Oral Answers to Questions

Debate between Andrea Leadsom and Kevin Hollinrake

Thursday 14th September 2023 Commons Chamber

[Dame Andrea Leadsom (South Northamptonshire) (Con)]

T2. Do Ministers agree that delegates to the Parliamentary Partnership Assembly, which was set up under the trade and co-operation agreement with the EU, should be there to promote Britain’s interests overseas, and that those who do not want to do so and who simply want to be apologists for Brexit and to act against the UK’s interests should leave the PPA?

[The Parliamentary Under-Secretary of State for Business and Trade (Kevin Hollinrake)]

My right hon. Friend raises an important point. The Parliamentary Partnership Assembly created under the trade and co-operation agreement is a parliamentary body independent of Government. The Government value its work and its role supporting a mature and constructive relationship with the EU, rooted in shared values and delivering on shared interests. She is right that we should look forward, not backwards.

Oral Answers to Questions

Debate between Andrea Leadsom and Kevin Hollinrake

Tuesday 17th January 2023 Commons Chamber

[Kevin Hollinrake]

That is an interesting point. We are looking at pay reporting, especially in larger companies. We want to minimise the burden of regulation on smaller companies, of course, but the hon. Gentleman raises an interesting point, and we will have a close look at it.

[Dame Andrea Leadsom (South Northamptonshire) (Con)]

My right hon. Friend knows only too well our energy triple challenge of keeping the bills down, keeping the lights on and decarbonising. As chairman of the 1922 Backbench committee on Business, Energy and Industrial Strategy, I draw his attention to the fact that we have just published a report on the future of energy. In my humble opinion, the report is packed full of incisive and actionable policy suggestions. May I invite him to meet me and my vice-chairs to discuss it and the implications for his Department?

SMEs and the Net Zero Target

Debate between Andrea Leadsom and Kevin Hollinrake

Tuesday 17th November 2020 Westminster Hall

[Kevin Hollinrake (Thirsk and Malton) (Con)]

I beg to move,

That this House has considered support for SMEs and the net zero target.

It is an absolute pleasure to serve under your chairmanship, Ms Ghani. I draw hon. Members attention to my entry in the Register of Members’ Financial Interests on all things small business.

I am very supportive of the push to get to net zero as soon as possible. I absolutely believe that business will help to deliver that solution even faster than 2050. My principal concern in bringing forward this debate is that, in the headlong rush to get to that point, we must not treat businesses as collateral damage. We have done that in the past. When we had a change of emphasis in lending back in 2008, that happened to some good businesses, as well as to some businesses that had probably borrowed inappropriately.

I want to give an example of a business in my constituency. There is a very good business a few miles away from where I live called the York Handmade Brick company. It makes wonderful, handmade bricks, that look like old clamp bricks, for lots of houses around the country. It is a fairly small business employing about 20 people and is an award-winning company. Its processes use fossil fuels—natural gas—to fire the bricks. Now, I can see a situation where, in future, banks may look at this business and say, “That business does not sit with our ethical and sustainable goals portfolio. Therefore, it is perhaps not a business we want to support.” If that business needs to borrow some money to invest to move away from fossil fuels, for example, and move to other processes—biogas being an obvious one—what that company will need as it moves, down the line, to a different process, is money to invest. It is absolutely critical that our banking sector takes such businesses forward with us. Hon. Members might say that that is blooming obvious, but that is not always what we have seen in the past.

If we are going to get to net zero, it is absolutely vital that the private sector is taken with us. It will provide the cash and capital to invest in new processes and new techniques. We know for an absolute fact that the private sector is much better at allocating capital than the public sector—I might point to Croydon council in that regard, if Members have seen some of the recent news reports. The private sector is much better at allocating capital; in the past, the public sector has misallocated capital.

