UK Trade and Investment

Lord Mitchell Excerpts

Tuesday 9th October 2012 Grand Committee

[Lord Mitchell]

My Lords, my noble friend Lady Liddell has done us a great service in securing this debate. We must thank her for that as well as the very impressive speech that she has just made. The contribution made by speakers from all parties is tribute to the importance of SMEs in the national economy.

It is no surprise that my party fundamentally disagrees with this Government’s economic policy, most particularly their refusal to moderate austerity and revert to a growth-based strategy. Yesterday, George Osborne said that there is no alternative. Today, David Cameron says that the economy is slowly healing. However, this morning, the IMF says that our economy is contracting and today’s trade figures are appalling. I wonder what planet these people live on.

In the SME world which I inhabit, the effect of austerity has been devastating. Without credit, businessmen simply cannot expand their businesses and cannot employ more people. I had guessed that by this stage of the debate every aspect of what UKTI does would have been covered, so I am going to stay away from it, at least directly, and talk about other agencies which the Government have to promote SMEs. The Government have been almost manic in introducing new programmes supposedly to help SMEs, but the results have been somewhat anaemic. The fact is that announcing a programme is one thing, making it work is something else. Not surprisingly, the Government have chosen the high street banks to deliver many of their programmes. The suspicion is strong, however, that instead of befitting small and medium-sized business as intended, the banks are directing these funds either to the more highly profitable consumer sector or else towards bolstering their own balance sheets.

The business growth fund owes its genesis to Project Merlin, which as the Minister will know was an undertaking written in blood by the banks to benefit British industry. But what do we see? We see the fund in many instances investing in companies not by funding investment or cash flow but, perversely, by cashing out managers and shareholders. The word on the street is that the business growth fund is a total failure. I would like to hear the Minister’s view on this.

I come to the business finance partnership. This is a £1.2 billion pot, of which £700 million is supposedly committed to mid-sized companies. It aims to promote alternative and non-traditional channels of finance. I am told by people who are in the know that little has happened. There is also the regional growth fund. Out of £1.4 billion earmarked for this project, only £60 million has been received by business. “Glacial” is a word I used to describe the fund. The enterprise guarantee scheme is also a flagship project. Again, I would like to know how it is progressing. There is also the export enterprise finance guarantee scheme that was launched to fund exports and is directed at SMEs. It is all good stuff, but by June of this year it had allocated only £3 million—or so I am told.

One government initiative that I fully support is the seed enterprise investment scheme introduced by the Chancellor this time last year. I am contemplating investing in various start-up companies, using this structure. It is very tax efficient. However, it seems almost like a state secret. No one I know, and perhaps very few of your Lordships, has ever heard of it. Why has it not been marketed and why does it last for only one year? Schemes of this nature need time to bear fruit. Pulling up the project by its roots after one year to examine whether it is growing is hardly the way to develop a policy geared to providing new investment in new companies. We need business angels to help fund exciting businesses, particularly in my area, which is technology. Using the tax system to help angel investment is an excellent idea. I will make a plea to the Minister that may sound strange coming from a shadow Minister. The SEIS is a very good scheme. Please leave it in place, and please market the programme seriously so that more potential angels are attracted to invest.

The programmes introduced by the Government have been woeful in their level of success. For the most part they have been ill thought through and incompetently implemented. My advice to the Government is to think deeper about projects to help SMEs, to put much more effort into marketing them and, most of all, to give them time to develop.

Middle East: Recent Developments

Lord Mitchell Excerpts

Friday 13th July 2012 Lords Chamber

[Lord Mitchell]

My Lords, I must say to the noble Lord, Lord Hylton, that, as a member of the Jewish diaspora, I have absolutely no influence whatever over the settlers; nor would they ever listen to me.

I thank the Minister for what he had to say today. It was a tour de force on the situation in the Middle East, and as we come to the tail end of this debate, it has been very inspiring. The headlines today say it all: “Another massacre in Syria”. My notes say that 15,000 people have been killed in Syria; the Minister says that it is 17,000. When this butchery is over and the facts become known, none of us will be surprised to learn that the real number is significantly higher than that reported. Certainly President Bashar al-Assad will have managed to outdo his father when it comes to slaughtering his own people.

