most small businesses, I collate my accounts information once a year and give it to my accountant. Having to do this four times a year will be a huge imposition and my accountant’s fees will be pro rata more expensive.”

Does the Minister not agree that what small businesses need is strategic support from the Government, not more bureaucracy and unnecessary cost?

It is about reducing bureaucracy and cutting costs for small businesses. It is not a quarterly tax return; it is good, sensible bookkeeping, which good businesses do anyway. Keeping the books in good condition every quarter will help small businesses when they come to submit their annual returns. I am more than happy to meet the hon. Lady’s constituent and explain things to her, because there is a lot of misinformation.

I am pleased to hear that the Minister has met the Federation of Small Businesses, of which I am a proud member. From that meeting, she will know that 60% of small businesses do not currently operate digital accounting systems. Does the Minister understand the rising level of anxiety in that part of the business community? Does she agree that it might be sensible for the Treasury to consider introducing the system on a voluntary basis, which made self-assessment such a success when it was introduced all those years ago?

My hon. Friend makes a good point. There will always be good, full support for this digital movement. The other thing that is of concern to some small businesses is access to superfast broadband, because there is no point in doing this unless a business has it. Many small businesses are reticent to get up to speed—if I can put it that way—but I am confident that, with the excellent work of my hon. Friend the Minister for Culture and the Digital Economy, we are making huge progress and ensuring that all businesses have access to superfast broadband.

The Minister has singularly failed to explain how the change will help businesses. I do not know whether she has ever produced a set of business accounts, but the Financial Secretary to the Treasury told MPs in a Westminster Hall debate in January that it would require a

“a summary of income and expenses.”—[Official Report, 25 January 2016; Vol. 605, c. 36WH.]

As every businessperson knows, that can be done only by putting together the full detail each quarter. Whether the Minister calls it reporting, filing or updating, her claim that the change represents a reduction in red tape is laughable. It is a major increase in bureaucracy, administration and costs, especially for those businesses without digital access. The Government should go away and think again.

I am one of those who actually had a real job or two before coming to this place. I can therefore assure the hon. Gentleman that, as a self-employed barrister, I absolutely did have to provide accounts each week, but I do not claim to have run a business of more than just myself and maybe one other. The most important thing is that these are not quarterly returns. The hon. Gentleman really should understand what is proposed. It is actually a good way of ensuring that small businesses always keep up to date with how their business is going. The change will enable businesses to do their annual returns considerably better.

Business Regulation

The Government committed in their manifesto to cut £10 billion of business red tape through the business impact target. We will report on our progress in June this year.

The Government are doing well to cut regulation at home, but we cannot ignore the fact that the most burdensome regulations on British companies come from the European Union and cost British business £22 billion a year. Given that there were 1,469 new pieces of EU regulation and 51 EU directives in 2015, is it not clear that the only way to end the cost to British business is to vote to leave?

My hon. Friend is absolutely right to raise the issue of cutting business regulation, but I do not recognise the £22 billion a year figure for EU regulation. I am sure that he will agree that as well as looking at the costs of regulation, we should consider the benefits of the single market. With 500 million consumers, it is the world’s largest economic zone, and there is no doubt that it helps to generate jobs throughout Britain, including in Greater Manchester.

The Secretary of State will be aware that many small businesses often apply to only one lender for finance—usually their bank—and that two in five of those turned down do not go on to apply for finance anywhere else. What more are the Government doing to ensure that small businesses have access to as good a range of financial products as possible to keep the economy moving in the right direction?

First, the hon. Gentleman may know that one of the changes brought in during the coalition Government was that if a small business’s application for credit is refused, that application can be passed on, with the business’s permission, to other potential lenders. That has certainly helped to change the landscape. We can also help to increase competition, on which the Treasury has been leading. If the hon. Gentleman looks at the number of providers of SME finance, he will see that there has been a dramatic change there, too.


Productivity, measured as output per hour worked, increased by 1% in 2015 as a whole—the largest annual increase since 2011—and is now 1.7% higher than it was in 2008.

The reality is that this Government’s record on productivity has been one of failure. Last July, they launched their deeply underwhelming productivity plan, which was damned by the Select Committee on Business, Innovation and Skills as

“a vague collection of existing policies”,

the Committee warning that it risked

“collecting dust on Whitehall bookshelves”.

Can the Minister update the House on what steps she is taking to improve on the Government’s record to date?

I am sorry that it seems the hon. Lady did not hear my answer; I remind her that productivity is now 1.7% higher than it was in 2008 and we saw its largest annual increase since 2011 only last year. I do not know where she is getting her information from—I have my suspicions—but unfortunately she is wrong. This Government are absolutely committed to improving productivity, and we have already heard, by way of example, the Minister for Skills talking about the work we are doing to ensure that we have the right skills—that is an essential part of an effective productivity plan.

