Oral Answers to Questions

Debate between Lord Vaizey of Didcot and Jim McGovern

Thursday 12th February 2015 Commons Chamber

[Jim McGovern (Dundee West) (Lab)]

2. What discussions he has had with ministerial colleagues in the Department for Education and Department for Culture, Media and Sport and with the devolved Administrations on ensuring that their policies meet the skills needs of the technology and video games sectors.

[The Minister for Culture and the Digital Economy (Mr Edward Vaizey)]

As a joint Minister at the Department for Business, Innovation and Skills and the Department for Culture, Media and Sport, I often have conversations with myself about this important issue, and on the odd occasion they get dull, I involve the Minister for Skills and Equalities and the Department for Education. I am pleased to tell the hon. Gentleman that we have introduced a new school computing curriculum, are establishing a new national college for digital skills and are co-funding with employers innovative degree apprenticeships.

[Jim McGovern]

I try not to speak to myself about this subject, but the Minister will be aware that I have raised on numerous occasions the importance of computer and video games to the Dundee, Scotland and UK economy. I am sure he agrees that there is a skills shortage—not enough graduates are going into the computer games industry. What is he doing with other Departments to address this situation?

[Mr Vaizey]

The hon. Gentleman is a doughty champion for the video games industry, which is hugely successful in his constituency and throughout the country, and the video games tax relief will also help the industry grow. However, he is quite right to point to the need to focus on skills. The games industry was instrumental in persuading the Government to have computer coding taught in schools, and, because we have a sense of urgency about this, we have introduced new degree apprenticeships so that people at university can work closely with employers on the latest technology.

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[Mr Vaizey]

Let me say that

“common sense in an uncommon degree is what the world calls wisdom.”

That is Coleridge as well, but nobody understood. My hon. Friend has displayed immense common sense in pointing out that it is important that we stand up for the intellectual property rights of our very successful creative industries. It has to be said as well that we should be mindful of what the consumer now wants, which is to access content in a fair and reasonable way wherever they are based. So we need to work with industry and the consumer to achieve a happy result.

[Jim McGovern (Dundee West) (Lab)]

T1. If he will make a statement on his departmental responsibilities.

Oral Answers to Questions

Debate between Lord Vaizey of Didcot and Jim McGovern

Thursday 16th October 2014 Commons Chamber

[Mr Vaizey]

I think that Helen O’Neill’s 43-year career in journalism is a testament to the fantastic contribution that local newspapers make to our democracy. I am pleased that I will be sitting down with the National Union of Journalists for a seminar on local newspapers because I, for one, want to do everything I can to ensure that they have a vibrant and brilliant future.

[Jim McGovern (Dundee West) (Lab)]

Unfortunately we ran out of time before I could ask Question 14, which was about the video games industry. The Minister is aware of how crucial that industry is to the economy of my home city of Dundee. What progress is being made on extending the three-year period for the skills investment fund?

[Mr Vaizey]

I hope that the hon. Gentleman does not mind that I often pray in aid Dundee as a brilliant example of a city that supports the video games industry. I am happy to tell him that the skills investment fund that we set up has put millions of pounds into skills training. Yesterday I attended the opening of the Industrial Light and Magic headquarters in London, which will employ 200 people in the visual effects industry, and we will certainly consider whether it is possible to extend the scheme.

Oral Answers to Questions

Debate between Lord Vaizey of Didcot and Jim McGovern

Thursday 20th June 2013 Commons Chamber

[Jim McGovern (Dundee West) (Lab)]

10. What assessment her Department has made of the potential benefits to a city of achieving UK city of culture status.

[The Parliamentary Under-Secretary of State for Culture, Media and Sport (Mr Edward Vaizey)]

The potential benefits of becoming the UK city of culture will be increased investment in cultural activities, a great deal of media coverage and a huge increase in visitor numbers.

[Jim McGovern]

I am sure the Minister will be aware of early-day motion 156, tabled in my name, which supports Dundee’s bid to be UK city of culture in 2017. I realise that it would be difficult for him to say that he supports one city, but is he aware that not one single SNP Member has signed that early-day motion? Is that because they would prefer Dundee not to be part of the UK in 2017?

