House of Commons
Tuesday 16 October 2018
The House met at half-past Eleven o’clock
[Mr Speaker in the Chair]
Oral Answers to Questions
Business, Energy and Industrial Strategy
The Secretary of State was asked—
Leaving the EU: Business Growth in Scotland
Reaching a good agreement with the European Union will have a positive effect on business growth in Scotland and in every other part of the United Kingdom. In Green GB Week, it is important to highlight the huge clean growth opportunities in Scotland in a sector that supports tens of thousands of jobs and brings £11 billion into Scotland’s economy.
Yesterday, AstraZeneca joined a long line of major UK employers that have put investment plans on hold because of Brexit uncertainty. The Governor of the Bank of England has indicated that, even before we leave, Brexit has already cost £900 per UK household. Does the Secretary of State agree with the Governor’s estimate? If he does not, what is his estimate of what Brexit has cost us to date?
The hon. Gentleman’s point underlines why it is important that we secure a positive deal, and the implication of that analysis is that if we do secure that deal, as I hope and expect that we will, there will be a substantial upside for the economy. The hon. Gentleman is interested in the negotiations because they provide us with access to European markets, but it is a matter of record that the Scottish National party wants to take Scotland out of the internal market of the United Kingdom by dint of leaving the rest of the UK, with which Scotland does four times as much trade as it does with the rest of the EU, so I would call for a bit of consistency from the hon. Gentleman.
This is just nonsense. Does the Secretary of State not accept that, by definition, the best possible relationship with the European Union has to be membership and therefore that leaving the single market and ending the freedom of movement of goods, services and people will inevitably be bad for business? Can he offer any reassurances at all to the 134,000 Scottish workers whose jobs the Fraser of Allander Institute estimates are reliant on trade with the EU?
In its Brexit risk assessment, Airbus said that if the UK left the EU without a deal, that
“would lead to severe disruption and interruption of UK production”
“would force Airbus to reconsider its investments in the UK, and its long-term footprint in the country”.
What steps is the Secretary of State, along with the wholly united Cabinet, taking to ensure that more firms do not depart Brexit Britain?
Does the Secretary of State agree that our membership of the internal energy market is not necessarily conditional on our membership of the wider single market? Does he agree that we would be better off were we to remain within the internal energy market, with all the energy security advantages that that brings?
My hon. Friend anticipates some negotiations that will need to take place on our future economic partnership. Suffice it to say, however, that we have a mutual interest in the interconnection between the UK and the continent, and it is strongly in the interests of consumers in this country and on the continent that the ability to trade over those interconnectors should continue.
Has my right hon. Friend made any assessment of the impact on business growth in Scotland if it left the UK’s internal market?
It would be disastrous. The value of exports from Scotland to the rest of the UK is £45.8 billion, compared with around £12.5 billion to the rest of the EU, so anyone who, like me, is interested in being able to trade without frictions should apply their own analysis to their own policy of pulling out of the UK.
Scotland’s financial sector has described the prospect of a no deal Brexit as “horrific”. Does the Secretary of State agree that to protect businesses and to stay in the single market and the customs union the resignations of the Secretary of State for Scotland and Ruth Davidson are a price well worth paying?
I hope that the hon. Gentleman supports the Government’s determination to ensure that the integrity of the whole United Kingdom is guaranteed by the negotiation. He suggests that the consequences of no deal would be negative; of course they would. That is why we are doing everything we can, with increasing confidence, to secure a positive deal with the rest of the European Union. I hope he will support that.
Electrical Product Recall
In March, we published the first Government-backed code of practice on recalls, and we have trained almost 300 trading standards professionals on its use. The Office for Product Safety and Standards is working with UK manufacturers and importers to ensure that their recall plans and processes are adequate.
Electrical Safety First tells me that the successful product recall rate for electrical goods is abysmally low, so why are the Government not doing more with platforms such as Amazon and eBay, which hold considerable consumer information, to find a solution to this problem?
I thank the hon. Lady for her question, and I understand her particular interest in this area. She is the chair of the all-party parliamentary group on home electrical safety, which I look forward to meeting at the end of the month. With particular regard to online traders, we need to ensure consumer confidence. Amazon and eBay already have primary authority partnerships with trading standards. They are advised by trading standards on the regulations and work with them to make sure that goods are removed as quickly as possible.
Those who do not wish us to leave the European Union claim that standards will fall, but will the Minister confirm that enhancing the UK’s product safety regime is in the industrial strategy, to give consumers in the UK and around the world ultimate confidence in the quality and safety of UK-manufactured goods in the future?
I thank my hon. Friend for his question, and I absolutely agree. Consumer product safety is a key part of our industrial strategy. The Government are determined to maintain a strong safety regime, and consumers can be confident that consumer protections already based in EU law will be retained. We want robust systems that identify unsafe products, share information and make sure that the checks at our borders and ports are right.
I am glad that the Government now take product recall seriously. They certainly did not in the case of the 5 million Whirlpool tumble dryers, many of which are still in our constituents’ homes. More catch fire every week, destroying peoples’ properties and putting their lives at risk. What will the Minister do about those?
I thank the hon. Gentleman for his question; he raises an extremely important point. The Office for Product Safety and Standards is already reviewing Whirlpool’s recall programme. Some 1.7 million dryers have been replaced or maintained under the programme. We are keeping it under review, and we will report once that review has taken place.
I welcome my hon. Friend to her new role. I also welcome the Government’s recent steps to improve the recall process. However, as the hon. Member for Hammersmith (Andy Slaughter) said, tumble dryers continue to be a leading cause of devastating house fires, as happened to my constituent in Long Eaton just last week. Will my hon. Friend look at what more can be done to improve the recall process, and more importantly, what more can be done to improve the rights of consumers who have purchased faulty products?
I thank my hon. Friend for her question and express my condolences to her constituent over that horrific incident.
I assure my hon. Friend that the new Office for Product Safety and Standards takes this issue seriously. We are working with UK manufacturers on the recall process; we are keeping it under review. We want to make sure that the UK is recognised for having high standards and consumer protections, and my Department will continue to work on that.
