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Lord Dobbs
That the Virtual Proceedings do consider the contribution made by businesses and the wider private sector in addressing the COVID-19 pandemic.
Lord Dobbs (Con)
My Lords, I am so sorry for the short delay, which has possibly been my fault with the technology. I am truly grateful to my Whips for this opportunity. I also thank the many noble Lords who have indicated that they want to contribute today. Even those who have made it through the virtual culling process have only two minutes, which is pretty thin gruel, and I am sorry, but this is a discussion that we will need to continue.
We are here to discuss the private sector, but I start by thanking all those who have done and are doing so much in the public sector: our extraordinary doctors, nurses, porters, receptionists, ambulance drivers—everyone in the National Health Service. I also thank the local authority workers, the civil servants, the members of the Armed Forces and police forces, not forgetting our charities and the millions of volunteers who do so much to bring our community together. At 8 o’clock tonight I will be applauding them all.
How often have we heard the cry, “I can’t wait to get back to normal”? We have even thought it ourselves, but we will not be going back to whatever normal might have been. We will have to move forward to meet what will be a changed world, with its own very different challenges. It is the private sector—not just big business, but the medium and smaller enterprises, start-ups and self-employed—that holds the answers to meeting those challenges.
What has the private sector done so far? What Britain has needed, it has delivered. A couple of months ago we found ourselves confronted by one of the most acute situations of modern times: literally a matter of life, death and days. The private sector rose to the challenge magnificently. We were desperate for more intensive care beds, so we built Nightingale hospitals. Yes, under the supervision of the Army and the NHS, but who actually built them from nothing in record time? It was contractors such as Mace, BDP, Vinci and McAlpine. Meanwhile, the private health sector provided 8,000 beds and more than 10,000 nurses to help the NHS take the strain. Who can forget the care homes, whose workers have toiled tirelessly through so many difficulties?
We needed face visors, so step forward the Royal Mint, Bollé Safety and Jaguar Land Rover, many of which manufactured visors in days, from a standing start. Protective gowns have come from Mulberry, Burberry, Barbour, Imperial Polythene and literally hundreds of others. The fightback has been tremendous, with well over 1 billion PPE items already delivered to the front line. I thank every worker involved.
But I am not finished. We need millions of test kits; where will we get them? From Roche, AstraZeneca and GSK. It is the same story with ventilators: Babcock, BAE, Honeywell, Rolls-Royce, Mercedes and even McLaren Formula 1. It is a long and extraordinarily diverse list of names, and I make no apologies for continuing with this roll call of honour. Brewers have turned out millions of bottles of sanitisers, and so have cosmetics manufacturers. Chivas and Budweiser have been standing alongside Estée Lauder and L’Oréal, not forgetting Diageo and PZ Cussons. Private enterprise has shown itself to be extraordinarily adaptive. I read on the BBC that one quick-witted manufacturer has turned his 3D-printing operation, which usually makes sex toys, to producing ear protectors for the NHS. This is not quite swords into ploughshares, perhaps, but it seems there is no end to the entrepreneurial imagination.
Beyond this, we have needed to keep food suppliers open, even as we have shopped at a social distance. Who changed overnight to meet the need? Yes, the retailers: the supermarkets, the takeaway outlets, the village shops in the countryside and the corner shops in the towns. We have even managed to meet the deranged demand for loo rolls. My village shop in Wylye has kept itself open and is doing home deliveries of food, prescriptions, news and, perhaps most important of all, comfort to the elderly, looking out for them. They have kept Wylye running, just as the power generators, petrol stations, transport firms, heavy-duty truckers and white-van drivers have kept the entire country running.
Who will provide the vaccine, as and when it is developed? Yes, the private sector, in collaboration of course with our finest universities, like Oxford, Cambridge and Imperial. Ask yourselves: who provides the backing and the financial resources for so many of these university research facilities? There is a simple answer: the private sector. The list of business that have adapted to provide Covid-related services is almost endless. Some have tens of thousands of employees, some less than 10. There is an excellent tally on the Manufacturer website that is so long that it will take an hour to read, and I hope will take noble Lords just as long to applaud.
Before the cynics start claiming that they only do it for the money, let them go and talk to some of those involved. This is what one business leader, whose company has been working on beating Covid, told me: “It was like nothing I have seen before. Our employees worked tirelessly for weeks on end, until late at night, and not seeing their families even over the long Easter weekend. They used their ingenuity and were motivated by the need to save lives.” And that particular firm did not ask to be paid for its efforts.
We have been faced with circumstances that no one alive today has ever seen before. It is a challenge of historic proportions. But no one has run out of fuel, no one has run out of ventilators, no one has run out of food, and neither must we run out of hope, initiative and enterprise.
Yet there is a price to be paid for beating Covid. More than 2 million people are now out of jobs. School and university leavers will find it far more difficult to move on with their lives with a quarter of all graduate jobs gone. A new generation is about to discover the pain of mass unemployment, through no fault of its own. There will be a heart-breaking rise in insolvencies and bankruptcies. Many firms will go bust, which is why the Government are right to bring forward a new insolvency Bill to help companies in trouble. There are hard times ahead for us all.
Yet there are some who seem almost to welcome the downturn, using it for their own narrow ideological purposes. “More control, more regulation; we must put welfare before wealth,” they cry. Rarely has more nonsense been encapsulated in a single phrase. Without wealth, and particularly without new wealth—which we are going to have to create—there will be no welfare. We cannot share what we have not got.
We are going to face entirely understandable demands for increases in spending on health, our growing number of elderly people, cleaner and greener industry, education and training. Yet, far from their hoped-for increases, these sectors and many others face budget cuts that will turn their dreams to nightmares, unless we can get Britain back to work.
Last weekend, the Sunday Times published its new “Rich List”. I know the very thought is enough to send timorous wee beasties into spirals of outrage, but who stood at number one? Sir James Dyson, that extraordinary, inspiring and very British engineer and innovator. His success does not make him perfect; he admits to mistakes. He blew half a billion pounds on developing an electric car: a great idea, but not to be. How did he respond to failure? Overnight, he retooled his facilities and began developing a new kind of ventilator for the NHS. That did not work out either: the NHS has more ventilators than it is able to use. Now, he has switched the workforce and facilities he used to develop the electric car concept into totally new research. “Ours is a life of risk and failure,” he says. “We try things and they fail. Life isn’t easy.” Well, he can say that again. But life is not about getting everything right; it is about getting enough right to make a difference.
Covid-19 must be fought on many fronts and in many ways. It is not just about a disease but about an economic recession that will bring with it mental illness, poverty, pessimism—afflictions that are already causing an increase in the number of non-Covid deaths. In the coming months, we will be hit by a tidal wave of appeals to support this sector or that interest, all of which may be thoroughly worthwhile, even vital. However, we cannot look forward if we are shackled by poverty and failure, and lockdown means poverty. If Britain ends up permanently poorer, the virus will have won. We need to turn the situation into an opportunity to create new wealth.
This will only come through the private sector. It is the private sector where we will find the means to take the revolutionary ideas pouring out of our universities and turn them into world-beating enterprises. It is the private sector where the new vaccines and drugs we need will be developed. It is the private sector where we will find new firms to harness the technologies that will enable us to live greener and cleaner, where the new jobs will be created that will restore hope and where the future prosperity of this country will be built. In the private sector. It is not perfect; I do not pretend that it does not have its faults, but it is the only solution to the challenge that Covid-19 will leave behind.
The Government have done an extraordinary job in providing short-term support, with furloughs, interest-free bounce-back loans and interrupted business-scheme loans, but, as always, our tomorrows will be created by ideas and enterprises that we do not yet know about. So, at every turn, the emphasis must be on supporting new enterprises, as well as bailing out old ones. Workplaces must look up again. Yes, there are risks in doing that, but there are risks on both sides of the equation. There is no place called safety right now.
I am also keen for this House of Lords to get back to our proper way of business. Otherwise, the idea will grow that we are nothing but a gathering of the elderly and infirm. Between us, we have many lifetimes of accumulated experience, so I welcome the commitments we have been given by the usual channels to get us back to full sittings as soon as possible—and perhaps even earlier, please.
One day soon, there will be a day of reckoning and inquiry, of looking back to ask how well we as a country did. Could we have done more to beat the virus? No doubt it will be filled with lurid headlines and partisan opinions that rely entirely on hindsight, but we must not shirk from that. We must go on getting better. We should remember that even Winston Churchill needed a Dunkirk before he reached his D-day. Nothing lasts forever, not even misery and disease. The infection rate is falling, along with the number of deaths, and I remain an optimist. I will stick to a few basic truths: there will be no recovery without risk, no welfare without new wealth, and a vibrant private sector is in the greatest public interest. I beg to move.
Lord Blunkett (Lab)
I congratulate the noble Lord, Lord Dobbs, on his initiative in getting this debate. I assure him that I am neither elderly nor infirm. In my two minutes, I wish to emphasise the importance of both private and not-for-profit organisations and businesses, not only in seeing us through these last 10 difficult weeks but for the future.
From care homes to transport operators, from equipment manufacturers to those producing, distributing and delivering food, we have seen the most enormous initiative, of which the noble Lord, Lord Dobbs, has spoken. He mentioned the “golden triangle” universities. I would like to see the initiative shown there replicated across the country. If the Government’s agenda is to be balanced, including in recovery, and if we are to invest in productivity and recovery right across the nation, we will need to see that public-private partnership, research and knowledge transfer, manufacturing and innovation all coming together. I hope that the north of England—not just west but east of the Pennines—can replicate that. The noble Lord, Lord Dobbs, mentioned the initiatives that have been shown, including by McLaren. The Advanced Manufacturing Research Centre here in the city of Sheffield will be an exemplar for the future, perhaps by linking the university with those across the Pennines.
Will the Minister place emphasis, along with the sustainability research task force, on that rebalancing of the economy, the initiative and innovation of recovery, and on the entrepreneurship that comes from people working together?
Lord Purvis of Tweed (LD)
I thank the noble Lord, Lord Dobbs, for the debate, and I very much share the sentiments of the noble Lord, Lord Blunkett. We know there will be very serious long-term consequences for many sectors in the UK economy beyond this immediate shock. For example, the Chancellor has already indicated that the self-employed will be likely to pay higher taxes and national insurance contributions next year, while businesses in Northern Ireland will have greater trade barriers because they were misled by the Government. Those are just two examples.
On a wider scale, we know from analysis in the FT that the UK is being and will be impacted greater than many of our competitors because of the profile of the UK economy on top of the contraction of investment, economic flight, and restrictions on labour mobility that we were already seeing as a consequence of Brexit. Our services-centred economy and the flexibility our businesses have had in a liberalised labour market were both highly integrated into our biggest economic market but from 2021, new barriers are being erected to that market.
Therefore, it is imperative that we have information on the core estimates of what the economic and business impact will be of the proposed trade agreement with the EU. When I asked the Government for this in a debate recently, I received subsequent correspondence from the noble Lord, Lord True, for which I am grateful. However, he said:
“The economic impacts of our trade deal with the EU are the subject of a thriving public debate among analysts. It is impossible for a single model, number or scenario to capture that complexity or represent the varying impacts that will be felt across different parts of the economy.”