Of course, that investment will contribute towards innovation, and the solutions to climate change are about innovation. The more innovation and the more competitive free markets we have, the more our consumers get a better deal at a better price. We are seeing some interventions from shareholders in banks, who are saying, “We do not want you to invest in these kinds of industries anymore.” Shareholder action groups will get increasingly vociferous, which could be to the detriment of small and medium-sized enterprises, and even bigger companies. This is not just about SMEs: bigger companies will remember that last year, for example, there were some protests by actors from the Royal Shakespeare Company regarding BP’s sponsorship of that organisation, which led to a parting of the ways between the RSC and its sponsor. That is despite the fact that BP is working within our overall regulatory framework, and will be incredibly important in the future in making the investment we need to move from a dependence on fossil fuels to a greater dependence on renewable energy.

We have seen this with recent shareholder action in terms of things like the covid corporate financing facility, which is dispensed by the Bank of England. Again, there has been pressure from certain shareholder groups, saying that at this crucial time, when lots of businesses are in trouble because of covid, support for those businesses should have been linked to environmental objectives. How unfair would it have been, when hundreds of thousands of businesses employing millions of people are in crisis, to link those supportive measures to sustainability goals at such short notice?

My key message for this debate is that any intervention by the Government and our financiers, who are so critical to the UK economy, must be comprehensive, well considered, strategic and stable. Our interventions should be consistent over a long period of time to get to that long-term goal. Again, one example I might give is the recent news that we will bring forward the date on which we move away from fossil fuel cars—diesel and petrol cars. It was 2040; it has been brought forward to 2035, and has now been brought forward again to 2030. The motor manufacturers, of course, are gearing up for that, although it presents some real challenges for that sector during what is a difficult time anyway. What about the other businesses in that supply chain? Lots of other SMEs will have to make that change as well: those could be parts manufacturers, but they could also be forecourts. They are going to have to make massive changes over a very short period of time, so we must make these decisions in a strategic fashion.

[Andrea Leadsom (South Northamptonshire) (Con)]

My hon. Friend makes a really good point about giving sufficient notice. He also points out that businesses will always overachieve, and he might recall that back in 2015, the announcement was made that we would be taking coal off the system by 2025. It has indeed been the case that businesses have overachieved, because coal is almost off the system and it is only 2020.

Does my hon. Friend agree that there could be some merit in the UK Government doing what many G7 countries have done, which is to create a development bank that brings in some offer of Government funding to help with the transfer towards net zero that we all want to see, and from which all SMEs could benefit?

[Kevin Hollinrake]

I absolutely agree with my right hon. Friend, and commend her on the work she did when she was in the Department for Business, Energy and Industrial Strategy as energy Minister, providing a long-term framework that businesses can work within to phase out coal over that period of time: she was very far-sighted with her interventions. I am sure that my hon. Friend the Member for Grantham and Stamford (Gareth Davies) will talk about a development bank in his remarks in a few minutes.

One other area in which we need to look at a more strategic framework is that of the green homes grants. In our manifesto, we committed to about £9 billion for retrofitting, and I think we have committed about £2 billion so far through those grants, which is very welcome. One of the difficulties, as I have communicated to the Minister, is finding installers in our area. A lot of installers are thinking that £2 billion will go very quickly and, therefore, what is the point of applying?

The Federation of Master Builders has some data on that. There have been 180 inquiries to the Federation of Master Builders and only three have completed the paperwork because it was seen as too short a timescale. If we have a longer timescale, businesses will be more likely to invest in the training and the necessary other actions they need to take to qualify as a registered installer for that grant. A long-term, stable framework will encourage much-needed investment.

I will go back briefly to 2008. I am representing here, as I often do as co-chair, the all-party parliamentary group on fair business banking. Much of our work of the past 10 years—including the three years I have been involved—has been around trying to clean up the mess of 2008, when we withdrew support from lots of SMEs, unfairly and far too quickly, and did not give them the chance to transition into a different kind of business or even rebroker their finance.

We need to learn from that in terms of a timescale and a structure for that change and forbearance, in which the APPG has much experience. We need to learn from history. Warren Buffett once said,

“What we learn from history is that people don’t learn from history.”

It would be good to have a focus on that particular episode in our banking history.