Sainsbury’s and Asda: Merger
Sainsbury’s has confirmed that there are no planned store closures as a result of the merger. The proposed merger of Sainsbury’s and Asda remains conditional on clearance by the Competition and Markets Authority. I wrote to the CMA on the issue in May, and the Under-Secretary of State for Business, Energy and Industrial Strategy, my hon. Friend the Member for Rochester and Strood (Kelly Tolhurst) and I had a meeting with the chief executive of Sainsbury’s yesterday.
It is right that the concerns of the workers are heard during the Asda-Sainsbury’s merger, so does the Secretary of State agree that there is a pressing need for the Competition and Markets Authority to hear the worker’s voice and take into account the impact of any merger or takeover on the workforce, not just on the competition?
It is true that the directors of the company have an obligation to have regard to the workforce. The CMA is independent of the Government, as the hon. Gentleman knows. It will make its report and assessment, and I am sure that it will look at all the companies’ responsibilities.
The Competition and Markets Authority says that it will not let the merger go ahead if any concerns that it has around higher prices or worse quality of service for shoppers are not fully dealt with. What assurances will the Secretary of State give that the same rigorous tests are being applied regarding the employment rights of employees at both companies, and will he commit to a meeting with the recognised trade unions?
I am always very happy to meet the trade unions. As I have said, I met the chief executive of Sainsbury’s yesterday. The company intends to run the Asda and Sainsbury’s businesses separately. It does not propose store closures or changes to the terms and conditions of the separate employees.
Will the Minister further outline what effect this merger will have on my constituents, who may see higher prices and less competition as a result of further limitation of the already smaller choice of supermarkets than on the mainland? Has the Department fully taken the likes of Northern Ireland and rural areas into consideration?
The hon. Gentleman raises a very important question. The essence of the CMA investigation is to see whether there could be—not just nationally, but in particular places—any diminution of competition. If the CMA thinks that that is in prospect, it has the powers to block the merger or to place conditions on it, such as requiring the sale of businesses to a competitor.
My hon. Friend’s constituents are keen to invest in the energy transition, as well as to ensure that their bills do not go up. Earlier this year, we brought forward the price cap Bill, which received strong cross-party support, and we are looking forward to those provisions coming into place by the end of the year. We estimate that my hon. Friend’s constituents on the most expensive tariffs will save around £120. All the other steps that we are taking, including the roll-out of smart meters, the warm home discount, the energy company obligation—which is now focused on the most fuel-poor households—and our work with Citizens Advice and the Energy Saving Trust are helping to keep bills down.
I thank the Minister for that positive response. Given that we as a society want carbon-free energy but also low energy costs, does she agree that requiring all newly built residential properties to incorporate solar panels would be a step in the right direction, and will she ask her Department to consider that initiative?
My hon. Friend is quite right that solar PV has an important role to play in the energy system. It might be ideal on some existing or new build homes. What I hate to see is the tokenistic solar panel that some developers pop up on roofs. Obviously, there may well be more effective and expansive measures to reduce running costs and cut emissions. When the Prime Minister launched her buildings mission as part of the industrial strategy earlier this year, she targeted the measure of overall energy. We want to halve the energy consumption of all new buildings by 2030 and we are working closely with the construction sector to deliver that goal.
As Ministers know, the development corporation site in Redcar is critical to the economic development of the Tees valley, and to get international industrial investment, we need affordable energy supplies. Will Ministers review the current arbitrary limit of 100 MW on the amount of electricity that can be supplied by private wire networks so that we can bring in jobs and investment, and fulfil our potential?
As always, I commend the hon. Lady and her colleagues for doing such an amazing job, cross-party, in promoting the next iteration of Teesside as the centre of clean economic growth. I know that the Secretary of State has met the company. We are aware of the issues. We will continue to review this, but we will also continue to review the chance to have a low-carbon industrial cluster, which is the way to get the new investment and get the carbon down in the area she is so proud to represent.
My right hon. Friend is always seeking advice on how he can cut his energy bills. I am delighted to see that, particularly as it is Green GB Week. There are lots of opportunities on the website to see what more he could do. The price comparison websites are getting better. One of the challenges is that they do not always show consumers who are in receipt of a warm home discount whether they might lose that. That point was raised by the hon. Member for Leeds West (Rachel Reeves), who chairs the BEIS Committee, and we are working with it. We want that decision to be as transparent as possible. As somebody who has switched twice, both times using a price comparison website, I can tell my right hon. Friend that it is actually a much simpler process than it used to be.
The Minister will be aware that wholesale prices of gas and electricity have risen significantly in the past year. What protections will she be ensuring for people on lower incomes, from poorer families, or who are older citizens and may be worried about the winter, particularly those who may still be using prepayment, pay-as-you-go meters?
It is quite right to note that the wholesale price determines the overall energy price, and of course it goes up and down. That is why the price cap Bill that we have all supported introduces a cap, not a freeze. I am sure that the hon. Lady is as pleased as I was to welcome the roll-out of the protection for customers on prepayment meters. That cap is already in place. It is already saving those households tens to hundreds of pounds a year. Indeed, the extension of the cap to the vulnerable consumers group is required by the CMA report. I would like to see these protections continue. Of course, all customers who are on rip-off tariffs will benefit when the price cap Bill we all worked so hard for comes into effect this year.
Winter is almost upon us, yet those suffering most from fuel poverty in the highlands are still paying higher electricity charges than those anywhere else in the UK, despite living in a centre of energy production. When will the Minister act to end this electricity unit price discrimination, which is estimated to add £400 a year to the already high cost of rural living?
The hon. Gentleman raises a point that is also often raised by MPs who represent other areas, such as the peninsula of Cornwall and Devon. There has always been a convention that because it costs more to deliver energy through conventional structures to those furthest parts of the UK, they bear a higher tariff. There is work ongoing, supported through BEIS innovation funding, to encourage self-generation and self-storage in many of the most remote communities—perhaps some of the things we have seen around the Orkneys with the hydrogen bus. The hon. Gentleman raises an important point. That is why the price cap Bill is so valuable and should be supported by all parties—because it caps energy prices for everyone in the UK.
Economic Growth and Emissions
My hon. Friend the Member for Crawley (Henry Smith) will know—and, I am sure, celebrate—that we have led the developed world in cutting emissions in our economy. Growth in our economy went up by 72% while emissions have decreased by 43%. That is not good enough—we want to go further and faster. That is why we set out last year all the policies in the clean growth strategy and why this week the first ever Green GB Week is helping us to re-emphasise the message that growth and green go hand in hand.