It seems to be possible to give a model, number and scenario of the impacts of a hoped-for trade agreement with the US, and a hoped-for Japan agreement, but the Government refuse to do so for what is by far our biggest import and export market. It is not acceptable that we go blind into making serious decisions, impacting on our businesses and private sector for the long term, without the Government releasing core estimates of the economic impact of their proposed agreement with the EU.
Baroness Noakes (Con)
My Lords, it is good to have the opportunity to debate Covid-19 in a context wider than health and social care. Sadly, a series of two-minute talking heads on a Zoom screen is very far from being a real debate.
The only economic certainty about Covid-19 is that it is causing massive damage to our economy. The political priority now needs to shift to rebuilding our economy. The Chancellor of the Exchequer has been bold. His job retention scheme and Government-backed loans are delivering on propping up many businesses and jobs for now. However, many will not be viable in the face of debt burdens, higher operating costs and changed demand in a post-Covid-19 world. Businesses and employment will be lost. We will need an economic renaissance with business at its heart. Growth and jobs come from new businesses and new investments in products and markets. I do not doubt that that there will be a role for publicly funded investment in the short term, but the foundation of a successful economy is not a big state; it is a big and effective private sector.
The Government must focus on encouraging small businesses, start-ups and scale-ups. They should listen to organisations representing SMEs and not, for example, the CBI. A holiday for SMEs from all non-essential regulations would be a terrific start. We need to move from risk aversion to sensible risk-taking. Let us have an end to draconian Covid-19 restrictions as soon as possible so that businesses and individuals can return to the normal world of taking responsibility for making informed decisions. Economic recovery cannot begin without that.
Lord Bilimoria (CB)
In this crisis, what has worked is not the Government working on their own but collaboration between them and the private sector. The first Nightingale Hospital, which the noble Lord, Lord Dobbs, spoke about—4,000 beds put up in nine days—happened because the Army, the Gurkhas, the NHS, the University of East London and the private sector all worked to put it together. On vaccines, we have seen Oxford, other universities and industry working with the Government and all coming together. Testing was not working when it was just in the hands of PHE; now it is because there is a collaborative effort between laboratories, research institutes, the Cambridge Biomedical Campus and, for example, AstraZeneca and GSK, all working together.
The CBI, where I am a vice-president, has a business heroes campaign, which urges organisations to join a nationwide effort and share examples of best practice. The CBI is helping to co-ordinate the efforts of companies and stepping forward to provide assistance where possible, from providing computers for pupils to PPE for healthcare and care workers. At the University of Birmingham, where I am chancellor, academics from across the business school are working with business intermediaries, such as the CBI, to reskill people for future working needs on working health and well-being.
As business, we are very grateful for all the help the Chancellor and the Government have given us, but the hospitality sector, which my business is in, is suffering greatly. It has basically been shut for two months and will take a long time to recover, especially if social distancing measures are meant to be in place. Through the Government’s CBILS loans, launched two months ago, 40,000 businesses have been given just over £7 billion. I have been urging the Government to give 100% guaranteed loans for business, and they listened and have done that. In just over two weeks, the bounce-back loan scheme is up to £50,000, and 464,393 companies have received £14 billion. This has worked.
With all the challenges ahead in this recession—as spoken about by the noble Lord, Lord Dobbs—I request that the Government raise the limit for the 100% government-guaranteed loan scheme to £500,000, because business will need this support. We, as a nation, are historically renowned for our creativity, business skills and entrepreneurship. That is what will get us through this crisis.
Lord Hunt of Kings Heath (Lab)
My Lords, in parallel to the magnificent efforts of the NHS and other parts of the public sector, we have seen a fantastic response from the private sector but, disappointingly, there are examples of where the Government have seemed reluctant to respond to offers of help. I particularly commend those engineering and manufacturing companies that have shifted their production processes to assist in the manufacture of ventilators. Then there are staff in the health devices industry who are clinically trained, who have returned to the NHS at their employer’s expense. There are pharmaceutical companies at the forefront of efforts, with universities, to develop vaccines while still securing the essential supply of medicines.
Alongside this, there have been a number of puzzling examples of the failure to embrace the potential of more such partnerships. In March, when the decision was made to withdraw community testing and tracing due to lack of capacity, why were businesses, universities and research institutes not asked to help? Why were dozens of UK companies that responded to the Government’s request to switch production to PPE ignored? And why did the Government not embrace the Covid-19 symptom tracker—developed by researchers at King’s College London and the health data science company ZOE—which has 3.6 million people contributing information?
Finally, why have the Government insisted on developing their centralised contact tracing app, which is in difficulty at the moment, as opposed to the decentralised model developed by Apple and Google? I fear that this kind of go-it-alone preciousness has been characteristic of the Government’s approach to the crisis, with a failure to learn from international experience and delay in taking decisive action. We must see better in the future.
Lord Balfe (Con)
My Lords, first, I thank the noble Lord, Lord Dobbs, for initiating this much-needed debate. Secondly, I declare my interest as the father of a small businessman who has a chain of bicycle shops—a very good thing to have at the moment. Many small business people have worked far harder during this closedown than at any time, because they have had to juggle staff—some of whom have wanted to be furloughed, as they have been in vulnerable positions—and a multitude of problems.
When this is over, they will be looking for a level playing field and fair treatment. They have heard what the Chancellor said about higher taxes for small businesses and they are prepared to pay their fair share. But they also look around and see many large businesses, often not domiciled in the United Kingdom for tax purposes, queuing up and asking for large amounts of money from public funds.
The Government must, with the help of the OECD, the EU and other international bodies, tackle the business of tax avoidance and make sure that everybody pays their fair share into what will be a crippled economy. It is necessary that the Richard Bransons and Philip Greens of this world are also brought to the chequebook when paying their taxes. I ask the Government to commit to getting a fair deal from big businesses, as well as tax from small businesses. If they do that, I am sure that all workers in small businesses will join together in the same common endeavour in which they have been engaged for the last few weeks.
Lord Wallace of Saltaire (LD)
My Lords, the noble Lord, Lord Dobbs, said that the private sector is the only solution to get us out of this. I disagree. We are a mixed economy, a society and a national community. We need our society, community and democracy to have the same high quality if we are to recover from all this.
The Government’s early mistakes in responding to this endeavour were in turning to large outsourcing companies to provide services in testing, and now in recruiting for tracing and managing PPE, and neglecting our local democracy and local authorities—which have been bypassed time and time again—and the local volunteers wanting to join. I have just contributed to a school in Bradford, which sent out an appeal for a new cutting edge for its 3D printer because, while the school was closed, it has been printing screens for local hospitals. There are all sorts of local initiatives like that going on, and I have heard the frustrations of people at the local level who have applied and offered to help.
The SMEs so strongly supported by the noble Baroness, Lady Noakes, and I, have not been caught up, because this approach has been so top-down. I have also heard from those in universities, particularly biologists, who have wanted to help and turn over their facilities, but take-up has been slow from an overly centralised Government in England.
My strong message here is that we have made mistakes in not engaging local democracy and local enthusiasm, and in not treating people as citizens, as well as consumers and patients. The private sector at the local, as well as the national, level has to be part of that. We are a national community of citizens, as well as consumers, and this is a national emergency that involves us all.
Lord Shinkwin (Con)
My Lords, as others have said, the contribution of businesses and the wider private sector will be pivotal to our recovery from Covid-19. While no one can take any pleasure from the economic situation in the EU, it seems increasingly clear that the eurozone is going for broke. We must go for growth. It is the only way to shift the coronavirus debt. Our new Chancellor has more than stepped up to the mark, but it is the taxpayer who will have to step up to the plate until we have driven down the debt. That is why we need to unleash the energy of enterprise; we must give business the freedom to innovate, to develop new markets and to grow UK plc.
As someone who owes his life to the NHS, I say we all have a stake in enterprise, wealth creation and growth, for only a competitive, thriving Great Britain offers the security on which our welfare state and the public sector depend. So it is even more important that the Government defend the national interest in our negotiations with the EU, the US, Canada and other trading partners. David Frost’s letter to Michel Barnier signals to the EU, its 27 member states and the world that we are serious in our commitment to trade competitively and to maximum mutual benefit. His commendable clarity is essential if we are to deserve to be taken seriously when Liz Truss, in the other place, says:
“Britain is open for business.”
She deserves our support.
Baroness Jones of Moulsecoomb (GP)
I congratulate the noble Lord, Lord Dobbs, on securing this very timely debate. I agree that we have to go forward and cannot go back, but I suspect we mean different things by that. Many people will expect and want the economy to be restored, more or less, to the way it was in December 2019, but why on earth would we want to do that? It was marred by gross and growing inequality. In a headlong rush towards destructive growth, our economy has been dangerously off the rails for decades. It needs some restructuring, and we now have the chance to do that.
Some, perhaps many, industries and companies will not survive without government intervention and public money, and this gives us all the right and the opportunity to choose how the economy can be different in 2021. The Government can work closely with industries to ensure that they shift their production towards a more sustainable future and to what is needed in the short run.
I would love to outline what a fair, healthy, sustainable economy looks like at some point, but until then, I have three specific questions for the Minister. Will the Government heed the calls from smaller farmers and food businesses for emergency business support, as well as long-term backing, including new funding for local food networks? In addition, will Her Majesty’s Government widen the school food voucher scheme in England to include local shops, along with markets and community food organisations? Finally, will the Minister accept that if the centralised scheme does not work for small businesses and food producers, schools and local authorities should have the powers and the funds to do what they think is best for the local economy in their area?
Lord Caine (Con)
My Lords, I thank my noble friend Lord Dobbs for securing this debate—I hesitate to use that word—and congratulate him on his speech. I echo many of his sentiments, including those about getting this House back to work.
The private sector is the engine room of a thriving, prosperous and free economy, and throughout the pandemic it has undoubtedly stepped up to the mark. Noble Lords have referred to many examples of the private sector helping in the national effort against the virus. I wish to refer to one sector: food.
Despite a few bumps with panic buying early on, the UK’s food and farming sectors have done an outstanding job in ensuring continuity of supply, choice and quality. That includes producers, retailers, large supermarkets, and all those down to small butchers—including my own here in Leeds—and grocery stores. Capitalism has kept our nation fed.
As many noble Lords have pointed out, looking ahead, it will be the private sector that leads our economy out of its Covid-induced recession and back to growth. Those who believe that the crisis has made the case for greater state control and intervention could not be more wrong. This country needs more capitalism, not less.
However, in backing private enterprise to help get our country back on its feet, I have one plea. Given the state of the public finances, it would be tempting for any Chancellor of the Exchequer quickly to impose higher taxes and burdensome regulations. I suggest that that risks strangling any recovery at birth and sending many more small businesses to the wall; a lesson that, alas, seems to be lost on that fledgling student politician, the Mayor of London. We need to get out of lockdown, get the UK back to work—including this House—and give business the freedom to thrive.
Lord Liddle (Lab)
My Lords, I share with the noble Lord, Lord Dobbs, a belief that the country needs a vibrant private sector of both big companies and SMEs. However, the crisis requires us to rethink its moral purpose and relationship to the state. I associate myself with what the noble Lord, Lord Balfe, said on the first point.
Shareholder value had already been knocked off its ideological pedestal before the crisis, but what we now see are the green shoots of a new era of public-private partnership that we should support. On Covid vaccines, the Government are sponsoring research and innovation, but also trying to ensure that we manufacture the stuff in Britain. The Government should take a comprehensive look at nurturing domestic and pan-European supply chains for goods, from basic PPE to highly advanced telecoms equipment. There are pressing security concerns that have to be addressed—I do not want a new Cold War with China—but we have to be less naive and more robust.
