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Business, Energy and Industrial Strategy

Volume 623: debated on Tuesday 14 March 2017

The Secretary of State was asked—

Low-carbon Economy

Between 1990 and 2015 the UK’s emissions have fallen by over a third while our economy has grown by over 60%. Since 2010, Government policy has contributed to a trebling of renewable electricity capacity and encouraging the take-up of low-carbon heating and ultra-low emission vehicles.

I thank the Minister for his answer. Businesses in the Scottish renewables sector predict that one in six jobs is at risk over the next six months due to changes in UK Government support. Will the Minister take action now to reverse those changes, to make sure we grasp the opportunities that our fantastic national energy resources provide?

Few countries, certainly in Europe, have done more than we have to expand renewable energy electricity capacity since 2010, and the low-carbon economy sector now employs over 220,000 people. The hon. Lady questions our continued commitment to renewable energy; I refer her to the public commitment to forthcoming auctions to support the less mature renewable technologies.

A recent Chatham House report as well as the Department for Business, Energy and Industrial Strategy’s own following study on North American woody biomass both concluded that the use of these pellets for energy production in the UK is high-carbon. Given that and that a review was promised of bio-energy policies in 2012, will the Government conduct an urgent review and impose a moratorium on new subsidies for biomass?

As the hon. Gentleman knows, we have reviewed and adjusted subsidies in relation to biomass, and we keep that under regular review.

Given that Scotland’s renewable energy will be cheaper than that produced at Hinkley by the time it is complete and that Brexit is already pushing up the build costs of these reactors in an environment where the UK Government have unilaterally decided to abandon the protection of Euratom, will you scrap the costly and inefficient nuclear obsession in favour of a low-carbon future?

Frankly, previous Governments neglected their responsibility to this country to invest in upgrading its power infrastructure, but this Government are grasping that challenge. As I have said, few countries have done more to make the transition to cleaner energy, with a trebling of capacity in renewable electricity, and the commitment to Hinkley offers us the potential for 7% of the country’s electricity—low-carbon based power.

Colleagues in both Houses have signed an offshore blade made by MHI Vestas on the Isle of Wight, which is also arranging a schools outreach programme. Does my hon. Friend agree that this sort of initiative raises awareness of how low-carbon renewable energy technology can ensure that the UK reaches its potential of exporting its first-class engineering and advanced manufacturing worldwide?

I thank my hon. Friend for his question and wholly endorse what he says. The Secretary of State and I saw at first-hand when visiting the new Siemens offshore wind blade turbine factory in Hull just what this technology and engineering can do to inspire, in particular, young people in the area about opportunities for employment in this exciting sector.

Nuclear power is an important part of the transition to a low-carbon economy. Will the Minister update us on the small modular reactor competition?

I congratulate my hon. Friend on her election to the Select Committee, and she is absolutely right: energy innovation is critical to both our future ability to reduce the cost of decarbonisation and unlocking the industrial opportunities inside the low-carbon energy sector. We are reviewing our plans in relation to our energy innovation portfolio. The nuclear industry is a very important part of those plans, and I hope we will have something to say very shortly.

The Minister will be aware that we in the south-west do not share the Scottish National party’s negative view of the Hinkley Point power station project, but will he reassure me about what work the Government will do to ensure that young people have the skills to take the jobs that will become available in these industries?

I thank my hon. Friend for correcting the impression that investment in new jobs in the nuclear industry is somehow bad news, given the commitment that 65% of the content of Hinkley should be supplied from this country. Just as important is the contribution it makes to upgrading our power infrastructure and making sure this country has the ability to access reliable low-carbon energy in the future.

Last week, the Budget failed to stop the 800% rise in business rates for companies that have installed solar panels. This week, research published in the journal Nature Energy states that to achieve our targets set out in the Paris agreement we need to set out longer-term plans beyond 2050, yet the Government have now dithered for five years and still refuse to publish their own implementation plan, even up to 2030. How does the Minister propose to increase our low-carbon exports when he cannot even set out how we will achieve our medium-term climate targets?

The hon. Gentleman accuses us of dithering, but our performance on emissions during the last Parliament was one of the most successful since 1990. He talks about delaying the emissions plan but he will know that the fifth carbon budget was set only last July. This country, and this Government, have a proud record of proving that we can reduce emissions while growing our economy, and we will continue to build on that.

With more than 30 large wind turbines in the borough, Kettering is coming close to generating more green electricity than it consumes, but what incentives are there in the business rates and planning systems to reward housing developments and business start-ups that are low carbon?

I thank my hon. Friend for pointing out how much progress we are making at the local level as well as nationally on the transition to green power. This has been facilitated by substantial investment through public subsidies and, as we look to encourage the deployment of renewable energy through competitive markets—preferably subsidy free—we are looking at what else we can do to facilitate that using the tools available to the Government.

Our concern on Hinkley is that the Government appear to be stacking the deck in favour of nuclear power over the much cheaper renewable energy. The strike price for Hinkley was £92.50 in 2012, compared with a much lower £82.50 for onshore wind in 2015, yet in the value-for-money assessment the Government assume a £90 strike price for onshore wind. Why are they inflating the price for renewables in comparison to Hinkley?