Earlier this month, I was pleased to welcome a Virgin Atlantic flight into Gatwick, the first ever sustainable fuels flight to land at the airport, using fuel derived from the recycled steel-making process. What can this Government do to ensure that the UK leads in this technology, which has the potential for zero carbon aviation by 2050?
This is a brilliant project and an example of exactly the innovation we need to tackle one of the most insurmountable problems we face, which is airline emissions. The Government relaunched last year a £22 million industry competition on future fuels for flight and freight to stimulate exactly this sort of innovative thinking.
Given that most people would prefer to live in a house that costs nothing to heat, boosting their spending power, that we have known for decades how to construct such houses cost-effectively and that there is no sign that big house builders will routinely offer such houses, are the Government planning to raise minimum standards for the thermal performance of new build houses, which will help the planet, the real economy and ordinary people’s household budgets?
I have here a card with my hon. Friend’s title—he is the chair of the all-party parliamentary group on self-build, custom and community housebuilding and placemaking, and he speaks with such knowledge and enthusiasm on this subject. He is quite right, and that is why we have set up the clean growth mission, why we have set out clear standards to drive up the energy efficiency of all homes to at least band C by 2035 and why we can no longer see new homes—particularly new build homes—that are off the gas grid being built with fossil fuel heating; we want that out by 2025.
But does the Minister not agree that the two aims can be brilliantly combined if we have an ambition to become a world leader in renewable energy and to increase investment in research and development in tidal and wave energy—two resources we have in abundance—to take them rapidly to commercial stability and create the jobs of the future?
The hon. Lady will be pleased to know that our renewable energy build is already over 30%, which is why we were able to get off coal earlier than many other developed countries. The problem with the tidal projects that we debated so extensively this year was that we were being asked to fund the most expensive power station that this country had ever built, with very few jobs created, and it was simply too expensive to burden consumers with. That is why we have said that the door is always open to innovation, but it has to be funded at the right price.
It is always a pleasure to meet the hon. Gentleman. The problem we have with feed-in tariffs is that we have spent nearly £5 billion since 2011, through consumer bills, on supporting some often very uneconomic projects. Quite rightly, particularly given the reduction in the cost of other renewable energies, the decision was made that that was no longer affordable. I support that. He asks whether there are other ways to continue to invest in the sector, and he is quite right that solar has an important role to play in the system. We have just finished the call for evidence and are considering the responses, and I hope to come back to the House soon.
Yesterday, the Minister requested that the Committee on Climate Change update its advice on the action necessary to respond to the report on 1.5° by the Intergovernmental Panel on Climate Change. For a brief moment, I thought she had done the right thing, but then I read her letter, which says:
“Carbon budgets already set in legislation…are out of scope of this request.”
The committee has already written to her twice, warning that the country is not on track to meet the lesser targets in those budgets. By saying that those budgets are out of scope, the Minister is pushing back the necessary change by 12 years. When did she become a follower of St Augustine—“Lord, make me virtuous, but not yet.”?
Blimey! Let me just clarify some of the hon. Gentleman’s misinformation. The reason those budgets are out of scope is that we already have a set of policies and procedures that will deliver 97% and 95% of the decarbonisation—[Interruption.] If he listens for a second and stops mansplaining, he might learn something. I live in hope; which saint said that?
The point is that the Committee on Climate Change told us last time we discussed the challenge of zero carbon that it was not technically feasible now. It would be pointless to ask for its advice again when we already have some of the most ambitious carbon reduction plans in the world up to 2032, set in statute. We need to know what to do from 2032 onwards, so that we can start planning for it now. Just once, it would be lovely to have some cross-party consensus on the challenging, vital issue of the destruction that climate change will cause. I live in hope.
Business in Scotland: Support
The Chancellor and I work closely together to support businesses across the United Kingdom. I also work with the Cabinet Secretary for Finance, Economy and Fair Work in the Scottish Government to ensure that we can create the right environment for innovative businesses throughout Scotland to thrive. Indeed, I will be meeting him again later this afternoon.
I hope the Secretary of State has heard that the Scottish Government have provided £18 million as part of a £65 million package of investment for its National Manufacturing Institute, which will be good news for manufacturers in Airdrie and Shotts, so will he change his industrial strategy to match that funding?
The industrial strategy is something on which we have good collaboration with the Scottish Government. It is right that we should work together for the long term. If we want to make sure that Scottish businesses can thrive, there needs to be a competitive environment. One thing that I know is very much on the minds of Scottish businesses is that Scotland is the highest taxed part of the United Kingdom, which is a substantial drain on confidence. I hope the hon. Gentleman will take that back to his colleagues and discuss it with them.
I do recognise that, not just in the case of hon. Gentleman’s beautiful but remote constituency but in the case of those of very many hon. Members across the country. This is a commitment that we have made in the industrial strategy. If we are to be a successful economy, using digital skills and attracting digital businesses, we need an upgrade in our broadband infrastructure.
Small Business: Finance
Improving access to finance is the mission of the British Business Bank, which addresses gaps in the finance market through guarantees and through debt and equity finance. The bank recently launched an online finance hub to help entrepreneurs identify the most suitable finance options for their needs. It is currently supporting about £5.2 billion of finance to almost 75,000 businesses across the United Kingdom.
I thank my hon. Friend for her response. As somebody who campaigned to get her elected, may I say how good it is to see her on the Front Bench?
Small businesses play an important role in my constituency’s economy. Will my hon. Friend tell me what the Government are doing to tackle the late payment culture, which has such a negative effect on small businesses?
I thank my hon. Friend for his kind words. It is great to be answering a question from him at my first Business, Energy and Industrial Strategy oral questions today. I know his constituency well, and I know that he represents the interests of his small businesses.
It is true to say that late payments are an issue that we want to tackle. Debt to small and medium-sized enterprises has halved since 2012. We have established a Small Business Commissioner, and introduced a requirement for large businesses to report publicly on their payment practices. However, we want to go further and bring in new measures to underpin the prompt payment code. We work closely with the Federation of Small Businesses, which has said that
“it is good to see the government getting serious about this issue, especially when it comes to large firms paying their supply chains promptly.”
