Oral Answers to Questions
Andrew Griffiths Excerpts(8 years, 8 months ago)
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The Minister for Universities and Science (Joseph Johnson)
We are discussing with Cabinet colleagues exactly how we might treat universities with respect to that proposal.
Andrew Griffiths (Burton) (Con)
The Secretary of State will know that the beer and pub industry in the west midlands employs 86,000 people in 5,000 pubs, has 124 breweries and contributes £1.3 billion in tax. Given his support for the brewing industry when he was in the Treasury, when he led the call for the duty cut, will he outline what his Department is doing to support the beer and pub industry—and will he pick up the phone to the Chancellor and ask him for another cut?
Sajid Javid
My hon. Friend has been an excellent advocate of that industry, helping it to grow and create thousands of jobs. He will have just heard from the Minister for Small Business, Industry and Enterprise, my right hon. Friend the Member for Broxtowe (Anna Soubry) about the Pubs Code Adjudicator, which I think is a very positive development. I have heard my hon. Friend loud and clear on the desire for a further cut, and I know he has made his representations to the Chancellor. When I was Economic Secretary to the Treasury, I recall getting a beer named after me—Sajid’s Choice, which was a fine brew—so there are many reasons to cut beer duty.
Enterprise Bill [Lords]
Andrew Griffiths Excerpts(8 years, 9 months ago)
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Sajid Javid
The hon. Lady will know that we talked last year about our plans to change the Sunday trading rules, and we had a consultation, to which I am sure she has contributed. The Government’s intentions have been clear. It is a question of finding the right vehicle to make those changes, and they will be in this Bill by way of an amendment.
Andrew Griffiths (Burton) (Con)
May I draw the Secretary of State’s attention to a letter that I received from the owners of the Octagon Centre in Burton? The businesses in that centre are urging me to support this important initiative from the Government because they say that it will help their businesses and that they would employ more people as a result.
Sajid Javid
My hon. Friend is right to point out the economic impact of this measure. As I have said, it might not be right for every area but it is surely correct for each local authority to decide what is best for its area, and if that leads to more jobs and growth locally, that is exactly the reason why we should follow through on this policy.
If any of our friends in the Press Gallery have spent time freelancing, they will be all too aware of the problem of late payments—[Interruption.] There are friends up there. If they are not up there, they are listening somewhere else. I have heard of one writer, who may well be listening now, who says that he still has not been paid for copy that was filed two years ago. The most shocking aspect of this problem is just how common it is. In my six years as the Member of Parliament for Bromsgrove, I have been contacted by many dozens of local business owners who have been pushed to the brink by one thing: the failure of large corporations to pay up on time.
Sajid Javid
My hon. Friend rightly says we should always look to see what more we can do to help the pubs in our community. Perhaps we can welcome this measure in The Mouse in her constituency, which is a very fine pub.
Andrew Griffiths
As somebody who opposed the initial proposal for the MRO legislation, I welcome the constructive way in which the Minister and the Government have worked with all sides to find a solution. The key to pubs’ futures is investment in their estates, so I welcome the Government’s recognition that that is most important.
Sajid Javid
My hon. Friend is correct about that. We want to see more and more investment in our local pubs, and I hope that these measures, taken together, will help to achieve just that. Let me also take this opportunity to commend him for the work he has done for pubs ever since he joined this House, not just on this code, but the huge amount of work he did to get the first cut in beer duty in almost 50 years.
Andrew Griffiths (Burton) (Con)
I am delighted to be called so early to speak in the debate. It will not surprise colleagues that I want to talk about one specific element of the Bill: pubs. I should draw the attention of the House to my entry in the Register of Members’ Financial Interests, not just because I am the chairman of the all-party beer group, and I see lots of our members in the Chamber today, but because Burton is the home of not only beer and British brewing, but three of the country’s largest pubcos—Marston’s, Punch and Greene King. Obviously, therefore, the issues in the Bill are hugely important to not just my constituents and the people employed in those companies, but publicans and communities across the country.
Graham Evans (Weaver Vale) (Con)
These days, pubs are not only competing with other pubs—they also have to compete with high-street cafés such as Starbucks. Does my hon. Friend agree that it is therefore essential that we encourage investment in pub facilities?
Andrew Griffiths
I congratulate my hon. Friend on the work that he does to support pubs, not just in his constituency but in this Chamber, in standing up for British pubs and British brewing. He is absolutely right: this is a competitive business. Pubs are not just competing with each other for trade—for business—but with the likes of Starbucks. It is therefore absolutely essential that we allow them to invest in their estates. I will come on to that point later.
I have to admit that I was one of those who opposed the market-rent-only legislation when it first came in during the previous Parliament, because I was concerned about unintended consequences. We all want our to pubs to thrive, our pub estate to grow, and our pubs to be successful and pay a good living to the publicans who run them, but we must also be aware of unintended consequences. I warned of repeating the mistakes we made with the beer orders. I know, Mr Deputy Speaker, that you are not old enough to remember the beer orders coming before this House, but that mistake, with the Government intervening in the marketplace and sticking their oar in, led to the break-up of the successful breweries and, indeed, to the pubcos that we have today. We have to be very careful.
The debate on this subject has been contentious; there has been a great deal of heat, and sometimes it has become somewhat unpleasant. I congratulate the Minister on the work that she has done in finding a way through this. She has not only shown an immense interest in the subject in talking to both sides and properly understanding the implications of what we do as a Government, but has not been shy in standing up to both sides. We know that there is a famous tradition of female Conservative MPs handbagging people around the table in order to get the best deal possible, and that is what the Minister has done to find a way forward. We must not forget that pubs are not charities—they are businesses that employ 1 million people across our country and raise £21 billion for the Exchequer. We must therefore make sure that we have the right conditions to allow them to grow as businesses, and that is what the Minister is able to do.
My hon. Friend the Member for Weaver Vale (Graham Evans) mentioned investment. I am pleased that the Minister’s proposals allow publicans to opt out of—to waive their right to—an MRO for the purpose of significant investment. It is absolutely right that our pubs need to be the best offering possible. They need to have good facilities, nice loos, and good heating. They need to be pleasant environments if people are going to go there and spend their money. He is absolutely right that they are competing with the likes of Starbucks. If we want people to pump money into our pubs, we have to give them security in making that investment. Why would the likes of Punch in my constituency invest a couple of hundred thousand pounds, perhaps even £300,000, in a pub to renovate it if it was likely to lose control of it in just 12 months’ time? The simple answer is that it would not. The Minister’s decision to allow the opt-out from—the waiving of the right to—an MRO will give some comfort to the industry and allow such important investment to go ahead.
I am concerned about red tape. The adjudicator, when introduced, could potentially have to deal with some 14,000 pub tenants. There is therefore a real risk that the adjudicator could be swamped with complaints. I hope that the Minister will be well aware of that when she brings forward the secondary legislation on how this thing will actually work. I am also concerned about the amount of red tape when somebody signs up for a pub tenancy.
Toby Perkins
Given how busy publicans are, they do not want to spend their time at the adjudicator. They want to be serving punters and getting on with running their business. What does the hon. Gentleman think it says about the way the industry is currently working if the setting up of an adjudicator creates the likelihood that it will be swamped because all those publicans are so unhappy?
Andrew Griffiths
I do not think creating an adjudicator does that at all. Very few tenants come forward with complaints under the current voluntary scheme. But as in any other sphere, when a new way to complain is advertised, people will undoubtedly come forward. Some of those complaints will be valid, but many will not be. We need to make sure that we do not ruin a perfectly workable system by allowing it to be flooded with the wrong kind of complaints.