I hope that the hon. Gentleman does not want to give the wrong impression. He knows from his experience that one of the keys to a successful energy policy is diversity of supply. That is the key to energy security, which is the primary responsibility of every Government. Ensuring diversity of supply is absolutely evident in what we as a Government are trying to do.

The Minister has completely missed the point of my question, which was about comparisons. The Government commissioned Frontier Economics to look at the whole systems impact of electricity generation models, yet despite repeated parliamentary questions and freedom of information requests the report has not been published. If the Government have nothing to hide, why are they hiding things?

I am not aware of hiding anything. I am trying to make a point about diversity of energy supply. I would make a further point about prices, in answer to the hon. Gentleman’s question. One of the most encouraging things is the progress we have made in our policy structure on driving greater competition, through contracts for difference, in order to get better prices for consumers and for the taxpayer from the public subsidies that are available. I hope that that will be evident very soon in the results of the forthcoming auctions.

UK Science

We are committed to making the UK the global go-to nation for scientists, innovators and tech investors. That is why, as part of the industrial strategy, we have announced an increase of £4.7 billion in public research and development funds—the biggest increase in science support for 40 years.

I welcome the Government’s recent £14 million investment to develop space technologies in Leicester, including the university-led national space park. What further steps could the Minister take to encourage the space industrial cluster in the midlands?

The space industry has an important role to play in driving growth across the UK, and the Government are working closely with the sector to make that a reality. I am pleased that the Leicester and Leicestershire local enterprise partnership is grasping this opportunity. The Satellite Applications Catapult has funded a centre of excellence in the east midlands for the past three years, focused on linking industry to local and national expertise. In addition, the UK Space Agency is supporting business incubators in Leicester, Nottingham and Loughborough to develop innovative space start-ups.

Page 98 of the Government’s industrial strategy talks about the importance of long-term institutions. Many of those who work in the science-based industries in Wirral and elsewhere feel that the single market is a long-term institution that has served them well. Has the Minister asked the Prime Minister to change course and keep our country in the single market?

The UK is a powerhouse of academic research, and our collaborations with institutions in Europe and around the world are an important part of that success. Through the industrial strategy, we want to continue to play to our great strengths as a science and research powerhouse, and we will continue to welcome agreements to collaborate with our European partners on major science and technology programmes in years to come.

Agri-science plays a vital part in the industrial strategy, but more could be done. Is the Minister aware of the excellent work of Harper Adams University in my constituency? It exports its excellence all over the world.

I am aware of the excellent work undertaken by that institution in my hon. Friend’s constituency. Agri-tech receives considerable support through our public investment in R and D, and will continue to do so.

The European Medicines Agency, which is based in the UK, is one reason why our pharma industry is so successful. What will happen to the agency when we crash out of the EU? What is the Science Minister doing to ensure that we have effective regulations that support our pharma industry?

The right hon. Lady should wait until we have embarked upon the negotiations for our future relationship with European funding streams. We anticipate that we will continue to collaborate closely with our European partners, so that our scientists can develop institutions such as the one she mentions to the benefit of this country for years to come.

Scientifica is a Wealden-based science and technology business that won the 2016 British Chambers of Commerce awards for business of the year and export business of the year, and I joined Scientifica members at the London Stock Exchange to open the markets yesterday. Will my hon. Friend join me in congratulating Scientifica on championing and promoting the best of British science and research?

I am delighted to congratulate Scientifica. Companies such as that are doing brilliantly at exploiting the research that is undertaken in our science base to this country’s benefit and maximising the commercial opportunities arising from our significant public investment into R and D.

Looking beyond the two-year period to when we exit the EU, will the Minister ensure liaison with the devolved Administrations—hopefully all fully restored before then—so that excellent facilities such as the science centres in Belfast and Londonderry can be availed of and replicated right across the UK to ensure that we get the maximum advantage?

Through the creation of UK research and innovation, a UK-wide global funding and research agency, we will continue to ensure that excellent science and research are supported throughout the UK in the years to come.

Oil and Gas Sector

The oil and gas sector is important for the UK’s economy, for energy security and for jobs. That is why the Government have established the Oil and Gas Authority as a strong, independent regulator over the past two years, providing a £2.3 billion package of support to encourage investment and exploration in the UK. In the spring Budget last week, the Chancellor announced that the Government will consider how tax could be used to assist sales of late-life oil and gas assets in the North sea, helping to keep them productive for longer.

Do this Government stand by or reject comments, which are in contrast to industry voices, made by the Scottish Conservatives’ energy spokesman, Alexander Burnett MSP, that the oil and gas industry does not need any help and that

“People in Aberdeen are not asking for more at the moment”?

I am unsure whether I entirely caught the hon. Gentleman’s remarks, but the Government have been clear in their support not just for the UK continental shelf and the companies on it, but for Aberdeen through the £250 million city deal.

22. Is my hon. Friend aware that at this very moment crude is trading at just $48.31? Has he read the OECD report which states that and many other structural factors mean that an independent Scotland would have a worse debt to population ratio than even Greece? (909243)

I am sure that my hon. Friend will understand that I will not comment on that specific economic issue. However, I admire his awareness of the oil spot price. The Government have managed to engineer a significant fall in oil and gas supply costs on the continental shelf—[Interruption.]