I thank my hon. Friend for his question, and I know what a champion he is particularly for that industry in his constituency. The coastal communities fund supports jobs and growth in coastal towns. Projects are forecast to deliver more than 18,000 jobs and £363 million in new visitor spending, benefiting local businesses along seafronts and in coastal towns. In England, the local enterprise growth hubs in coastal areas also provide local business support and advice. Retail and hospitality businesses in coastal towns benefit from those national programmes as much as they do from business rates relief, business improvement districts and the business support helpline.
Social enterprises—for example, Wrexham football club—are important employers and active community hubs in a lot of constituencies up and down the country. It seems to me that banks do not support or understand social enterprises sufficiently well. Does the Minister agree?
There are a range of options to support all kinds of SMEs and social enterprises in the current system. We have launched a finance hub which, with the British Business Bank, is available for organisations to get in touch with. A whole range of finance is available for different types of organisations. As MPs, we have a duty to make sure that our constituents and the businesses operating in our constituencies are aware of Government information, so that might be useful in future.
And it continues to fight, as do I. Thank you all.
Some of our most important small businesses are local post offices. In 2017-18, post office profits rose to £35 million, while postmaster pay was cut by £17 million. Communities and the Post Office are facing a crisis as more and more postmasters resign, as they are undervalued and underpaid while executives receive a pay rise. What are the UK Government going to do to support sub-postmasters and make their businesses financially viable?
Fundamentally, the Government absolutely support the post office network, and we are determined to make sure that it is provided across the country. As the Minister with responsibility for post offices, I have taken a particular interest in that since taking up my role. I am determined to make sure that we keep the network running across all parts of the country to benefit our communities.
First, I welcome the Minister to the Dispatch Box.
The British Business Bank is simply not reaching most businesses that need support. Only 12% of members of the Federation of Small Businesses apply for external finance, and two thirds of those applications are rejected. In the spirit of cross-party co-operation, how about setting up a network of regional development banks to deliver business finance where it is most needed? The Government have stolen a number of our policies—why not that one?
I must remind the hon. Gentleman that the British Business Bank has access to the £20 billion investment in the industrial strategy. Through our start-up loan scheme, we have made 57,000 loans, delivering £436 million in finance and creating more than 56,000 jobs. Access to finance has improved a great deal since I became an MP. The hon. Gentleman served on the Committee on which we made invoice financing another option for many small businesses.
Small Business: Rates
The small business sector is thriving. We have 5.7 million small and medium-sized enterprises, and we are ranked in the top 10 in the world for ease of doing business. As the right hon. Gentleman knows, the Government have taken significant action on business rates in each of the last three Budgets, including £9 billion of support announced in 2016, making sure that nearly two thirds of a million small businesses pay no rates at all.
Small retailers across Kingston and Surbiton have been hit by a combination of high rises in business rates and unfair competition from online retailers, who too often escape taxation. Will the Secretary of State talk to the Chancellor before the Budget, and to European colleagues before Brexit, to agree a new tax for internet retail, using the proceeds to slash business rates and save our high streets before it is too late?
When the right hon. Gentleman was a Minister in the Business Department, he took part in a decision to defer revaluation, for reasons that he understands. I accept the point—it has been made strongly by the Retail Sector Council—that reflecting the contribution that high street businesses make to their communities is a significant need. As business rates are reviewed, that is one of the council’s recommendations that we will take forward.
The Secretary of State will know that I have been concerned about this issue for some time. I met a business on Saturday whose business rates, which are currently about £300 a month, will go up to over £1,000 a month next April. What can I take to that business to assure them that we are on its side?
My hon. Friend can reflect on the fact that the Government have taken action to permanently double business rates relief from 50% to 100% and to raise the threshold from £6,000 to £12,000. That means that a third of all properties, including small shops, now pay no business rates at all.
With Small Business Saturday coming up on 1 December, I am sure everybody in this House will be celebrating their local small businesses. I will be launching my Small Business Saturday competition soon. Is it not a good opportunity to use the Budget to show that we are behind small businesses by doing something about business rates, which are hitting small businesses on the high street?
I join the hon. Gentleman in drawing attention to Small Business Saturday, which is coming up. I am sure colleagues right across the House will want to enthusiastically promote businesses in their constituencies. I hope that, being a fair-minded Member, he will reflect on the major changes that have been made. As I said, the Retail Sector Council has made some suggestions for the future, and I am sure the Chancellor will be listening.
I think it is well known, and my right hon. Friend is aware, that we have been one of the leading forces in the world in ensuring that the rules should be changed, so that companies that currently pay little tax because of international agreements make a fair contribution. There is more to be done, but my right hon. Friend served in Cabinets in which this was put at the top of the agenda, and some progress has been made.
I warmly welcome the Under-Secretary of State, the hon. Member for Rochester and Strood (Kelly Tolhurst), to her new role. I am sure she will do fantastically.
All the major business representatives, from the CBI to the chambers of commerce and the Federation of Small Businesses, have highlighted the need for business rates reform and temporary relief. The CBI says:
“The…system is stifling growth and investment”,
and the FSB says it creates a significant barrier to small business growth. Can the Secretary of State confirm today whether there will be any action on this issue in the forthcoming Budget?
The hon. Lady knows that decisions on the Budget are for the Chancellor, but one of the measures we have taken, which I hope she would acknowledge, is a very substantial reduction in the burden of business rates on small businesses. That shows that the Government are alive to the importance of business rates for small businesses. We of course listen constantly to the organisations she mentions, but also to the Retail Sector Council.
I suddenly have a sense of déjà vu. At the last autumn statement, business groups warned of the devastating effect of business rates. In return, we saw only minor tinkering. Since then we have had a raft of store closures, with more than 100,000 retail jobs lost in the past three years. Many businesses cite business rates as a root cause. The Secretary of State has reportedly said that adjusting business rates would be one way to recognise the value of our high streets, yet the Chancellor said in July that there were no plans for reform. Just what is going on? Will there be action, or should we expect another year of meaningless tinkering from the Chancellor?
