Oral Answers to Questions

Andrea Leadsom Excerpts

Tuesday 22nd October 2019 Commons Chamber

[Anne Milton (Guildford) (Ind)]

6. What guidance her Department has issued to businesses to help them make more effective use of the apprenticeship levy.

[The Secretary of State for Business, Energy and Industrial Strategy (Andrea Leadsom)]

I strongly believe that apprenticeships are a superb option for people to earn and learn. In my Department, we have 154 apprentices, 149 of whom are levy funded. I have taken on a new school leaver apprentice in my office every year since becoming an MP, which has been an excellent experience for them and for my team. Since the introduction of the apprenticeship levy, we have made changes to ensure that businesses can spend up to 25% of it in their supply chain, and I am delighted that the number of people starting higher-level apprenticeships has increased by over 40% since the 2016-17 academic year.

[Sir Desmond Swayne]

Is the 80:20 rule an overhead that is unwelcome to employers who have to provide cover for employees who are learning?

[Andrea Leadsom]

My right hon. Friend makes a really important point, but he will appreciate that off-the-job training is vital for apprentices to develop the knowledge, skills and behaviours they need to succeed at work. The 20% off-the-job training rule is based on standards used by apprenticeship programmes regarded as world class, such as those in Switzerland and Germany, which we have made it our ambition to at least match.

[Mr Campbell]

Employers complain about the inflexibility of the apprenticeship levy. What steps is the Minister taking to ensure that it becomes more flexible, leading to greater dynamism in our local economy?

[Andrea Leadsom]

The hon. Gentleman will be aware that the apprenticeship levy is collected from Northern Ireland businesses, with Northern Ireland subsequently receiving a Barnett consequential of spending on apprenticeships in England, which is funded by the levy. Ensuring that apprenticeship policy in Northern Ireland is delivering for Northern Ireland businesses is just one of a number for reasons why it is so essential that devolved government in Northern Ireland is restored.

[Anne Milton]

In Guildford, 97% of businesses are small businesses. What progress have the Government made on ensuring that they can use the 25% transfer from levy employers to build the skilled workforce that we desperately need in this country?

[Andrea Leadsom]

I pay tribute to my right hon. Friend for her superb work as Minister of State for Skills over the past few years. Under her watch, the importance of technical education has been raised substantially. She will be aware that sectors in all parts of the economy are now creating apprenticeship programmes, from cyber-security to offshore wind, and more than 61% of starts are now on high-quality industry design standards.

[Sir Vince Cable (Twickenham) (LD)]

How does the Secretary of State explain the fact that the Government’s own skill index, which measures the value added from apprenticeships and vocational training, is now 25% below 2012 levels?

[Andrea Leadsom]

The right hon. Gentleman will be aware that in the 2018-19 academic year, despite an overall fall, nearly 60,000 people started higher-level apprenticeships, up nearly 43% on the year before the levy was introduced. It is important that the Government continue to talk to business about how to make use of this, but we are very pleased with progress.

[Mr Iain Duncan Smith (Chingford and Woodford Green) (Con)]

A recent report by the Centre for Social Justice showed that in the UK, of those who start entry- level work, only 15%—15%—will ever progress beyond it in their whole life. That is an indictment of the UK under different Governments. Beyond apprenticeships, what plans does my right hon. Friend have to find ways to encourage businesses to do on-the-job training, so that those people can move on and increase their salaries?

[Andrea Leadsom]

My right hon. Friend is right to raise the much bigger challenge of how to get young people not only into an apprenticeship but past it, enabling their skills to develop. We are doing that in a number of different ways. The Government continue to speak with businesses and monitor the impact of the apprenticeship levy on the performance of young people. We are doing a lot to promote start-up businesses for young people through the British Business Bank, but we continue to need to seek ways to ensure that no young person is left behind.

[Jim McMahon (Oldham West and Royton) (Lab/Co-op)]

People are living longer, which is a good thing, but they need care in old age. In Oldham, health and social care is a growing industry, but at the moment it attracts the lowest band of the apprenticeship levy. I saw this week that the Department of Health and Social Care was advertising jobs at just above the minimum wage. Will the Department for Business, Energy and Industrial Strategy work with the Department of Health and Social Care to raise the value of those jobs?

[Andrea Leadsom]

The hon. Gentleman raises a really important point. We want to see young people being attracted to apprenticeships right across the range, and he is right to raise the importance of getting good-quality people into the social care system. I would be delighted to speak with him and others who are interested in that area of future employment.

[David Hanson (Delyn) (Lab)]

2. What recent assessment she has made of trends in the level of executive pay.

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[Giles Watling (Clacton) (Con)]

10. What steps she is taking to enable more women to establish businesses.

[The Secretary of State for Business, Energy and Industrial Strategy (Andrea Leadsom)]

We want to make the UK the best place to work and grow a business. We have set the target of an additional 600,000 female entrepreneurs by 2030, and the British Business Bank has delivered over £198 million to women in start-up loans. With my hon. Friend the Exchequer Secretary to the Treasury, we are implementing the initiatives of Alison Rose’s review, including focusing on female entrepreneurs’ access to finance, better enterprise education and launching the investing in women code.