Oral Answers to Questions

Debate between Lord Vaizey of Didcot and Jim McGovern

Thursday 16th June 2011 Commons Chamber

[Mr Vaizey]

I would certainly be happy to meet the hon. Gentleman to discuss coverage in south Wales. I have learned from many years’ experience that there is no such thing as utopia, but we can strive towards it. As far as Mr Murdoch’s monopoly is concerned, I know that he will have taken note of Ofcom’s investigation into pay TV, sports rights and other such competition issues.

[Jim McGovern (Dundee West) (Lab)]

10. What discussions he has had with the Chancellor of the Exchequer on future Government support for the UK computer games industry.

[The Parliamentary Under-Secretary of State for Culture, Olympics, Media and Sport (Mr Edward Vaizey)]

I discussed future Government support for the creative industries—including the video games sector—with the Chancellor of the Exchequer in the development of the plan for growth which was published alongside Budget 2011. The plan for growth sets out the specific actions that we are taking to tackle major barriers to growth in the creative industries and to create the right conditions for creative businesses to flourish.

[Jim McGovern]

I do not know about high-speed broadband, but that was a high-speed answer—and I am sure that the Minister will appreciate that it is not the one I was looking for. He will be aware that games companies in the UK are closing and that many of their staff are going to Canada. Ireland is now looking to introduce tax breaks, but for some reason this Government persist in doing nothing. Will the Minister reassure me, the House and my constituents that the assessment of tax breaks for the industry, as recommended by the Scottish Affairs Committee, will be carried out as a matter of priority before more harm is done to this very important industry?

[Mr Vaizey]

I am mindful of your desire, Mr Speaker, to crack through the Order Paper, which is why I tend to answer questions in a rapid manner. Let me first congratulate the hon. Gentleman on his championship of the video games industry. I know that 150 jobs have been created in the industry in his own Dundee constituency. Measures in the Budget, such as the changes to the research and development tax credit and the enterprise investment scheme, will help the video games industry. I will continue with my vocal and, I hope, practical support for that important industry.

Oral Answers to Questions

Debate between Lord Vaizey of Didcot and Jim McGovern

Thursday 20th January 2011 Commons Chamber

[Mr Vaizey]

Yes. It is important to emphasise that even in an area where, in theory, superfast broadband already exists, there will still be patches where the broadband connections are not as good. That is why we have set aside such a substantial sum of money to help with the roll-out of broadband.

[Jim McGovern (Dundee West) (Lab)]

7. What plans his Department has to enable Scotland to benefit from the London 2012 Olympics.

UK Software Industry

Debate between Lord Vaizey of Didcot and Jim McGovern

Wednesday 10th November 2010 Westminster Hall

[Jim McGovern]

When will a member of the coalition Government visit Abertay university?

[The Parliamentary Under-Secretary of State for Business, Innovation and Skills (Mr Edward Vaizey)]

On 3 February.

[Jim McGovern]

The Secretary of State for Scotland has visited, but no Conservative Member has done so.

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[Jim McGovern]

I thank my hon. Friend for giving way; I went to my usual seat in the Chamber over here, so I seem to have split from the Opposition.

On the subject of access to MPs, prior to the previous Labour Government’s March Budget statement, numerous Ministers—the Chancellor, the Secretary of State for Scotland, and Ministers from the Department for Business, Innovation and Skills and the Department for Culture, Media and Sport—visited Abertay university. They saw for themselves just how important the industry was to Dundee and, on the back of that, the Chancellor announced a tax break for computer games. However, since the general election, there has been not one visit to Dundee.

[Mr Vaizey]

Just the Secretary of State for Scotland.

[Jim McGovern]

Prior to the withdrawal of tax breaks for the computer games industry, not one Minister visited Dundee. Does my hon. Friend the Member for Wrexham (Ian Lucas) agree that that was unfair, at the very least?

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[The Parliamentary Under-Secretary of State for Business, Innovation and Skills (Mr Edward Vaizey)]

I am grateful, Mr Weir, to be serving under your chairmanship today, instead of serving with you in Committee as we were yesterday, and will be again tomorrow.