The hon. Lady knows, and retailers will tell her if she listens to them, that the change in the pattern of retail trade, as more of us are buying more goods online, is going to make a change to the high street. Everyone accepts that. Do business rates make a contribution, and can they help? Yes, of course. That has been behind the changes that have been made. I have said before, and I said it today, that it is reasonable for the taxation system to reflect the contribution that high street businesses make to communities.
Greenhouse Gas Emissions
As the hon. Gentleman will know, on Monday I wrote to the chair of the Committee on Climate Change for advice on how to get to a zero-carbon future. We did not ask for a specific date. We asked for advice on what date would be appropriate, as well as an analysis of the costs and benefits. I expect a response by next March. He will know, as the proud representative of one of the finest universities in the world, that so much of that change will be based on innovation and research, much of which is going on in his fine city. That is why we have contributed more than £2.5 billion during this Parliament to support that research, which can help us to save the planet.
I know the hon. Gentleman’s city well and I commend the council there—it is the wrong colour, but it is making many good decisions on such things as solar bins, cycling and walking, which are very possible in a city such as Cambridge. In constituencies such as mine, people have to rely on their vehicles. We know that the cost of living is an issue and it is right that we continue to help people to put some money back in their pockets. On electric vehicles, 13% of new vehicles sold in August this year were ultra-low emission. That market is evolving and the cost of those vehicles is coming down. We have spent half a billion pounds of taxpayers’ money subsidising the purchase of those vehicles and my expectation is that the price will continue to fall faster as we see the infrastructure build up.
We are making the UK the best place to start and grow a business and a global draw for investors: for example, Green GB Week showcases fantastic opportunities in clean growth for businesses, as put forward in our industrial strategy. We have put in place the building blocks to drive £20 billion of investment into high-growth potential businesses and to support long-term investment across the UK.
I thank the Minister for his answer. Town deals are a welcome part of the industrial strategy. Yesterday, a delegation from Torbay Together met the Minister in the other place to discuss how a town deal for Torbay would make our bay the best place to grow and start a business. What view does the Minister take of how such a deal for Torbay would help to deliver this objective of the industrial strategy?
I am aware of the ambitions in Torbay and I am encouraged to see the high-level commitment from the Torbay Together partnership. I encourage Torbay Together to continue its engagement with the Heart of the South West local enterprise partnership to ensure that the forthcoming local industrial strategy reflects the potential for the local area, and I commend its strategy.
UK shipbuilding is vital to the industrial strategy and our long-term economic success. When he visited Cammell Laird last year, the northern powerhouse Minister—the Under-Secretary of State for Housing, Communities and Local Government, the hon. Member for Rossendale and Darwen (Jake Berry)—said:
“The future of this yard is absolutely crucial to the future of Birkenhead and Liverpool and I will do all I can to support them.”
Since the decision was made last week to cut more than 290 high-skilled jobs—40% of the entire workforce—the silence from the Government has been deafening. What will the Government do to defend jobs in this vital industry?
The Under-Secretary of State for Business, Energy and Industrial Strategy, my hon. Friend the Member for Watford (Richard Harrington), met and spoke to Cammell Laird last night. It has finished one contract and a number of other contracts are on the way. It has also received £150 million for projects that it is engaging in and the Minister will be delighted to meet the hon. Gentleman to update him.
Research and Development
Research and development plays a vital role in improving productivity and helping us to expand our global opportunities. The Government are investing an additional £7 billion in R&D funding by 2022—this is the biggest increase in public funding. Our ambition is also to increase total R&D spend to 2.4% of our GDP by 2027, and 3% in the long term.
My hon. Friend is absolutely right. I understand that my colleague, the Under-Secretary of State for Business, Energy and Industrial Strategy, my hon. Friend the Member for Watford (Richard Harrington), is meeting with him and leaders from the ceramics sector on 24 October regarding its proposal for future investment. I wish them all the best.
The Minister may be aware that there is a need for more research and development funding for geothermal energy projects, which I have previously raised with the Energy Minister. Will he set out what additional funding he will give to get more projects in line, such as the one in Caerau in my constituency?
I commend the hon. Gentleman on what has been done so far. As I said, a record increase of funding is available for research and development, mainly through UK Research and Innovation. We also have the industrial strategy challenge fund, but in all that, we are looking for projects that are cost-effective and if those become available, we will be happy to fund them.
I thank my hon. Friends for asking this question during Green GB Week. Nuclear power is the key to the UK leading the world in decarbonising its economy, which is why the Government are working hard to secure a good deal at Wylfa, Anglesey and to develop alternative financing models to benefit future projects and implement the landmark nuclear sector deal.
Would the Secretary of State meet me and cross-party colleagues to progress the nuclear decommissioning of our out-of-service nuclear submarines, which are currently decaying in Plymouth, not only to maintain our world-leading skills in this vital nuclear sector, but to develop the export potential for this work, to help meet our global commitment to a cleaner planet and to ensure a continuing increase in the number of nuclear engineers?
My hon. Friend is correct to bring this subject to my attention. The Ministry of Defence leads the submarine dismantling programme and my Department the civil dismantling programme. I talked to the Secretary of State for Defence only yesterday about co-operation between our Departments, because it will unlock significant opportunities for the UK economy, including exports and skills. Our Department is getting very good at decommissioning.
The hon. Gentleman should be aware that the Government have a responsibility to ensure a mixture of power sources. Nuclear has a role to play and makes a tremendous contribution to the economy, employing nearly 70,000 people, but renewables are also very important. It is all about a mix and ensuring that the country has secure green energy for the future.
As the Minister is aware, the Civil Nuclear Constabulary is an important element of the future of nuclear power. In December 2017, I asked about its pension arrangements, and I understand that we are still awaiting an equality impact assessment from the Minister’s Department. Will its staff have it for this Christmas?
As the hon. Gentleman may know, I like to give Christmas presents wherever possible. I have met the chief constable and representatives, and I have written to the Treasury. I cannot imagine what Santa will bring, but we are doing our best in the Department to resolve this issue.
I am proud that BEIS supports all its employees with comprehensive family-friendly policies. More widely, employees are entitled to a suite of family rights and protections, and we are looking to go further. We are considering requiring employers to assess whether a job can be done flexibly and to make that clear when advertising. We will also consult on a proposal to require large employers to publish their parental leave and pay policies.