Covid is creating the greatest economic crisis since World War II. The Government are offering generous loans to keep companies afloat, but many of these will not be repaid. The solution is to convert these loans into public equity. We must turn the British Business Bank into a German-style KfW and work out how this new relationship will work.
Finally, the Government are opening their doors again to the trade unions. Employers are seeing the positive role that workplace representatives can play in ensuring health and safety. We need to match a new era of public-private partnership with a new era of social partnership.
Baroness Northover (LD)
My Lords, I also thank the noble Lord, Lord Dobbs. I will focus here on the UK pharmaceutical sector. We have the fifth and sixth-largest global pharmaceutical companies in the UK—GSK and AstraZeneca—with other international companies also operating here. We have long been regarded as strong in this field, closely allied to strengths in our universities. However, we employ fewer people in the sector than is the case in France and Germany, which employ almost double the number of people that we do.
As a DfID Minister during the Ebola crisis, I was immensely impressed by the work of Oxford University’s Jenner Institute. I am delighted that both Oxford and Imperial are currently among world leaders in vaccine research. AstraZeneca has partnered with the Jenner Institute for large-scale manufacture and distribution.
I note that the United Kingdom would get early access to the Jenner vaccine, if successful in clinical trials, but also that the vaccine would be destined for low and middle-income countries. That is vital. Could the Minister explain how this will work? Is industry engaging on the potential Imperial vaccine?
AstraZeneca and GSK have set up a testing lab at Cambridge University. They are helping the national testing centres, particularly in automation and robotics. AstraZeneca is part of the R&D platform to fast-track research into potential treatments, and both companies are working on antibody developments. All of this is very encouraging, for now and the future.
I therefore ask the Minister: what assessment has been made of the impact on the UK pharmaceutical sector and our leading research institutes of leaving the EU with no deal at the end of this year?
Lord Hunt of Wirral (Con)
My Lords, in declaring my interests as set out in the register, I am delighted that my noble friend Lord Dobbs has initiated this debate to ensure that everyone who has played their part is appropriately acknowledged and celebrated.
In these dark and challenging times, there are, mercifully, so many positives. Supply chains have held up remarkably well, even during the toughest period of the lockdown. All those involved, including those on supermarket tills and helplines for home wi-fi, call-out engineers, delivery drivers and emergency plumbers, have made their own vital contribution to our national resilience. It has been, and continues to be, a truly inspiring effort.
However, I hope that we all do whatever we can to help and support those sectors that have had little or no ability to carry on during the period of lockdown and social distancing. I think of course of hotels, tourism, restaurants, pubs and cafés, and, in particular, theatres.
In my last speech in the House—really in the House—I referred to the press night I had just attended for the new cast of the marvellous West End show, “Come From Away”. It is an inspiring tale of how, at a time of crisis, human beings adapt and co-operate and the boundaries between private and public, and stranger and stranger, suddenly no longer mean so much. Every time we go online, turn on a light, go into a shop, or receive a delivery of provisions during this dark and unnerving time, we should be grateful for the innovation, doggedness and resilience of millions of our fellow citizens in the private sector, such as my noble friend Lord Dobbs. They deserve our undying thanks.
Lord Moynihan (Con)
My Lords, I refer to my declaration of interests in the register. Companies in the UK offshore oil and gas industry contribute around 50% of our gas, which is used for a large proportion of our electricity production. They also produce a major proportion of the oil that fuels our cars and which is used in the manufacture of a wide range of items that we use in our care homes and the NHS, from contact lenses and toothbrushes to medical equipment, and the heating that supports the vast majority of our homes.
These companies were referred to by my noble friend Lord Dobbs, and many in the service and supply sector that support them also back the UK drive to net-zero emissions. They are fully committed to and are embracing the 2050 targets, while working on the technology to help us achieve the Government’s objectives to lead the world. Oil and Gas UK chief executive Deirdre Michie recently said that the
“UK’s offshore oil and gas industry is not shying away from the climate conversation but embracing it.”
Many in this sector have faced particular hardship during this epidemic, in this new world of working with Covid-19 restrictions. Oil and Gas UK has confirmed it is to seek an exemption for offshore workers to the proposed 14-day quarantine on flight arrivals to the UK. This is an industry I know well, having implemented the Cullen recommendations as Minister for Energy after the horrific Piper Alpha disaster. The safety of its people remains the primary focus, with extensive measures in place to protect and manage their welfare. I hope that the Minister will respond positively to the request to seek an exemption to the proposed quarantine restrictions to minimise any further impact on businesses and jobs in this essential private sector industry, which is already severely impacted by Covid-19, redundancies, furloughing and the low global oil and gas price environment.
Baroness Kennedy of Cradley (Lab)
My Lords, I too thank the noble Lord, Lord Dobbs, for this debate. The incredible effort of businesses large and small needs to be recognised. There is no doubt that there are many heroes in the private sector who are to be thanked for their role in this crisis, such as those joining the national effort to deliver PPE, from our great engineering and manufacturing companies that have switched their production lines, to a pub in Cumbria which has become a makeshift PPE factory, and wedding dress makers now producing aprons and masks.
In the retail food sector, workers have put their lives at risk to keep us fed. Sadly, a recent survey by the trade union USDAW has shown that shop worker abuse has increased during the Covid outbreak. I commend USDAW for its continued campaigning on this issue. Can the Minister give an update on the government consultation into shop worker abuse?
By working together, the supermarkets have kept food on our shelves. They have listened to customers and helped to get food to vulnerable people. The Co-op, for example, has donated over £1 million of food to FareShare to feed those at risk of hunger. But the Government have over-relied on this sector to deliver food to the vulnerable through online deliveries and were slow to realise that this was not the complete solution. Is the Minister confident that his department is doing all it can to ensure that the food supply needs of high-risk groups are being met? Will the business learning from this crisis on food supply and demand be fed into the national food strategy?
In closing, I echo the words of the noble Lord, Lord Dobbs, and recognise the role of our local corner shops. They have been a lifeline to many, especially those who feel safer shopping in smaller, less crowded spaces. Despite financial pressures, they have, for example, given products away to NHS staff and pensioners, arranged free deliveries and set up shops in hospital car parks. Corner shops have done a phenomenal job, so what action are the Government taking to ensure that these small businesses survive and take full advantage of the help available to them?
Lord Addington (LD)
My Lords, in listening to this debate, I find that two things occur to me. One is that the mixed economy really does not have any opponents here; the only thing we are arguing about is the level of the mix. The private sector holds some of the answers, but certainly not all. Remembering that the Government set the terms of market—that is, trading—and what is possible and desirable, we must never take our eye off the interaction. That brings me to the question that I want to talk about: what will happen in the new job market to those with disabilities?
There has been a huge drive to get everybody who has a disability into work. I refer the House to my registered interests, both paid and in the voluntary sector. How will we help? I have seen, in over 30 years as a Member of this House, the peaks when everybody was to be employed and we were short of labour, and the economic downturns when suddenly this group is squeezed. A group that needs adjustment, even if it is comparatively easily done, will always be slightly less attractive to employers than those who do not. Those who have problems that develop at work will always be that much more vulnerable or feel that they should not ask for the help that they are entitled to when the job market suddenly becomes tighter. Can the Government give some assurance that all employers will be reminded of their legal duties and moral responsibilities to these groups? Normally, they are workers who stay in their jobs, do not change and, indeed, perhaps oddly, do not take sick leave. Can the Government assure us that they will maintain this level of support in the future?
Baroness Redfern (Con)
My Lords, I thank the noble Lord, Lord Dobbs, for initiating this debate, reflecting on how businesses and the private sector are collaborating to address this Covid pandemic, which is cutting across people’s lives and livelihoods, and—we hope—to formulate a pathway for businesses not only to survive but to thrive post Covid and get ready for the Brexit D-day. I welcome the continued Treasury support to help businesses large and small, financing them through furlough arrangements, grants or rate relief. Unfortunately, even with all that, not all businesses will survive this pandemic.
Even with such uncertainty, innovative organisations have not stopped taking action right away and offering their services. Companies have adapted quickly to change and redesigned their products or services, or even created new ones, to respond to demand. Textile factories have switched production from curtains and duvets to hand sanitisers, and clothing companies that produced wax jackets now make disposable clinical gowns and medical scrubs.
Post Covid, and post Brexit, it is essential that the Government support companies large and small and encourage them to help scale up, particularly in the engineering, agricultural, chemical and research sectors, thereby increasing their future contribution to UK supply chains, rather than us always looking globally. In the terms of a procurement exercise, let us see what the UK can do first. Tomorrow will present a vastly different landscape. Therefore, if we are to look closer to home with our supply chains, businesses in many areas—
The Deputy Speaker (Baroness Pitkeathley) (Lab)
Oh, we seem to have lost the noble Baroness, Lady Redfern, so we will go on to the noble Baroness, Lady Uddin.
Baroness Uddin (Non-Afl)
My Lords, we have heard about the extraordinary impact of the private sector contribution from the noble Lord, Lord Dobbs, and other noble Lords. I wish to highlight the work of the British curry industry which, as a collective of 11,000 restaurants with 80,000 staff—[Inaudible.] Any recession or job losses elsewhere is likely to have profound effect on this business, which is interconnected and interdependent. Many noble Lords will be aware of the pioneering entrepreneurs and leaders among the 5,000-strong members of the Bangladesh Caterers Association —[Inaudible.] This lockdown has been devastating on their profession. Further job losses—[Inaudible.] It has impacted hundreds of thousands of families for whom this has been their livelihood for generations.
Post lockdown, with the economic decline, many of these businesses are likely to face catastrophic meltdown. The UK’s forthcoming immigration point-based system will further exacerbate the pressure—[Inaudible]—staff from overseas, though not Europe. I look forward to the Home Secretary fulfilling her promises made during the Brexit campaign to support this industry and to recruit skilled chefs from abroad.
Despite all these factors, the majority of restaurants, if not all, throughout the four nations have responded to this emergency in earnest by donating ready-made meals to hundreds of thousands of vulnerable families—particularly during the month of Ramadan—and of course to every hospital in their locality as well as to care staff. I am proud of their formidable endeavours, reaching out to make a difference and disregarding—[Inaudible.] They are indeed the pride of Britain.
I invite the Minister to commend the work of the Bangladesh Caterers Association and agree that government measures for the curry industry are equally as essential—[Inaudible.]
Baroness Bloomfield of Hinton Waldrist (Con)
I remind the noble Baroness of the speaking limit.
The Deputy Speaker
My Lords, I apologise for some of the difficulties we had with sound there. I call the noble Lord, Lord Desai.
Lord Desai (Lab)
My Lords, there is a public sector and a private sector, but there is also a social sector. We must not forget that the social sector is also part of private society. I have been very impressed by how many neighbourhood associations have sprung up to make lockdown tolerable for a lot of people. They have delivered things to neighbours, supplying food and any help. We ought to acknowledge our gratitude to our extensive network of voluntary neighbourhood associations which work towards general welfare and which have sustained us in the lockdown.