Topical Questions

Ministers and officials across government continue to work around the clock to support Britain’s steel industry—I have updated the House on progress several times and will continue to do so, whenever appropriate; our two major pieces of legislation, the Enterprise Bill and the Trade Union Bill, are moving closer to the statute book; and we are on the verge of naming the National Environment Research Council’s new polar research vessel. The final decision on that will be made by the Minister for Universities and Science—Joey McJoface, as we like to call him.

In The Sunday Times this week it was reported that meetings are taking place in France to look at how people could take advantage of getting business from the UK in the event of a Brexit vote. Does the Secretary of State agree that remaining in the EU is vital for British trade, particularly in the automotive and aerospace industries, and for the health of the British economy as a whole?

Yes, I agree with the hon. Lady on that. She mentioned the automotive and aerospace industries, two of our strongest manufacturing sectors in the UK, which rely heavily on a supply chain that is international—much of it is in Europe. Equally, she could mention our services industries, which account for 80% of our GDP.

T6. Does the Secretary of State accept that the proposals to allow waiters and waitresses, rather than restaurant owners, to actually receive tips given to them will be warmly welcomed? Does he not think that the House of Commons should show a lead, because in our own restaurants the agency workers and part-time workers who serve Members and their guests do not receive tips? (904792)

I thank my right hon. Friend for that question. May I begin by thanking and paying a huge tribute to everybody who works in this place, especially those in our catering services? They often have to work the most unsocial hours and often do so in the most difficult of conditions, as they suddenly have a huge influx of us going into the Tea Room or wherever it might be. We perhaps underestimate the work they do. My right hon. Friend makes a very good point and I would be more than happy to take this up with the House authorities. In the meantime, I congratulate my right hon. Friend the Secretary of State on rightly launching this consultation, as when someone, in any facility, pays a tip, they expect the person to whom they want that tip to go to receive it—all of it. I think this will allow us to begin to see real progress, so that we do the right thing on this.

Two Select Committees of this House are now preparing to examine the collapse of BHS into administration last week, putting at risk 11,000 jobs. Sir Philip Green bought the company for £200 million, took hundreds of millions of pounds out of it in dividend payments for his own family and then sold it for £1 to a bankrupt with no retail experience. What does the Business Secretary think are the issues for public policy as he contemplates the current situation? Does he think this represents responsible ownership?

The hon. Lady is right to raise that issue. As she said, two Select Committees are already looking into it, and considerable concern has been expressed in Parliament. I share some of those concerns, which is why I can inform her that today I have written to the chief executive of the Insolvency Service and instructed her to commence an investigation immediately. She has agreed to do so, and I will make both those letters—mine and hers—available in the Libraries of both Houses later today.

That is good news and I certainly welcome the steps that the Business Secretary has taken. During Sir Philip Green’s stewardship of BHS, the pension fund went from a surplus to a black hole of £571 million. What options do the Government and the pensions regulator now have to ensure that Sir Philip Green pays his fair share of that huge liability? Does the Secretary of State agree that the Pension Protection Fund was designed as a lifeboat for staff pensions, not a funding stream for the owner’s luxury yacht?

Hopefully, the hon. Lady will understand that it would be wrong of me, and of anyone else, to single out any particular individual. That is for independent investigators to look at by examining the evidence in front of them. She will also know that, when it comes to defined benefit pension schemes, there are many in deficit, and just because one is in deficit does not necessarily mean that there has been some kind of wrongdoing. As I have said, I have instructed the Insolvency Service to commence an investigation, but she should also be reassured that the pension regulator will be looking into this matter.

T10. There are 850,000 dementia sufferers in the UK, and that number is set to double over the next few years. What is the Minister doing to encourage British scientists to be as innovative as possible in delivering on improved care for those suffering from dementia? (904796)

We took the decision to protect the science budget, enabling us to invest and put the UK at the front of tackling diseases such as dementia. In addition, a Government investment of £150 million has been announced by the Prime Minister to establish a dementia research institute. I am pleased to confirm that two leading charities, the Alzheimer’s Society and Alzheimer’s Research UK, have now pledged a further £100 million towards the project. The Medical Research Council will be looking for an inspirational director to lead the institute and bring together the collective experience that exists in the UK and worldwide.

T2. Guidance issued by the Government on 8 February on the use of Government-funded research for lobbying caused great concern in the field of higher education and indeed among academics in my constituency of Wirral West. Can the Minister confirm that all grants given out under the remit of the Department for Business, Innovation and Skills will be exempt from the anti-lobbying clause? Will he also confirm that he is seeking a similar exemption for research grants given out by other Government Departments and agencies? (904788)

Yes, there has been concern from academic communities and I can confirm that all grants issued by the Higher Education Funding Council for England and the academies will not be covered by that clause.

T7. I am proud that, of the south-east’s 348,000 apprenticeships, Rochester and Strood has provided 7,410, the fourth largest number. I am also grateful to companies such as BAE Systems that makes an annual commitment to 12 higher level apprenticeships in my area. How can the Secretary of State provide further support to my constituency’s small and medium-sized businesses to offer more local people the opportunity of a quality apprenticeship? (904793)

The performance of businesses in my hon. Friend’s constituency is truly remarkable and leads the way in the south-east. I hope that she is aware that we offer smaller employers who have never had apprentices before a grant to help them with their first five apprenticeships. I hope that she will be able to communicate that to them and ensure that they take up that grant.