With regard to banking, I mentioned before that banks are seeing some shareholder action in the businesses and sectors they will support in future. Access to capital being the most fundamental requirement of any business, this is a hugely important topic. As such, the APPG has come up with a project called Bankers for NetZero. It is engaging with the banking sector and others. It is supported by Volans, the sustainability think-tank, and Re:Pattern, who specialise in business transformation social impact. It is developing policy recommendations to lead to COP26, looking at the regulatory environment and the part banks play in financing; engaging with businesses on net zero challenges; and looking at opportunities and obstacles for banking, while trying to formulate some evidence-based, targeted policy, and to make recommendations on legislation and regulation, in accordance with the United Nations environment programme finance initiative, or UNEPFI, for short. The key objective is that no willing SME is left behind in this vital change to our economy.

One big issue over the next few years is the expected transition of lots of businesses from dependence on fossil fuels to a completely different model. That will be at a time, of course, when a lot of those SMEs are burdened with a significant amount of debt. TheCityUK recapitalisation group report said that SMEs are currently burdened with around £35 billion of unsustainable debt, which will put around 780,000 businesses at risk.

As a result of the covid crisis, it will be very difficult for the two thirds of businesses whose leadership is more focused on being greener and better to make that transition. We know how important SMEs are to our economy: 99% of all businesses are SMEs and they employ 61% of private sector employees, that is, 5.9 million businesses in total. That is a business environment that has been a huge success under this Government.

SMEs are disproportionately positively represented in our levelling-up areas. That also fits into the Government agenda. A very high proportion of SMEs are in construction; 99% of all construction businesses are local builders. They are going to be vital to retrofitting and other measures that we require to modernise our housing stock. They employ hundreds of thousands of local workers and 70% of all apprentices. Other sectors that have a high proportion of SMEs are transport and retail.

I know the Minister’s Department is looking carefully at the next few months. In terms of immediate business support, we need to think about things such as bounce back loans. Not all businesses can access bounce back loans, which is a huge issue. Lots of our businesses are with non-bank lenders, such as Tide, which do not have access to the Bank of England’s term funding scheme for SMEs and therefore do not have the capital to lend to them. Businesses already face that challenge.

Many businesses are struggling to get the new top-ups that the Department has brought forward, which is welcome. As for the businesses that can access that liquidity, many are swamped with applications or are closed to applications from new customers. We are locking some SMEs out of support right now, and we are going to need them to provide us with the solutions to our economic challenges moving forward. There are also issues with the new measures to allow businesses to pay this debt over a longer period of time—the “pay as you grow” guidance. That will be key, as it will allow businesses to pay back the loans over 10 rather than six years.

I welcome the Government’s focus on moving forward to a greener future. The Pension Schemes Bill that was before the House yesterday certainly moves us towards the net zero horizon. Last week, the Chancellor announced a taskforce for climate-related financial disclosure for large companies and financial institutions by 2025 to report on their progress in those areas. We also have the new green taxonomy and a plethora of policies in my right hon. Friend the Minister’s Department on the clean growth strategy.

In terms of where we need to go, first we need to ensure that we have diversity in finance provision. We need to solve the non-bank lender problem. However, I would also like us to invest in a new type of bank: a regional mutual not-for-profit bank that has a much more patient approach to providing finance to SMEs. During the financial crisis of 2008 and all the way through to 2013 in Germany, lending rose by 20% because of the regional banks. In the UK, lending to SMEs dropped by 20%, showing that patient capital works much better when it is provided by a diverse range of providers.

We need a sector-specific just transition road map that looks at every different sector. If some of the current provisions for hospitality, such as the VAT cut, were extended or made permanent, that would be welcome. The British Business Bank needs a role in supporting and advising SMEs. We need to standardise just-transition restructuring, so that if businesses are seen as being in a sector that banks do not want to support, there is a proven standardised process for taking those SMEs from where they are today into the greener future. The shared prosperity fund should be used to support SMEs to make the transition and we should have a fiscal policy that is conducive to allowing SMEs to make the transition, with tax breaks, for example, to decarbonise.