The requirement first set out by the Government would have meant that a pubco had to provide more than 80 pieces of information to somebody who wanted to sign up for a tenancy, and those would all have had to be checked off and a receipt accepted. That compares with about 10 pieces of information that have to be provided to somebody signing a normal commercial lease. I agree that we should make sure that tenants walk into the arrangement with their eyes open and with all the information, a business plan, advice from a financial adviser and a clear understanding of what that business is currently doing and what their earning potential is, but we should not make it impossible for a pubco to sign up a willing tenant who understands the business and understands what they are taking on.
On time scales, the suggestion is that the measure will come in at the end of May. Time is ticking and I hope the Minister will be attuned to the fact that this is a huge thing for tenants and pubcos to understand. Will she consider some interim measures to make sure that the measure can be introduced in a manageable way, and that the information does not swamp both tenants and pubcos?
Finally, I wholeheartedly support Sunday trading, as it would be good for the pub trade. The Association of Licensed Multiple Retailers and the British Beer and Pub Association say that encouraging people to come into our town centres on a Sunday to do shopping would also be good for our pubs. I entirely support that, but I remind the House of a letter that I received from Peter Hardingham, the manager of the Octagon shopping centre in Burton. Urging me to lobby for the important devolution to councils of Sunday trading regulation, he wrote: “Such a change in the law is critical to allow bricks and mortar retailers to compete with online retailers and to satisfy the customer demand that exists.” That is absolutely right.
The legislation, devolving the power to local authorities, giving our local councillors control over what is best for their high streets, will allow our shops to compete with online retailers. We can order from the internet on our phone and get something delivered on a Sunday afternoon. How can our shops compete with those retailers? The measure is a great idea and I hope the House will get behind it. I thank the Minister for her work on pubs. Please listen to our concerns, and I will be in the Lobby supporting Sunday trading.
Amanda Solloway (Derby North) (Con)
It is an honour to follow my fellow member of the Business, Innovation and Skills Committee, the hon. Member for Edinburgh West (Michelle Thomson).
The Bill will contribute to the UK continuing to be a leading nation in supporting businesses that show the initiative and courage to start up on their own. I want to touch on three provisions—those relating to late payments, late insurance payments and the capping of exit payments —all of which not only highlight the positive changes being made to business culture, but support the Government’s offer to businesses.
I have always believed that to ensure that the economy continues from strength to strength, we must start by repaying the contributions made to it by the smaller businesses in the UK. They employ more than 15 million people across the UK; that is 48% of our private sector employment. The provisions in the Bill aimed at making the UK a better place for them to go into business should create an encouraging environment in which they can carry out their day-to-day work and thrive at business.
The proposed small business commissioner will address many of the issues that smaller firms face when dealing with larger firms. Late payments are a problem that most small firms have to deal with regularly, and securing those payments can prove to be a costly and long-drawn-out process. I was shocked to read the numbers: SMEs in the UK collectively spend more than £10 billion a year on trying to recover late payments. That figure is simply unacceptable. I have first-hand knowledge of how late payments by larger businesses, which often have a late payment policy, can cripple small businesses.
In the current system, too often, payment disputes cannot be resolved without cases going to court. That process is limiting for small businesses, and the costs can spiral out of control, which makes it a barely viable option for SMEs. A recent study found that one in five businesses in the Derby region is the victim of late payments. Those late payments are a primary factor in a fifth of corporate insolvencies. That element of business culture must change. We must show smaller businesses that other options are available to them, that advice and support are on offer, and that we will not directly hit their business cash flow. Of course, large firms can, if they choose to, fund such procedures, but the expectation that SMEs will do so is unreasonable.
Andrew Griffiths
My hon. Friend is making an effective and strong case in support of small businesses, and in describing the problems that they face with late payments. Does she also find that small businesses are struggling with deferred payments, over longer terms? The fact that they are not being paid by bigger firms within 90 days, or even 180 days in some cases, is severely affecting their ability to survive.
Toby Perkins
I absolutely agree. We had long and very passionate debates about that during the last Parliament, particularly in the run-up to the Olympics, when the Government made what they said at the time was a short-term change to the Sunday trading legislation.
I have an interest in this matter in that my son works at Morrisons and is often there on a Sunday. One thing that will happen—I have had very few representations in favour of this—is that the supermarkets, finding that the others are opening, will have to start to open. That will not add any extra business, but it will extend or spread out the shopping week. It will mean that people have to work very late on Sundays, and people wanting to work during the week will find there are fewer shifts available during the week. No more business will be created; it will just be spread over a longer period. The period after 4 o’clock on a Sunday is vital to the convenience store sector, which is under incredible pressure.
Andrew Griffiths
I am listening carefully to the hon. Gentleman and I understand his concerns, but why does he think that the workers in Sainsbury’s and Tesco deserve to have their Sundays protected as special, but not the workers in Sainsbury’s Local or Tesco Express? They work for the same business, but one set of workers gets protection and the other does not.
Toby Perkins
The hon. Gentleman asks a legitimate question. All of those questions were debated at the time of the original legislation. As my hon. Friend the Member for Great Grimsby (Melanie Onn) said, a compromise was reached. The existing compromise is vital for the convenience store sector. The number employed in large Tesco, Morrisons or Sainsbury’s stores far outweighs the number employed in those other stores. I will not say anything more about that matter, but the exchange between the hon. Member for Strangford (Jim Shannon) and the Secretary of State entirely exposes the fact that many people do not entirely understand what they are being asked to vote for today.
I come to this subject as someone who ran his own small business for five and half years before entering this place and who spent the previous 20 years working in a range of medium-sized businesses—I was once a human being. I have also had the opportunity, as a shadow Business Minister, to debate many of the issues.
I was struck by what the hon. Member for Derby North (Amanda Solloway) said about the impact of late payments on small businesses in particular. Late payments beget late payments: when someone receives payments late from their customers, they end up being late payers to their suppliers, and so it goes on. She is absolutely right to say that action needs to be taken. She may want to research the amendments that we tabled to the Small Business, Enterprise and Employment Bill during the last Parliament. Those were far more powerful proposals, and I may encourage my Front-Bench colleagues to dust them off and have another look at them. Those serious legislative proposals would have outlawed late payment and removed the incentive for late payment.
When discussing late payments, we must understand why they exist. Payments are made late because businesses like to keep the money in their account for the purposes of cash flow. There will be an opportunity for a small business to go off to the commissioner and report their customer, but in the course of that process the big company may well have paid the small business. That will not get the small business paid any quicker; it just puts in place a bureaucratic process. The idea of a small business commissioner in itself is not a bad one—it may well deal with some of the disputes between suppliers—but the idea that it is the solution to late payments is entirely wrong. It will make very little difference to whether or not companies are paid late.
The hon. Member for Burton (Andrew Griffiths) spoke about major companies that are setting out with purchasing terms of 90 or 180 days. They are paying after 90 days and they are not even late. The Government may say that, if companies do not pay within 60 days, they cannot be classified as a prompt payer under the prompt payment code, but these are relatively small measures. They do not provide legislative protection against major firms in the way that the amendment I proposed in the last Parliament would have done. I urge the Government and all members of the Bill Committee to look at how we can strengthen the proposals, because this is a matter of real importance.
It always strikes me that the Secretary of State believes all regulation to be a bad thing. Recently, I met the UK Weighing Federation, which had a reception in Parliament. It said that the lack of policing of the regulations in the weighing industry leaves the UK market open to cheap foreign imports that are not compliant and that undercut good-quality British manufacturing.