I congratulate the hon. Member for Houghton and Sunderland South (Bridget Phillipson) on securing this important debate. May I give her one quick, straight answer, which is that I would be delighted to meet her at a later date if she finds my speech unsatisfactory? I can make a safe prediction that because I am a Minister and she is member of the Opposition, my speech will almost certainly fall short in some respects of what she wishes.

I would also be only too delighted to visit Sunderland and see some of the innovation and technology happening in that city. The hon. Lady used her speech to highlight brilliantly the sort of technology expertise that now exists in Sunderland. In fact, as pointed out, in the north-east alone it is said that the software and IT industry is worth something like £800 million; there are almost 2,200 businesses, 27,000 people and companies such as 5G, which she mentioned, and, in other parts of the north-east, Sage, Reflections and Eutechnyx. Sunderland is a hub of high-tech industry.

I am grateful to some of the other hon. Members who have contributed to the debate. The hon. Member for Southport (Dr Pugh) made a thoughtful speech, which was not partisan but reflected on many of the issues that affect the software industry. He effectively turned the debate, for a moment, into one on the video games industry. Another point, which I shall return to, and which I absolutely support him on, was his reflection that in schools children today are learning how to use applications rather than how to programme.

In fact, the hon. Gentleman might have shared with me some of the anecdotal experiences of talking to some of our top games developers, many of whom learned their trade, as it were, on the BBC Acorn computer in the ’80s. We simply do not have such access to the nuts and bolts of technology. One of the things that I want to work on, in a big society kind of way—I am one of those Ministers who fully understands what the big society is—is some sort of after-school club where children can sit down with developers and learn how to programme. I also took on board the hon. Gentleman’s points about big IT and big government. He will be well aware that many members of the new Government, particularly the Chancellor, are keen supporters of open source software. The Government are very focused on ensuring that small and medium-sized enterprises get a fair share of the cake from the Government.

I was pleased that the hon. Gentleman took a realistic view about the fate of BECTA—we should not always focus on the quango as the be-all and end-all of Government policy. I am sure that schools will continue to access excellent high-tech IT equipment for their children, not least from RM plc, one of the foremost educational technology providers in this country, based in my constituency, at Milton park in Didcot.

It was good to hear the speech of my hon. Friend the Member for Hove (Mike Weatherley), whose soon-to-be constituency I visited during the election. I am not sure whether I made a big impact; I suspect it was his hard work and dedication to his now constituents that secured him the seat. He has already made a name for himself in the House with his passionate support for the creative industries. He used to work in the film and music industry. His focus is on piracy, to ensure that there is a balanced debate and that we remember that rights holders deserve to make money from their creations. I take on board his points about the R and D tax credits.

I am delighted to see my hon. Friend the Member for North Swindon (Justin Tomlinson) in the Chamber, having won his seat at the election. His remarks reflected the change of tone in the House on video games. When I was an Opposition spokesman and talked about the importance of video games, the only Labour Member who would talk about video games was the right hon. Member for Leicester East (Keith Vaz), who regularly criticised them for their violence and their effects on society—he alleged. It is good that my hon. Friends are now standing up and saying proudly that they are players of video games.

[Jim McGovern]

Does the Minister accept that “video games” is perhaps the wrong title for the subject? Anyone who has visited Abertay university would see that what are called video or computer games can be applied to construction, architecture or medical science. It is wrong to say that “video games” just involve young lads sitting at a computer playing “APB” or “Grand Theft Auto”.

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[Mr Vaizey]

Obviously, the software industry is far wider than simply video games. We tend to call it the video games industry in the vernacular, although some people call it the interactive entertainment industry. However, I have said consistently over many years that what one loosely calls the video games industry is at the heart of a whole range of technologies in defence, education, health and the wider creative industries, such as architecture. That is why it is so important to support the core skills and companies in the industry.

My hon. Friend the Member for North Swindon invited me to meet the Technology Strategy Board. I have done so. It is incredibly important to the debate about the future of the software industry, as well as across a range of other areas. I am delighted that it is in Swindon, just down the road from my constituency; indeed, several of its employees are constituents, so they are clearly people of great judgment. Let me take this opportunity to wish my hon. Friend a happy birthday for last Friday.