My final point to the Minister—and I know he gets this—is please, please, please let us have no cliff edges, but a strategic approach and a long-term stable framework towards that net zero future.

Leaving the EU: Workers’ Rights

Debate between Andrea Leadsom and Kevin Hollinrake

Tuesday 29th October 2019 Commons Chamber

[Andrea Leadsom]

I am grateful to the right hon. Lady for raising that very important point. She is right that the EU has discussed the gig economy and enhancing the rights of working parents. It is true that the EU has introduced proposals in the transparent and predictable working conditions directive, but it is not true that those proposals go further than the good work plan. For example, we brought forward a statutory instrument in March this year under which the right to a written statement on day one for every worker will come into force in April 2020, whereas under the EU’s proposals, if it does introduce that directive, it will not take effect until the summer of 2022, so the UK is bringing forward workers’ rights further and faster than the European Union.

[Kevin Hollinrake (Thirsk and Malton) (Con)]

The Prime Minister championed the London living wage and a much higher national living wage. Does that not demonstrate his commitment to increased workers’ rights?

[Andrea Leadsom]

My hon. Friend is absolutely right. This Prime Minister has been extremely keen to ensure that all workers get a fair deal. He has presided over the intention to bring the national minimum wage to £10.50 at a greater speed than was previously envisaged. We will bring forward measures to ensure that that can be put into force as soon as we can.

Business of the House

Debate between Andrea Leadsom and Kevin Hollinrake

Thursday 5th July 2018 Commons Chamber

[Andrea Leadsom]

The hon. Lady is right to raise the issue of modern slavery. I am sure she will recognise that this Government have done a huge amount to try to tackle this scourge with the first ever Modern Slavery Act. She is right to raise the problem of continued slavery within the supply chain. We have Home Office questions on Monday 16 July, and she might want to seek a further update on progress at those oral questions.

[Kevin Hollinrake (Thirsk and Malton) (Con)]

Our all-party parliamentary group on fair business banking reports next week on dispute resolution, so that businesses that have been mistreated by their banks will be able to find justice for the first time. Bearing in mind that the kick-off for our event is 7 o’clock next Wednesday, would my right hon. Friend be willing to offer some Government time to enable these matters to be properly debated?

Private Members’ Bills: Money Resolutions

Debate between Andrea Leadsom and Kevin Hollinrake

Thursday 10th May 2018 Commons Chamber

[Andrea Leadsom]

Unfortunately, the hon. Gentleman disregards the conventions of this House, as he often does. The financial initiative—[Interruption.] The financial initiative of the Crown is a basic constitutional principle, which means that it is for the Government of the day to initiate financial resolutions. That is a long-standing constitutional principle set out in “Erskine May”, and he must respect that. I can say to him that 13 private Members’ Bills have passed Second Reading and, of those 13 Bills, one has completed all stages in this House and passed to the Lords and three further Bills have received money resolutions and completed their Committee stages. Those include important Bills such as the Parental Bereavement (Leave and Pay) Bill, the Mental Health Units (Use Of Force) Bill and the Prisons (Interference With Wireless Telegraphy) Bill. There is plenty of time left in this extended Session, and further money resolutions will be brought forward in the usual way.

[Kevin Hollinrake (Thirsk and Malton) (Con)]

Will my right hon. Friend update the House on the progress of my private Member’s Bill on parental bereavement, which I hope will complete its remaining stages in this House tomorrow?

[Andrea Leadsom]

My hon. Friend has the Commons remaining stages of his Bill tomorrow. I know that the Bill has enormous support across the House. It will really make a difference to parents who have been bereaved. It carries a great deal of support and the Government were delighted to bring forward the money resolution for the Bill and will be delighted to see the remaining stages being debated tomorrow.