I agree with my right hon. Friend the Member for Don Valley (Caroline Flint) that we do not want unnecessary burdens, but we do want a regulatory regime that protects not only the consumer, but British businesses that are doing things in the right way. A similar case was made by NAPIT recently in respect of the electrical competent persons register and the lack of policing of building regulations.
Part 7 includes measures on the pubs code. I was pleased to hear the Secretary of State say today that the Government have listened and learned from the discussions in another place, and that the four triggers that were originally put in place when the legislation passed in that famous defeat of the Government in the last Parliament will be retained in the pubs code. It is incredibly important that the code continues to operate in that way.
It is important to remind Members who were not here in the last Parliament why we decided to legislate for the pubs industry in a unique way; we have not used that for any other industry. There was a simple unfairness in the relationship between the major pub companies, with all the power they had, and the small individuals who owned a single pub, who often put their life savings into it, only to find that the information that they had going into the relationship was very misleading. As a result, those people often found that they were not in a position to get the deal that they thought they were signing up to. It was incredibly important that we came up with an arrangement where they had the opportunity, at certain trigger points, to say, “I don’t think this relationship is working for me. I’d like to take my chances on the open market and buy beers from wherever I can.”
Oral Answers to Questions
Andrew Griffiths Excerpts(9 years ago)
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Joseph Johnson
We have a competitive offer, as underlined by the fact that international student numbers are up by 3% to 4% year on year. We work closely together to ensure that our international offer is competitive. It remains competitive and will continue to be so. There is no cap on the number of international students coming to this country and no limit to the number who can go on to work in graduate jobs with a sponsored employer.
Andrew Griffiths (Burton) (Con)
8. What assessment he has made of the effectiveness of steps taken by UK Trade & Investment to encourage British exports.
The Parliamentary Under-Secretary of State for Business, Innovation and Skills (George Freeman)
I am delighted to be able to report that UKTI has increased its effectiveness year on year since 2010. We have doubled the number of UK companies assisted on exports from 27,000 in 2010 to 55,000. This is working. We have secured an extra £60 billion in additional sales and a rise in exports of 9% for existing exporters and 46% for new exporters. I am also delighted that the life sciences are doing their bit. I recently signed a £2 billion trade deal with China, and there will be more announcements on Thursday with the Indian state visit.
Andrew Griffiths
Britain brews the best beer in the world, and I know that the Minister wants to get our brewers exporting, but sadly they tell me that the performance of UKTI to date shows that it could not organise a party in a brewery. Will he sit down with UKTI and do all he can to help medium and family-sized brewers export across the world?
George Freeman
May I pay tribute to my hon. Friend, who is a doughty champion for British beer and Burton brewers? He makes a very important point and I would be delighted to convene that meeting with UKTI. We need to roll out the barrel for British beer and I am delighted to say that my right hon. Friend the Secretary of State for Environment, Food and Rural Affairs and I have set out an ambitious food and agri-tech export plan, to ensure that the whole world experiences the benefits of British beer and food.
Small Business, Enterprise and Employment Bill
Andrew Griffiths Excerpts(9 years, 8 months ago)
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Toby Perkins
It is a great pleasure to speak on the amendments proposed by the noble Lords.
On 16 July, we debated the Second Reading of this Bill. It was interesting, in preparing for this debate, to re-read the contributions that were made then and those that have been made by Labour Members in both Houses during its subsequent stages. Though modesty would usually prevent me from quoting extensively from the contribution that I made, it would be strange not to reflect on how widely our critique of the Bill has been adopted by the Government. We said that it had the potential to make a real difference to small businesses but that the steps that it originally proposed were a collection of faint nods in the right direction of key issues that had emerged under this Government. We said that far more robust action would be needed if this Bill was to deliver on the steps small businesses required and to take action on things like abuses of the labour market and their impact on workers in every constituency in the land. On the subject of pubs, we said that a successful small business Bill—a Labour small business Bill—would have introduced a code with a market rent only option, which the Bill now indeed contains. It would be churlish not to recognise that the Government have ultimately acted in good faith on pub company legislation.
I should place it on the record that this is the last piece of legislation that the Minister will be bringing through in this Parliament. As we fast approach the general election, who knows when will be the next time a Liberal Democrat Minister will have the opportunity to bring through a piece of legislation? She has done a good job in reflecting the wishes of the House and has acted in good faith on pub company regulation.
Their lordships’ amendments broadly achieve the objective of striking the devilishly difficult balance between proper protection for pub tenants while not imposing an overly rigid straitjacket on the industry with the potential to discourage future investment. They are positive steps forward that have faithfully built on the spirit of the historic clause 42 proposed by the hon. Member for Leeds North West (Greg Mulholland). We recognise that some aspects of the proposals will sensibly need to be included in the pubs code through secondary legislation.
There remains the thorny issue of the right of the tenant to offer a substantial investment in their public house in exchange for giving up the right to use the next rent review period as a trigger to request an MRO assessment. The letter dated 16 March from the Minister, Baroness Neville-Rolfe, to the noble Lords Mendelsohn and Stevenson details the Government’s intentions with regard to new clause 43 and specifies that it must not be used to abuse the waiver. However, this will still leave those who fought this cause for many years with considerable unease that this creates the potential for too broad an exemption for too small an investment.
We entirely agree with the Government that encouraging future investment in the stock of public houses is a crucial element in the future success of the industry, but, over four months since the original victory for clause 42, that still leaves a huge unanswered question about the scale of investment that constitutes “substantial”. I think that my party’s record on this issue means that campaigners will have confidence that the statutory code that addresses it under a future Labour Government will be consistent with the approach—
Andrew Griffiths (Burton) (Con)
The hon. Gentleman mentioned his party’s position on investment. What scale of investment does he believe would constitute “substantial”?
Toby Perkins
That is an excellent question. The whole reason this issue is being placed in secondary legislation is that we recognise that there is a very difficult balance to strike. The formula needs to be dependent on the relationship of the investment to the value of the pub. For some pubs, a £30,000 investment might be substantial. For a town centre or city centre pub, a £200,000 investment might not be so substantial. There needs to be some sort of relationship between the rateable value of a pub, the amount that it turns over, and the amount of investment.
The hon. Gentleman is echoing my point, which is that this has been left very open. A great deal of work would need to be done. I assure the House that under a future Labour Government the principles laid out by Baroness Neville-Rolfe are exactly how we would see this. I anticipate that the same would be true of a Liberal Democrat-influenced Administration, although it would be good to hear the Minister clarify that. It would also be good to hear from the Conservative party whether its manifesto will follow the Bill’s principles, or whether it will take a different approach. The industry and campaigners have the right to expect that.
Andrew Griffiths
I draw the House’s attention to my chairmanship of the all-party group on beer, and to my entry in the Register of Members’ Financial Interests.
This has been a contentious and on some occasions ill-tempered debate. That is a great shame, because ultimately we all want the same thing—to achieve a thriving industry. We want British pubs to succeed, to reduce the number of pub closures that have gone on over decades in this country and to stop such closures taking place. We need legislation that will allow the industry to do that.
The Government have obviously listened to the will of the House. I put forward a particular view—I had concerns about the unintended consequence of the Bill—but the House took a different view. The Government have listened to that view, and they have been honourable in how they have proposed changes to the legislation. Nobody who voted on Second Reading can have any concerns about the Government not having done the honourable thing in listening to the will of the House, so I commend them.
