Oral Answers to Questions

Greg Clark Excerpts

Thursday 24th May 2012 Commons Chamber

[Henry Smith (Crawley) (Con)]

9. What support his Department is giving to small and medium-sized businesses to enable them to grow.

[The Minister of State, Department for Business, Innovation and Skills (Greg Clark)]

To drive growth, we are reducing the cost of lending to small businesses by keeping interest rates low and through specific measures such as the national loan guarantee scheme. We are also stripping away red tape, including a three-year moratorium on domestic regulation for micro-businesses.

[Henry Smith]

Will my right hon. Friend update the House on the progress the Government have made in reducing the burden of EU regulation on small and medium-sized enterprises?

[Greg Clark]

Yes. My hon. Friend will be aware that in Brussels the Prime Minister secured an agreement from the EU Commission that any future regulation should be assumed not to apply to small businesses unless a case were proved that it needed to do so. The Prime Minister has secured a significant step forward.

[Mark Lazarowicz (Edinburgh North and Leith) (Lab/Co-op)]

13. The most recent Bank of England survey says that smaller firms continue to report that they are unable to obtain credit and that it has become harder to secure long-term funding. That issue is raised by Members on both sides of the House every month at BIS questions. The Government may have introduced some measures to provide finance to small businesses, but they are clearly not doing enough. Is it not time to develop some new policies?

[Greg Clark]

All Members of the House recognise the need to encourage banks to lend to small businesses. There is some good news; the volume of lending to small businesses in 2011—the latest year for which figures are available—was £75 billion, a rise of 13%, but there is more to be done. With my colleagues in the Department for Business, Innovation and Skills, we are doing everything we can to encourage banks to lend to small businesses.

[Neil Carmichael (Stroud) (Con)]

Will the Minister join me in congratulating Advanced Insulation, a firm in my constituency, which has just won the Queen’s award for enterprise? Does he agree that such firms are emblematic? We need to demonstrate that we are good at innovating and exporting, and that that is the direction of travel for economic growth.

[Greg Clark]

I will indeed join my hon. Friend in congratulating that company. In fact, a record number of the recent Queen’s awards, announced last month on Her Majesty’s birthday, were for small businesses, which shows that this country’s small businesses have a huge amount to contribute to the future success of the nation.

[Toby Perkins (Chesterfield) (Lab)]

Yesterday I met 35 small businesses that borrowed money to fuel growth but now feel that they were mis-sold interest rate swap products by their banks. There is a real urgency to investigate that issue before more otherwise healthy companies are brought down. Will the Minister join us in calling for banks, while they are investigating whether these products were mis-sold, not to foreclose on companies that are falling behind because of these products?

[Greg Clark]

If the allegations are correct, the companies will need assistance to cope. An investigation on that is about to conclude. I will take the matter forward with the hon. Gentleman and am happy to discuss it outside this place with his Front Benchers.

[Diana Johnson (Kingston upon Hull North) (Lab)]

10. If he will assess the commercial prospects of the caravan manufacturing industry in and around Hull.

[The Minister of State, Department for Communities and Local Government (Greg Clark)]

The Government recognise the important contribution of caravan manufacturing to Hull and the importance of the caravan industry in other areas. I am aware of the concerns across the country about the effects of the proposed VAT changes. Although that is clearly a matter for the Treasury, as the hon. Lady understands, she will know that I, as Minister for cities, have a personal commitment to and interest in the future success of Hull. If she or other Members would find it helpful, I should be happy to visit Hull over the next few weeks to meet manufacturers.

[Diana Johnson]

If the coalition really is supportive of Hull and caravan manufacturing, can the Minister explain why the Treasury thinks that putting VAT at 20% on static caravans, which we know will result in a 30% drop in the market, less money going to the Treasury and 7,000 job losses across the country, will help manufacturing in my city?

[Greg Clark]

As I think the hon. Lady knows—I also pay tribute to my hon. Friend the Member for Beverley and Holderness (Mr Stuart) and other Members across the House who have raised concerns about the impact of the proposal—the consultation has been extended. She and others have had meetings with Treasury Ministers and clearly made a forceful case, because the extension has been made. I know that Ministers are seriously considering this matter. I will be happy to meet her and manufacturers. I know the importance of the caravan industry; when I was growing up I spent my holidays in a static caravan on the north-east coast. I am keen to do what I can.

[Mr Charles Kennedy (Ross, Skye and Lochaber) (LD)]

11. When he last met representatives of the Russell group; and what matters were discussed.

--- Later in debate ---

[Robert Halfon (Harlow) (Con)]

Is the Minister aware that Harlow has the highest business growth in the United Kingdom and a new enterprise zone that will open next year and create 5,000 new jobs? Will the Minister of State, my right hon. Friend the Member for Tunbridge Wells (Greg Clark), who is responsible for cities, visit Harlow, even though it is a town, and see what more we can do for jobs and growth?

[The Minister of State, Department for Communities and Local Government (Greg Clark)]

It would be a pleasure to go back to Harlow with my hon. Friend. We are about to conclude the first round of city deals, but I will make an announcement shortly to invite other places across the country, especially those that have prospects of high growth, as I know Harlow does, to put their innovative ideas forward.

[Paul Blomfield (Sheffield Central) (Lab)]

T5. Will the Minister for Universities and Science reassure the House that the introduction of any student premium to offset the impact of tuition fee increases, as proposed earlier this week by the Deputy Prime Minister, will not be at the expense of the funding that is provided for the widening participation premium and currently allocated to universities by the Higher Education Funding Council for England?