Order. A cerebral Minister is at the box responding to a pertinent inquiry, and the hon. Member for Coatbridge, Chryston and Bellshill (Philip Boswell) is behaving in a mildly boorish fashion—very uncharacteristically. I am sure that this is an exceptional case.

I am not sure that anyone can recover from the attribution of being “cerebral.”

The way in which the Oil and Gas Authority has lowered costs on the UKCS is testimony to how competitive our economy can be in oil and gas, even when oil prices are falling.

UK Space Sector

The UK’s space sector is world leading. A quarter of the world’s telecommunication satellites are either built here or are built with key UK components. Our recently announced draft Spaceflight Bill will enable UK businesses to enter a global market worth an expected £25 billion over the next 20 years. Our industrial strategy will ensure that we build on that and continue to be a global leader in this very important sector.

Many people think that my constituency, North Swindon, is out of this world, and they are not wrong, as we are home to the UK Space Agency. Will the Secretary of State therefore tell me how the upcoming Spaceflight Bill will enable the UK to build on its strengths in science, research and innovation?

North Swindon has a stellar Member of Parliament, too. The space sector is one of our most important industries, and the Spaceflight Bill, in particular, will move us forwards and enable us to be in the business not only of manufacturing satellites but of launching them, which will give us further industrial opportunities from which not only Swindon but the whole UK can benefit.

The collaborative approach of the UK aerospace sector is one of the lessons that the Government need to remember in the difficult years ahead. Will the Secretary of State please come to one of the most important aerospace sectors in the country in north-east Wales to see its excellent work and the potential threats to one of the most successful industries in our country?

The hon. Gentleman is absolutely right. One of the reasons why the space and satellite sector has been so successful is the collaboration between the firms, the Government and the research institutions, which is the way forward. The Under-Secretary of State for Business, Energy and Industrial Strategy, my hon. Friend the Member for Hereford and South Herefordshire (Jesse Norman), will visit north Wales and the facilities that the hon. Member for Wrexham (Ian C. Lucas) mentions, and I look forward to hearing all about it.

18. As someone who has calculated inertia matrices and Hohmann transfers, I am pleased that the Government are focusing on this area. What assessment has the Secretary of State made of the capacity of the UK’s commercial space flight sector? What steps will he take to support it? (909239)

I am glad that my hon. Friend is not questioning me on inertia ratios and matrices. The capacity is there, but it requires planning ahead. That is why the industrial strategy mentions the need to invest in science and research and development—it is important that we do that—and the need to look forward to make sure that we have the skills in the workforce to fulfil the order books. The purpose of having a long-term industrial strategy is so that we are prepared to reap those very opportunities.

Exiting the EU: Small Businesses

6. What support his Department is providing to small businesses as a result of the UK’s decision to leave the EU. (909226)

9. What support his Department is providing to small businesses as a result of the UK’s decision to leave the EU. (909229)

Small businesses are vital to the economy, and we are providing additional access to finance and support to help scale up businesses so that they are able to reap the benefits of future trade with the EU and the rest of the world.

I wish everybody a happy Pi Day—“pi,” the mathematical version, not “pie,” the pork version.

The Conservative party broke its 2015 manifesto commitment by failing to consult the business community on the changes to national insurance for the self-employed. Will the Government now address the ongoing uncertainty that those changes could bring to workers’ rights, such as maternity and paternity pay, sick pay, annual leave and pensions?

The Government are absolutely committed, as the Prime Minister has said on several occasions, to protecting workers’ rights as we leave the European Union. And not just to protect those rights but to enhance them, if necessary. She has set up the Taylor review to examine the details.

I call Martin Docherty-Hughes. I am sad to note the rather uncharacteristic absence of the hon. Gentleman. We will do our best to bear up with such fortitude as we can muster.

A number of small businesses in the oil and gas sector supply chain have been hit disproportionately by the oil price reduction. My hon. Friend the Member for Aberdeen South (Callum McCaig) and I held a meeting last week to encourage young businesses to access different methods of capital financing so that they can grow. What are the UK Government doing to encourage such businesses to access capital finance?

Although support for businesses in Scotland is largely devolved, the British Business Bank funds a vast number of companies in Scotland. It has provided £415 million of finance for Scottish companies, including through start-up loans. In addition, more than 1,600 companies in Scotland benefit from the enterprise finance guarantee scheme.

Small and medium-sized enterprises are the backbone of the south-west, and much effort is being put into upping productivity in the region. We in Taunton Deane welcome recent Government investment in a lot of infrastructure and the work that is being done on skills. However, to give us a real fillip, will the Minister, or perhaps someone else from the Department, agree to come to Taunton’s annual business conference on 6 June to give a boost to the things that the Government can help us with?

I thank my hon. Friend for such a wonderful invitation. Although I have already been to the south-west, I am sure I can find an occasion on 6 June to do so again.

The hon. Member for Taunton Deane (Rebecca Pow) looks as though her cup has runneth over. What a happy day for her and, indeed, for Taunton Deane—not to mention the Minister.

One advantage for small businesses of the United Kingdom leaving the EU is that the House will be free to repeal unwanted EU regulations. What steps is the Minister taking to consult small businesses so that she can identify those regulations?

I assure my hon. Friend that we consult small businesses all the time. The Department for Exiting the European Union regularly engages with the Federation of Small Businesses. We will, in due course, ask that Department to hold a roundtable for small businesses to discuss the very issues that he raises.

