Exports: Government Support

Lord Kirkwood of Kirkhope Excerpts

Thursday 29th January 2015 Lords Chamber

[Lord Kirkwood of Kirkhope (LD)]

My Lords, it is a pleasure to follow my noble friend Lord Leigh of Hurley. I am also pleased that this debate is happening at this time. The way in which it was introduced was excellent, and we are fortunate to have colleagues such as the noble Baroness, Lady Wheatcroft: her speech will repay careful study.

I want to acknowledge that we have made substantial progress in the United Kingdom in terms of extra growth in the recent past. It is therefore an appropriate time to continue the coalition Government’s important attempts to improve the rebalancing of the United Kingdom economy. It might sound old-fashioned, but I want to support the increased support that manufacturing exporters need, particularly small and medium-sized enterprises.

I hope that in his wind-up the Minister will be able to reassure us that there will be an opportunity to help people rebalance away from increasing activity in the property, services and shopping fields, so that we can rely more on driving growth from exporting potential rather than the manufacturing industry having to rely on domestic demand, as in the past. It is 10% of our economic output, and it will be a hugely and increasingly important area of our economic activity in the future. I hope that we can get some additional support, particularly at this time, when a lot of manufacturers are at a disadvantage in the eurozone because of the recent changes in the two currencies.

In my view—and I do not need to tell my noble friend Lord Livingston about this, because he knows it much better than any of us—the new digital economy is beginning to develop in a way that stops it being sensibly referred to as a digital economy. It is everything we do now. No matter what exporting businesses do, few of them will not have an important element of digital and internet-based activity. That is a huge exporting potential, not just as regards the products and the outputs, but it is an opportunity as regards the individuals that we can export—if I may put it that way—because of our knowledge and expertise in the area.

As a final recent example of that, I was very pleased to see the recent announcement by the Hut Group. The Chancellor of the Exchequer was up there, rightly, acknowledging its £100 million investment in Warrington, which has an online retail dimension, but also a manufacturing development dimension. These things are hugely important for businesses in the future. We should not forget the digital economy as we go forward, because it will become more, not less, important to our economy and our exports.

I will first pick up a little on our relationship with the United States. It was interesting to notice that at the back of the Prime Minister’s visit to the United States to talk about security matters was a series of very important announcements about trade. A £1.1 billion trade agreement was signed between President Obama and David Cameron, which is a significant achievement, but you have to look quite deeply into press reports before you can find any evidence of that having being reported. That £1.1 billion is a significant amount of money. In the course of researching this, I discovered that the Americans are in favour of British cheese, gin and salmon. I do not know what happened to whisky—I resent that, and I am sure that the Minister is on my side here—but we need to do more work with our American friends to get them to change their tastes for the better. These are all significant things. I want to use that as a way of backing up what other colleagues, including the noble Lord, Lord Risby, said about the role of our ministerial teams, lord mayors and public officials, who work their socks off, to some great effect. As I said a moment ago, I am disappointed that we do not hear more about those successes.

A couple of colleagues made an important point earlier: can the noble Lord, Lord Livingston, give us some reassurance about the Transatlantic Trade and Investment Partnership? I think we are now in the eighth round of negotiations. I am in favour of that agreement, because it is a huge opportunity. It is easy to sit on the sidelines and carp but Her Majesty’s Government have not been properly selling its advantages. This is an invaluable opportunity, but some press reports came out in the last 24 or 48 hours saying, perfectly correctly, that we need some further guarantees and that further work needs to be done to ensure that it is absolutely in the United Kingdom’s interest as regards jobs, consumer rights and environmental protection. I hope that the Minister will be able to say a bit about that, because it is of fundamental importance to our country.

Moving on to the eurozone bailout, I understand what other colleagues are saying about China and India, the brave new world and emerging markets, but in the immediate future we really need to concentrate on helping exporters who are struggling in the short term. The ECB bailout may not work. The Russian economy is flat on its back, and the Japanese economy is not in good health. Even in China, there is some evidence of slowing down. There are headwinds all over the place, if I may put it that way. Can there be headwinds all over the place? Maybe there can. There are difficulties, and we should not underestimate the fact that we sell 40% of our exports to the European Union. I support what my noble friend Lord Stoneham said about the importance of that. We must not forget the difficulties that people face there.

I want to talk about some of the excellent work that Tobias Ellwood, the Trade Minister in the other place, has been doing. For instance, in the past few weeks he has taken a trade mission to Egypt, and we have had the third UK-Pakistan trade and investment conference and the Britain in Kuwait exhibition. We struggle to hear about these things, but they are all good news and that work is very important.

However, visas are still a very serious problem for students and trade missions. I know that I probably have the noble Lord, Lord Livingston, on my side in this matter, but we really need to talk to UKVI. We should give ambassadors, who know their territory well, more discretion over who gets visas, so as to prosecute better trade and student relationships. David Willetts was absolutely correct to campaign as vigorously as he did about students being forced to return to their country of origin on graduation; I think that the noble Lord, Lord Cope, referred to this. Those people have valuable potential to be of assistance to us in the future when they go back to their own countries.

There are opportunities in the UK, with the strength of our local economy, and we should be doing everything we possibly can, including giving extra support to UKTI and the ambassadors who act in the Queen’s interest in this business in other countries.

I end with a simple political message: we should be saying to the electorate not only that we need political stability and economic certainty after the election, but that this is no time for people to be voting for parties that have no experience of Westminster government. From these Benches, I would add that this is no time to vote for parties that would put at risk our membership of the European Union. I hope that the Minister will be able to reply to some of the points that have been made in what has been a good and important debate.