T3. Given the similarity of recent events at British Home Stores with what happened to Hull-based Comet four years ago, when British taxpayers were left with tens of millions of pounds to pay out in redundancy payments, will the Secretary of State ensure that the report that he commissioned on Comet and the Comet scandal is published? (904789)

The hon. Lady will know that the report was commissioned by my predecessor. I will take a close look at what she has said and get back to her.

Given the hope of renewed trade links between the UK and Iran, which will be dependent on good communication, does my right hon. Friend consider that now is the right time to withdraw accreditation for Persian GCSE and A-level?

My hon. Friend is right to highlight the importance of trade with Iran. She will know that that is why the Government have announced a trade mission that will take place soon. If more people in the UK speak Persian, that will help. I will happily take up the matter with my right hon. Friend the Education Secretary.

T4. I welcome the fact that BHS administrators have entered consultation with USDAW, the retail union, for the lack of consultation was in part to blame for the pension fund going from a £5 million surplus to a £571 million deficit. In the light of that, will the Secretary of State consider the case that there should be enhanced employee rights, in particular in this aspect of companies law? (904790)

As I said earlier, it would be wrong of anyone to jump to conclusions about the pension fund and the reason for the deficit. The right way forward is for independent regulators to take a look.

I am a champion of the Sutton Trust and the inquiry by the all-party parliamentary group on social mobility into access into leading professions. What is the Department doing to support our leading professions to work with schools and universities to build up the schools base, so that more young people from disadvantaged backgrounds can access our top professions?

We have established the Careers & Enterprise Company to make sure that all young people know about the opportunities available to them through our higher education reforms. We are also giving students more information than ever before about their course choice, and we have introduced degree apprenticeships as a new route into the professions. We want to see universities playing their part too, which is why I have asked the director of fair access to continue to focus on access to the professions in his work with universities.

T5. A total of 11,000 BHS employees face an uncertain future over not just their jobs, but their pensions. Where will the Secretary of State place responsibility for filling the pension fund black hole? Will it be with the taxpayer or with the owners of the company, who paid themselves more than £400 million in dividends while the pension fund was driven into the ground? (904791)

The hon. Lady will know that if, sadly, defined benefit pension funds have trouble, we have the Pension Protection Fund in place, but of course we should always examine why a pension fund may need recourse to the PPF. That job should be done by independent regulators, not politicians.

The HCF CATCH training facility in my constituency was established 10 years ago as a partnership between the local authority and the private sector, since when 800 apprentices have passed through its doors. May I invite my right hon. Friend the Secretary of State or the Skills Minister to visit it? Does he agree that such a partnership is the way forward?

I feel sure that my hon. Friend is slightly disappointed to have just a Lincolnshire neighbour coming to visit him, but if he can put up with me, I would be delighted to do so.

T8. In the Secretary of State’s discussions with Tata, will he have time to raise Tata’s involvement in the outsourcing of up to 800 jobs from British Airways, including its centre in south Manchester, which supplies jobs to my constituents and has already announced 80 redundancies? As The Daily Telegraph revealed last week, this is another example where Tata’s actions threaten our national security along with our jobs, so will the Government step in to protect both? (904794)

If the hon. Lady wants to send me more detailed information about that, I will gladly take a closer look.

Why should 100% of British businesses have to comply with EU regulations when less than 10% of them export to the EU?

I touched earlier on the importance of the single market. It is the largest single market in the world, with 500 million consumers, and it brings huge benefits to British businesses in growth and jobs.

T9. Will the Secretary of State reconsider the decision to scrap bursaries for nurses? First, that will deter mature students and people from black and minority ethnic communities and disadvantaged communities, and secondly, while nurses are training, they spend 50% of their time doing practical work, looking after people. It is unfair that they should pay to provide services to others. (904795)

What I share with the hon. Lady is a determination to ensure that the groups she mentioned and other groups that have been discussed today have the maximum opportunity, particularly in the NHS. That is one reason why we are making great steps towards developing a new nursing apprenticeship, which will offer people a way into the profession, gaining that qualification while they are working and earning.

Alas, there is no law against selling a company to a bunch of clowns, which is a great pity for the employees and pension holders of British Home Stores. However, there is an expectation that the public should be able to look to the advisers in such a sale—the lawyers and accountants—to live up to their responsibilities and to do their duty. Will my right hon. Friend look carefully at the templates and responsibilities for advisers in transactions so that we do not see another great British company sold to a bunch of muppets?

I can reassure my hon. Friend of that. He has spoken eloquently on this issue a number of times, and he knows it well. We will learn lessons from the collapse of any company, but especially one as important and as large as BHS. As I said earlier, there will now be an investigation by the Insolvency Service, which I have instructed to start today, and we will certainly draw lessons from the outcome of that and other investigations.