Small Business Growth

I am glad that the hon. Lady is so keen to hear my answer to this question.

We support small business growth by ensuring that small businesses can access finance and wider support. The British Business Bank is already supporting more than 54,000 smaller businesses with £3.4 billion of finance, and I am leading a taskforce to enable SMEs to accelerate their growth potential and realise their growth prospects quicker.

I know that Rugby is a great place to run a business, but many small businesses continue to tell me that an obstacle to their expansion is still a shortage of suitable industrial premises. At a time when our authority is preparing its local plan, what discussions has my hon. Friend had with her counterparts in the Department for Communities and Local Government to ensure that adequate land is allocated for the development of business units?

We work closely with the Department for Communities and Local Government, and I recently co-chaired a successful roundtable with my hon. Friend the Minister for Housing and Planning and providers of finance. We will be having a further meeting, and I shall obviously consider the needs of businesses in Rugby for more space.

Small businesses in Doncaster have expressed concern to me about how they can access apprenticeship schemes. Will the Minister work with the Department for Education and draw up a regional analysis—especially for Yorkshire and the Humber—of how small businesses can access those schemes effectively, particularly in the light of the apprenticeship levy?

We will certainly talk to businesses in the Doncaster region, as well as to those elsewhere in Yorkshire, but I am delighted to say that only 1.3% of businesses will actually pay the apprenticeship levy. For all other businesses, particularly small businesses, the Government will fund 90% of training costs following the introduction of the levy proper next month.

Last week’s announcement on business rates by my right hon. Friend the Chancellor will provide welcome relief to hundreds of independent small businesses in my constituency. Will the Minister join me in congratulating our tourist management organisation, Visit Bath, as it focuses more attention on the marketing of our independent small businesses in Bath in domestic and international markets, which will bring jobs and growth to my constituency?

I absolutely join my hon. Friend in congratulating Visit Bath on all the trade and ideas that it brings to SMEs in his constituency.

As chair of the all-party group on disability, I have been hearing from disabled entrepreneurs that they still have to face far too many barriers, including with regard to access to affordable loans, peer mentoring and information, even through the Government Gateway. What specific measures are the Government taking to support disabled entrepreneurs and what more can be done to address these very important issues?

I thank the hon. Lady for her excellent question. I work closely with the Minister for Disabled People, Health and Work, who is leading huge initiatives to improve opportunities for people with disabilities. I will raise with my hon. Friend the specific question of entrepreneurs with disabilities.

The truth is that the Government have to show a lot more love for small businesses to reinforce the truth that the Conservatives are the party for entrepreneurs. Will my hon. Friend start that by eliminating the time limits on the enterprise investment scheme for small businesses, and by finding a way, after we leave the EU, of reducing the compliance with regulations for small businesses to a single check mark?

As my hon. Friend knows, I am a great lover of small businesses and entrepreneurs, and I think that I can speak for the rest of the Government in that regard. He knows that the EU governs time limits and caps on the EIS at the moment. What happens following the Brexit negotiations will be a matter for the Treasury.

I do not think that small businesses are really feeling the love after last week’s Budget. A report by the Federation of Small Businesses entitled “37 problems and tax is one” states that the

“proposed National Insurance tax grab on this group is an absolute kick in the teeth, just at a time when we need to create more entrepreneurs, not fewer.”

The Minister says that the Government consult the Federation of Small Businesses, but perhaps they might listen to it in future and do what it suggests as well.

The small business world must feel more love from this Government than it would from Labour, were it to take our place in government.

On the hon. Gentleman’s specific question, I know that the FSB lobbied hard on a number of points, including national insurance, business rates and the quarterly reporting of tax accounts. On the latter two, it was very pleased with what the Chancellor provided. With regard to national insurance, the hon. Gentleman knows that more than 60% of people who are self-employed will actually benefit from the changes mooted by the Chancellor last week.

Energy Infrastructure

Just yesterday I was a few miles away from my hon. Friend’s constituency in Carrington, opening a new combined-cycle gas turbine plant. A few weeks before that, I was in Folkestone to see the new interconnectors being built through the channel tunnel. Both schemes remind us of the Government’s commitment to the UK’s energy infrastructure, underscored by a capacity market and contracts for difference. We are also investing £320 million in new heat infrastructure, which underlines the size of our whole commitment.

Base load energy supply is fundamental to delivering our energy needs. Solar and wind power do not provide base load, and there is a pressure not to increase the consumption of hydrocarbons, so does my hon. Friend agree that, in the absence of energy storage capacity, future investment must go to the nuclear industry, especially small modular reactors?

As my hon. Friend knows, we are spending a great deal of time working with developers, with new investment, alongside the plans that are already being executed at Hinkley. Small modular reactors could be part of that conversation. However, there are many possible storage technologies that might come on stream over the next decade or two; undoubtedly, they will also be an important part of the picture.

The country needs 21st century systems such as smart metering. Will the Minister update the House on the progress of the roll-out, and will he have a word with the energy companies to stop them blaming the Government for smart metering being part of the hike in energy prices that is ripping off the consumer?

We are in no doubt at all about the need for energy companies to bear down on prices. As they will be aware, the costs of policy are a relatively small part of those prices.