Last but not least, I welcome to our Benches the hon. Member for Dundee West (Jim McGovern). I cannot work out why he is sitting where he is, and I had better tread carefully in making an analogy, but he resembles one of those soldiers from the last war who was so dedicated to his craft in taking on the enemy that he dug deep, burrowed down, hid and covered himself in camouflage. In coming to his usual seat, he is as yet unaware that the last war has concluded, victory has been declared and there is a new Government. Alternatively, his choice might simply reflect the huge success of the coalition’s policies over the past six months, particularly pertaining to the software industry, to which I am about to turn.

[Jim McGovern]

Let me say in response that I might be the first, but I will certainly not be the last, to split this coalition.

[Mr Vaizey]

The hon. Gentleman indicates that he is simply acting as a buffer between Conservative and Liberal Democrat members of the coalition. I wonder what other conflict spots we could send him to, given that he is doing such an excellent job this morning.

I have mentioned the huge importance and success of the software industry in Sunderland. The hon. Member for Wrexham (Ian Lucas) talked of the success of the UK software industry, and I heartily endorse what he said. More than 500,000 people work in it, and there are more than 100,000 enterprises, generating more than £39 billion of gross value added. The UK market for software products and services is the largest in the European Union and has sophisticated leading-edge consumers in sectors such as logistics and financial services. As a result, almost all the world’s major software businesses have a substantial presence in this country, whether in research and development, logistics or sales and marketing.

The software industry is not immune to the pressures being felt across the UK economy. In the longer term, globalisation will create additional pressures, as routine tasks and activities continue to be relocated to lower-cost economies. However, there are also tremendous opportunities for the sector, and I am certainly from the school that sees the glass as half full, rather than half empty. Innovative software technologies will underpin many of the fundamental shifts that we see in our society and our economy—everything from how we shop and access entertainment such as television and video to how we improve our transport networks and manage our scarce natural resources. In all those areas, new software systems will be the key enabler and driver of growth and innovation. As a result, the sector’s importance extends far beyond its direct contribution to UK GDP and employment, vital though that is. The sector will be in the vanguard of our broader economic renewal.

The coalition Government are absolutely committed to creating the right conditions to allow software and other UK technology companies to flourish. That means responding to the sector’s distinct requirements to ensure that the software businesses of tomorrow are nurtured today. Last week, the Prime Minister launched “Blueprint for Technology”, which clearly stated the Government’s ambition to make the UK the No. 1 place in the world to start and invest in a technology company, as well as our ambition to be the most technology-friendly Government in the world.

The hon. Member for Wrexham took huge exception to the fact that the blueprint was launched in Shoreditch, not Sunderland, and I assure him that I will be writing to the hon. Member for Hackney South and Shoreditch (Meg Hillier) to tell her that one of her party’s spokesmen deems her constituency unworthy of the prime ministerial launch of a technology blueprint. The hon. Gentleman gave no reason, but if he wants to clarify why he has a downer on Shoreditch, he has only to intervene.

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[Mr Vaizey]

I should love the hon. Lady to point out what party political point I made. I was simply setting out our policy and the fact that we responded to the concerns in question with an entrepreneur visa. I noted that the hon. Member for Wrexham was shaking his head. Clearly, he simply opposes the policy for the sake of it, rather than considering what it does.

The blueprint also announces a review of the intellectual property framework, to ensure that its design will support the growth of both new and existing businesses. That review is incredibly important, because it will focus on the needs of small and medium-sized enterprises. We want to give our full backing to the high-growth, innovative companies of the future, whether they specialise in software or other disciplines. Part of preparing for the future is looking critically at the frameworks that we have in place to protect innovators. The review will focus on identifying and dismantling barriers to growth in the IP system, and will look at how the IP framework could better support new business models as they develop.

The third important element of our blueprint is the framework for supporting future technological innovation in software and other disciplines. We are now pledged to establish a network of elite technology and innovation centres, based on the model proposed by Hermann Hauser and James Dyson, to commercialise new and emerging technologies in areas where there are large global market opportunities and a critical mass of existing UK capability. The recent comprehensive spending review has provided £200 million of funding for the technology centres over the next four years. The network will be overseen—in answer to the questions of the hon. Member for Wrexham—by the Technology Strategy Board. Individual centres will operate with a high degree of autonomy, to give them the flexibility to respond to business needs and emerging opportunities, but the board will provide the overarching framework.

