BHS

Amanda Milling Excerpts

Thursday 20th October 2016 Commons Chamber

[Amanda Milling (Cannock Chase) (Con)]

As a member of the joint Committees that conducted the inquiry into the collapse of BHS, it is a pleasure to speak in the debate. It is also a pleasure to follow the hon. Member for Westminster North (Ms Buck), a fellow member of the Committee, and my hon. Friend the Minister, whom I welcome to her place. She had a slightly different role beforehand—she was my Whip.

Before being elected to this place, I worked in business. Like my hon. Friend the Member for Bedford (Richard Fuller), I am pro-business and pro-enterprise, but not at any cost. I have been appalled by the catalogue of events that led to the demise of BHS and by what we learnt in the Business, Innovation and Skills Committee about working practices at Sports Direct. Both are bad for business and, I am afraid, both are bad for the reputation of business, to pick up the point made by the hon. Member for Westminster North.

Rightly, reputable businesses have also been appalled by both situations. The irresponsible behaviours of a few endanger the reputations of the majority that operate responsibly. That is why I fully support the position of the Prime Minister and the Government that we need to make our economy work for everyone. As she said on the steps of Downing Street,

“we’re the party of enterprise, but that does not mean we should be prepared to accept that ‘anything goes’”.

That is not, as I see it, an attack on business—far from it. There is a desire to protect the reputation of business. After all, we do not want to see the irresponsible behaviours of a few tarnishing the reputation of good business. We need to look only at the banking crisis and the resulting lack of trust in banks, from which, let us be honest, they are still trying to recover, to see the dangers of reputational damage resulting from such events.

[Michelle Thomson]

I rise to note something on the banking crisis and to refer to the Minister’s remarks earlier. Does the hon. Lady agree that, with issues such as the banking crisis and how the state deals with the continuing RBS saga concerning the Global Restructuring Group, how quickly and effectively agencies deal with the matters that we call out is pivotal?

[Amanda Milling]

The hon. Lady makes an interesting point. She has a lot of personal interest in looking at RBS and the banking industry. From my perspective, the Government have been very quick in responding to the collapse of BHS and in recognising that there is a need to review corporate governance. I will come on to that in a bit more detail shortly.

The devastating events that resulted in the tragic collapse of BHS raise several questions about whether the framework of corporate governance is satisfactory, especially in relation to large private businesses—those with large workforces and large pension liabilities. This is about protecting our economy, protecting the taxpayer from picking up the bill and, most important, our responsibility to do everything we can to protect employees.

Many right hon. and hon. Members have discussed the consequences of the collapse of BHS. They have looked at the employees and the members of the pension scheme. I would like to focus on the employees. Eleven thousand people lost their jobs as a result of the collapse of BHS. But for those people it was not just about losing their job; it was about the impact on their lives and that of their families. Many of those people have mortgages to pay and are worried about whether they can keep a roof over their head and that of their family.

[Richard Fuller]

May I echo what my hon. Friend is saying? My right hon. Friend the Minister for Apprenticeships and Skills, who cannot be here today, mentioned to me that the BHS store in his constituency was for many years one of the most profitable BHS stores, but no due regard was given to those employees or pensioners. They were essentially cast aside, as everyone else was. The impact is being felt throughout the country—in town after town, store after store.

[Amanda Milling]

I thank my hon. Friend for his intervention. He makes an important point. The stores are across the country. I do not have one in my constituency, but many right hon. and hon. Members do. Hundreds of people were employed at each store.

As I said, this is not just about the employees; it is also about their families. Far more people than the 11,000 employees have been affected by the collapse of BHS. As the hon. Member for Rutherglen and Hamilton West (Margaret Ferrier) mentioned, the effect has been devastating. This has been a horrid period for the people who no longer have jobs at BHS and are facing difficulties in finding new employment.

[Alison Thewliss (Glasgow Central) (SNP)]

I agree with the case that the hon. Lady is making. Does she agree that not just the people in the stores who were directly employed by BHS, but the catering and cleaning staff and everyone in the supply chain will be adversely affected?

[Amanda Milling]

The hon. Lady makes an incredibly valuable point. It is about the supply chain. Recently, Rugeley B power station shut in my constituency. That affected not just the employees but the contractors and the wider supply chain. It had a real knock-on effect.

The joint Committees’ inquiry has highlighted that the events that led to the collapse of BHS suggest the need to review the regulation on corporate governance, particularly with regard to large private businesses. The inquiry has also suggested that there is a need to create a more level playing field between large private and publicly listed companies in terms of transparency and codes of conduct. As the hon. Member for Hartlepool (Mr Wright), the Chair of the BIS Committee, has mentioned, it will be conducting an inquiry to look at corporate governance and the roles and responsibilities of directors, addressing the issues that have been highlighted in the BHS inquiry.

I am pleased that the Government are committed to reforming corporate governance. It is clear that we need to review the practices of large private businesses, the role of directors in decision making and the responsibilities of directors to consider how they protect the interests of their employees and the members of their pension schemes. Therefore, I welcome the Minister’s remarks and I hope that she and the Government will consider the inquiry’s observations and recommendations and the points made by right hon. and hon. Members this afternoon.

To conclude, we have a responsibility as policy and law makers to learn lessons from the collapse of BHS. I look forward to the Government publishing their consultation this autumn.