Tidal energy gives the UK an opportunity to provide a clean and predictable source of renewable energy. It is a sector in which we have world-leading business expertise in the Solent region. Will my hon. Friend consider giving tidal a higher priority in the UK energy strategy so that we can maintain our competitive edge?

My hon. Friend will know that we are looking at tidal energy and related issues closely in the context of our consideration of the Hendry review.

Following on from that question, will the Minister tell the House when a final decision will be made on the Swansea tidal lagoon?

It is fair to say that we have stated that we will come to the House as soon we can and that the matter is presently under consideration.

The Minister mentioned the capacity market. I am sure he will agree that the prime purpose of that market has been to procure new infrastructure capacity. Will he tell me how many new gas-fired power stations have been procured with the £3.4 billion that has been spent so far on the capacity market? What plans does he have to improve that number?

Well, I am all in favour of the self-answering question, but I remind the hon. Gentleman that the last capacity market procured energy at a cost of £7 per kilowatt, which is cheaper than any conceivable alternative.

Gig Economy

With no common definition of the “gig economy”, numbers vary in terms of how many workers are involved in it. We have commissioned new research, to be published this summer, which will look at the number of individuals working through digital platforms in the UK and at their experiences.

The number of freelancing moms has increased by 79% since 2008. Although I welcome the Government’s announcement that they will consult further in the summer on fairer maternity pay for self-employed moms, this was recommended 13 months ago. Why has it taken the Government so long to act on this crucial issue for these women when it took a stroke of a pen to increase their taxes?

As I said in my previous answer on national insurance, the increase in taxes, which itself is under review, will be ruling out—[Hon. Members: “Ah!”] In terms of the maternity and paternity issues raised by the hon. Lady, I should hasten to add, the consultation will run its course this summer and she will have an answer before the end of the year.

Does the Minister begin to understand the sense of grievance on the part of the growing army of the self-employed who are reluctant conscripts to self-employment in the gig economy? They work in a twilight world of insecurity without basic rights, but they will now have to pay more in tax although there was not one measure in the Budget to put the burden on the shoulders of those truly responsible: the Ubers of this world.

The hon. Gentleman knows that the Taylor review is currently examining all the issues that he raises. I am very concerned about the plight of some low-paid workers—they may well actually be workers, rather than self-employed. That is up to the courts and the Government to conclude later this year, but I assure him that we take the issues he raises very seriously.

Industrial Strategy: West Midlands

11. What assessment he has made of the potential effect of the Government’s industrial strategy on the west midlands. (909232)

13. What assessment he has made of the potential effect of the Government’s industrial strategy on the west midlands. (909234)

Last week, we published the midlands engine strategy. It is further demonstration that this Government are committed to investing in the midlands, a region that has seen over 180,000 more people in employment since 2010.

I thank the Minister for his reply. Telford is seeing increasing inward investment from businesses in the automotive supply chain such as Polytec and Magna’s Cosma, bringing real jobs and growth to Telford. Does he agree that Telford, with its reputation for innovation and advanced manufacturing, is set to play a key role in the midlands engine strategy, and will he congratulate those businesses on helping to build a successful future for Telford?

I will indeed. My hon. Friend’s constituency, which includes Coalbrookdale, has a good claim to be the cradle of the first industrial revolution—[Interruption.] It is perhaps a disputed claim, but I think Abraham Darby, in 1709, was fairly early. However, now, Telford is at the heart of the fourth industrial revolution, as my hon. Friend says. The T54 site is proving to be a very important location for automotive sector supply chain.

Does the Secretary of State agree that one pivotal thing that needs to be in an industrial strategy for the west midlands is closing the skills gap that has held back the west midlands for too long, so that areas such as the black country can continue to work to become leading specialists in things such as aerospace, automotive and advanced manufacturing, which are critical to the agenda of the Conservative candidate for west midlands Mayor, Andy Street?

I agree with my hon. Friend—he is absolutely right. The reputation of the black country is very strong. There is the phrase

“Made in the Black Country, Sold around the World”,

but to fulfil that we need good skills. Andy Street, being a person of great business experience, is the best person available to bring that business acumen to bringing more businesses to the whole of the west midlands.

Order. This is supposed to be about an industrial strategy, rather than an electoral strategy, but there you go.

In passing, may I say that it was the black country that was the birthplace of the industrial revolution, not Coalbrookdale? However, on transport spending, which is key to the industrial strategy for the west midlands, when does the Secretary of State expect to persuade his colleague the Secretary of State for Transport to spend as much per capita in the west midlands as in London?

The hon. Gentleman, who is an assiduous reader of these things, will see that, in the industrial strategy, we propose a commitment to upgrade infrastructure right across the country. I hope he will respond to that so that when we have the Budget later in the year, we will be in a position to make further such announcements.

24. What role does my right hon. Friend see the self-employed, particularly those in my constituency, playing as the industrial strategy develops? (909245)

The self-employed have an important role to play. One trend that colleagues on both sides of the House will know of is that the development of supply chains is one of the key sources of innovation in many industries. Within that, start-up businesses, including those run by the self-employed, can make a big contribution to making us attractive for jobs and new businesses.