I also want to point out the role of charities, which have existed for a long time and risen to the occasion quite splendidly to fill the gap which the state has left in its provision for Covid patients. In particular, the newspapers have stepped in and organised special charities and fundraising for supplies and equipment. [Inaudible.] We ought to appreciate all that voluntary work.
I have a suggestion. Someone proposed earlier in the debate that the loans the Government have given to a lot of companies should be returned not in the form of money but in equity in those companies. That is a very fine suggestion. The Chancellor and Government should take advantage of it and set up a sovereign wealth fund from the equities returned by companies. Indeed, they should say that all loans should be returned in the form of equity and create a sovereign wealth fund.
Baroness Buscombe (Con)
I join others in thanking my noble friend Lord Dobbs for this opportunity to celebrate the many who have worked through the lockdown to deliver vital goods and services across the country. Small businesses have applied amazing ingenuity to work at pace in a relatively safe environment, and others have risked their lives, entirely unsung, such as my friend Ralph who works nights cleaning Chiltern trains and making it safe to travel. Ralph asks: who cleans the trains for the cleaners?
Food shops and hardware stores are thriving, as well as online shopping, with people preferring to avoid supermarkets and stay at home. But my heart goes out to their neighbours on the high street who cannot yet reopen. Some will not be able to afford to reopen after years of developing their businesses, delivering a service and paying their taxes.
We must be proportionate and reduce the distance rule in line with the WHO advice to one metre and reopen our schools to free up the workforce to stem the tide of what is frankly, with respect, cultural and economic suicide. Over 13% of working-age households in the UK were entirely workless before Covid. I stress as a former DWP Minister that we cannot afford this disproportionate approach to the risks. Otherwise, unless we are prepared to radically reform our generous welfare system, the private sector and the taxpayer cannot afford to support the fallout from this crisis.
On a brighter note, let us celebrate those exceptional minds developing a vaccine at the Oxford Jenner Institute, aptly named after Edward Jenner, who developed the first vaccine for smallpox in the 18th century. In praise of British innovation and business, could its deal with AstraZeneca, which said this morning that it has the capacity to manufacture 1 billion doses of the vaccine, be a launchpad for rebuilding our manufacturing base post Covid? For the sake of our young people’s future, I very much hope so.
Lord Razzall (LD)
My Lords, I obviously agree with everything the noble Lord, Lord Dobbs, has said in praise of the private sector. It is now a statement of the obvious that the private sector has been debilitated by the Covid pandemic. Claims for unemployment rose by 69% between March and April, the largest month-on-month increase since records began. The private sector has borne the brunt of economic collapse. What does it face when we return to the so-called new normal?
The Chancellor warned us on Tuesday of a recession like no other that we have seen before. He also warned the House of Lords Economic Affairs Committee that it was not obvious that there would be an immediate economic bounce-back. In practical terms, this means that key sectors of our industry will have difficulty recovering. The hospitality and entertainment sectors represent a key part of our economy, but how will our restaurants, pubs, theatres and cinemas remain economically viable if they have to enforce social distancing? Good luck to the taskforce announced yesterday to tackle these issues.
In economic terms, the numbers will be dire. The Bank of England predicts 2 million job losses this year, taking unemployment dramatically higher, most of all from the private sector. This is on top of the 7.5 million people on the furlough scheme, many of whom may not keep their jobs when the scheme ends. Clearly, we cannot go back to the world before the virus, so surely this is an opportunity to restructure the way the private sector operates. It is obvious that many companies are overloaded with debt. Inevitably, some of the debt will have to be converted into shares. Is this not an opportunity for increasing worker participation and share ownership, a long-held aspiration of the Liberal Democrats?
Talking of the Liberal Democrats, noble Lords will expect me to touch on Brexit. Until we know how the UK can trade back to solvency outside the European Union, surely it is time to extend our transition period and trade talks until the economy has stabilised.
Lord Lang of Monkton (Con)
My Lords, I declare my interests as per the Lords register. I welcome and congratulate my noble friend Lord Dobbs on securing and so effectively introducing this debate. There are certainly vital lessons to be learned from the pandemic about relations between business and government. I wholly endorse tributes paid to the medical and surgical skills of those at the sharp end of saving lives and curing victims, but within the Department of Health and the NHS, among the maze of administrative sectors and subsidiaries, there sometimes seems to be another world that speaks a different language.
The language of business embraces drive, expertise, capability and agility. By contrast, the ponderous language of government bureaucracy sometimes conjures thoughts of delay, control, check and recheck, distrust and aversion to risk. Everything seems to take so long. We hear of telephone calls, emails and letters going unanswered at a time when clothing manufacturers were, voluntarily and unasked, switching their profitable production lines to the manufacture of PPE, and the distillers of whisky and gin to sanitisers. One wonders why precious civil servants are used in, for example, the procurement and distribution of PPE. These tasks are second nature to the private sector, to which speed and accuracy are watchwords.
I am not making a general criticism of the Civil Service. I know from past experience that there are very many brilliant and dedicated civil servants. As a nation, we are deeply fortunate. But some things are surely best done by others. I welcome the progress that is now emerging, but there must be change in the future. The innate suspicion that parts of the Civil Service seem to harbour against the private sector must be overcome. Efficiency, inventiveness and adaptability are what we need and what it offers. Its concern is not ownership or control of chunks of government departments. In times of crisis it wants to help, to be consulted and to work in partnership. Going forward, there needs to be a rebooting of the relationship between the business world and government. Covid-19 has revealed that need. It is time for the private sector to be the first port of call instead of the last resort. That needs a change of culture which I hope the Government will initiate.
The Deputy Speaker
My Lords, after I call the next speaker, the Chair will be taken by the noble Baroness, Lady Garden of Frognal.
Lord Gadhia (Non-Afl)
My Lords, Milton Friedman’s dictum that the business of business is business was always an exaggerated and oversimplified representation of the role of private enterprise in society. Today’s debate has highlighted how the vast majority of businesses take their wider responsibilities seriously and are playing a crucial role in our effort to combat the current pandemic. This forms part of a much broader secular trend, from shareholder supremacy to stakeholder primacy. From the pioneering work of the Quakers in Bournville or Port Sunlight in the late 19th century to the aerospace and munitions manufacturers in World War Two, and through to the modern manifestation of stakeholder capitalism enshrined in Section 172 of the Companies Act 2006, this shift is increasingly being reinforced by the attitude of institutional investors and their use of ESG metrics to evaluate sustainable corporate performance. Indeed, Covid has been a live test of business resilience and agility. The mass implementation of homeworking and the reconfiguration of supply chains and business models to accommodate physical distancing has been a remarkable feat. Covid is accelerating trends and bringing the future closer.
It is clear that businesses will not return to the status quo ante, but the road ahead remains uncertain as we learn to live with the virus. Soon, our health anxieties may be overtaken by concerns for the economy and our livelihoods. Once again, businesses will play a pivotal role in this next phase. While the near-term priorities will be incorporating health and safety protocols into the workplace and any customer interactions, we should also seize the opportunity to address the fundamentals that are holding back our economic performance and productivity.
If there is a silver lining to this human tragedy, it will come from building back better. To borrow from a sentiment expressed previously by the most reverend Primate the Archbishop of Canterbury, we can recast Milton Friedman’s dictum to demonstrate that the business of business is human flourishing.
Baroness Shields (Con)
My Lords, today I would like to talk about how artificial intelligence has made its mark as a powerful technology in the fight against Covid-19. Before I begin, I declare my interest as CEO of the British technology and drug discovery company, BenevolentAI.
Following China’s publication on 12 January of the genetic sequence of the virus, the race was on to identify existing drugs that can be used to treat Covid-19 infections until a vaccine becomes available. The focus has been on already-approved drugs that could have the prophylactic effect of reducing the severity of the infection, or that could inhibit the virus and the body’s hyper-inflammatory response to it. In an epidemic, speed is of the essence. Artificial intelligence and machine-learning models excel at handling data in fast-changing circumstances. Computing power and algorithms work as tireless and unbiased super-researchers, analysing chemical, biological and medical data to identify potential drug leads much faster than humans can do alone.
In late January, BenevolentAI launched a scientific inquiry using artificial intelligence to identify approved drugs that could potentially inhibit the viral progression of Covid-19 and which could be given to patients immediately. The group’s biomedical knowledge graph surfaced a number of potential drugs and identified Baricitinib as an approved drug for rheumatoid arthritis that could be a potential treatment. At the start of February, these research findings were published in the Lancet and following that in the Lancet’s list of infectious diseases. By mid-March, small groups of Italian physicians who were battling the virus on the front line became aware of the hypothesis and began testing Baricitinib on patients. These investigator-led trials yielded successful outcomes. Eli Lilly, which owns the drug Baricitinib, subsequently validated BenevolentAI’s research hypotheses in vitro and by 10 April had entered into an agreement with the US National Institute of Allergy and Infectious Diseases to test the drug in clinical trials. The incredible speed with which these hypotheses have moved from computer to lab-bench to the bedsides of patients demonstrates the far-reaching potential of AI models and algorithms to identify existing drugs and new drugs to treat disease.
In a connected world in which pathogens spread at unprecedented speed, advanced technologies like AI and machine learning can be the weapons to fight back. While AI has proved its worth in the battle against Covid-19, ultimately it is the fusion of machine intelligence and the triumph of human ingenuity that will bring our society through this crisis.
Lord Hendy (Lab)
My Lords, I thank the noble Lord, Lord Dobbs, for tabling this debate. It provides an opportunity for the Government, through the noble Lord the Minister, to show their appreciation not just to private companies but to their workers and those in the public sector. Some 33 million of them form the tsunami of unemployment which is following the medical crisis. These are the people who provide the goods and services on which we all rely; who actually produce the wealth of this country; who have been keeping the country going, many of them risking their health to do so.
Perhaps the Minister will follow my noble friend Lord Liddle in crediting the 100,000 trade union workplace safety representatives who are working tirelessly to try to minimise the risk. Their unions have been working flat out to support the millions who are facing loss of income, loss of jobs, loss of health and, tragically, death. The Government were right to listen to the TUC’s proposal for a job retention scheme and they ought now to heed its call for a tripartite national recovery council that would give a role to private companies, public employers, government and workforce representatives. This is surely the way to solve the massive problems, particularly unemployment, which have been thrown up by this crisis, and to plan a new and better future based on dialogue.
Baroness Falkner of Margravine (Non-Afl)
My Lords, we recognise that the health of the private sector will be the key to reducing unemployment, which is projected to peak at around 9%. I want to speak about the impact on the young, in particular those who do not seek the university route to build up their qualifications, but instead look to workplace training such as apprenticeships as the route to employability. We know that Covid-19 has already had a great impact on apprenticeship schemes around the country. According to reports, Covid has forced around 60% of employers to suspend on-the-job learning, to make recruits redundant or, less alarmingly, to furlough them. Apprenticeship schemes at 40% of companies have been suspended due to the lockdown, while in a survey of their current plans, over 30% of employers said that they would either hire fewer apprentices or none at all. This has been exacerbated by the fact that private apprenticeship training providers are going out of business or have already done so, and are therefore unable to provide the training.
It appears that the problem lies with the Department for Education, which is refusing to comply with Cabinet Office guidelines and to continue paying private apprenticeship providers during the lockdown. This matters, as 70% of apprenticeships in England are run by private companies. The inconsistency of the Department for Education is evident, in that it is providing support to FE colleges, as it should, but cannot see the logic of treating apprenticeship training providers in the same way.