I have just come from the Education Committee, where we heard from Pepper the robot, who could perhaps help us all give better answers to questions.
Does the Minister agree that one of the keys to unlocking the gender pay gap and family-friendly working practices is to raise the esteem in which part-time workers are held, so that they have the same pay, career progression and investment in training as other employees, and that perhaps if more fathers worked part time, we might raise that esteem further?
The hon. Lady raises an important point. Part-time workers are a valuable part of our economy, and it is right that they be held in the same esteem as full-time workers. With our policies and announcements on flexible working, I hope that the Government can strengthen this and deliver what she seeks.
This week, through more than 30 events, Green GB Week is celebrating the UK’s status as a world leader in clean growth. At the world’s first zero emission vehicle summit last month, we announced further investment in research and development relating to green vehicles, new batteries and low-carbon technology, as part of the Faraday challenge in our industrial strategy. That resulted in a pledge by the industry to invest half a billion pounds in those opportunities.
In addition, since we last met we have announced action to protect small businesses against unfair late payment terms imposed by larger firms. Alongside the Siemens chief executive Juergen Maier, I chaired the first meeting of the Made Smarter Commission, which will help to transform manufacturing through digital technologies. We have also announced that, to evaluate the impact of the industrial strategy in the years ahead, the Bank of England’s chief economist, Andy Haldane, will chair the Industrial Strategy Council.
A business took over Thomson Reuters in Wrexham a few weeks ago, and last Wednesday announced the redundancies of 300 skilled workers who had spent the last 10 years building it up. The jobs are being moved to India. In the context of Brexit, does the Secretary of State agree that we need to reconsider the takeover laws that apply in the United Kingdom, so that this type of predatory behaviour can end?
Our record as a country of attracting inward investment from all over the world has stood us in pretty good stead. Many times, across the Dispatch Box, we have celebrated the success of Jaguar Land Rover, which is, of course, a recipient of Indian investment. It is important for us to maintain that tradition. As the hon. Gentleman will know, we are consulting on proposals to ensure the appropriate assessment of any national security considerations in respect of investment, but if we want to prosper as a country, it is also important for us to engage with the world and to attract investment from all over the world.
Realising the full economic and social benefits of the excellent research at our universities is at the heart of our industrial strategy. Through United Kingdom Research and Innovation, our industrial strategy challenge fund and the higher education innovation fund, excellent research can be commercialised and translated into businesses that create jobs and growth.
Only last week, the publicly owned Post Office announced the closure of a further 74 Crown post offices. Although the Post Office has not disclosed all its spending for its franchising programme, the Communication Workers Union estimates that up to £30 million of public money will be spent on compromise agreements, with staff being paid to leave, as customers, local high streets and the jobs market suffer. Does the Secretary of State agree that the Post Office must be transparent about how much its franchising programme is costing the public purse?
On 11 October, the Post Office announced a plan to relocate 40 post offices in WHSmith stores. The overall number of post offices will not be reduced. WHSmith will also reach a franchise agreement for the 33 post offices that are already in its stores, so the total number of post offices operated by WHSmith in its stores is planned to rise.
My hon. Friend has made a valuable point. We have high sustainability criteria, but we must ensure that biofuels are sourced sustainably. We have asked the Climate Change Committee for a bioenergy report, which it will provide shortly, and which will give us new advice on questions of land use and the long-term best use of resources.
My hon. Friend is very well informed on matters to do with minerals, but this is topical questions, which require quick answers, so I would like very much to meet my hon. Friend and any other colleagues to discuss this issue in detail.
As I have outlined, a number of stores are going into franchise agreements. It is important that we have a post office network that is fit for purpose and serves consumers as they currently are being. As Post Office Minister, I take that very seriously, but I am always happy to meet with the hon. Gentleman to discuss any particular concerns in his constituency.
I thank my hon. Friend for this question because it is absolutely relevant to our nuclear sector deal, which concentrates very much on the development of skills particularly for young people. I was most impressed on a recent visit to Hinkley Point C by how many young people are in training, particularly the increase in the number of young women involved in nuclear, and I know that will continue.
As my right hon. Friend will know, our high streets face unprecedented challenges. Will he therefore join me in challenging the sharp practices of Smart Parking, which operates in the Westgate shopping centre in Basildon? Its charging and fining regime is damaging the viability of shops and fining thousands of people who have all tried to do the right thing.
My hon. Friend raises an important point, and it is one of the issues we will be looking at with the Retail Sector Council. There is already the review by John Timpson into our high streets, but we need to keep track of this area. My hon. Friend will, as a local MP, champion the cause of his constituency, and I, as Small Business Minister, am acutely aware of the challenges facing our high streets.
The hon. Gentleman will be aware that the Government are considering the Migration Advisory Committee proposals in full, but there is no cap on international students coming to study in this country. The university sector is one of the most successful sectors in this country and this Government will make sure we continue to support it.
My right hon. Friend is correct in making the point that the next generation of diesel engines are very much less polluting than their predecessors. The road to zero strategy makes it very clear that diesel will continue to have a role for some years to come, and for some journeys it will be a particularly appropriate choice. My right hon. Friend will understand that the overall tax regime is a matter for the Chancellor.
I am delighted to tell the hon. Lady that I am in regular communication with the steel industry about a sector deal, which is developing thanks to Jon Bolton, who is chairing it, and to Gareth Stace, the chief executive of UK Steel. I am optimistic that this will develop in a way that will please the hon. Lady.
Preliminary talks are under way in Taunton Deane on the establishment of a digital geospatial centre, to maximise the expertise of the UK Hydrographic Office, which makes the world’s shipping maps. Is not this exactly the kind of unique high-tech enterprise that will open up job opportunities, and exactly the kind of worldwide collaboration that we ought to be including in the industrial strategy?
The UK is at the top of the global league for start-ups, but it is languishing at the bottom for scale-up. Is it not true that this is a black hole in the industrial strategy, because that is where productivity gains could be made? Why is the Secretary of State not acting on this?
It is quite the opposite, and I am surprised to hear the hon. Gentleman say that. If he has read the industrial strategy, he will know that the commitment to scale-up is very prominent. I made reference earlier to the Made Smarter Commission that Juergen Maier is leading. Its purpose is precisely to diffuse the technology that the bigger firms have to those that are growing and scaling up.