We are all looking for the outcome that more pubs thrive, survive and are successful, but I just draw the attention of hon. Members to my concerns about unintended consequences. We have heard the phrase “the beer orders” on many occasions, and we have looked at what Lord Young and the then Government did in relation to legislation on brewers and pubs. The unintended consequence of that legislation was to put the industry in a worse position: it actually led to the creation of the pubcos that so many people now argue against vehemently, and it had a terribly detrimental impact on the industry and on the sustainability and profitability of pubs. I urge the Government, in continuing to develop their legislation, to be aware of the unintended consequences of their actions.
One particular point to which I draw the House’s attention is the issue of investment. This is an industry. Yes, we love our community pubs, which are an important part of our society, and we all appreciate the work they do in our constituencies. However, such pubs have to be viable—profitable and successful—businesses for the people who invest in them. We all recognise that in the modern world, where there is the constant redevelopment and repackaging of the offering in the service industry, be it from Starbucks, Costa Coffee or the local pub, there is a dramatic need for investment. If a pub does not have investment, looks shabby and down-at-heel, does not feel modern and is not well-kept, the public will vote with their feet. They have so many other places to go to. They can enjoy their time at home or go to one of the many coffee shops, restaurants and other premises on the high street.
Investment is essential if we are to develop our pub estate, improve the offering and the customer experience, and encourage more people to use the pub. That is what we have to do. The reality is that people are drinking less and going to pubs less. We have to allow the industry to provide a product that encourages people to leave their homes and visit our pubs. Investment is essential if we are to achieve that.
I therefore urge the Government to look carefully at the secondary legislation that they bring forward. We need the companies that are investing in our pubs to have certainty. Investing in a pub can cost more than £50,000 and in some cases as much as £150,000 or £200,000. If companies are to make that investment, it is essential that they have some certainty about the return on their investment. If we cut off the supply of investment, it will be to the detriment of our pubs and we will see them go backwards. I therefore urge the Government, when they come forward with secondary legislation, to listen to the industry. It needs certainty.
Oral Answers to Questions
Andrew Griffiths Excerpts(10 years ago)
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Jo Swinson
Although I share the hon. Lady’s desire for gender equality, I have to put her right on a couple of points. I am not the only woman in the Department: Baroness Neville-Rolfe plays an important role in the other place. The gender pay gap is falling and fell significantly in the figures announced only yesterday. That is good news, but of course more needs to be done. That is why we are ensuring that we support women in the workplace through initiatives such as “Think, Act, Report” and through our reforms of flexible working and shared parental leave. It is this Government who are introducing such initiatives, which her Government failed to do.
Andrew Griffiths (Burton) (Con)
T6. The decision of this House on Wednesday to vote to scrap the pub tie caused £350 million to be wiped off the share price of pub companies yesterday, and it continues to fall today. That of Punch Taverns in my constituency fell by 17% in one day. Jobs and businesses are at risk. What discussions is the Department having with those companies and what help is the Secretary of State offering? If he is not offering help, why not?
Vince Cable
As the hon. Gentleman knows, Parliament has spoken and we respect its views on the subject. All I would say is that the Federation of Small Businesses commissioned a study that pointed in a very different direction from the one he is describing. Of course, there has been extensive consultation with all the different parties on this issue.
Small Business, Enterprise and Employment Bill
Andrew Griffiths Excerpts(10 years ago)
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Jo Swinson
We are proposing a power for the Secretary of State to introduce the market rent only option following a review that finds that tenants are not sufficiently protected by the system that we put in place. An important point that should reassure my hon. Friend is that we are creating a pubs code and putting a pubs code adjudicator on a statutory footing, so there will also be a significant individual who is independent, who is an expert and who has great experience of dealing with disputes. If cases go to arbitration, the adjudicator may be involved in investigations as well. The pubs code adjudicator will have a substantial amount of information at his or her disposal. We will not be in the situation that we have been in up to now, where it would be more difficult to assess the position. The adjudicator will enable us to make that assessment and to have an independent voice to set out what may need to happen further.
Andrew Griffiths (Burton) (Con)
Does the hon. Lady accept that, in an industry that employs thousands upon thousands of people and creates millions of pounds-worth of wealth for this country, there will be incredulity that amendments are to be made within hours of the Bill leaving this House? We have had four BIS Committee inquiries into this and years to discuss the issues, yet the Minister comes scrabbling to the Dispatch Box just a few hours before we are due to vote on the measure. How can that give the industry any confidence?
Jo Swinson
I regret the fact that my hon. Friend is disappointed, but he was often disappointed in the Public Bill Committee when we were not able to accept his amendments on a range of issues that, if taken together, would have undermined the purpose of the Bill. I know that he speaks up for his constituents and he represents one of the larger pub companies that has its base in his constituency, so I understand where he is coming from. His view of what needs to happen to address the problems and injustices in the industry is very different from that of many, and perhaps most, Members of Parliament. We want to make sure that we get the details right. We want to listen to the House. That is what a responsible Government do.
Jo Swinson
Yes, the hon. Gentleman was unchivalrous and I am not sure he rescued the situation with that intervention. My right hon. Friend the Secretary of State, my right hon. Friend the Minister for Business and Enterprise, who is my fellow Bill Minister, and I discuss these issues as the hon. Gentleman would expect, as we try to make sure that we give the right response to the concerns raised in Committee.
Jo Swinson
I would like to make a little progress, then I will give way to my hon. Friend.
We have set out in the Bill the parallel rent assessment process, which gives tenants the opportunity to request a parallel rent assessment so as to be able to ascertain—
Jo Swinson
This is not the first intervention that my hon. Friend has made, and I am obviously happy to respond to it. The industry has made significant representations in writing and had the opportunity to contribute at the public evidence session, which is an excellent, fairly new innovation in this House from which we all benefited in Committee.
Jo Swinson
I would like to finish my answer to my hon. Friend the Member for South East Cornwall (Sheryll Murray) before I take another intervention.
In Committee, we had the opportunity to hear from and to have these discussions with the industry, as well as with campaign groups—we must recognise that both sides are important in this. Since then, written correspondence has taken place, to which I have responded to deal with some of the issues raised. Of course, as Minister, I will continue to do so.
Jo Swinson
I give way to the hon. Member for Pudsey (Stuart Andrew), who has not yet intervened.
Jo Swinson
During the process of developing this legislation, there has been significant dialogue and consultation on the whole area through the formal consultation that Government held, to which we had the response earlier in the summer. I have met, through various round tables, members of companies that own pubs, family brewers, and tenants’ groups.
Jo Swinson
I am being asked to give way before I have finished responding to the previous intervention.
Andrew Griffiths
I thank the Minister for giving way, because this is a very important issue. Investors will be looking at her statements today. This could affect the viability and the profitability of businesses, together with thousands of jobs. She has announced a brand-new element—the introduction of the free-of-tie option but with a two-year wait. Can she confirm whether she has spoken to a single member of the industry about the implications for their business of that two-year delay—to one person, yes or no?
Jo Swinson
I would like to correct the hon. Gentlemen’s characterisation of what is happening. He is saying that this is the market rent only option but with a two-year wait. To be absolutely accurate, it is a power for the Secretary of State to introduce the market rent only option after a period of two years if a review finds that that is necessary. That is not exactly the same thing. It is important to put that on the record.
Throughout this process, the Government have been engaging with companies and with individuals. The market rent only option was extensively covered and discussed within the consultation process. I have had very many such discussions with companies over the course of the past 18 months. As was put to us forcefully on various occasions, some large pub companies will not welcome this and are very opposed to it. At the same time, we recognise the issues that have been raised in successive BIS Committee reports about the tenants who are suffering and the need to do something about it. We think that our parallel rent assessment is a proportionate and sensible way forward that will deliver for tenants, but we are keen to make sure that if that does not happen we do not end up at this stage again; we need the ability to act swiftly to introduce a market rent only option.