For many young people from the most disadvantaged backgrounds, an apprenticeship is one of the few routes into longer-term, sustainable employment, particularly in the technologically advanced sectors. We also know that the disproportionate impact of youth unemployment will hit already disadvantaged northern towns, so it is perverse that, while the Government wish to level up the economy in those areas, departmental silos are preventing that. Will the Minister please ask the Department for Education to redress this anomaly before greater damage is done? Importantly, will he indicate to providers that the problem will be addressed, so that those who are making decisions today know the Government’s intentions before they take irreversible decisions?
Lord Howard of Rising (Con)
My Lords, I too would like to congratulate my noble friend Lord Dobbs on introducing this Motion. It is timely that the contribution made by the private sector is being recognised. The contribution of businesses such as supermarkets and many others to keeping the nation functioning during the lockdown has been superb. They have adapted to the many and varied problems that have arisen—not only the commercial ones, but to enable compliance with government guidelines.
It is a pity that the health authorities have not been more willing to make better use of the considerable talent pool within the private sector, and I declare an interest as a shareholder in pharmaceutical companies. I hear almost weekly about organisations that get no response from health authorities. I realise that at a time like this, health authorities get many offers of assistance, which all need to be evaluated, but what I am hearing indicates a very strong reluctance to make use of the private sector. This would be easier to understand if there was not the continuing example of what the private sector can do, given its magnificent response to Covid-19. I therefore urge health authorities not to be quite so blinkered in their approach to what the private sector could do in respect of this disease.
Lord Campbell of Pittenweem (LD)
My Lords, we shall not succeed unless we have the most effective partnership that we can between public and private, any more than we will not succeed if we do not accept the advice of the noble Lord, Lord Heseltine, expressed last night in an interview on Channel 4, that it is essential to utilise local initiative, knowledge and experience.
What I want to know is what forward thinking is taking place in the Government. There was a lot of wartime language at one stage, in the early days of our understanding of this virus. It is worth remembering that the Butler education reforms were conceived in the course of the Second World War, as indeed were the Beveridge proposals for social security. We certainly need equivalent foresight now.
There are two particular responsibilities which seem to me necessary for the Government. The first is education —to some extent I am echoing some of the sentiments just offered by the noble Baroness, Lady Falkner of Margravine. Once and for all we should put vocational education upon a par with higher education.
It is also necessary for the Government to embark on a serious programme of retraining. Those Rolls-Royce employees who are going to lose their jobs have a skills base that would easily allow them to be retrained for other similarly skilled opportunities. How shall we pay for this? I do not believe that the wholesale raising of taxes makes sense, as it will depress both demand and initiative; nor is cutting public expenditure possible. There can be no return to austerity; indeed, we may need to increase public expenditure.
The solution is obvious. Interest rates have never been more favourable. The Government should—
The Deputy Speaker (Baroness Garden of Frognal) (LD)
We seem to have lost Lord Campbell. I will move on to Lady McIntosh of Pickering.
Baroness McIntosh of Pickering (Con)
My Lords, I declare my interests in the register. I congratulate my noble friend on securing this debate and herald a true partnership between the public and private sectors. I join other noble Lords in giving fulsome thanks to doctors, nurses, carers, all the emergency services, and all involved in delivering front-line patient care. I also give fulsome thanks and pay tribute to all the farmers and landowners who have worked all hours, and in all weathers, to put food on our plates.
I shall tell just one little story and recognise the contribution of a local firm based in Easingwold. Industrial Textiles & Plastics makes impermeable plastic materials to a high specification. These have been used in the past to protect against chemical warfare. Independently of government, they have joined forces with Barbour and Burberry to manufacture personal protective equipment, free of charge, which is being distributed by a local voluntary organisation in Thirsk for use by our local hospitals, the Friarage, James Cook, Harrogate and York hospitals. I pay tribute to its initiative and generosity in ensuring that our hospitals—patients and staff—are kept as safe as possible in these times. I hope that this small example, which is big in spirit, can be repeated across the country and actually bring the community and government closer together.
Lord Burnett (LD)
I congratulate the noble Lord, Lord Dobbs, on securing this debate and draw attention to my interests in the register. Because of its urgency, I have given notice to the Minister of my intention to raise the matter of the potential personal liability of many unpaid directors, trustees and governors of schools. I am very grateful to the Minister for taking this point. I should disclose that I have the honour to be the chairman and a director of the Plymouth diocese Catholic Academy Schools Trust, comprising 36 schools. Will the Minister request the Department for Education and the Attorney-General to write a joint paper explaining to all trusts, as soon as possible, the liabilities in civil and criminal law of directors, trustees and governors and what indemnities and other protections are available to them?
The noble Lord, Lord Dobbs, made a compelling and powerful speech. He mentioned the wonderful achievement of the conversions to Nightingale hospitals. I wonder how long the planning process would have taken in normal circumstances, with a normal applicant. Open-market and social housing are vital to individuals, to the economy and to our futures. Builders cannot build houses without planning permission. Will the Minister exhort planning authorities to, first, speed up the planning process; secondly, not to put unnecessary barriers in the way of planning applications; and, thirdly, to keep their demands reasonable and economically possible? Finally, will the Minister commit to extend the Help to Buy scheme for a reasonable period? This will provide greater confidence to the housing industry, particularly to first-time buyers.
Lord Naseby (Con)
My Lords, I thank my colleague and noble friend Lord Dobbs. It is worth reminding ourselves of the macro situation. One-third of the UK’s GDP is covered by public services, and they are all working flat out now. Another third is those who are producing and distributing food, fuel, power, water, water disposal and waste disposal, and they are working flat out. There is a remaining third, where nothing is happening: they are shut down, they cannot work, they cannot sell and they cannot deliver. We urgently need to get them back to work, and to do that we need a sensible distancing level of one metre, as recommended by the World Health Organization and used by France and Italy. Secondly, we must never forget my university’s diktat of Maynard Keynes: unemployment is the issue that has to be dealt with, not debt.
Turning quickly to Public Health England, I am sorry to say that while it may be working hard, it has rebuffed offers of help from the private sector. That is not a good situation. It happened with PPE and it is happening now with testing. That has to be dealt with now; it is urgent.
Finally, I say a few words of thanks to my local Tesco, at Sandy. It is well run, well organised and responsive, and my goodness, that has happened in store after store, up and down the country. Secondly, I pay tribute to the work of the National Business Response Network. It has had well over 1,000 requests, half of which have been dealt with and the other half of which are being dealt with now—all on a voluntary basis. Well done to it and to the many other organisations that have helped our people.
Lord McConnell of Glenscorrodale (Lab)
My Lords, I declare my interests as recorded in the Lords’ register. I thank the noble Lord, Lord Dobbs, for initiating this debate: it is a fantastic opportunity to recognise the significant role of the private sector in the Covid-19 pandemic crisis. Perhaps even more important is the critical role of the energy and creativity of the private sector in the economic recovery that must surely follow. I shall raise two points that perhaps add to the many points that have been made by noble Lords during the debate.
First, I want to recognise the fact that companies and firms have been far ahead of government in this country in relation to the sustainable development goals. They have seen their potential for the management of risk, for building greater resilience in supply chains and development, and for securing sustainable economic development both at home and abroad. I hope the Government will take that on board in looking towards an economic recovery that is more sustainable in the future, and that has the sustainable development goals as part of the framework for building the sorts of partnerships that will be required.
Secondly, I want to make a point about consumers. This crisis has highlighted, perhaps as never before, the disgraceful way that some companies treat those who are applying for refunds—whether it is airlines and holiday companies, as in this case, or others. Will the Government include in their review of actions after this crisis the question of whether new consumer rights are needed to ensure that people are better protected in future?
Lord Sheikh (Con)
My Lords, there are more than 3 million Muslims in the United Kingdom. Last year, Muslims donated more than £130 million to humanitarian and charitable purposes. Donors included a number of businesses. This year, the figure will be higher as the community wants to help during the Covid pandemic. Per capita, the Muslim community gives more than any other community to help others. When Covid-19 hit the country, individuals, businessmen, charities, mosques, centres and organisations recognised the need to provide immediate and effective help. Muslim businesses include caterers, takeaways, pharmacists, shopkeepers, taxi owners and other small businesses. The business community plays an active role. Muslim charities set up a campaign for national solidarity and provided financial help to individuals and families in difficulties.
I thank the noble Lord, Lord Desai, for mentioning charities. Muslims have established food banks providing meals, provisions and other essentials to elderly and vulnerable people as well as to refugees and the homeless. In addition, meals are supplied to hospitals and NHS staff. Furthermore, prescriptions are delivered to people at home. Victims of domestic abuse have been given support. The community has also provided financial help to families to bury their deceased. It is in our DNA to help other communities irrespective of their race or religion, and we have played a role to support the needy in the country during these difficult times.
Muslim doctors have been offering training to medical students joining the front line. Finally, it was a Muslim doctor, Ibn Sina, known as Avicenna, who taught the world the use of quarantine to control disease. His legacy is protecting us from coronavirus.
Lord Mann (Non-Afl)
I echo the points made by the noble Lord, Lord McConnell, on consumers. He will be pleased to know that a shining example of good practice is the Scottish Youth Hostels Association. Sadly, I will not be spending time with it this weekend.
As we approach the likelihood of a second, or perhaps third or fourth, wave of this epidemic, it will be critical that entrepreneurs step forward, not just specifically to assist taking on Covid-19 but to move the economy forward. We cannot afford an economy that will stagnate or worse over the next two years. The Bank of England needs to use the full range of instruments at its disposal to ensure that investment in the economy continues apace by both private investors and the state. That new economy needs to learn the lessons that Japan learned after the Second World War by using W Edwards Deming and total quality management to change the paradigm within which industry operates.
We will be entering a new economy post Covid-19. That economy will have new products. We need to be self-sustaining and self-reliant as a nation and an economy, with the electric car, the driverless car, energy-generating building materials, artificial intelligence and robotics, goods movement shifting on to freight and effective 5G everywhere. We need to take action to move into that new economy now. We must not delay.
Lord Goddard of Stockport (LD)
My Lords, I too thank the noble Lord, Lord Dobbs, for this timely debate and the noble Lord, Lord Heseltine, for his comments last night. I firmly believe that rebuilding our fragile economy will eventually be down to people such as Graham Kershaw, the owner of a small, family-run plastics company in Stockport called Macpac. It has 55 employees and not one has been furloughed. He switched production and designed and produced a plastic visor for protection from Covid-19. So far he has produced more than 100,000 a week. He modified the design and now they fit any hard hat manufactured. Network Rail is using them. He has now designed a small plastic desk partition for schools. The innovative, can-do attitude of hundreds of small businesses up and down the country will be the key to getting our economy back on track. Always remember: necessity is the mother of invention.
Greater Manchester is also home to many young, vibrant, fast-growing businesses. However, our youngest businesses, those set up since 2019, remain excluded from the Government’s self-employed income support scheme. The leader of Stockport Council and Greater Manchester LEP have written to the Chancellor with proposals to close this gap. It would be helpful to have an update from the Minister on what action the Government are taking to support newly self-employed people as well.
