Small businesses are leading the economic recovery in Wales. There are now 30,000 more small and medium-sized enterprises in Wales, employing 65,000 more people than in 2010. With SMEs accounting for over 99% of all businesses in Wales, the UK Government fully recognise their important contribution to the growth of the Welsh economy.
The Chancellor’s recent Budget announcement that business rates for the smallest businesses will be either greatly reduced or removed has gone down very well. It will have huge advantages for small shops in particular. What steps are the Minister and the Secretary of State taking to make sure that businesses in Wales will also benefit?
My hon. Friend is perfectly right to say that the business rates announcement was welcomed by small businesses in England. The Wales Office is calling on the Welsh Government to replicate the steps taken in England, in order to ensure that small businesses in towns and cities across Wales benefit in the same way from the changes that are being implemented in England, which will allow them to grow and to employ more people in Wales.
The Welsh Government have done well in attracting inward investment, but in terms of business confidence and Brexit, what will the UK Government do to shore up certainties about the Swansea bay lagoon, electrification and supporting Swansea with a city deal?
The hon. Gentleman should be aware that the Wales Office is working very closely with the Treasury to develop a Swansea city deal, which will include the electrification of the main line to Swansea. We are also proposing a review of the Swansea bay tidal lagoon in order to look at its viability and to ensure that it will provide value to the taxpayer if it is developed.
Some 242,000 jobs are directly or indirectly dependent on a successful tourism industry. Will the Minister concede that we could boost those small businesses either by reducing VAT on hospitality and tourism or by raising the threshold on which they pay VAT?
The hon. Gentleman is a champion of this issue and has been ever since I have been in this place. I share his view of the tourism industry in Wales: it is a success story of which we should be justly proud. It is important that the case is made to the Treasury, but I stress that the tourism industry in my constituency and in that of the hon. Gentleman is doing extremely well at present, regardless of any changes to VAT.
As the Minister well knows, many small businesses in Wales are highly dependent on the steel industry and will have been anxiously awaiting the outcome of today’s meeting in Mumbai. The terms of the package that his Government propose will be crucial to any potential deal, so will he confirm that they will do everything it takes to secure a successful future for our steel industry?
The hon. Lady is absolutely right to highlight the importance of the steel industry not just to direct employment but to the supply chains in both north and south Wales. I assure her that the Wales Office and the UK Government are doing everything in their power to ensure that the steel industry and its skilled supply chain are protected in the future.
Many of our small businesses will also be concerned about the EU referendum, not least those in the Welsh agricultural sector, which received some £350 million a year from the common agricultural policy. The Minister has previously confirmed that, in the event of a Brexit vote, there is absolutely no certainty that his Government would replace those EU funds, so does he agree that it is in the very best interests of Welsh farming and the broader Welsh economy that we vote to remain in the EU on 23 June?
The hon. Lady is absolutely right to highlight the importance of the agricultural industry to Wales. Almost 60,000 people are directly employed within the sector, and more than 95% of all Welsh agricultural exports go to the European Union, so I fully subscribe to her view that the Welsh agricultural sector will be protected if we vote to remain in the EU.