Business of the House

Debate between Andrea Leadsom and Kevin Hollinrake

Thursday 19th April 2018 Commons Chamber

[Andrea Leadsom]

I completely agree with the hon. Gentleman. We must do everything we can. I have tried to set out how, through the serious violence strategy, the Government are seeking to provide funding for community efforts, and to use a national media campaign to take young people away from this seemingly attractive lifestyle of joining a gang and being involved in this appalling violence. We are working with young people who have already been stabbed and are in hospital, and trying to turn them away from that lifestyle before it is too late. The hon. Gentleman is right to say that more could be done, and I recommend that he seeks a Backbench Business Committee debate so that all Members can share their thoughts on the subject.

[Kevin Hollinrake (Thirsk and Malton) (Con)]

Understandable changes to the parliamentary timetable this week precluded the opportunity to debate the hugely important banking scandals, and the effect that they had on thousands of business people around the country. Will my right hon. Friend find Government time to debate that important issue?

[Andrea Leadsom]

I agree that that is an important issue. The loss of livelihoods following the financial crisis was a devastating blow for many people. I will certainly take my hon. Friend’s request away and see whether it can be accommodated.

Oral Answers to Questions

Debate between Andrea Leadsom and Kevin Hollinrake

Thursday 7th January 2016 Commons Chamber

[Andrea Leadsom]

I completely agree. In fact, just recently I went to see a proposed new project in my own county of Northamptonshire that is looking to use landfill to create a renewable heat scheme. Some fantastic new ideas are coming forward, and my officials and I are always very keen to hear about them and support them where we can.

[Kevin Hollinrake (Thirsk and Malton) (Con)]

9. What steps she is taking to prevent shale gas drilling at the surface in areas of the greatest environmental value.

[The Minister of State, Department of Energy and Climate Change (Andrea Leadsom)]

First, I commend my hon. Friend for the personal commitment he has shown to researching best practice in this area. I can assure him that the Government are committed to protecting our most valuable spaces from surface drilling of wells for fracking. On 4 November, we set out how we plan to do this via petroleum exploration and development licences. We will issue a response to our industry consultation as soon as possible.

[Kevin Hollinrake]

I very much welcome the Minister’s comments. The Task Force on Shale Gas has called for a single regulator and increased levels of independent monitoring. Does the Minister agree that this would improve public confidence and provide further protection, particularly for our most sensitive areas?

[Andrea Leadsom]

The task force’s 2015 report says that the regulatory regime is currently fit for purpose, but my hon. Friend rightly points to its proposal that if the shale gas industry does develop the Government should consider creating a bespoke regulator. I can absolutely assure him that we will keep the regulatory regime under review to make sure that it remains fit for purpose. On his second point about independent monitoring, I entirely agree, and that is why we are already grant-funding baseline monitoring in North Yorkshire and Lancashire.

Oral Answers to Questions

Debate between Andrea Leadsom and Kevin Hollinrake

Thursday 19th November 2015 Commons Chamber

[Andrea Leadsom]

The hon. Gentleman will be aware of the CCS competition that is going ahead. I have had meetings with the association which promotes that area. As the hon. Gentleman will know, the spending review is coming up and decisions will be made then, but the United Kingdom has been a keen supporter of CCS here and in other countries, and we have spent a great deal of money on trying to explore the opportunities for the UK to extend the life of our fossil fuels.

[Kevin Hollinrake (Thirsk and Malton) (Con)]

There is an application to explore for shale gas in the beautiful area of Ryedale in my constituency. Assuming the application and the exploration are successful, what assurances can the Minister offer that an expansion of the industry will not lead to an industrialisation of that beautiful area?

[Andrea Leadsom]

I can absolutely assure my hon. Friend that all onshore oil and gas projects, including shale gas projects, are subject to scrutiny through the planning system, which addresses impacts on residents such as traffic movements, noise and working hours, and that national planning guidance says that, in respect of minerals such as shale oil and gas, new developments should not just be appropriate for their location but take into account the effects of pollution, including the cumulative effects, on health, the natural environment or general amenity, and the potential sensitivity of the area. I am well aware of what a beautiful area he lives in and I assure him we are absolutely focused on that.