Last year we witnessed another massacre about to happen. The forces of Colonel Gadaffi were marching on Benghazi determined to liquidate that city. Thankfully, due to prompt and effective military intervention by our Government, together with France and the United States, this carnage was prevented. Two years ago people in Bahrain demonstrated against their Government. As my noble friend Lord Watson mentioned, young doctors who treated the wounded demonstrators were arrested and given long jail sentences. In Iran three years ago a general election was held. The Government ignored the result and massive protests occurred resulting in many deaths.

The Middle East has been on fire with revolution. This Arab spring is still burning, but the costs in human life have been massive. We have witnessed great hope but also great abuse of human life and human rights. When Arabs are slaughtering Arabs, should we not ask ourselves why this very evening there will be no protests outside the Syrian embassy in London? Why have there been no calls for Iranian universities to be boycotted? How was it that Bahrain was allowed to play host to Formula 1 motor racing? When such atrocities are taking place, where are the predictable protesters? Where is the Socialist Workers Party? Where is the Palestinian Solidarity Council? Where are the demands for further debates in Parliament? Where is the normal righteous indignation? When Israel transgresses, the whole world goes crazy. It takes only a minor incident on the West Bank or Gaza for the rent-a-mob crowd to be up in arms. Hypocrisy is the only word that comes to mind.

My noble friend Lady Blackstone referred to the FCO report, entitled Children in Military Custody, on the treatment of Palestinian children under Israeli military law. Where are similar reports about children in military custody in Iran, Syria, China, the Democratic Republic of the Congo, or any other despotic region we could mention? That will never happen. But in democratic Israel, even painful investigations are allowed to take place.

In 2007 I was chairman of an organisation called Weizmann UK and today I am proud to sit as a member of its executive council. Weizmann is not a university as such but a science institute working solely on basic science. It is a powerhouse in Israel providing one-third of the PhDs in science in that country. Three years ago it achieved its first Nobel prize. When there was much talk in this country of an academic boycott of Israeli universities, I took all the actions noble Lords might have expected. I spoke in your Lordships’ House, wrote letters to the press and mustered as much support as I could, and I think we won. Even though the calls for a boycott continue, the intensity is not as great. But for me it was not enough. I wanted to do something more to demonstrate that academic boycotts are not only wrong in principle but wrong in purpose. So I initiated a project called Making Connections, which has been a huge success.

We raised initial funding to enable Weizmann scientists and UK scientists to collaborate on frontline projects designed to advance scientific learning. Partnerships have been established with, among others, Cancer UK Oxford, Cambridge, Edinburgh, UCL, Durham, Warwick and Imperial. Among the subjects in question are: motor driven transcription factors in injured nerves; switchable nanomaterials for catalysis and sensing; the electrical double layer in pure ionic liquid next to an electrified metal surface; and the interplay between algorithms and randomness. Noble Lords will get my drift. It is cutting edge science, with Israel and the UK in partnership, and the eventual winners being mankind itself.

There are, of course, other initiatives. The British and the Israeli Governments have entered into an agreement to promote closer understanding between universities in a whole host of subjects. My noble friend Lord Turnberg, who is in his place, and his wife Lady Turnberg, created the Dr Daniel Turnberg UK/Middle East Travel Fellowship in honour of their late son. Under this project, early-career biomedical researchers from Israel, Egypt, Jordan, Lebanon, Palestine and the UK have worked together and obtained great results. One day, Arab students will go to Israel and vice versa.

Once upon a time, if you thought about Israel’s economy, you thought about oranges. Today Israel is about science and technology. It is a high-tech powerhouse. When it comes to cutting-edge research and development, it is second only to Silicon Valley. Nowhere in Europe even gets close. Technology fuels Israel’s economy. Last year it recorded GNP growth of 4.5%. Just like people in Singapore, Malaysia or China, Israelis look at you blankly when you talk about a double-dip recession.

In the area of information technology, Microsoft, Intel, Cisco and Motorola all have major development plants in Israel. Apple has just agreed to follow, and Israel will be a major partner in its development. At CERN in Switzerland, Israeli scientists have been at the forefront, and 11 of them have worked with colleagues to confirm the existence of the Higgs boson.