Toby Perkins
The hon. Gentleman mentions planning and whether pubs can expand, and it is important that pubs have that opportunity. However, the biggest planning issue currently facing pubs is the fact that big supermarkets can come in and change a pub into a supermarket without any reference to planning law. In my constituency we have a significant campaign to try to save The Crispin—I was not going to mention it, but the opportunity now arises. A pub that currently operates perfectly successfully under Enterprise Inns will be closed because the lease has been signed to Tesco. Indeed, Labour’s planning proposals would increase restrictions on pubs that are turning into supermarkets, and deal with many of the concerns that I have already raised. Hon. Members gave many examples of pubs that are being closed to become supermarkets.
Andrew Griffiths
The hon. Gentleman has treated us to a tour of the country and listed some 30 or 40 MPs who have done something to save pubs. It has all been very interesting, but we have not heard what he will do to save pubs. Rather than packing his speech with such examples and filling time, will he get on with telling us what he is going to do?
Toby Perkins
Many contributions that hon. Members have made are important to their constituents and they will consider it pretty disrespectful for the hon. Gentleman to say that I am filling time. I do not think I am—this is a significant issue. We can all get the press release out or attend packed public meetings, and we can all rail against unfairness and talk about how a pub company sold a false prospectus and failed to consider the needs of the community, but today is the day for talking to finish and for us finally to act. People will reflect on whether, when given the opportunity to act, Members of Parliament stood up in the Chamber to complain about the situation or actually took action.
Andrew Griffiths
I can reassure the House that I will not be speaking for 40 minutes, nor will I be reading off a list of pubs that have been saved or want to be saved around the country. I just want to get to the nub of the point.
I begin by telling the Minister that I want to help her today. In fact I want to help her so much that I have sent my researcher off to WHSmith to buy two packets of Benson & Hedges, not because I have taken up smoking or I think her nerves are bad, but just in case she wants to write two new policies while we are having this debate and she needs something to write them on.
We have debated this issue for many years and today the Minister comes up with an amendment that was cobbled together within the last couple of hours. This is an important industry. It employs thousands of people across the country. Livelihoods depend on the decisions we make today, and I am deeply concerned that there has been no consultation whatsoever with the industry about her proposal today to have this two-year stay so that we can assess the situation. There has been no impact assessment, and there have been no discussions.
I have the same aims as the hon. Members for West Bromwich West (Mr Bailey) and for Leeds North West (Greg Mulholland). We want to see pubs prosper. We want to see pubs thrive. We want to keep the community pub. We want publicans to do well and to be profitable. It is how we achieve that that is key. The hon. Member for West Bromwich West mentioned unintended consequences. I have heard that said a number of times over the last 24 hours or so. I would bring the House back to the fact that we find ourselves in this situation because of the beer orders. A Conservative Minister decided, with the best of intentions, that the Government should interfere in the market; the Government decided that they should split up the big brewers because they were acting in an uncompetitive way and the consumer was not getting a good deal. They broke up the big brewers. The reality is that that decision set us on this path we are on today with the pub companies. We should therefore be careful and cautious—and afraid—of unintended consequences. The hon. Gentleman said that there is no certainty. Of course there is no certainty, but as politicians—as legislators—we have to act with caution when we are interfering in business and in the marketplace and in people’s livelihoods.
Greg Mulholland
A little bit of the beer orders story is conveniently forgotten, which is that it was not the Government’s decision; it was the industry lobbying to stop there being a limit on non-brewing companies that led to the creation of the large pub companies. The lesson is to not listen to that sort of self-interested industry lobbying and instead get the legislation right.
Andrew Griffiths
Once again the hon. Gentleman talks about big business as if it is a bad thing. I like big business. I like small business. I like successful business. Just because a business is big does not mean it is acting inappropriately.
Grahame M. Morris
The hon. Gentleman is speaking for big brewers and I understand his perspective, but what about consumers? If a tenant is paying 60% or 70% more for the product, surely the consumer is getting a bad deal as well?
Andrew Griffiths
The hon. Gentleman has read up on this subject. I refer him to the Office of Fair Trading report of 2009 and its recent interventions in this debate—it has said this has had no impact on consumer costs and the price the consumer is paying for a pint. In fact it could be argued that, because of the big distribution models, beer is actually cheaper. The statistics show that beer across the country is cheaper in a tied house than in a free house. I hope I have answered the hon. Gentleman’s concern.
Andrew Griffiths
I support big and small businesses. The hon. Gentleman should note that the Society of Independent Brewers, which represents the smallest breweries across the country, is opposed to the scrapping of the measure—
Andrew Griffiths
The hon. Gentleman shakes his head, but it is true. The hon. Member for Leeds North West tries to undermine decisions made by any organisation that disagrees with him, but the Society of Independent Brewers is clear that this provision would disadvantage the country’s smallest brewers, and I will tell hon. Members why. The society believes that guest pumps would be taken over by lagers from foreign-owned breweries, which would come in and offer massive discounts, so that rather than having micro-brewers selling beer in our pubs, we would have foreign brewers selling lager.
Andrew Griffiths
Of course; this is a market and there is always going to be an inequality of bargaining power. If I am buying 10,000 items, I will have greater bargaining power than if I am buying only one. The question that we have to ask ourselves is whether the publican, the tenant, is being treated fairly.
Richard Graham
I have huge respect for the hon. Member for Wrexham (Ian Lucas) and for his colleague, the hon. Member for West Bromwich West (Mr Bailey), both of whom have made some good points. I must point out to them that when my family pub buys beer, we are just one pub doing that and we are hugely disadvantaged compared with the buying power of the big companies—
Andrew Griffiths
I thank my hon. Friend for making a good point. When we are talking about scale, it is true that there is a difference between those who are buying in bulk and those who are buying in small quantities. I want to return to the point I was making earlier, which was that we want our publicans to get a fair deal. We want to ensure that they pay a decent amount of rent and a decent price for their beer, so that their businesses can be successful.
Bob Stewart (Beckenham) (Con)
But can my hon. Friend tell me why so many tied publicans are going out of business? Why is that happening?
Andrew Griffiths
I understand my hon. Friend’s concern, and I do not defend the fact that there have been bad practices, that some people have been dealt with unfairly and that some of the pubcos have acted incorrectly. The point is that this Bill, as set out by the coalition Government, will address that by bringing in a statutory code that will provide protection for tenants. For the first time ever, tenants who feel that they are paying too much rent or paying too much for their beer or spirits will have some redress in law.
Sheryll Murray
Will my hon. Friend explain the difference between contracts that are negotiated at the outset and assignments, which can sometimes be guilty of putting the pubs we are trying to protect out of business?
Andrew Griffiths
My hon. Friend has shown great interest in this issue. She has done a great job in standing up for family brewers, and she has demonstrated that she understands the complexities of these matters. She asks about assignments. These occur when someone who has previously taken over a tenancy assigns it to someone else. Some of the most egregious cases of mistreatment that we have seen have involved such assignments. The problem is that the pubcos have no control over them; they cannot, by law, interfere in how an assignment takes place.
To return to my point, if we want to protect our tenants and ensure that they pay fair prices and fair rents, we have the power to do so in this Bill. For the first time, there will be an adjudicator to whom tenants can take their concerns. If they feel that they are paying too much rent or paying too much for their beer, they will be able to go to the adjudicator, who will be able to intervene and ask the pubco to change its pricing. The adjudicator will also be able to fine a pubco if it is acting inappropriately or unfairly. That will provide great support for those tenants, and it will go a long way towards addressing the concerns that hon. Members have expressed.
