Oral Answers to Questions
Debate between Angela Eagle and Anna Soubry(8 years, 6 months ago)
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The Minister for Small Business, Industry and Enterprise (Anna Soubry)
I thank my right hon. Friend for that question. May I begin by thanking and paying a huge tribute to everybody who works in this place, especially those in our catering services? They often have to work the most unsocial hours and often do so in the most difficult of conditions, as they suddenly have a huge influx of us going into the Tea Room or wherever it might be. We perhaps underestimate the work they do. My right hon. Friend makes a very good point and I would be more than happy to take this up with the House authorities. In the meantime, I congratulate my right hon. Friend the Secretary of State on rightly launching this consultation, as when someone, in any facility, pays a tip, they expect the person to whom they want that tip to go to receive it—all of it. I think this will allow us to begin to see real progress, so that we do the right thing on this.
Ms Angela Eagle (Wallasey) (Lab)
Two Select Committees of this House are now preparing to examine the collapse of BHS into administration last week, putting at risk 11,000 jobs. Sir Philip Green bought the company for £200 million, took hundreds of millions of pounds out of it in dividend payments for his own family and then sold it for £1 to a bankrupt with no retail experience. What does the Business Secretary think are the issues for public policy as he contemplates the current situation? Does he think this represents responsible ownership?
BHS
Debate between Angela Eagle and Anna Soubry
Ms Angela Eagle (Wallasey) (Lab)
I thank the Minister for her statement and for giving me early sight of it.
Eleven thousand BHS staff will be desperately worried about their jobs today. BHS is a venerable British company, which has been a feature of our high streets for almost a century. I am sure Members on all sides of the House will hope that administrators will be successful in their attempts to sell BHS as a going concern. At this difficult time for the workforce and their families, we all want to be reassured that the Government are doing everything they can to support a successful outcome to the process. If the worst happens, BHS workers will want to know that the Government stand ready to offer help for them to get back to work as soon as possible.
The crisis facing BHS highlights a wider challenge for our high street retailers, with increased competition from online retailers. It is vital that our high streets adapt and change to stay relevant and competitive. It is important to understand how we ended up here and to think about the implications for public policy.
There are some serious questions to answer, not least by the former owner, Sir Philip Green. He bought BHS in 2000 for £200 million. In just two years of his ownership, £422 million in dividends was paid out, with the vast majority going to him and his family. He seems to have taken out far more in value than he paid for the business in the first place. Last year, he disposed of BHS for just £1. When Sir Philip bought BHS, the pension fund had a surplus of more than £5 million and it remained in the black as late as 2008. Yet when he got rid of the business, he had turned this into a deficit of hundreds of millions of pounds. The pension fund now reportedly has a black hole of £571 million.
If the worst happens, the liability will be covered by the Pension Protection Fund, as the Minister indicated, and BHS staff will get only 90% of the pension they have worked so hard for and saved for. However, Philip Green seems to have got much more out of BHS for himself and his family than that. BHS staff and the public will understandably want to know whether the former owner, who took so many millions of pounds out of the business, will have to pay his fair share of the liabilities that accrued during his stewardship.
It is right that the pensions of working people are covered in the event of their employer going under, but in this situation it appears that the owner has extracted hundreds of millions of pounds from the business and walked away to his favourite tax haven, leaving the Pension Protection Fund to pick up the bill. We know that Sir Philip is such a vocal supporter of the Conservative party that in 2010 the Prime Minister asked him to conduct a review for the Cabinet Office of how to slash Government spending. What he appears to have done with BHS is to extract huge value from the business before walking away and leaving all the liabilities to others, including the public purse. Now we are learning that BHS has paid more than £25 million to Retail Acquisitions, which bought it for £1 in 2015.
What help can the Department give to ensure that the interests of the 11,000-strong workforce are properly looked after? Does the Minister think that taking hundreds of millions of pounds out of a business which then accumulates a huge pension black hole is responsible ownership? What comments does she have on the conduct of Sir Philip Green during his ownership of BHS? Does she agree that in cases such as this, former owners should be held accountable and liable to pay their fair share of any accumulated pension deficit, rather than leaving it to responsible pension funds to pick up the bill through the pension protection scheme?
Sir Philip has reportedly offered a mere £40 million in lieu of the pension deficit. That is less than 10% of the total, but he has taken far, far more than that out of the business. Does the Minister believe that that offer is acceptable? If not, can she set out the options which the Government and the Pensions Regulator have to pursue him for a fairer settlement? Will she review the current law to ensure that irresponsible owners are not able to extract value from businesses and then walk away, leaving the liabilities elsewhere?
Anna Soubry
My concern is for the workers of BHS and the creditors, notably the small businesses. I find it most peculiar, though perhaps not unexpected, that the hon. Lady should turn this into some party political game. This is way above all that. I have said that the Pensions Regulator is looking at the various matters, and the Insolvency Service, which will oversee the administration, will take very seriously any allegations of any misconduct by any of the directors of the business. Any impropriety is taken very seriously not only by this Government but by all the regulatory bodies that oversee these things.