Industrial Strategy

12. If he will make an assessment of the effectiveness of his sector-based approach in delivering the aims of the Government’s industrial strategy. (909233)

16. What steps the Government is taking to ensure that all sectors of the economy benefit from its industrial strategy. (909237)

We have had great success over the years in developing key sectors, including aerospace and the automotive sector. To build on this, we have set out proposals for new business-led sector deals in the industrial strategy. The first set of deals is already under development. We are taking steps to drive growth in sectors across the economy, including with funding for science, infrastructure and technical education.

Does the Secretary of State share my concern that the implementation of an industrial strategy led by the big players will focus solely on the big players? What is he doing to ensure that the small and medium-sized enterprises in those sectors, which are often the engine rooms, get their fair say and their fair share?

I assure the hon. Gentleman that that is not the case. I have regular discussions with the Federation of Small Businesses, the British Chambers of Commerce and smaller businesses right across the country. The supply chain, and making our country more attractive to supply chain businesses, are absolutely foundational to our industrial success, and that involves a particular regard for small businesses.

Cyber-security is one of the most important sectors for this country’s growth, but the UK has the highest skills gap in cyber-security in the world. Does the Secretary of State think that the Government’s current commitment to educate 1% of our students in cyber-security by 2021 is anywhere near good enough?

The hon. Lady makes a very good point. If we are to take advantage of the opportunities that exist, we need to upgrade our technical education. That is why in last week’s Budget the Chancellor made such a clear commitment, prominent in the industrial strategy, to transform the level of technical education, including to increase by 50% the hours of tuition that are available. Cyber-security is one of the areas in which I would expect that to be applied.

20. I welcome the £90 million that the Chancellor has given in the Budget for PhD places. Has the Secretary of State determined how they will be distributed and whether the academically excellent area of Cambridgeshire will benefit from this funding? (909241)

Yes. I would expect all competitive areas to make a bid for these places. The University of Cambridge and Anglia Ruskin University in Cambridgeshire, and other institutions more broadly across the country, will be in a good position to benefit from that.

21. The aerospace sector is of vital importance to the economy in the north-west of England. In December, I was delighted to take part in a ground-breaking ceremony at Rolls-Royce in Barnoldswick ahead of its £50 million expansion of its Pendle site. How can the Government’s industrial strategy help to further the growth of our aerospace sector? (909242)

My hon. Friend is absolutely right. This is an important sector, as has been evident from our discussions this morning. That reflects the track record of working together that will continue and be reinforced. I think that all Members across the House will have been as delighted as I was that Boeing made its commitment to its first ever UK plant in Sheffield, showing how attractive we are to advanced manufacturing businesses such as that.

The BEIS Committee’s recent report stated that the industrial strategy Green Paper

“provides little clarity on how…sectoral deals will work in practice”,

and that it appears to lack “political will”, falling short of

“providing a clear framework for decision making in the long term.”

Is it lack of clarity or lack of political will that has led to a bespoke Brexit deal for certain manufacturers while leaving others, and indeed other industries, in a state of uncertainty?

May I welcome the hon. Lady to her first BEIS oral questions? I see her predecessor behind her. She is, I think, my third opposite number in the eight months that I have had this job. The first was appointed in the summer, the second in the autumn, and she was appointed in the winter. I noticed this week that the birds were singing and the sun was out, so I hope that is not bad news for the hon. Lady. On her points about the industrial strategy, the sector deals that we have proposed have been widely welcomed. We have set out a number of initial deals in, for example, life sciences and the creative industries. We are already talking to other sectors such as the steel sector, and a lot of colleagues in the House will want to see that taken forward.

Oh, the Secretary of State is cheeky! He might want to refer to the report, because it also states that the White Paper on exiting the EU failed to meaningfully refer to an industrial strategy

“and reinforces a lack of coordination between the Government’s major challenge and its principal plank of business policy.”

Given that last week’s Budget failed to mention Brexit or the industrial strategy, does the Secretary of State agree with the recent Foreign Affairs Committee report that the Government have provided “no evidence” of industrial contingency planning in the event of no deal? If that is so, what is his no deal plan?

I say gently to the hon. Lady that she will have to do a bit better than that. I have the Budget here. She says that it does not mention the industrial strategy. I can tell her that it is mentioned in the first paragraph on the first page, and throughout. Given her interest in this, she ought to read the Budget.

15. I am keen that the north-west should play its part in the Government’s industrial strategy to drive up competitiveness in our area. How can small businesses play their part in my area? (909236)

In my hon. Friend’s area, as in every area of the country, the opportunities for the supply chain to be attracted to and to locate in this country—to supply the major manufacturers and service providers, but also to export around the world—is one of the key themes emerging from the sector deals that are being negotiated.

Renewable Energy

Nearly £56 billion has been invested in renewable energy since 2012. In the Budget last year, my right hon. Friend the former Chancellor of the Exchequer announced £730 million of annual support for less established renewable energy projects, including offshore wind. In the previous autumn statement, the renewable heat incentive was announced, at £1.15 billion by 2021.

We have heard a lot about the importance of small business this morning. There are 44,000 small businesses that have their own solar microgenerators. Currently, they are exempt from business rates, but from 1 April they face an 800% increase in business rates, which is clearly damaging for them and for the solar industry. I hope that that is not deliberate, so will the Minister meet the Chancellor to see what can be done to relieve the situation?