Using solar energy, Israelis are converting greenhouse gases into fuel. In medical research, they are dramatically improving the diagnosis of blood infection as well as using extreme cold to destroy diseased tissue. I love the fact that Israel was the only country to end the 20th century with more trees than it started it with.

I know Israel well and I have worked closely with its scientists. They love their subject and they love international collaboration. From time to time I have posed an out of the box and totally impossible question: “If you had the opportunity, how would you view working with scientists in neighbouring countries?”. Everyone I spoke to was very excited, but they knew it could never happen—yet it does happen. I saw it at CERN, where Israeli scientists were working with their Muslim equivalents. I saw it at Haifa University, where 20% of the students are Arab. I have seen it in Britain, where Jewish and Muslim students, often from Israel and Arab countries, simply get on with it. The science comes first; it is the politicians who get in the way.

I invite noble Lords to imagine Israelis and Arabs working on joint projects on subjects that matter to them, such as water, which other noble Lords mentioned. Crops could be developed that grow in saline water and all sorts of diseases could be prevented. The opportunities are many, but the political situation does not let it happen. It needs a breakthrough.

So I have an out of the box request for the Minister to think about. I am not sure that I will get an answer today, but perhaps he will mull it over. Just as I and many others have initiated bilateral scientific co-operation between British and Israeli universities, why does this country not go one step further? Why do we not have a three-way programme, with British, Israeli and Arab universities working together? We in Britain are in a prime position to do this. We have connections with all countries in the region. The Government could set up a fund so that UK universities could take the lead and promote three-way joint projects. It would not need massive publicity and it may not lead to peace, but it would certainly improve the climate. Fanciful? Perhaps. Impossible? Maybe. But in this world if you do not try, you get nowhere—and if it were to succeed, what a coup it would be.

Iran

Lord Mitchell Excerpts

Tuesday 30th November 2010 Grand Committee

[Lord Mitchell]

My Lords, I, too, thank my noble friend Lord Corbett for initiating this debate. I do not suppose that any of us are wildly happy about the WikiLeak revelations, but in some ways they throw into sharp relief the true views of the Arab states on Iran. Like many other noble Lords, I have always been surprised by what I have heard Arab diplomats and politicians say in private behind closed doors compared with what they say in public. When talking about the dangers to their countries, they look to the threat from the East—in other words, Iran—rather than to that from the West—that is, Israel. They have one language for the street and another for diplomacy. On Iran, the leaks quote the King of Saudi Arabia as saying that the head must be cut off the snake; the King of Bahrain as saying:

“The danger of letting it go on is greater than the danger of stopping it”;

and about Ahmadinejad that he is “unbalanced, even crazy”.

The Iranians, of course, deny that they are building a nuclear weapons capability; they say that they are building nuclear power plants. Iran is a poor country. Could someone please explain to me why, as one of the world’s largest producers of gas and oil, it should need to build nuclear generators? It is laughable. I see the Iranian situation as a car crash waiting to happen, and it is all in tortuous slow motion. For years, we have known that the Iranian regime is wholly bad. Ever since the revolution, it has been a force for evil in this world. It destabilises Iraq and Afghanistan, and it is our soldiers who pay the price. It set up a state within a state in southern Lebanon, such that Hezbollah today is a major threat to Israel, armed to the teeth with more rocketry than it had in 2006, despite the United Nations trying to prevent it. It finances and arms many organisations that we deem to be terrorists and which are threats to our security. Now it is in bed with the North Koreans, who it seems are to supply it with medium-range missiles capable of hitting western Europe: talk about a marriage made in hell.

I am a firm supporter of the state of Israel. To Israelis, a nuclear-armed Iran is an existential threat. It sees Tel Aviv as target number one. Ahmadinejad has stated on many occasions—and who are we to disbelieve him?—that the Holocaust never happened and that Israel must be wiped off the face of the earth. So the man both denies the Holocaust and, at the same time, plans for the next one. He plays for time, stringing us all along while he zigzags from side to side. We threaten him but we always back off. We indulge him, hoping that he and his state will change their tune, but they do not. We apply sanctions, which are soft and meaningless, but he ignores them. All the time, the centrifuges keep spinning—at least, they would were it not for the Stuxnet virus.

My conclusion is that nothing will stop Iran in its pursuit of nuclear weapons, except crippling sanctions, and these should be implemented before it is too late.