I could say that it is, perhaps, unfortunate that Labour decided to vote against our very moderate but important proposals on Sunday trading, when there was clear evidence that that would have helped the retail sector. If the Opposition had not done that, they might have a little more credibility when they comment on the unfortunate situation of BHS. This is not a political football to be kicked around by the Opposition.
Enterprise Bill [Lords]
Debate between Angela Eagle and Anna Soubry(8 years, 9 months ago)
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Ms Eagle
The changes to the Act are minor, simply because they restore in real terms the original import of the Act—that minor change merely brings the Act up to date. There is no reason why any Opposition Member should worry about that change. It is aimed at a part of the rural broadband roll-out that is very important for a lot of people in rural areas, so it is wholly acceptable, certainly to the Opposition, although I am not sure whether the hon. Gentleman is opposing his own Front Benchers on this issue.
The Minister for Small Business, Industry and Enterprise (Anna Soubry)
We are trying to find out what you would do.
Ms Eagle
I am saying what we will do. We support this part of the Bill, because it makes a minor extension that just restores the intention of the original Act.
There are many modest measures in the Bill with which we agree; indeed, the Government resisted many of them during the passage of the Deregulation Act 2015, the Consumer Rights Act 2015 and the Enterprise and Regulatory Reform Act 2013 in the previous Parliament, and we welcome the fact that the Government appear to have come round and accepted them now.
However, there are a number of measures in the Bill with which we are not in agreement.
Ms Eagle
The Government have spoken. They keep acting as though we know what the changes are, when we do not. They have chosen not to give us any warning that they were going to be in the Bill, not even a private tip-off, so we have to react completely in the dark. Other than what was said from the Dispatch Box, we have no idea what will be in the Bill. [Interruption.] The Minister for Small Business, Industry and Enterprise chunters away from the Front Bench, saying that these changes are minor, but we do not know whether they are minor until she publishes them and we read them. If she would like to publish them now, we can have a five-minute break, go out and read them and check whether she is telling us the truth.
Anna Soubry
The hon. Lady was obviously present during BIS orals, so she heard me say, for example, that this is about devolving power down to a local level. [Interruption.] Hang on! Chill out! Calm down! It therefore gives local authorities the power to decide whether they will extend Sunday opening hours to a very small number of shops. That is what it is about. It is not some huge, major measure. I would be the first to say that this is about the devolution of power. I think the hon. Lady has a problem with letting people at a local level make the decisions in the interests of local people.
Ms Eagle
I have no problem whatsoever with letting people decide locally, but it is not for a Government Minister to tell the Opposition what their attitude to something should be before we have actually seen what the proposed clauses say. The Government are asserting, even as we speak, that the public sector exit payments are all about fat cat public sector pay-offs, but we have discovered—because this has actually been printed in the Bill—that those fat cat payments apply to people on £25,000 a year. The right hon. Lady’s view of reality may not be the same as that of the Opposition. As a Minister, she should realise that, if she wants the Opposition to take a view on something, she should publish it.
Anna Soubry
Does the hon. Lady accept that the exit payments will apply to only some 5% of workers, because we are talking about a redundancy payment of £94,000?
Ms Eagle
By the Secretary of State! They earn as little as £25,000 and have given their lives to long public service. We know that because the clauses have been printed. The right hon. Lady should publish her Sunday trading clauses. The Government should have published them a lot sooner, if they were going to put them in the Bill.
I can only assume that the Government chose to introduce the changes to Sunday trading at such short notice in the hope that they can bounce them through the House with minimum opposition and scrutiny. This is yet another example of them governing from the shadows. It treats the House of Commons with the utmost disrespect, and it treats the House of Lords with contempt. Given that the Cities and Local Government Devolution Bill was subject to scrutiny by a Committee of the whole House, will the Secretary of State do the same for the Sunday trading amendments that the Government will table to the Enterprise Bill? That is the least he can do in the circumstances.
Unless something else comes to light, we do not intend to oppose the Bill’s Second Reading, but we are disappointed at this legislative pudding. We are even more disappointed at the developments on Sunday trading, and we will hold this Government to account as the Bill goes through Committee.
Anna Soubry
They will not be devolved. Let me make that absolutely clear. We will introduce legislation for all work that will affect any worker working on a Sunday—
Ms Angela Eagle
On a point of order, Madam Deputy Speaker. The Minister is spending time talking about provisions that no one but her has seen, because they are not in the Bill. How can that be in order?
Steel Sector
Debate between Angela Eagle and Anna Soubry(8 years, 10 months ago)
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Ms Angela Eagle (Wallasey) (Lab)
It is welcome that the Government have come to this House to make a statement on steel rather than having to be dragged here, as they have been on so many other occasions, by urgent questions tabled by the Opposition. It is disappointing, given the seriousness of the issue, that the Secretary of State has not seen fit to make the statement himself, but I welcome the Minister for Small Business, Industry and Enterprise to her place.
I welcome the Minister’s intention to work closely with the Welsh Government to mitigate the effects of the job losses on local communities. I especially welcome the co-operation on business rates, but I note that the Government have taken no action on business rates in England.