Of course, the impact of rates differs from company to company as regards their solar panels. Three quarters of businesses are projected to have rates that fall next year and there is of course transitional rates relief, but the Department has long recognised the problem in some cases to which she refers, and we are in active discussion with other Departments about it.

Energy Supply Market: Competition

23. If he will make it his policy to increase competition within the energy supply market; and if he will make a statement. (909244)

If the Secretary of State is successful in engendering much greater competition, will we need a regulator at all?

The aim of Government policy must be to have such vigorous competition in markets that that takes care of itself. Unfortunately, I do not think we are in that position, so I am determined to make sure that customers are treated fairly.

Topical Questions

As well as continuing the consultation on our industrial strategy Green Paper, we are acting on its diagnosis. Last week’s Budget set out our plan to transform technical education—increasing the hours students are taught by 50%, increasing funding for technical education by £500 million a year and establishing new institutes of technology. We announced in the Budget the first £270 million of projects under the industrial strategy challenge fund, including a world-leading investment in the development, design and manufacture of batteries to power the next generation of electric vehicles, and we announced a £100 million fellowship fund to attract the world’s brightest minds to come and work in the United Kingdom.

I am pleased that my right hon. Friend is planning to visit AstraZeneca’s Macclesfield site, the largest pharmaceutical site in the United Kingdom, in the near future. Will he tell the House what plans the Government have to support the life sciences further as part of its northern powerhouse strategy?

My hon. Friend, who is a great champion of the life sciences as well as of the Cheshire economy, knows that the opportunity to negotiate a sector deal for life sciences, which is being led by Sir John Bell, will be good for the whole country, but will have particular relevance to Cheshire and Macclesfield. I am looking forward to visiting his constituency to see the facilities for myself.

T2. Will the Secretary of State join me in congratulating the greatest evening newspaper in the country, the Express & Star, and the brilliant work of Wolverhampton University, which have launched the green shoots scheme? The scheme has now successfully distributed £4 million of regional growth fund money, supporting 65 businesses, creating or protecting 600 jobs and, extraordinarily, generating over 11 million in private sector investment to support businesses in places such as Dudley. Contrary to what he said earlier, everybody knows that Dudley was the real birthplace of the industrial revolution. (909247)

Having dipped my toes into controversy by talking about places with claims to be the cradle of the industrial revolution, I am certainly not going to nominate the best local newspaper in the country—suffice it to say that I gather the Foreign Secretary began his illustrious career on the Express & Star, although I do not know whether that shows its prescience, or whether it has recovered from that particular judgment. Local newspapers make a vital contribution to the success of local business, and I am delighted to hear about the initiative that the Express & Star is promoting.

T4. Since 2010, my constituency has seen 8,800 apprenticeships started across many sectors, and very soon I will be hosting my first apprenticeship fair, bringing together local students and businesses. Will the Minister outline what steps he is taking to encourage more small businesses to engage with apprenticeships and take on more apprentices in places such as my constituency? (909249)

The new phase of the “Get in Go Far” campaign focuses on helping small employers understand the benefits of apprenticeships. The National Apprenticeship Service supports that by contacting small businesses that have previously engaged with the programme. That will be of great benefit to small and medium-sized enterprises in my hon. Friend’s constituency.

T3. The Government’s industrial strategy Green Paper talks of the need to close the skills gap and invest in infrastructure, so can the Secretary of State explain to the House why childcare is not mentioned once? (909248)

Making ourselves attractive as a country to the workforce and making sure that we are the best place to operate a business and to work is an important theme of the strategy. I look forward to the hon. Lady’s contribution to the consultation, and if that issue does not have the emphasis that she thinks it needs, we will have the opportunity to address that.

T6. I thank the Secretary of State for his support for the midlands engine. In Stafford, we build them. Last week I had the honour of opening the technical training centre at Perkins’ large engine plant in Stafford. Does he agree that that shows just how important it is for businesses to be proactive in putting together the facilities needed for apprentices and taking on more of them, as Perkins is? (909251)

I quite agree with my hon. Friend. That demonstrates the need for all businesses, especially SMEs, to take advantage of our target of 3 million apprenticeships and the huge improvement in the quality of apprenticeships that the National Apprenticeship Service supports.

T5. Given that the Brexit negotiations are about to start, does the Secretary of State agree with his right hon. Friend the Prime Minister that no deal is better than a bad deal? (909250)

T9. Will my right hon. Friend set out how he intends to shape the regulatory environment as we leave the European Union, including through such things as visa allocation, to ensure that the United Kingdom remains at the forefront of the technological revolution? (909254)

The UK is the No. 1 place in Europe for inward investment in technology, and the Government’s industrial strategy will deliver the Prime Minister’s vision of Britain as a magnet for international talent and a home to the pioneers and innovators who will shape the world ahead. We are making sure that our regulatory landscape and visa system are up to that challenge through a range of measures, including the tier 1 exceptional talent visa.

T7. Scotland’s economy, from its thriving universities to our diverse food and drink sector, relies on EU freedom of movement. How does the Minister hope to close the skills gap and pave the way for a highly skilled economy if he cannot safeguard the rights of EU nationals living here? (909252)

The Government have made it clear on many occasions, including at the highest level, that we value tremendously the important contribution that EU nationals make to the success of our higher education institutions and scientific establishments across the country, including in Scotland, and we have every intention of that continuing in the years ahead.