Mr Laurence Robertson (Tewkesbury) (Con)
I have a connection with a tied house that is run by a family member, and I have looked into this matter carefully. Does my hon. Friend agree that the most important thing to get right is the contract at the beginning of the arrangement? Far too many people are desperate to get a pub, and they do not look properly at what they are getting themselves into. That is the area in which a lot of guidance is needed.
Andrew Griffiths
I absolutely agree with my hon. Friend. As he says, some people are desperate to get a pub. They have a dream of being a publican, and there have been instances of pubcos waiting for the next sucker to come along and take on a tenancy. There has also been an element of rinsing—of passing people through the system. I do not support that; it is wrong and we should stamp it out.
Mr Bailey
The hon. Gentleman is being incredibly indulgent to the queue of Members trying to intervene on him. May I take him back to his point about the brewing orders? They undoubtedly had unforeseen consequences, but the proposals in new clause 2 are nothing like the proposals in those orders. The new clause proposes a graduated, incremental approach that would give the industry a chance to adapt and to see how the new arrangements were working.
Andrew Griffiths
I understand the intentions behind the hon. Gentleman’s new clause, but its fundamental aim is to break the tie. There have been many investigations of the tie, and it has been proved lawful. It has also been proved not to be anti-competitive. What we want to stamp out are the abuses, where the tied model is being abused by companies that treat their tenants badly. That is what the Bill will do, without the addition of new clause 2.
Richard Graham
My hon. Friend is absolutely right. For the record, does he agree that if someone disagrees with new clause 2, that does not make them an unabashed supporter of large pubcos? We have the right to criticise abuses in individual pubs, such as the one in my constituency.
Andrew Griffiths
Thank you, Mr Deputy Speaker. I saw that look in your eye, so I shall try to make some progress.
Andrew Griffiths
I think I have been fairly generous, but I will of course give way to the hon. Gentleman.
Greg Mulholland
The most fundamental dishonesty is the suggestion that the new clause would abolish the beer tie. It absolutely would not; it would simply give an option, at certain trigger points, for people to choose between a tied agreement and a rental-only agreement. That would make the tie work properly and ensure that we got back to what the beer tie used to be.
Andrew Griffiths
I think I found a question in the hon. Gentleman’s intervention. Given that he spoke for only 40 minutes earlier, I quite understand why he wanted to have another go.
I should like to get back to the point made by my hon. Friend the Member for Tewkesbury (Mr Robertson) that people often find they have signed up for things that they did not expect. They find that they have been hoodwinked because they were not given all the details, and that they have not got a fair deal. That is what we want to outlaw. I want briefly to consider what, under this legislation, someone wanting to take on a tenancy today would have to do. First, they would have to have a business plan, which would have to be assessed. They would have to have an accountant and a lawyer, and they would be told what they are paying for their rent, their beer, their whisky and for everything else. They would also be told how many barrels of beer and bottles of whisky the pub sold in the past year, in the previous year and in the past five years. All that information would have to go before their accountant before they could sign. I do not know what other Members think, but I think these people are grown ups and business people. If they are provided with all that information calmly and clearly so that they can make a decision, it is not for government to intervene to tell them they cannot engage in a business agreement that is perfectly legal.
Andrew Griffiths
I have given way enough, so I will move on, because I want to make the following point to allow colleagues clearly to understand what new clause 2 would do. Let us suppose I am a tenant with Marston’s in my constituency, a company that brews magnificent beer and would be affected by this legislation. Let us suppose I go to Marston’s asking to become one of its tenants and I go through all the procedure—it could take up to six months to do the due diligence on me—to take on that pub. Let us suppose I do all that and sign on the dotted line. Under new clause 2, I could then say to Marston’s, “Excuse me, Marston’s, I have changed my mind and decided I don’t want to sell Marston’s beer. I want to sell Greene King beer so I would like to go free of tie. Not only am I not going to sell your beer, but I would like the Government to tell you what rent you can charge me.” That is what is being proposed. To all those who have signed new clause 2 and are thinking of backing it, I say that that does not sound like a Conservative proposal to me. I do not know what some of my colleagues think, but it does not sound like a very Conservative approach to business. I want protection and clarity, but I do not want mummy state interfering and telling people how they can run their businesses. That is very important.
We have heard a little about people being able to buy their beer elsewhere under new clause 2, so let me just enlighten the House as to what it would do. New clause 2 states that brewers could still stipulate the sale of their brands but the tenant must be free to buy them from someone else. I could stipulate that people had to buy Marston’s, but they would be able to buy it from anywhere. In essence, Marston’s would no longer be able to sell its beer at a lower rate to large wholesalers who are buying 10,000 barrels than to the Dog and Duck which is buying 10 barrels—and this would come with full brewery technical support and reduced dry rent. This new clause is a serious market intervention; we would be interfering in a market in a way unlike anything that happens in any other industry in this country. These are the unintended consequences that colleagues need to consider when they vote for this new clause.
Let me discuss the facts. They are that the industry is desperately concerned about the implications of new clause 2 and this free-of-tie provision. We are talking not only about the pubcos, which people might hiss at and not like, but about the family brewers, who will be exempt. We are talking about the microbrewers and the Society of Independent Brewers; the people who are not even affected by this legislation are concerned about the knock-on effects and the consequences for the industry and the market. We should be desperately concerned about that. The Minister will know that the Department for Business, Innovation and Skills commissioned a report from London Economics, which estimated that if we scrapped the tie and introduced something like this new clause, 1,800 pubs would close and 8,000 jobs would go. Nobody here wants to see that happen to our pubs. We saw what happened under the previous Government, when 52 pubs a week were closing and the hated beer duty escalator increased duty by 48%. We have seen the consequences of legislation for our industry. We should hold our nerve. We should vote for the statutory code and for the adjudicator, and we should give power to our publicans, but we should not throw the baby out with the bathwater—we should not vote for new clause 2.
Paul Murphy (Torfaen) (Lab)
I rise to support new clause 2. It was interesting to listen to the hon. Member for Burton (Andrew Griffiths) and, for about two and a half seconds, I felt sorry for the pub companies. Are they really the great bastions of competition? No, of course they are not. They have lost the confidence of not only the landlords who are their tenants, but this House of Commons and the general public. That is why I congratulate the Government, particularly the Under-Secretary of State for Business, Innovation and Skills, the hon. Member for East Dunbartonshire (Jo Swinson), and her boss, the Business Secretary, on coming up with the pubs code of conduct and the adjudicator. I also congratulate my hon. Friend the Member for West Bromwich West (Mr Bailey) and his predecessors, the various Chairs of the Select Committee, all of whom agreed that change was absolutely necessary. On each of the three occasions we have debated this issue in this House of Commons there has been no vote against the basis of the debate: to ensure that there was change with regard to pub companies and how they treat their tenants.
On the new clause, the market rent only option was central to all those debates and to the reports of the Select Committees, because it highlighted the fact that the pub companies take far too much profit for themselves and leave very little for the tenants who run their pubs. The pub companies charge excessive rents and their beer prices are inflated and, as a result, their landlords are often impoverished. Is that competition? It is a cartel and a monopoly; it is nothing to do with competition—it is all about greed. The key principle outlined by the Select Committee reports and others is that the tied licensee should be no worse off than the licensee who is free of tie. That is central to today’s debate and to the decision this House of Commons must take within the next hour.