Lord Bourne of Aberystwyth (Con)
My Lords, I also thank my noble friend Lord Dobbs for bringing this debate forward and for presenting the case with his customary flair and gusto. Like others, I think we have a kaleidoscope of support in our country: the public sector, which has been delivering magnificently—our NHS, care homes, transport sector and local authorities —and our voluntary sector, with great bodies such as Age UK, the Big Issue and so many others. We also depend massively on the private sector. We live in a changed world and it will change much more. Our needs and priorities will have changed, and the private sector needs to step forward to help deliver.
Meanwhile I shall mention how, in two key areas, the private sector has been stepping us and delivering, very often literally. First, on food, as many other noble Lords have said, it has done so not just by providing us with food but by providing help to the NHS and public authorities, with companies such as Kettlebell Kitchen delivering food and giving a portion of its profits to the NHS. Pubs and restaurants throughout the country are no longer able to provide pub meals in the pubs but are delivering them to their communities. The George and Dragon in Hurstbourne Tarrant is giving some of its profits to the NHS. Such pubs and restaurants deserve our thanks.
Like other noble Lords, I strongly believe that healthcare needs more encouragement and help by being provided with PPE, ventilators and a vaccine. The public sector and our great universities also need encouragement and help. Nightingale hospitals have been mentioned; They, too, are important. I also applaud what the Chancellor, Rishi Sunak, has done. He has shown flair, compassion and a steady nerve.
Baroness Ritchie of Downpatrick (Non-Afl)
My Lords, I thank the noble Lord, Lord Dobbs, for initiating this debate. I will bring a perspective from Northern Ireland. As far back as 26 March, 100 private sector companies diversified, showing skill and expertise to help in the Covid pandemic. They made scrubs, ventilators and PPE equipment because of the paucity of those items. Many restaurants and coffee shops provided much-needed meals to those who were shielding or who could not provide for themselves because of the inequalities that had arisen.
The Government provided finance through the furlough scheme and the self-employed scheme, but we have to look to the future. It is quite clear that there were many problems with our existing economy. We now have two shocks—the first was Brexit—and I hope Northern Ireland businesses will not face many barriers as they try to face what happens in terms of the Irish Sea and what was announced yesterday. It is important that there is unfettered access.
The second issue is that we have to look at the level of redundancy that will ensue whenever the furlough scheme ends. As the Ulster Bank survey last week showed, we are facing a vice-like grip on our economy—a major contraction of around 10%. What plans do the Government have, along with the devolved institutions, to bring forward regional and national strategies to build our business confidence, a business strategy and an economic strategy in the post-pandemic era? That is very important, and I would like to hear the Minister’s views on it.
The Deputy Speaker
I call the noble Earl, Lord Shrewsbury. Do we have him? I do not see him. I call the noble Lord, Lord Hussain.
Lord Hussain (LD)
My Lords, while calamities such as earthquakes, floods, wars and pandemics cause enormous damage, disruption and economic and human loss, they often give a society a sense of unity and sympathy. We have seen that during the current Covid-19 crisis in our own towns and cities. While the authorities are trying to do their best to help the nation in these difficult times, the business community and the voluntary sector are also playing their part in helping those in need.
In my own town of Luton, the medically trained firefighters at London Luton Airport, where passenger traffic is nearly zero, have been redeployed with the East of England Ambulance Service to assist it in its duties. The airport has also created an online volunteer hub, with the target of providing at least 100 volunteers across 18 local charities. It has also announced that it will host a by-appointment drive-through testing centre to control the spread of Covid-19.
Nationally, we have seen supermarket giants—Sainsbury’s, Tesco and others—open their stores exclusively for elderly and other vulnerable people and NHS workers. TK Maxx, Boots and other brands have also participated generously through their national initiatives. Locally based Costa Coffee donated 1 million drinks to NHS and key workers and local food banks. Contributions are also pouring in from other businesses, in collaboration with voluntary organisations. Facebook groups such as the Covid-19 Luton Community Action Group and organisations such as Age Concern Luton, Luton Foodbank, Discover Islam and countless more are helping with shopping, hot meals and support for key workers and our most vulnerable.
Small businesses such as Level Trust produced 200 packs to help keep children across Luton learning during school closures and provided a further 1,000 chocolate treats. Chiltern Learning Trust produced over 10,000 PPE face masks to support front-line workers. These donations have been distributed by hundreds of volunteers to beneficiaries of Luton Foodbank and key workers.
I conclude with the words of Luton Borough Council’s Chief Executive, Robin Porter, who said:
“The community effort in Luton has been, quite simply, astounding. It demonstrates the values of ‘Luton in Harmony’ in action, particularly as a lot of these groups cross cultures and religions and are working together for the good of the town.”
Lord Empey (UUP)
Well done to the noble Lord, Lord Dobbs. This crisis has shaken us to our very foundations. As the noble Lord, Lord Mann, said, we will be returning to a new economy. However, since 1970 Whitehall has turned its back on manufacturing in this country. We last had a trade surplus in manufactures in 1983. Since then we have been making up the difference by borrowing and selling assets. It cannot really go on.
This crisis has taught us that, while having long supply lines appears to save money in the short term, when we actually needed them we did not have the capacity to produce products. In a country that was for many decades the world leader in textiles, which built the wealth of this country, we find that we cannot even sew together two pieces of material to provide gowns for our health service. I believe we need a root-and-branch rethink.
I would like the Minister to respond to this, or, if he does not answer, take it back: we need to set up a unit in the Government looking at import substitution. We have seen what the private sector can do when it gets the opportunity, but we also know that there has been a lack of interest in this from Whitehall, because over the years it has thought that the service sector will see us through. But, at the end of the day, we still need a manufacturing base for our own security—not only food security, but industrial and health security. I ask the Minister to take that back. If he cannot answer today, will he put a letter in the Library of the House?
Lord Wei (Con)
My Lords, declaring my interests as in the Lords register, especially in tech, I join other speakers in praising the contribution of the private sector, which by and large has really stepped up to play a role in helping tackle this crisis that is bigger than just making money for shareholders. It has supported us so much as a nation, and we need to look out for business and employees in the coming economic crisis.
I have three questions for the Minister, bearing in mind the time. First, in future can the private sector be engaged through the furlough scheme and a modified industrial strategy, taking Covid into account, to transition to a more resilient world, so that businesses are never again caught out because they operate only in a physical way? We have heard many examples—pubs becoming supermarkets, et cetera. This would help us all help those who will be unemployed move into the new jobs of the future. Rather than everyone being paid to stay at home and not work, perhaps we should start paying people a little to start imagining what the future could look like.
Secondly, could more be done to build trusted hubs online? For example, I think of the excellent work of Frontline.live, set up within weeks recently to facilitate requests for PPE and suppliers that can provide it. Rather than relying purely on government procurement technology, we could look at things such as leisure technologies and blockchain to find ways to eliminate fraud, increase transparency and ensure that supplies are delivered to spec faster and less bureaucratically, using different trusted platforms that need to be built. In this context, I think particularly about the many low-margin businesses in this country in food production or other areas that right now are struggling to raise finance, operate or pay off invoices. Could there be ways in which we could help support more resilient supply chains in low-margin industries, especially post Brexit, and create the ability for them still to have the funding they need to keep our critical services and goods and products flowing, even in crises such as this?
My final question relates more to health. There have been some signs in parts of the NHS and Public Health England of a slightly anti-private sector attitude, which may have contributed to some of the challenges we have had in securing PPE and in supply chains around testing labs and so on. Could more be done to enable the NHS and, especially, Public Health England and other public bodies to have greater awareness of the potential to work with business, so that together we can solve future problems and crises more effectively and rapidly?
The Deputy Speaker
My Lords, we now come to two speakers who are out of order on the main list. We will first hear from the noble Lord, Lord Tyrie, and then from the noble Earl, Lord Shrewsbury, who we hope will have regained his signal. Then we shall have the Front-Benchers winding up. I call the noble Lord, Lord Tyrie.
Lord Tyrie (Non-Afl)
I declare an interest as chairman of the CMA. I will say a few words about what the CMA is doing to try to assist in this crisis. In a nutshell, the CMA has three jobs during the crisis. First, it needs to ensure that competition law does not get in the way of necessary co-operation between firms in the crisis, especially to ensure the maintenance of essential medical and food supplies. I am pleased that the Government have acted on CMA advice to exclude a number of agreements between firms on competition law that would otherwise have been prohibited.
The second thing we can do is to act rapidly and robustly against the small minority of traders that may have been exploiting consumers’ vulnerability. The CMA’s statutory base contains no provisions for emergency action of that type but we have a taskforce for exactly that job. We have sent over 250 letters to firms asking for an explanation of their conduct. To address price gouging, deterrence is essential in the long term, and even in the next few months, as are time-limited emergency powers, like those introduced in many other countries, especially where they have been put in place as part of the emergency. Something like that in the UK would boost deterrence further. We have offered the Government advice on this.
The third point, and the most important in the long term, is the contribution that the CMA can make to post-crisis reconstruction. The starting point will not be good. Big recessions usually weaken competition, as market concentration rises. Legislation is going to be needed and, as a number of noble Lords have pointed out, to play a full role we will need a stronger legislative base.
The Deputy Speaker
Do we have the Earl of Shrewsbury? I think he still does not have a signal, by the look of it. I call the noble Lord, Lord Fox.
Lord Fox (LD)
My Lords, I draw attention to my interests, as set out in the register. We have heard from 45 speakers, I think, each highlighting how private sector industries and the people in them have contributed to the community. Obviously, there are too many to list in this winding speech but they all deserve our thanks, as does the noble Lord, Lord Dobbs, for calling this debate. He was right to thank public sector workers, and I associate myself with his comments, but we should also remember that many private sector businesses and their employees are delivering public sector services. Refuse collection, running buses and trains, care workers visiting people in their homes and—sometime soon, we hope—the track and trace part of the future system designed to bring down the R number; most of these services come from private sector firms.
The noble Lord, Lord Blunkett, was right to emphasise the importance of public-private partnerships, and my noble friend Lord Addington was wise to caution about the nature of those relationships. In the past, public-private partnerships have attracted negative connotations; but, necessarily, the pandemic has required the rapid melding of public services and private businesses. The noble Lord, Lord Lang, spoke of the cultural differences, as did the noble Lord, Lord Wei. My impression is that some of these differences have been successfully bridged, albeit slowly sometimes. Can the Minister tell your Lordships what lessons have been learned and how these lessons will change the future of such public-private partnerships, once we are past the pandemic?
The noble Lord, Lord Caine, referenced the food industry and its distribution networks and stores, and as the noble Lord, Lord Naseby, said, that stepping up has been quite magnificent. I, like the noble Baroness, Lady McIntosh, would like to call out farmers. Work goes on, whatever the weather and whatever else happens, but some farmers are finding life very difficult. They are getting some help from the Government but not to the extent of the business that they have lost. Much of this may be a Defra concern, but can the Minister assure us that the needs of rural communities are not falling in the gaps between two government departments?
Looking forward, the noble Lord, Lord Dobbs is right. The lockdown has to end as soon as we can do so. In the “back to work” debate last week, I raised the issue of bolstering the confidence of workers that they will be safe once they return to work, and the need to support employers so that they know they have taken the right precautions. My noble friend Lord Burnett raised a question regarding liability. This is as true of the private sector as it is in schools.