Our vision for technology and innovation centres is that they should help industry sectors to exploit new and emerging technologies, and bridge the gap between original research and technology commercialisation, reducing some of the attendant risks to business. I am aware of the issue from my constituency where there are several high-tech companies that can benefit from spin-off research. Each idea appears to me to be potentially world-changing, but the struggle they have to take that research to market and commercialise it cannot be underestimated. The centres will support projects that businesses and universities often cannot undertake, or that they do not have sufficient incentive to undertake on their own. They will help new technologies get to investment readiness so that they are a viable proposition for venture capital or other forms of investment, and will help, we hope, to accelerate their journey to market.

We want to get the network up and running as soon as possible, so the Technology Strategy Board will work closely with industry, stakeholders, and the Government to identify the priority sectors, the scale of initial investment required and the governance structure for the network of centres by April 2011. I urge the hon. Member for Houghton and Sunderland South and any other hon. Members who are interested in the issue to contact the board to discuss it.

The Technology Strategy Board plays an important role in supporting the software sector. It already supports innovation among software-intensive firms in a number of ways, either through sector-specific programmes or through cross-sector projects designed to deal with a particular challenge, such as low carbon. It also backs the software sector via initiatives such as knowledge transfer partnerships. Several of the Technology Strategy Board’s programmes routinely invest in initiatives where more than 90% of the business activities are software-related. That is true of its information technology programme, as well as its creative industries, intelligent transport and network security programmes. In addition, the board has identified its recently formed digital programme as one of its five strategic priorities in the period ahead. In total, over the past year the board has launched 13 software-intensive competitions for projects with a combined value of around £100 million, including £50 million of private investment.

Some other issues were raised, including broadband. Again, some myths were propagated by the Opposition. I think that we all agree that superfast broadband and that kind of infrastructure is essential to the future of the economy. However, I find it odd that the Opposition seem to believe that we have reneged on a promise, or that we do not share their view of its importance. The previous Government had a very poor ambition, which was simply to get universal broadband of 2 megabits at the end of 2012. They proposed to pay for that with a telephone tax that would have hit some of the poorest in society, as well as being a disincentive.

[Jim McGovern]

Will the Minister give way?

[Ian Lucas]

Will the Minister give way?

[Mr Vaizey]

I will take the intervention of the more senior Member first.

[Jim McGovern]

On the subject of promises, prior to the general election, the Minister was quoted—I shall have to paraphrase—as saying that his party unequivocally supported tax breaks for the computer games industry. What has changed his and the Chancellor’s mind?

[Mr Vaizey]

As to promises, the hon. Gentleman’s party said in, I think, the 2001 election manifesto, that they would not introduce tuition fees. So if the hon. Gentleman wants to accuse me of broken promises, perhaps he should look to his own party’s huge record of broken promises, not the least of which is leaving the British people with the biggest deficit in peacetime history, having promised to end boom and bust.

As I said, the telephone tax would have been a huge disincentive to investment. It would have hit small businesses and the poor—all for the paltry ambition of 2 megabits universal broadband.

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[Mr Vaizey]

I have read that report, and I am happy to stand corrected. We are in a similar position, except for the fact that the Government are not imposing a tax; we plan to get superfast broadband to as many people as possible by 2015, while the Labour party remains stuck in the slow lane at 2 megabits.

I now tackle the thorny issue of video games and tax breaks. Again, I shall try to knock down a few of the myths that have been propagated. To hear Labour Members speak, one would have thought that the land of milk and honey had arrived with the last Labour Government. When I was Opposition spokesman, I sometimes felt like a lone voice when talking about the success of the video games industry over the last three or four years. However, I pay tribute to the hon. Member for West Bromwich East (Mr Watson), who has been a fantastic advocate of the video games industry.

I remember that the Labour Government ruled out a video games tax break. When in opposition, we mentioned competition from Canada, and were told that the Government were going to refer the matter to the World Trade Organisation. However, a chance conversation with an insider revealed that that was a red herring. When I tabled a parliamentary question about it, the Government were forced to perform a U-turn and reveal that the reference to the WTO was an excuse for inaction. Finally, they were converted to a video games tax break.

