Public and Private Sector Productivity Trends

Baroness Kramer Excerpts

Thursday 30th October 2025 Lords Chamber

[Lord Livermore (Lab)]

On the noble Lord’s first point, I am very aware of some issues around the data, and I believe the ONS has been reviewing it along the lines he suggests. On the Employment Rights Bill, he will know that labour supply is also a fundamental component of driving productivity, and that a more motivated and more secure workforce is a more productive workforce. I hope he will take that into account.

[Baroness Kramer (LD)]

My Lords, we hear this week that only 11% of UK SMEs say they use technology to a great extent to automate or streamline operations. Do the Government understand that the slow pace of adoption of new technology by SMEs—many of which have not even adopted first-generation technology—lies at the heart of our productivity problem, which is why it remains incomprehensible that the Government keep adding burdens on SMEs? I know the Minister cannot tell us what is in the Budget, but can he at least tell the House that he recognises the problem?

[Lord Livermore (Lab)]

Yes, I absolutely recognise the problem and I agree with 90% of what the noble Baroness said. The only part I disagreed with was when she criticised the Government. I agree: digital adoption and AI adoption will be central to solving the productivity problem. SMEs are vital to that. It is why digital adoption was a key part of our small business strategy. I hope we can work together on this important issue.