In that debate, I also asked questions about the Health and Safety Executive. Frankly, I am still awaiting some answers. Perhaps this is my chance because, since that time, news has emerged that the HSE’s response will probably be more limited than the Statement implied. This is no surprise, given the huge cuts that the organisation has endured. The £14 million granted recently goes only a small way towards replacing them. Can the Minister ensure that the HSE has the resources it needs? Can he outline how it will go about giving workers and employers the confidence they need to get back to work? Further, to support this, can we not designate HSE and workplace safety workers as key workers? There is a wider need for more focused testing in workplace hotspots, whether or not they are designated as key workers. Can the Minister comment on plans for that?
As the noble Lord, Lord Dobbs, mentioned, many non-medical sector businesses have also worked to develop technology or produce equipment to help tackle the crisis. Much of this work came from engineering and manufacturing businesses like those I worked in for many years. The country’s private sector response would have been even more effective if we had not been so careless with our industrial capacity over many years. The noble Lord, Lord Empey, is completely correct on that. My noble friend Lord Purvis highlighted that our current economic profile exacerbates our challenges going forward. Germany’s much-vaunted response was built on its industrial scale. In this context, the noble Lord, Lord Shinkwin, spoke of the need for enterprise and innovation, and the noble Baroness, Lady Noakes, spoke of the role of SMEs. They are right to highlight these. Of course, many smaller companies are integral parts of supply chains for larger companies. As the noble Lord, Lord Liddle, said, any future strategy needs to understand the role of these supply chains, how they drive innovation and how policy should help them to grow.
I hope that, if nothing else, we have learned the importance of our industrial capacity and that this informs our strategy as we go forward, for all political parties. The scope of this debate does not stretch that far, but I hope that we can return to it in future. Like the noble Baroness, Lady Jones, I look forward to debating the Government’s plans to green our economy, and, as the noble Baroness, Lady Falkner, said, we need to discuss fully how we really grapple with the workplace skill deficit. In the meantime, I look forward to the Minister’s responses to this debate.
Lord Stevenson of Balmacara (Lab)
I add my thanks to those of others to the noble Lord, Lord Dobbs, for securing this debate. Despite the limitations on speaking time it has been of high quality throughout, with many interesting insights.
Most noble Lords have singled out our magnificent health and care workers for their exemplary work during the crisis. The Motion also allows us to recognise the contribution and generosity that we have seen from businesses and the wider private sector during this crisis. The noble Lord, Lord Dobbs, called it a roll-call of honour, and I think he is right. This has included the crucial role played by corner shops; special opening hours and discounts for key workers in many retail stores; companies deciding to build ventilators to increase capacity; and, as the noble Lord, Lord Bilimoria, reminded us, companies ignoring commercial rivalries to develop services and medicines to assist those afflicted by the virus and in pursuit of a vaccine. We have just heard about the role of the CMA in that.
On the whole, businesses have stepped up when we needed them. Indeed, they could have done much more if their offer of help had not been ignored when it was made, as the noble Lord, Lord Hunt, reminded us. We thank them for their continued efforts. There really is no limit to what can be achieved if we all pull together.
As many noble Lords have pointed out, what the Government have asked from business and the wider private sector during the pandemic is unprecedented in peacetime, and they have complied. However, because of these measures, thousands of businesses face an existential threat and possible closure, with all that that means for millions of workers. This supply shock could have been disastrous in an economy that was already showing strains earlier this year, but it is a credit to the Government that they have provided a range of support measures, including the job retention scheme, various business loans and the self-employment scheme, which has worked very well. Combined with the forthcoming changes to the insolvency laws, which we support, these measures will ensure liquidity, prevent unnecessary bankruptcies and hold jobs open for millions of workers until it is safe for businesses to reopen. In this context, I agree with the noble Lord¸ Lord Fox, that the Health and Safety Executive has been given a major responsibility, and it needs to be supported now and in future.
I hope the Minister will accept that some of the measures have been improved by scrutiny here and in the other place. There are still issues to be resolved, such as schemes for SMEs that are looking to access loans with a 100% guarantee above £50,000. As several noble Lords have pointed out, additional support may need to be provided for companies operating in the tourism, hospitality and cultural industries, particularly where taking on more debt is not a viable option. What plans are the Government considering for these sectors?
Does the Minister agree that where the state has assumed responsibility for providing support to a private sector company, it is absolutely right, as the noble Lord, Lord Balfe, has pointed out, to require all such firms to make the correct tax payments when they fall due; to require that they are not registered in a tax haven; and that they should not pay dividends to shareholders while they are claiming government resources?
I turn to the recovery. Private businesses and the wider private sector will also have a significant role to play after the pandemic. It is true that businesses want to reopen and people want to return to work, but this must be done with maximum safety. It is equally important that such moves have full-hearted public support so that the great pause, as some are calling it, does not turn into a great depression. The Chancellor has said, perhaps rather chillingly, that he cannot save every business, but surely he recognises that every business that goes bust risks deepening the recession and extending the time taken to recover our economic health. We are fast approaching the point where the focus of the Treasury’s efforts has to switch from supply to demand. How are we to persuade people to spend more than they do at present on goods and services, preferably those that are not imported? To do that, people need to feel secure about their income, their employment and, as the noble Lord, Lord McConnell, said, their consumer rights, and they have to be certain that spending today is not going to take them into unmanageable debt. There are both monetary and fiscal aspects to this, and it will need careful planning and timing if it is to work. As the noble Lord, Lord Campbell of Pittenweem, said, threatening a return to austerity will not take this trick.
The Government need to come up with a rescue plan to drive up demand and reduce business uncertainty for the long term, a strategy that focuses on sustainable high-quality jobs and growth. As the noble Lord, Lord Dobbs, said, we particularly need to reach out to young people entering the workforce this year and guard against this becoming a lost generation. However, I believe that recent polling suggests that the public also want something else. They do not want the economy simply to return to where we were pre-pandemic. They want a new deal, with growing support for a green new deal. What could that be composed of? As the noble Lord, Lord Hendy, said, surely we first need to learn the lessons of recent months and get real about the sort of income levels and support that those who have borne the brunt of the pandemic will need in future. It is after all the lowest-paid workers whom we have relied on most, as well as our key workers, and they need a new inclusive approach to employment laws and protection if we are to tackle their insecurity.
But the climate emergency is a challenge that we can simply no longer afford to ignore. I read recently, in an FT editorial last weekend, that
“governments should use their spending power to help stimulate a recovery from the virus that does not lock in a fossil-fuelled economy.”
Such a strategy could create an army of zero-carbon workers planting trees, rewilding our countryside, restoring natural habitats, insulating our existing housing stock and office buildings, and working on green energy technologies. This could help us to achieve our zero-carbon target much earlier than the Government are currently planning, provide people with much-needed job security after a period of such turmoil, and benefit everyone’s financial security through lower energy bills. The public should look back on the support that they have given business over this period with pride, but it would be strange if that investment were not used to return benefits to the public good.
My noble friend Lord Liddle called for a public/private partnership while my noble friend Lord Desai suggested a sovereign wealth fund. I hope that both ideas have been given serious consideration. Another way, which would follow on from the support given to the banks in the 2009 crisis, is that the Government should be willing to consider taking an equity stake in firms that they have supported, particularly where there is a compelling economic, security or environmental reason. Other countries are already doing this—for example, the French and US stimulus packages allow for the Government to take equity stakes in airlines that receive aid—but we could go much further by taking government stakes in line with long-term green new deal goals. We can invest in new technology companies to power the fourth industrial revolution or require energy-intensive industries such as steel to switch to alternative manufacturing methods.
I doubt that many people think the global supply chain will return to its shape pre Covid-19. Indeed, some commentators are saying that globalisation will enter a new phase after the pandemic that will demand a new sustainable trade policy more capable of dealing with the demand and supply shocks caused by Covid-19. Coronavirus has cruelly exposed global inequality, so different priorities for trade need to reflect a reoriented world. A sustainable trade policy could focus on securing opportunities for all sizes of businesses, human and employment rights, consumer interests and climate protection for the whole world long term. It would also provide a proper role for Parliament, something that we will return to in round 2 of the Trade Bill.
Business and the wider private sector have contributed greatly to the work of combating Covid-19. We welcome their contributions. We have supported the Government as they have tried to deal with their concerns during the crisis, and there is more to come. The noble Lord, Lord Dobbs, said it would be a tragedy if we ended this crisis with greater poverty. I agree with him that we must now work with business and the wider private sector to secure the recovery with a green new deal that shares the benefits of cleaner inputs and more sustainable outputs for the benefit of us all.
The Deputy Speaker (Lord Palmer of Childs Hill) (LD)
I call the noble Lord, Lord Callanan. Lord Callanan, you need to unmute.
The Parliamentary Under-Secretary of State, Department for Business, Energy and Industrial Strategy (Lord Callanan) (Con)
My apologies; I thought the muting was done centrally. I thank my noble friend Lord Dobbs for securing this important debate. The excellent, well-informed contributions from many noble Lords demonstrated the excellent range of expertise across our House.
It goes without saying that these are extremely difficult times, and there is no question but that they would be a lot more difficult were it not for the role of the private sector. This is of course a national effort, as the noble Lord, Lord Wallace, reminded us, involving community, democracy and the voluntary and public sectors all working together. Business and the wider private sector have played a critical role too, as many other noble Lords pointed out. Its generosity and ingenuity have helped us to protect the NHS, save lives and shield the economy from the worst of this virus. I put my gratitude on the record. It is of course impossible to name all the companies that have played a part, or even all the ways in which they have helped, but I would like to echo many noble Lords and give the House just a small flavour. Since the crisis began, we have witnessed businesses adapting with impressive speed to operate safely and safeguard jobs, not least in the food sector, as my noble friend Lord Caine reminded us. I include in that smaller shops such as corner shops, which the noble Baroness, Lady Kennedy, spoke about.
Companies such as Interserve and KPMG have played an integral role in building our Nightingale hospitals, as many noble Lords observed. Without the prompt response from construction companies and the efforts of builders and engineers, we would not have been able to bring those hospitals online with such speed. We have seen many firms supporting the vulnerable alongside the voluntary sector, with energy suppliers agreeing to assist customers facing difficulties, and companies such as Brakes, Bidfood and Holiday Inn getting food to the vulnerable and providing rooms for the homeless. Across the country we have watched private companies turn their manufacturing might towards meeting the demands of the pandemic and supplying medical equipment to our vital NHS front line.
In the north-east alone—my home region, if the House will forgive me—we have seen the Barbour factory in South Shields shift from producing wax jackets for the world to making gowns and scrubs for local hospitals. Rolls-Royce in Tyne and Wear, and indeed elsewhere, played its part in the ventilator challenge, producing medical ventilators for the UK. The same is happening up and down our nation. As mentioned by the noble Lord, Lord Dobbs, our leading world fashion houses have gone from luxury fashion to protective kit, delivered to the front line by eBay, Amazon and many others. I am sure my noble friend Lord Lang will be delighted to hear that.
The need for hand sanitiser has mobilised cosmetics and drinks companies large and small, with companies such as Chivas Brothers in Scotland sending tankers of Strathclyde grain spirit rattling down the motorway to make gel for our front-line NHS staff. Meanwhile, pharmaceutical companies are collaborating with our universities to support the Government’s plans to boost testing. As the noble Lords, Lord Blunkett and Lord Bilimoria, pointed out, such private-public collaboration is absolutely critical to the effort. I recognise the point made by the noble Lord, Lord Liddle, on public-private partnerships as well; it was important to make that observation. Our outstanding life sciences sector will help us to produce the vaccines that we need once one has been found. As the noble Baroness, Lady Northover, pointed out, we have considerable expertise in the UK in this area.