There are those who argue that new clause 2 would bring doom and disaster upon the industry, with thousands of people losing their jobs and hundreds upon hundreds of pubs closing. That is all scaremongering; it is all tactics to try to ensure that Government Members and some other Members who feel strongly about these issues should vote in a certain way within the hour. The hon. Member for Leeds North West (Greg Mulholland) spoke eloquently, as always, referring to the fact that new clause 2 would mean that the market rent only option would be introduced gradually; it would not suddenly fall upon the pub companies, but would happen in a piecemeal way, bit by bit and with sense.
Secondly, the new clause would not affect small family brewers. As we have all heard, it applies only to companies owning more than 500 public houses. Yet time and again in this debate people have been bringing up the idea that somehow or other companies such as Brains from south Wales, which is active in my constituency, will suddenly disappear from the face of the earth because of new clause 2, which does not affect them.
Andrew Griffiths
I am delighted that the right hon. Gentleman has mentioned Brains, because I understand that it does not support the free-of-tie proposal. Will he understand that although family brewers may not be encompassed by it, they will be affected by it, because they supply their beer to the pubcos and through their pub chains and distribution network? So it is not true to say that family brewers will not be affected; they are deeply concerned by these proposals.
Paul Murphy
The concern is not warranted. If new clause 2 came in and tenants were able to choose what beers and ciders they had in their pubs, perhaps in addition to the pubs in south Wales that currently serve Brains beers, other pubs that do not but that are linked into the pubcos could do so. Far from hindering the progress or in some way destroying the profits of Brains, this liberating measure would mean that public houses could serve Guinness, Brains and other local beers and ciders as well.
Paul Murphy
No, I will not. The hon. Member for Leeds North West made it clear that the detail in new clause 2 was specifically designed to exclude small companies such as Brains and others. It is possible that those companies were frightened by the tactics of some hon. Members and others, or, worse, that they were frightened because the pubcos had told them that they wanted friends to defend their own position. I do not believe for one second that small companies in my constituency, or anywhere else, would be adversely affected if pub companies allowed their tenants and landlords to earn a living wage—what is wrong with that?—to have a variety of cheaper beers, including those of the small companies, and to ensure that the profits are shared. Nothing in that could be said to be anti-competition. On the contrary, it probably means that they would do better in their pubs if they were allowed to earn more, to share their profits properly and to sell beer and cider from the microbreweries that exist in many of our constituencies. No, this is all about scare tactics.
Richard Fuller
We have had a fractious debate today. The responsibility for that can be placed firmly at the door of the Secretary of State for Business, Innovation and Skills, who has treated the House in a very shabby way. He has brought forward last-minute amendments and asked this House to take on trust that he can singly make massive and sweeping changes to this industry and that we should just trust him that his word is sound. He is proposing to affect an industry that has long been a mainstay of economies up and down this country.
I have very little confidence that the Secretary of State understands the industry on which he singly wishes to intervene. It is rather a poor show that he has not come to this House, but has instead left a very capable, but nevertheless junior, Minister to outline why the Government are retreating on one set of amendments, and looking to make changes in another set of amendments. That is no way for the proposed changes to be put to this House.
I speak on behalf of family brewers when I say that it is incredibly important that the Government keep the promise that they gave at the start of the consultation that those brewers would not be included in respect of the pubs code adjudicator. I was very pleased that my Conservative colleagues, along with the Opposition and the Liberal Democrats, voted to oppose the Government’s attempts to impose those regulations on small family-owned breweries. Today, the Minister has offered half a loaf back. She has said, “Well, we won’t do it for those who own 500 or fewer. We will do it for those with 350 or fewer. Just trust me, we will make it happen in another House.” I am happy that she is not pressing amendments 41, 43 and 44 today, but I am still at a loss to understand why there is an in-principle difference between 500 and 350. If it is a fact that just three family brewers are impacted by that change, there is a very serious issue about whether this is ultra vires legislation that is being felt by certain family businesses but not by others. I think the Minister will find that she will also have severe problems in the other House.
Andrew Griffiths
I completely agree with my hon. Friend’s analysis about plucking the figure of 350 out of the air. Does he share my concerns that this is a recipe for disaster, as we are bound to have legal challenge after legal challenge about what is a competition matter?
Richard Fuller
My hon. Friend is absolutely right. This is one of the problems of trying to make policy on the hoof. Small businesses in this industry up and down the country will be looking aghast at the actions of the Secretary of State. Serious business people run these breweries. They have to make long-term investment decisions that affect themselves, their employees and their customers. To have a Secretary of State who makes his position clear on a Friday, but changes it by Tuesday and again when it goes to the upper House sends an incredibly poor set of signals to an industry that has to make those long-terms decision. To be quite honest, a Secretary of State for business should understand that and should have the decency to be here—[Interruption.] I am sorry, I should not say that. It would have been preferable if he had been here today so that he could explain his rather unforced flip-flop at the last minute, because these are unprecedented changes that he is putting forward.
Grahame M. Morris
I do not know whether I can take on one of the characters from “The Lord of the Rings” and better that finish from the hon. Member for Bedford (Richard Fuller).
I want to speak in support of new clause 2, and I declare an interest as vice-chair of the all-party save the pub group. I pay tribute to my fellow officers, the hon. Member for Northampton South (Mr Binley), the hon. Member for Leeds North West (Greg Mulholland), who has done such a sterling job of researching new clause 2, and the hon. Member for Romsey and Southampton North (Caroline Nokes). Like other Members, I acknowledge the important role played by Fair Deal for Your Local, the Campaign for Real Ale, the Fair Pint campaign, my union Unite, the GMB, various support groups for tenants and the Punch Tenants Network.
New clause 2 is about stopping exploitation by large pubcos of pub landlords up and down the country. The situation has not come out of the blue. We have been discussing the issue for some years now, and it has been known about for a long time. The hon. Member for Burton (Andrew Griffiths) gave an example from his constituency, and the point I sought to make, although there was not time for me to do so during his speech, was that I can think of many cases in my constituency where a tenant of one of the large pubcos has effectively invested their life savings, and often their redundancy money, in taking over a business and turning it around. They have built it up and taken on additional responsibilities, such as opening a restaurant or providing bed-and-breakfast rooms, but when the review of the tenancy has come around, the pubco has doubled the rent, so that it is not viable for those people to continue.
Grahame M. Morris
I will give way to the hon. Gentleman, even though he would not give way to me.
Andrew Griffiths
I think that I was pretty generous in giving way. The hon. Gentleman has done a lot for beer and pubs, and I acknowledge his support in scrapping Labour’s hated duty escalator. I agree that it would be absolutely unfair of a pubco to do what he has described, but does he not accept that under the statutory code, the tenant could take the case to the adjudicator, who could rule on whether it was fair, and get the decision overturned? The tenant would have protection under the code.
Grahame M. Morris
I think that the best protection is offered by new clause 2, with the market rent only option. Time is short, but I shall try to explain why. We have heard from the respected Chair and former Chairs of the Select Committee on Business, Innovation and Skills. We have had debates, and the all-party save the pub group is certainly aware of the four reports produced by the Committee that concluded that there had been abuse of the tied system, and that recommended time and again the market rent only option.
During her opening remarks, the Minister was harangued by Government Members with prophecies of doom about the consequences for local economies and regional brewers, but in truth the Federation of Small Businesses suggests that there will be a considerable benefit to the economy of offering this option. CAMRA estimates that large pub companies force their tenants to buy beer at prices that are inflated by as much as 50% or 70%; that is on top of rent that is already excessive. Anyone who believes in fairness would support new clause 2, which would correct that.