In this Green GB Week, will the Minister join me in recognising the work being done by the major oil and gas companies, through the oil and gas climate initiative? They are voluntarily making huge efforts and investments towards a lower carbon future.
My hon. Friend is a strong defender of that industry, which is vital to the UK economy. He will know that those companies have set out their own pledges and that they have set out how they see world changing fundamentally. They are also investing heavily in the new technologies that they want to be part of the future.
The Department’s consultation on limited partnerships closed on 23 July. Scottish limited partnerships continue to be used for dirty money, to the absolute discredit of the country. When will the Minister do something about this?
We acknowledge the reports that limited partnerships, particularly Scottish limited partnerships, have been misused. That is why we have consulted on proposals to tackle the issue and to modernise the law. In June 2017, Scottish limited partnerships were brought within the scope of the register of people with significant control, and since then there has been a fall of 80% in the registration of new partnerships.
The chief executive of Jaguar Land Rover has said that a bad or no deal Brexit would cost the company more than £1 billion a year and threaten its future investment in the UK. Can the Minister explain how that can be avoided if the UK is outside the customs union?
Thank you, Mr Speaker. I have been desperately trying to catch your eye. We have had a number of comments on post office relocations and closures. Will the Minister make it absolutely clear that relocating a post office to WHSmith does not save the services within it? Many have been massively downgraded at the point to which they have been relocated.
Thank you, Mr Speaker. May I bring to the Secretary of State’s attention the power that he has to mutualise Post Office Ltd to allow sub-postmasters and sub-postmistresses, and their customers, to have a share in their own Post Office? Will he look at this, because it would bring greater sustainability to the post office network?
That is something I am more than happy to look at in my new role, but it is something that you could have done yourself—[Interruption.] Sorry, Mr Speaker! It is something that the right hon. Gentleman could have done when he was a Post Office Minister.
As increasing numbers of high street banks are closing, post offices offer a potential solution for communities suddenly left without a branch facility. However, sub-postmasters are not yet able to carry out the full range of transactions that customers expect. What can the Minister do to help our post offices, which are vital to the survival of our high streets, to perform the banking functions that have been recommended?
My hon. Friend is right that post offices are now so valuable to our high streets. There are lots of opportunities for post offices to develop further in providing services to their community. As the Minister with responsibility for post offices, I will do whatever I can to facilitate that.
I am just starting my career as an independent, but you are right, Mr Speaker.
The urgent question is: To ask the Secretary of State for Work and Pensions if she will make a statement on her Department’s proposed changes to the roll-out of universal credit.
I note the precise wording of the urgent question. I have a great deal of respect for the right hon. Gentleman, who cares deeply about welfare matters and is an excellent Chair of the Select Committee on Work and Pensions. He, his Committee and the whole House have a right to hold the Government to account, and that includes the Department for Work and Pensions.
I do not wish to be unhelpful. However, some of the matters to which the right hon. Gentleman may allude are the subject of speculation in the media. There has been a great deal of speculation about universal credit over the past few days, and I cannot and will not comment on speculation.
When it comes to the roll-out, we have long said that we will take a slow and measured approach to managing migration, which is why we will continue to take a test-and-learn approach, acting on feedback and improving the system as it rolls out.
Universal credit will be in every jobcentre in the country by December 2018. People making new claims to our benefits system now apply for universal credit, rather than being put on the old system. Next year, we will start the wider process of moving people from the old benefits system on to universal credit. The process will begin later next year in a measured way, with no more than 10,000 people moved over, to ensure that the system is working well for claimants and to make any necessary adaptations as we go.
We have said for a long time that the managed migration process will take place from 2019 to 2023.
I think I am grateful for that answer. I will be more grateful if we get answers to my five questions, which I will put in the two minutes I am allowed.
Will the Government commit themselves to ensuring that everybody who is transferred from the existing benefits on to universal credit is not made worse off, does not lack income and does not face hunger or destitution? First, to that end, will the Minister guarantee that existing benefit payments will continue to claimants until they pick up universal credit?
Secondly, on debt recovery, a welcome rumour has been given to the papers of a reduction in clawback from 40% to 30%, but that is only on the advance people might receive to prevent hunger and destitution; it does not cover all other debts. People can still be left with no money. Will the Minister guarantee to the House that nobody will face a situation where their debt repayments cancel out their benefit payments?
Thirdly, will the Minister implement the Select Committee’s recommendations to ensure that those brave people who have chosen self-employment to try to free themselves from poverty are encouraged, not discouraged?
Fourthly, for mothers already on universal credit who find work, will he guarantee that their childcare payments will be made up front, and not a month in arrears?
Fifthly, given that this benefit is designed for people on monthly payments and not for poorer working people who get their income on a daily or weekly basis, will the Minister wish me luck when I meet the Secretary of State this afternoon to discuss our need for a citizens bank, which will help people manage their money, once all those reforms are in place, and ensure that none of them faces hunger, destitution or losing their home?
I thank the right hon. Gentleman for his comments, and perhaps I may go through them in turn. He raised the overall issue of managed migration. As he knows, we have made our draft proposals available to the Social Security Advisory Committee; they have been public and people can see them. We have received recommendations from the SSAC and in due course we will publish our feedback on those. As for ensuring the position of anyone currently on benefits when they are transferred across, we have made it very clear that transitional protection is in place for those individuals. We have also said that the 500,000 people on severe disability premium will be protected. As he knows, earlier this year we also implemented £1.5 billion of extra support. I say not in anger but in sorrow that Opposition Members did not support those proposals, and I hope that when it comes to managed migration, they will. On debt recovery, he talked about a “rumour” and I am not going to comment on rumours, but, as he knows, maximum deductions are currently 40% of the standard allowance. On self-employment, we are indeed helping people; as he knows, from 2017 we introduced a new enterprise allowance, and we are making sure that we are giving support to people to help them to develop their business plans and to grow their businesses—as a party that is the champion of entrepreneurs, that is absolutely the right thing for us to do. He will of course know that up to 85% of childcare costs are recoverable under universal credit, and that is an important improvement that has been made. I am sure that he will find his meeting with the Secretary of State extremely useful.