[Giles Watling]

I thank my right hon. Friend for her answer. In my Clacton constituency, I am fortunate to have a group of very powerful businesswomen, with whom I had a very pleasant business lunch recently. In 2018, the BBC reported that women were half as likely to set up a business as men. I am pleased that the Government are doing all that my right hon. Friend said, but that must be in part due to a bias in education, so what more can be done to address this great loss of potential?

[Andrea Leadsom]

My hon. Friend is quite right. We need to go further in addressing education, and that is why one initiative in the Rose review specifically addressed the roll-out of enterprise education in schools and colleges to help in particular with the skills women need for business success at an earlier age. BEIS has also launched the Longitude Explorer prize, which is aimed specifically at 11 to 16-year-olds, to encourage innovative problem solving in our young entrepreneurs.

[Ruth George (High Peak) (Lab)]

Many of the women in business in my constituency are EU nationals, and they were extremely concerned at yesterday’s tabling of the draft Freedom of Establishment and Free Movement of Services (EU Exit) Regulations 2019, which would allow Ministers to remove their rights to own and manage companies or provide services. While we welcome the fact that the Committee was cancelled yesterday, what are the Government’s plans in this regard, because many EU nationals in business are very concerned?

[Andrea Leadsom]

I am sorry that the hon. Lady seeks to lean into the scaremongering. The statutory instrument has a very limited direct policy impact and will not impose additional restrictions on EU nationals or EU-based businesses or on the nationals and businesses of countries with associated agreements after we have left the EU. It is very important that we all take great care not to scaremonger and try to make people think that things are the case that are simply not the case.

[Mrs Anne Main (St Albans) (Con)]

Establishing a business is very difficult, particularly when business rates are so high and online businesses often do not pay their way. Is it not time, particularly for those establishing businesses, that we had a root-and-branch review of the business rates model, which affects so many businesses in St Albans?

[Andrea Leadsom]

I am very sympathetic to my hon. Friend’s point; I know she is a big champion of businesses in St Albans. In my Department, we are helping the British Business Bank to provide greater support to start-up businesses, providing huge support to the UK’s 1.2 million female-led SMEs, and doing everything we can to ensure that there are more incentives and opportunities for women to start businesses than ever before.

[Jim Shannon (Strangford) (DUP)]

If we are to encourage more women into business, it is essential that we tackle the gender pay gap at executive level. What has been done to address that issue?

[Andrea Leadsom]

The hon. Gentleman will know that the gender pay gap is now the smallest it has ever been and that the Government have required reporting of the gender pay gap. Such transparency can partially solve the problem, but we are not resting there: we are doing as much as possible to get more women to become entrepreneurs and to help women to acquire the skills they need to lead some of our fantastic UK businesses.

[James Cartlidge (South Suffolk) (Con)]

11. What support her Department is providing to the offshore wind industry.

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[Julian Sturdy (York Outer) (Con)]

T1. If she will make a statement on her departmental responsibilities.

[The Secretary of State for Business, Energy and Industrial Strategy (Andrea Leadsom)]

After two years as a sole trader at this Dispatch Box as Leader of the House, it is a huge pleasure to be here today with such a superb ministerial team. In addition to my Department’s vital work to help businesses to prepare for Brexit, we have set out three key priority areas for BEIS. First, we aim to lead the world in tackling climate change. From the Prime Minister chairing a new Cabinet Committee to our hosting of COP26 in Glasgow next year, our pathway to net zero is well under way. Secondly, we will seek to solve the grand challenges facing our society, from new support for our life sciences sector to developing fusion power to setting out how amazing UK innovations can solve the challenges of low productivity. Thirdly, we aim quite simply to make the UK the best place in the world to work and to grow a business.

[Julian Sturdy]

Will the Secretary of State reassure me that her Department is fully assessing the potential of UK peatlands and peatland restoration in regions such as North Yorkshire, where my constituency lies, in getting us to net zero? Peatlands are a carbon sink that absorb more emissions than the world’s oceans each year.

[Andrea Leadsom]

My hon. Friend is right that peatlands have a vital role to play in delivering net zero. In addition to £10 million to help to restore more than 6,000 hectares of peatland over a three-year period, we are working with Natural England on a number of pilot projects, including one in North Yorkshire, to test our approach for moving all peatlands in England on to a path of recovery and restoration.

[Rebecca Long Bailey (Salford and Eccles) (Lab)]

I welcome the Secretary of State to her place for our first BEIS orals together. I know that we will have many a productive exchange.

Nine thousand UK jobs lost and 150,000 holidaymakers repatriated at an estimated cost to the taxpayer £100 million, yet the former chairman of Thomas Cook confirmed that Government financial support would have allowed him to save the company. A report from Unite the Union and Syndex also showed that £188 million in bridging loans would have prevented Thomas Cook’s collapse. With reports that banks and investors were still willing, even on the day of the collapse, to support a deal provided that the Government stepped in, will the Business Secretary explain why she failed to meet with the company in the final days and clarify her rationale for not offering support?