Oral Answers to Questions
Andrew Griffiths Excerpts(10 years, 10 months ago)
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Sir Tony Baldry (Banbury) (Con)
15. What his policy is on the national minimum wage.
The Secretary of State for Business, Innovation and Skills (Vince Cable)
Our aim is to maximise the wages of the low paid without damaging their employment prospects. We fully support the work of the independent Low Pay Commission in framing the pay rate recommendations for 2014. I have also asked it to consider the conditions that would be needed for faster, above inflation, increases in the national minimum wage.
Andrew Griffiths
I warmly welcome the Chancellor’s announcement of his support for raising the national minimum wage, which would be of huge benefit to the lowest paid in Burton and Uttoxeter, and across the country. Does the Secretary of State accept that it would also place extra costs on business, particularly on small business? Will he consider what could be done to reduce business taxes and regulatory burdens to help those businesses pay for an increase in the minimum wage?
Vince Cable
Yes, of course we are conscious of the extra cost that would fall on business. That is why the Low Pay Commission tries to make a balanced judgment between the impact on employment and the increase in earnings for workers. It must be left to make its judgments and its independence must be respected. On the tax implications, given that the Chancellor is now heavily involved in this proposal and supportive of it, I am sure that he will be helpful on that front as well.
Start-up Loans
Andrew Griffiths Excerpts(11 years ago)
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Matthew Hancock
The £151 million is available over the next two years. Further details will be set out in the autumn statement. We are working with the Administration in Scotland to ensure that the scheme can be rolled out across Scotland as well.
Andrew Griffiths (Burton) (Con)
May I congratulate the Minister on a scheme that has helped to deliver the lowest unemployment level in my constituency since August 2008? I particularly congratulate him on the 4,500 disabled people who have been able to access a scheme that is hugely important in allowing them to reach their true potential. Will he assure me that he will continue to promote that objective?
Matthew Hancock
Yes. My hon. Friend makes an important point. It is vital that the scheme should allow everybody the opportunity to reach their potential through starting a business, and he put that very eloquently.
UK Trade & Investment
Andrew Griffiths Excerpts(11 years, 2 months ago)
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Daniel Kawczynski
I completely agree with my hon. Friend. The middle east and north Africa are my areas of interest. It is important that the scheme is extended to SMEs to encourage them to export to those countries—they will clearly be taking risks as some of those countries are pretty unstable.
Luckily, I studied French at university; I can speak French. We seem to avoid non-English speaking countries when trading. We are brilliant at exporting to countries where people speak English, but anywhere where French is a first language is a vortex for us: “No, no, no. That’s the French-speaking part of north Africa.” That is of great concern to me, because we must penetrate those traditional French markets. What unites them all—whether Tunisia, Algeria or Mauritania—is that they are fed up with the German export monopoly and with France repeatedly using them as dumping grounds for cheap exports, rather than engaging in bilateral economic co-operation and technology transfer. They are desperate to pull themselves away from their over-dependency on France and want greater economic exchange with the UK.
Andrew Griffiths (Burton) (Con)
I am enjoying my hon. Friend’s speech very much. He is making some valid points. Does he share my view that the collapse in the eurozone, the difficulties in European economies and the subsequent collapse in the potential marketplace for UK businesses have been drivers for UK companies to look at other markets? They have seen the potential in some middle eastern countries, the BRIC countries—Brazil, Russia, India and China—and the far east, and that potential is still to be tapped.
Daniel Kawczynski
Absolutely. I could not agree with my hon. Friend more, and I am sure that the Minister will reply to his point.
If I can achieve one thing from the debate, it will be that the Minister goes out and advertises for a top French export expert. I want the Minister to pinch him or her from the French export agency or a French export sector. I want him to find him or her, whoever is best, and pay him or her double what he or she is getting in France. Frankly, we will never get into the French markets unless we have French understanding, in both language and how French-speaking countries operate. We are not normally prone to saying wonderful things about France; but to start pinching their contracts, we need to understand how to do it. I want the Minister to take that point seriously, and if not, at least explain to me what his Department is doing to ensure increasing competence in the French language and the ability to understand how French contractual operations function in French-speaking north Africa, so that we are in a better position to attract contracts.
I pay tribute to the two Prime Minster’s trade ambassadors who are here. They do a superb job and are in a privileged position. To appoint them trade ambassadors, the Prime Minister obviously has great confidence in them, but how many people out there or in Shrewsbury know about trade ambassadors? I am sure that they know my hon. Friends the Member for Wealden (Charles Hendry) and for Gloucester (Richard Graham). It is important that we communicate with SMEs in Shrewsbury and elsewhere, so that if they are interested in exporting to Indonesia, for example, we can say, “There is a dedicated trade ambassador. This is his name. This is how you get in contact with him,” and do the same with Algeria and other countries. What work is the Minister’s Department doing to ensure greater understanding among SMEs of the vital resource of trade ambassadors and envoys that the Prime Minister put in place?
I have spent 20 years studying Libya. It is a country about which I am passionate. I have many friends there whom I treat as family. Before the last election, I wrote a book about Libya and the appalling human rights abuses there. My tremendous frustration with the previous Labour Government trying to curry favour with Colonel Gaddafi was such that I decided to write the book, highlighting the extraordinary abuse in Libya. I presented the Prime Minister with a copy two weeks before the 2010 election, and in 2011, I, along with others, pleaded with him to intervene in what we thought would be a bloodbath on the streets of Benghazi. Recently, I went to see him to highlight my concern about the ongoing instability in Libya.
I passionately feel that British companies should be exporting to Libya. The media circus has of course moved to Syria, but we must never forget that if we intervene in a country such as Libya, we have a duty and a responsibility to ensure that everything is done subsequently to help with security, building democracy and ensuring that residents have stability, so that they can trade with the UK.
From my friends in Tripoli, I get daily reports of kidnappings, violence and acts of terrorism; the Government still do not have control over large parts of the country. It is very important that we do everything possible to help Libya, by assisting her with security, and here I am drawn into the point made by the right hon. Member for Coatbridge, Chryston and Bellshill (Mr Clarke) about our security industry.
There are many people who would like to criticise British security exports, but exporting the knowledge that we have accumulated in the UK over decades—on policing, border guards and training armies, navies and air forces—to a country such as Libya is a good thing. Surely, we ought, at the very least, to help Libya—with all its instability—with our expertise.
National Curriculum
Andrew Griffiths Excerpts(11 years, 4 months ago)
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Michael Gove
I should say that, in both art and design and music, it is clear that students will be encouraged to create—there is an emphasis on drawing at an earlier stage in the art and design curriculum, so that people can become familiar with one of those foundational skills. It is also the case that the design and technology curriculum will include everything from the use of 3D printers to the most sophisticated methods of contemporary design. I was inspired visiting a school in the hon. Lady’s constituency to see exactly how high-quality computer science can be delivered to a range of students who were enjoying their teaching, thanks to the support that she has consistently championed.
Andrew Griffiths (Burton) (Con)
The main complaint from local engineering businesses in my constituency is that too many young people leave school and college with good GCSEs, and sometimes A-levels, in maths and sciences, but do not have the deeper understanding of the subject to be able to pursue a career in engineering. What do these reforms do to ensure that we are growing the engineers of the future?
Michael Gove
I am delighted that the changes that we have made to the design and technology curriculum have been welcomed by James Dyson, one of the most authoritative and persuasive voices when it comes to design and engineering. The new approach that we are taking, specifically in design and technology, will complement the essential skills of maths and science that engineers need.