At what point did that amazing conversion come? Was it at the beginning of a Parliament, when the Government had a strong majority and a lot of energy? No; it came with the last Budget of a discredited Government who were about to lose an election. They knew that they would not have to implement that tax break—and it was not implemented. It was an extraordinary U-turn; despite the comprehensive spending review of October the year before, that decision would still have had to go to Brussels for approval. The sound of Labour MPs clambering on to bandwagons now that they have no public policy responsibility for the matter is quite extraordinary.

[Jim McGovern]

I resent the Minister’s comment that Labour Members are jumping on a bandwagon. I have supported the computer games industry in Dundee for a number of years, and several Ministers have visited us. Why did Ministers not visit Dundee prior to withdrawing the tax break?

[Mr Vaizey]

Dundee is an incredibly important part of the video games sector in the UK. We have invested £2 million in the university of Abertay to support video games, but video games do exist in other parts of the country, and it is not essential to visit Dundee to decide whether we should have a tax break. But I intend to visit because it is a pioneering area with a world-class university. I am raring to get up there. Indeed, given the austere times that we live in, I hope that the hon. Gentleman will put me up for the night. It is a bit odd for Labour MPs to claim that if you cut them open, “video games tax relief” will be written on their hearts; the relief was a political ploy to win support from the industry in the run-up to the election, and they knew full well that they would not have to implement the policy.

Let us be clear about it: people want a video games tax break because of the competition that we face from Canada. A tax break is not a panacea; France has a tax break, but we have a more successful video games industry. Canada does not have a national tax break for video games. It has two strong regional Governments who actively compete for the video games industry; they made that decision 10 or 15 years ago and they are throwing money at the industry. They are handing over millions of dollars—there is nothing wrong with that—to tempt developers and publishers to base themselves in Canada, and that means salary holidays, rent holidays and other kinds of support.

I want to put in place a strategy for the video games industry—for example, so that it can access the regional growth fund that we announced, and can take advantage of the numerous funds that I have discovered in the Department for Business, Innovation and Skills. Partly because of exchange rates, we are close to Canada, even without a tax break. One company that has invested in Canada showed me the numbers; without breaking commercial confidentiality, I can say that there was a difference of about 10 or 15% in costs per employee. However, as the hon. Member for Southport mentioned, we have a fantastic skills base, and that is another important reason to invest here.

This has been a good-natured and good-humoured debate in which we have found a great deal of common ground, huge support for the software industry and a passion for the video games industry. There has been recognition of the pioneering role of the north-east and Sunderland in ensuring that the UK remains a world leader in this important industry. I set out our policies—the technology blueprint, our plans for technology innovation centres and entrepreneur visas, and our plans to review intellectual property law. However, there is broader support, too.

I was disappointed to hear that it is now the Labour party’s policy to push up corporation tax. Under this Government, corporation tax will fall year on year; that is an important point to make. We have also increased entrepreneurs’ relief for capital gains tax. Our tuition fees policy is progressive, and it will mean people paying back their debt when they are at a higher income level than applied under the Labour Government. We have made significant progress in empowering our universities. As the hon. Member for Southport pointed out, despite Labour’s U-turn on tuition fees, their introduction did not stop people wanting to go to university.

I was privileged to be at the graduation of four apprentices at Culham Science Centre in the constituency of my hon. Friend the Member for Henley (John Howell). It is worth remembering that we have a fantastic Minister for Further Education, Skills and Lifelong Learning in this Government; he has put together a national apprenticeship policy, which is important for high-tech industry. People leave school and go on to be apprentices, and the four whom I met were formidable. As the head of the Culham Science Centre said, they are as qualified as any graduate, but have been paid for four years and have no debt. Many will be going on to do higher degrees. They will be at the heart of a high-tech industry in Culham. Thanks to that Minister, this Government, unlike the last, have—at long last—a clear policy to promote apprenticeships and skills, which are important to both the IT and software industries.

I cannot read the face of the hon. Member for Houghton and Sunderland South, and I am not sure whether I have allayed all her fears, but she seems to be in a slightly happier mood than when the debate began. I am happy to sit down with her and talk through the issues at a later date, and to visit her in Sunderland.