[Andrea Leadsom]

First, I would like to reciprocate by saying that I am delighted to be working with the hon. Lady. I look forward to many exchanges across the Dispatch Box.

The hon. Lady will appreciate that my Department and I were very closely involved in the run-up to Thomas Cook’s insolvency. It is a Department for Transport lead and, as all hon. Members will appreciate, too many cooks can spoil the broth, so I liaised closely with the Secretary of State for Transport who took the lead on this, but BEIS officials were very closely involved.

At the weekend I wrote to the insolvency practitioner about clawback and malus, to ATOL about looking after the insurance for those who booked holidays, and to the banking associations about ensuring that proper restraint is shown to those who sadly lost their jobs in that run-up.

Why did we not bail out Thomas Cook? Simply because it was clear that the £200 million it was asking for was just a drop in the ocean. There was no way the company could realistically be restored, despite the Government seriously considering the prospects for doing so and for making it an ongoing concern.

[Rebecca Long Bailey]

It is interesting that the German Government saw fit to intervene. Not only did our Government refuse, they also failed to take the basic action needed to ensure good corporate behaviour. Today, reports demonstrate a clear conflict of interest for auditing firms that, while signing off on Thomas Cook’s finances, separately advised directors on securing bumper bonuses.

BHS, Carillion and the banks all had similar auditing conflicts. Sir John Kingman officially advised the Government nearly a year ago to create a more robust statutory regulator, but to no avail. Will the Secretary of State confirm if and when she will bring forward reforms to the Financial Reporting Council and the wider auditing sector, as proposed by the Kingman review, Professor Prem Sikka and the Competition and Markets Authority?

[Andrea Leadsom]

First, may I gently say to the hon. Lady that the situation in Germany was extremely different? It was a separate business in Germany. If there had been an opportunity to save Thomas Cook, we would have done so. We looked very carefully at the prospects—[Interruption.] The hon. Lady is just demonstrating a lack of understanding of how UK business works, and I am very sorry to hear that. She really needs to look at the facts here, and not just at trying to make a point. This was a very serious issue, and it was something the Government took very seriously.

We have done everything possible to protect those who sadly lost their jobs. I am delighted, but the hon. Lady did not even mention, that Hays Travel has taken over many Thomas Cook shops, which is fantastic news for many of those employees. She has also not paid any regard to the fact that the Government were able to establish a repatriation on the biggest scale ever in peacetime to bring more than 140,000 people back to the United Kingdom.

[Vicky Ford (Chelmsford) (Con)]

T9. Workers’ rights matter. Given that eight out of 10 mums consider work-family balance before thinking about any new job opportunity, can the Government confirm they remain committed to considering the proposal that employers should make all jobs flexible unless there is a good reason not to do so?

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[Greg Clark (Tunbridge Wells) (Ind)]

I welcome the Secretary of State to the Dispatch Box and hope that she will have distinguished tenure at this important time. She will know that the recommendations of the independent review of the Financial Reporting Council, conducted by Sir John Kingman, were widely endorsed and are urgently required. I was concerned that the statutory implementation of those recommendations was not included in the Queen’s Speech. Can she assure me that she is not going to miss a golden opportunity to make these reforms and give a big boost to our standing in the world?

[Andrea Leadsom]

First, let me pay tribute to my right hon. Friend, my predecessor, who did a fantastic job in this Department. I am delighted to stand by the position that he took as Secretary of State: it is the Government’s plan to legislate for a new regulator with stronger powers, replacing the FRC, as soon as parliamentary time allows. We are planning to progress this work in the first quarter of next year, once we have received Sir Donald Brydon’s review of the quality and effectiveness of audit.

[Karen Lee (Lincoln) (Lab)]

T4. Next month will mark five years since the Government first announced they would undertake an independent review of the UK’s product recall system, and a failure to implement recalls has led to fire services responding to preventable fires due to product failures. Will the Minister today update the House on the review’s progress and whether the single recall register will be up and running this year?

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[Phil Wilson (Sedgefield) (Lab)]

Sedgefield is home to the largest business park in the north-east of England, with 500 companies and 10,000 to 12,000 jobs. More than 50% of the jobs and businesses there rely in some way on trade with the EU. If the Secretary of State has her way and there is no more frictionless trade with the EU, no more customs union and no access to the single market as there is now, does she not have a responsibility to publish an economic assessment on the effects that will have on my constituents’ jobs?

[Andrea Leadsom]

I am delighted that Hitachi in the hon. Gentleman’s constituency is doing so well and that the high value manufacturing catapult that has an operation in his constituency is also doing well—both supported by the Government. We are seeking to get the withdrawal agreement Bill through this House, so that we can move forward with a good free trade deal that works for the United Kingdom, the EU and the many people in his constituency who are employed in manufacturing, which is something in which the UK excels.