When I visited the Corby steelworks on Friday, there was real enthusiasm for a sector deal for the steel industry and a real commitment to ongoing partnership working. Is my right hon. Friend the Secretary of State willing to visit the Corby works to discuss those opportunities?

I would be delighted to visit Corby with my hon. Friend. He is absolutely right—my discussions with the steel industry show a real appetite for a long-term sector deal to secure the future of the steel industry.

T8. Given the decimation of Scotland’s renewables sector and the fact that Scotland has very different energy capabilities from the rest of the UK, why do the Government continue to think that a one-size-fits-all energy policy is in any way appropriate for Scotland? (909253)

I have already emphasised in earlier answers the importance of a diverse energy supply, which is at the root of energy security. There is no question about this Government’s commitment to ongoing investment in renewables.

Many of those focused on driving forward the fourth industrial revolution are in new sectors such as robotics and 3D printing. Can the Minister ensure that the industrial strategy’s sector engagement includes new, innovative challengers, not just incumbents?

I certainly can. Through our industrial strategy, we are backing Britain’s innovators with the biggest investment in science and technology since 1979 and a new industrial strategy challenge fund to bring cutting-edge ideas out of the lab and into the wider economy.

T10. A recent Resolution Foundation report stated that one in three UK businesses admitted to under-investing over the last five years. What measures will the UK Government take to turn that around? (909255)

Yes, this country does recognise that it has been under-investing in research and development, and that is why at the autumn statement and in the Budget we have made the biggest investment in R and D for more than 40 years. Public investment in R and D helps to bring in private sector investment at the rate of about £1.36 for every £1 of public investment.

Can my right hon. Friend outline what measures are included in the midlands engine strategy to support small businesses and enterprises such as those in Cannock Chase?

As my hon. Friend knows, in the growth deals that are part of the midlands engine there is support, through local enterprise partnerships, for small businesses—both start-ups and growing businesses.

Following npower’s 15% price hike last month, the Government pledged that

“where markets are not working we are prepared to act.”

E.ON raised its prices by 14% last week and SSE by 8% yesterday. How many more companies need to raise their prices before the Government actually act to stop energy customers getting fleeced?

The hon. Gentleman is absolutely right that that behaviour is unacceptable. It has been reported by Ofgem that there is no reason to increase prices. We have committed to a Green Paper on consumer markets, which will be published very shortly. The time is up for these companies.

As the recently elected chair of the all-party group for small and micro business, I know that access to finance in the early years is a real challenge for small businesses. What advice could the Minister give to those in my constituency who are looking for access to finance in the early years?

I can advise my hon. Friend that the Start Up Loans Company has already helped 44,000 small start-ups and will be on hand to support start-ups in his constituency.

What plans does the Secretary of State have to encourage new innovation support for SMEs in our key foundation industries, which make materials such as glass, ceramics and steel for cars, including those needed for Nissan in my constituency? This could help to create hundreds of jobs in the supply chain that are actually made in Britain.

Support for innovation has received its biggest boost since 1979 in the autumn statement and in the Budget that was just announced. The industrial strategy challenge fund has just seen the first allocation of £270 million, which will help to boost innovation in key areas across the economy.

Diesel-powered generators add to poor air quality. Will the Minister welcome the contribution of Off Grid Energy, a small, innovative business in my constituency, whose mobile hybrid units provide green energy to the construction and event sectors?

My hon. Friend makes an extremely good point. Through him, may I congratulate the business involved?

What positive impact will the Government’s plans to improve the energy infrastructure have on small businesses when it comes to electricity costs?

On Friday, I visited Graham Engineering, in Nelson. It is an excellent company in the nuclear supply chain that currently has 30 new vacancies, which will be on offer at my seventh annual Pendle jobs fair on 24 March. What more can we do to support the nuclear supply chain?

One of the things that we have done to support the nuclear supply chain is to have a continuing commitment to nuclear power in this country, and that will benefit my hon. Friend’s constituents. Through our network of training colleges, we will make sure that we grow the nuclear skills that we need for this industry.

I thought the Minister was a touch complacent in his earlier answer on smart meters given that this will cost the taxpayer £11 billion by the end of the Parliament. What is he going to do about the fact that they do not work when a customer switches supplier?

The smart meter programme should be judged on its long-term effect. It will save £47 billion by the end of that decade.[Official Report, 15 March 2017, Vol. 623, c. 5-6MC.]

When will the business rate review commence and report? The sticking plasters offered last week will do little for small businesses in York.

The digital strategy is a key component of the Government’s industrial strategy. Can the Secretary of State do better than the Department for Culture, Media and Sport and tell me which companies have committed to work in Great Grimsby as part of the digital skills partnership?

The whole of the industrial strategy is an invitation to businesses in every sector to come forward and propose to the Government what is required to grow jobs and skills. That is the invitation to all digital companies.

The Pubs Code Adjudicator Paul Newby failed to declare a much more fundamental direct conflict of interest than Charlotte Hogg, yet Ministers are ignoring it. Tomorrow, tenants will protest outside his office. How long will Ministers keep failing to do their duty and not face up to this situation?

The hon. Gentleman knows that the Commissioner for Public Appointments stated that the panel considered there were no conflicts of interest in this case that would preclude Mr Newby from doing his job.