There is heavy pressure on time, with two further urgent questions to follow. There will of course also be a debate on this important matter tomorrow. It may not be possible to accommodate everybody, but the chances of doing so will be better if we have pithy questions, to be exemplified by the hon. Member for North East Somerset (Mr Rees-Mogg).
My hon. Friend is absolutely right; under the legacy benefits system, some people did face effective tax rates of 90% and that system also disincentivised people from work. As I have said, those on legacy benefits that we manage migrate across will of course receive transitional protection.
Universal credit is causing severe hardship for many people claiming it, and over the past two weeks conflicting statements from the Government have caused real confusion over the impact it will have on people who are required to move across to claim it in the next phase. First, we were told that austerity is over and then that families on low income are in danger of losing up to £200 a month as a result of transferring to UC. Next, the Prime Minister said that nobody would be worse off, but the Secretary of State contradicted her the following day by confirming that in fact some families would be worse off. So will the Government now publish their impact assessments of that next phase? How many households currently claiming legacy benefits will be worse off between now and 2023 as a result of making a claim for UC?
Yesterday, the Secretary of State met criticism of UC with accusations of scaremongering. So can the Minister tell us: are Citizens Advice, the Child Poverty Action Group, the National Association of Welfare Rights Advisers, the Residential Landlords Association, the National Housing Federation, the Resolution Foundation, the National Audit Office, two former Prime Ministers and more than 80 organisations representing disabled people scaremongering? From these Benches, we again call on the Government to stop the roll-out of UC now.
It is interesting that the hon. Lady talks about confusion. Let me be absolutely clear: there is no confusion on the Government Benches; the confusion is on the Opposition Benches. The shadow Chancellor talks about abolishing universal credit and others talk about reforming it. There is no clarity at all from the Opposition. They oppose everything but they have the solution to nothing.
When it comes to hardship, as I just said we introduced an extra £1.5 billion, but the hon. Lady did not vote for or support that. When it comes to protecting people, I have already made it clear that we will have transitional protection and that there will be protection for the half a million people on severe disability premium. I do not know what the hon. Lady wants, but if she wants to go back to the legacy benefit system, she should know that 700,000 people in this country are not getting the benefits that they require. That is £2.4 billion of underpayment and that will change under universal credit. Finally, the hon. Lady talks about Citizens Advice; I hope that she will welcome the partnership we recently announced with Citizens Advice to help the very vulnerable.
I was in the House in 2010 when the Conservatives had to come in to sort out the mess left by the previous Government. Labour Members told us that as a result of our policies, there would be a million fewer jobs, but there are more than 3 million more jobs. They should welcome today’s jobs figures. My hon. Friend is absolutely right that unemployment is at its lowest level since 1975, youth unemployment is at a record low—it has more than halved since 2010—and wages are outpacing inflation for the seventh month in a row.
Thank you for granting this urgent question, Mr Speaker.
In spite of what the Minister has just said, which I think was a return to the flat-earth rhetoric referred to by the BBC’s Michael Buchanan, it appears that the Secretary of State is finally starting to recognise what her predecessors failed to recognise: the fundamental problems with universal credit. Of course, just delaying the process, or reducing the clawback rate, as has been rumoured, will not fix the misery that is being faced in areas where universal credit has already been rolled out, such as Airdrie and Shotts, or in those areas progressing to roll out, such as Glasgow, Edinburgh and Aberdeen.
Yesterday, the Secretary of State hinted to me that she has made requests of the Chancellor for additional funding in the upcoming Budget. In that regard, the Chancellor should really be sitting with the Minister, listening to proceedings on how to make universal credit work. It appears that moves are afoot to change universal credit. If the Minister will not comment on rumours, why will he not be straight with the House now and tell us what the plans are? Does he not agree with the many concerned expert groups listed by the shadow Secretary of State that have called for a halt to the roll-out, dramatic and fundamental intervention in the Budget and a full review of universal credit thereafter?
As I have said and suspect I will have to keep saying, I am not going to comment on rumours. The Secretary of State was clear yesterday that matters relating to the Budget are for the Chancellor and the Prime Minister. Indeed, the Chancellor will be here in a couple of weeks and the hon. Gentleman can ask questions then. I have already set out our plans for managed migration. If the hon. Gentleman is keen for universal credit to work properly, he should support the measures that we have introduced and will be bringing in to support the most vulnerable. The shadow Secretary of State talked about the £1.5 billion; the debate was on 13 March this year and she did not support the £1.5 billion for the most vulnerable.
The roll-out of universal credit reaches Kettering tomorrow. Some 530 local households currently receive universal credit, but 7,700 households on legacy benefits will qualify. Will the Minister assure my constituents that all the staff training and systems are in place at Kettering jobcentre to ensure a smooth migration?
When we actually do roll out universal credit—as I have said, it will be completed across all jobcentres by the end of the year—we absolutely ensure that full training is given to our work coaches. Of course, local Members of Parliament are invited in to have discussions with jobcentres. I have been with colleagues to several jobcentres where universal credit is about to be rolled out and they have been satisfied with the roll-out process. On managed migration, that will take place from 2019 to 2023 and we will make sure that we get our processes absolutely right.
Universal credit rolled out in Wirral at the beginning of the year, and in the first six months of this year there was a 34% increase in food bank use in the Wirral area. That is more than 30 tonnes of extra food needed, and the people who work in the food bank tell me that that is a direct result of the universal credit roll-out. If everything is so wonderful, why is this happening and why are a Conservative ex-Prime Minister and a Labour ex-Prime Minister warning the Government that they have to change this system?
If the hon. Lady was so keen to help her constituents, she would have voted for the extra £1.5 billion of support, but she did not. Labour Members cannot get away from that. Members cannot call for help for their constituents—for all our constituents—and then not deliver when it comes to the votes. As the hon. Lady knows, the all-party group on hunger published a detailed report on this issue and concluded that there are myriad complex reasons for the use of food banks. It cannot be attributed to a single reason.
The Minister referred to moving people from legacy benefits on to universal credit; will he look into doing that for vulnerable people, rather than relying on them to make a new claim and risking there being a gap in their benefit receipts if they do not understand the process?