All in all, there has been overwhelming support from business and the wider private sector. We are grateful for every offer of help that we have received, just as we are grateful to the business leaders, trade associations and representative bodies that have given up their time to help shape the Government’s response to this crisis. My noble friend Lord Bourne spoke about the support that the private sector has offered to the public sector, and so it is with central government. I should point out that these organisations, alongside others such as Be the Business, are providing critical support, guidance and information to businesses as well as regularly meeting my colleagues and me in BEIS to tell us about the situation on the ground. We all listen carefully to everything that they have to say to us. It was their feedback that helped us to make changes to the Coronavirus Business Interruption Loan Scheme in April, which has now loaned over £7 billion—banning personal guarantees for smaller loans, for example, and extending the scheme to small businesses.
It was in response to their concerns that we introduced the bounce-back loans scheme at the end of last month to make sure that the smallest businesses can access the credit that they need within days. I am pleased to tell the House that this scheme has now issued loans worth £14 billion. It is because we have listened that we will soon be introducing the Corporate Insolvency and Governance Bill, which was introduced in the other place yesterday. This will help to support businesses through these very difficult times, with new options for company rescues and corporate governance measures, giving directors more flexibility to focus on what matters most during the pandemic.
As of yesterday, we have launched the Future Fund, issuing convertible loans to innovative companies facing financing difficulties due to the virus, helping them to weather the crisis. We have also worked closely with business, industry bodies and trade unions as we have developed the safer workplace guidance for firms. As the noble Lords, Lord Liddle and Lord Hendy, said, the input from trade unions was vital here. This guidance is helping businesses to reopen safely and get our economy going again—and we will continue to work with trade associations, responsible trade unions and other representative bodies to do so. We know that business is the engine that will drive our economic renewal, and rebuilding our economy is now critical, as my noble friend Lady Noakes said. We recognise the difficulties that businesses face, as many other noble Lords have mentioned. The noble Baroness, Lady Uddin, for instance, mentioned caterers. I would indeed like to congratulate the Bangladesh Caterers Association, as well as the Muslim community, on their efforts, as mentioned by the noble Lord, Lord Sheikh.
As we rebuild the economy, the green sector will play an important role: driving growth, positioning the UK at the forefront of clean technologies and helping us to meet our net-zero target by 2050.
Many excellent points were made during the debate and a number of questions posed. Noble Lords will understand that it is impossible for me to respond to them all, from 50 speakers, but I will go through as many as possible in the available time and hope that noble Lords will accept my apologies if I do not get around to their point.
The noble Lord, Lord Balfe, raised an important point on small businesses. The Government are committed to a corporate tax system that is competitive but fair. We will not tolerate anyone, including large businesses, treating tax as an optional extra. Her Majesty’s Revenue and Customs subjects large businesses to an exceptional level of scrutiny and secured £10 billion in additional compliance revenue from the largest and most complex businesses in the UK in 2018-19.
The noble Lord, Lord Bilimoria, asked about the government-guaranteed loan scheme. Across the Government’s business interruption loan schemes, businesses can access loans of between £2,000 and £50 million. We have carefully considered what size of guarantee gives lenders confidence to provide finance to SMEs; an 80% government guarantee on lending is an important tool to ensure that lenders have sufficient skin in the game when lending large government and taxpayer-backed loans.
The noble Baroness, Lady Jones, asked a number of questions. I will take them in turn. First, all farms and food businesses are eligible for the various financial support packages provided by the Government, including the Coronavirus Business Interruption Loan Scheme and the bounce-back loan scheme. We will continue to monitor the situation and to work closely with all the food and farming sectors to assess and respond to emerging issues as they arise, working closely with our colleagues in Defra. The noble Baroness also asked about the school food voucher scheme. This is, of course, a matter for the Department for Education but I reassure the noble Baroness that the Government recognise that it may not be convenient or possible for some families to visit one of the supermarkets on the scheme. The DfE are working to see whether additional supermarkets can be added to the list. Schools are best placed to make the decisions for their children, families and communities. We encourage those schools to utilise a local solution supporting eligible pupils—for example, purchasing vouchers direct from a local provider.
My noble friend Lady Buscombe talked about the high street and asked about reducing social distancing measures. The science about Covid-19 transmission is of course complex. As a precaution, Public Health England recommends trying to keep two metres away from people as much as possible. The second step, set out in the Government’s road map from 1 June, covers non-essential retail. The timing of businesses’ reopening will depend on the latest assessment of the risk at that time because the risk of transmission is higher in environments that are indoors, require more physical contact or encourage crowds. We have set up task forces to work with these sectors to develop Covid-19-secure guidelines for them to follow when it is safe to do so. We have seen examples of how supermarkets and other essential shops have implemented the social distancing guidelines to operate safely. Further work will need to be done alongside sectors currently closed to ensure that they too can operate safely.
The noble Baroness, Lady Kennedy, asked for an update on the Government’s consultation on shop worker abuse. Any incident of violence or abusive behaviour towards retail workers is completely unacceptable and especially so in current circumstances. Retailers and staff are working hard to accommodate customers and implement social distancing measures to keep the public safe. We recognise that there is more to do. That is why the Government launched a call for evidence on violence and abuse towards shop staff to help strengthen our understanding of the scale and extent of the issue. During the Westminster Hall debate on protection of retail workers, the Minister for Crime and Policing committed to publishing the Government’s response in March. However, as the Government’s communications must focus on tackling Covid-19, publication of the response has been delayed; we will endeavour to publish the call for evidence as soon as practicable.
The noble Baroness also asked about ensuring food supplies. I assure her that retailers are continuing to monitor their supply chains and are taking all necessary steps to ensure that consumers have the food and supplies that they need.
The noble Lord, Lord Addington, asked what will happen to those with disabilities in new job markets. In their manifesto, the Government committed to reducing the disability employment gap. They are actively monitoring the impact of Covid-19 on the labour market, including on those with disabilities and on other groups. Of course, employers must comply with the requirements of the Equality Act 2010 and ensure that they do not unlawfully discriminate.
I thank the noble Lord, Lord Burnett, for his question about the liabilities of the chairmen and directors of multi-academy trusts, and I thank him, too, for giving me advance notice of his question. I assure him that I have raised this matter with colleagues in the Department for Education, and I will ensure that he gets a speedy reply on this important matter.
My noble friend Lord Moynihan raised an excellent point regarding the UK oil and gas industry, which is continuing to provide essential energy to our economy throughout the epidemic. The Prime Minister gave an update on the quarantine regulations last week, and further information on this will come shortly.
In response to the noble Lord, Lord Tyrie, my department and the CMA have been working together closely to develop the proposals made by his organisation in 2019. For example, following a commitment made in June 2019 by the previous Secretary of State, we are looking into the possibility of putting the CMA’s powers on an administrative basis. This will allow the CMA itself to decide whether there has been a breach of consumer law, rather than having to go to court.
The noble Lord, Lord Fox, asked about struggling farms. I assure him that all farms and food businesses are eligible for the various financial support packages provided by the Government, including the Coronavirus Business Interruption Loan Scheme—the bounce-back loan scheme. We will continue to monitor the situation and to work closely with all food and farming sectors.
The noble Lord, Lord Stevenson, asked about the green new deal for the economy. As we recover from the Covid-19 pandemic, the Government intend to deliver a UK economy that is stronger, cleaner, more sustainable and more resilient. Defra and BEIS are working closely together on this. I agree with the noble Lord that as we and other countries recover from Covid-19, the decisions that we make today will either lay the foundations for sound, sustainable and inclusive growth or they will lock in polluting emissions for decades and, in so doing, make our society and the planet more vulnerable to the interlinked challenges of public health, climate change and biodiversity.
This pandemic has, of course, had terrible consequences but it has also shown the best of us: the courage of our key workers, our community spirit and the resilience of our nation. Finally, I agree with my noble friend Lord Hunt of Wirral that it is indeed an inspiring tale of the ability and willingness of business to embrace its role in this great national effort, both to defeat the virus and to power our economic recovery. For that, I, and I am sure the whole House, is hugely grateful. I thank my noble friend Lord Dobbs for securing this important debate.
Lord Dobbs
My Lords, I thank my noble friend Lord Callanan for his attention to this debate. We have all enjoyed some dodgy IT, the barking dog belonging to the noble Lord, Lord Blunkett, and some very tempting sunshine outside. Nevertheless, we have got through what I think has been an excellent and wonderfully wide-ranging debate. Astonishingly, I am told that it is the first debate on the private sector in Parliament since the Covid crisis began, so, once again, the House of Lords is doing what it does so well.
Noble Lords will understand that I cannot possibly do justice to all the excellent contributions. However, I would like to express sympathy for those who were unable to participate despite preparing valuable contributions. I hope that we will get many more such opportunities over the coming months and when we get back to full and proper debate.
The noble Lord, Lord Addington, made a very powerful point about the disabled—a point that touched me. It reminded me, and I hope that it reminds us all, that the private sector is not just about the big battalions or the behemoths; it is about ordinary people: workers; the abled; the disabled; working mothers; part-timers; the elderly; and apprentices, as the noble Baroness, Lady Falkner of Margravine, reminded us—those who will never be rich but who want no more than to care for themselves and their families. They are the private sector, too. There are millions of them and that is why we should care.
The debate ahead, which we will continue to have, has been pretty clearly outlined. The noble Lord, Lord Hunt of Kings Heath, criticised the Government. My noble friends Lord Lang and Lord Naseby questioned the abilities of those at the centre—in government and in the Civil Service—to deliver the things that they hoped to deliver. Where will the future balance come from?
Fascinatingly, there has been little criticism of the private sector but much praise—from, for example, my noble friend Lord Hunt of Wirral. The private sector has done very well, although inevitably there have been some exceptions, as the noble Lord, Lord McConnell, reminded us. My noble friend Lord Balfe—I thought, quite correctly—also reminded us that we should examine the moral basis of what we do and how we do it. I hope that we will always do that. I enjoyed the characteristically powerful plea from the noble Lord, Lord Empey, for us to look at the role of the manufacturing industry and at shortening supply lines.
There will be—there must be—an ongoing debate, and even dispute, ahead of us about all the things that we have discussed. None of them is easy, yet many noble Lords—the noble Lord, Lord Blunkett; the noble Lord, Lord Bilimoria, with his plea to work together; and the noble Lords, Lord Liddle, Lord Campbell, Lord Fox, Lord Stevenson, and many others—talked about the public and private partnership. To give a little context to those perfectly correct pleas, the public sector employs less than 17% of the workforce; the private sector is far larger—five times larger—and that is why it deserves our attention.
I think that we can be proud of this debate. We must all get back to business. In particular, I am told that I need my hairdresser. In the meantime, I reiterate my thanks to all: those in front of the screens, those behind the screens and those who never made it to the screens. I wish them all health and happiness. Once again, I express my thanks.
The Deputy Speaker
My Lords, the Virtual Proceedings will now adjourn until a convenient point after 4 pm for the Question for Short Debate in the name of the noble Lord, Lord Cormack.