Tata’s announcement of 1,050 job losses across Port Talbot, Llanwern, Trostre, Corby and Hartlepool is devastating news for all the workers, their families and the close-knit communities affected. Our hearts go out to them. This latest bombshell comes on top of job losses at Tata’s Newport plant last year, along with thousands of job losses across the sector in the UK, including the complete closure at Redcar.
At this time of crisis for the UK steel industry, all we seem to get from this Government is warm words but very little concrete action. In the three months since the Government convened the emergency steel summit last year, only one of the five asks raised with them has actually been delivered. Who would think that steel is the foundation of many of the UK’s most important manufacturing sectors, including aerospace, defence, automotive and construction? The existential threats facing it show no sign of abating, and yet the Government have been asleep at the wheel. They have not been tough enough with the Chinese or active enough with the European Union. They have made no concessions on the business rate system, which actively penalises those who invest in expensive infrastructure to improve productivity, and there is no sign that their technical change to procurement rules is making any difference in the award of Government contracts to help our domestic industry.
When are we going to get effective action from this Government and not just warm words? Countries such as China are engaging in ruthlessly uncompetitive practices that are destroying our steel industry. My right hon. Friend the Leader of the Opposition raised that directly with President Xi when we met him in October, and we have raised it with the Chinese at subsequent meetings.
The slow response in the EU to the tsunami of cheap Chinese steel, which is snuffing out our industrial base, is a disgrace. I made that point in no uncertain terms at a high-level meeting with representatives of the Commission in Brussels last week. They need to take action now and this Government should be leading the charge to reform EU trade defence instruments, but they are actually resisting reform to speed them up.
This country desperately needs an industrial strategy so that our steel industry can survive and thrive. The Chancellor once declared that Britain would be
“carried aloft by the march of the makers.”—[Official Report, 23 March 2011; Vol. 525, c. 966.]
But five years on there is a yawning gap between his rhetoric and the grim reality. Manufacturing exports have slumped and manufacturing output is still below its level of seven years ago. Whether on the deficit, debt, exports or manufacturing, the Chancellor has failed every test he set himself. Despite the fanfare and flurry of Government press releases, there is no substantive industrial strategy in sight. Is that any wonder when we have a Business Secretary who will not even let the phrase “industrial strategy” cross his lips? Because the Government will not do it, Labour will create an advisory board of experts from business, industry and the trade unions to lead work on the development of an industrial strategy for the UK.
What size of steel industry does the Minister regard as sustainable in the UK? When will the Government stop cosying up to China and confront its role in dumping cheap steel on UK markets? Will the Minister assure this House that the question of market economy status for China will not be resolved until it stops dumping cheap steel in the UK?
Why are the Government blocking the modernisation of EU trade defence instruments, which would deal with unfair trade before, not after, the damage is done to our domestic producers? Although there was welcome progress on the UK’s state aid application on the renewables obligation and feed-in tariffs, can the Minister confirm that until approval for its second application is received, it leaves some companies in the steel and other sectors without access to much needed compensation and still exposed to some 70% of climate change policy costs? When will there be any progress on business rates, which penalise new investment to increase productivity? When, in short, are the Government finally going to turn their warm words into real and urgent action to save our steel industry?
Anna Soubry
I am sorry the hon. Lady did not listen to what I said. While we are dealing with facts—actually, she was not dealing with facts—I remind the House that 68,000 people worked in the British steel industry in 1998; by 2010, that number had fallen to 33,000; and by 2014, it had risen to 35,000. It ill behoves Opposition Members, therefore, to lecture the Government about supporting the steel industry, which, I would contend, we have done more to support in the past few months than the last lot did in 13 years. It does not help anybody to make cheap political points—[Laughter.] It is so tempting, given the palpable nonsense coming from Labour.
The steel industry, including the unions, made five asks of us: energy costs—delivered; industrial emissions—delivered; procurement—delivered; dumping—delivered. [Hon. Members: “What?”] In July, for the first time, we voted to protect our steel industry. Such was the surprise of others sitting round the table that the EU officials went back to the UK delegation to check they had heard correctly, because never before had we voted to protect our steel industry. We did it again in November, and we have supported rebar, so we have delivered on that.
I confess—because I like to be honest with the House—that only on business rates have we not delivered. The review continues, and I hope, when it is finished, the Chancellor can say he will help all those who invest in plant and machinery so they are not penalised with higher business rates, which does seem rather perverse. Those arguments and discussions continue. I suggest, however, that we have done a good job in protecting our steel industry, and will continue to do so. We are not a party that has a problem and just sets up a committee; we are a Government who deliver and meet the demands and asks.
If I may, I will quickly deal with the allegation that we have been cosying up to China. Not at all: the Prime Minister was very frank with President Xi when he came over, and made our position clear. The EU will make the decision on market economy status. Yes, there is a good argument for our wanting China to have it, but we have also made it clear that if a country wants to be part of the game, it has to play by the rules. That seems a sensible approach.