Start-up Loans

Jeremy Lefroy Excerpts

Wednesday 20th November 2013 Commons Chamber

[Matthew Hancock]

I pay tribute to my hon. Friend, who is the Prime Minister’s apprenticeship ambassador. He does a huge amount of work to promote apprenticeships, small businesses and start-ups across the country.

[Jeremy Lefroy (Stafford) (Con)]

I welcome the scheme and its extension to include sharia-compliant finance. The UK is a world centre for ethical finance on Judaeo-Christian principles, which, like sharia-compliant finance, concentrates on risk sharing. Will the Minister consider including an ethical product?

[Matthew Hancock]

I will certainly consider that proposal.

UK Trade & Investment

Jeremy Lefroy Excerpts

Thursday 12th September 2013 Westminster Hall

[Daniel Kawczynski]

I thought the hon. Gentleman would say that, but whether or not we agreed with privatisation, we all remember the campaign. That is the sort of campaign that I want the Government to proceed with, so that everybody understands and is cognisant of UKTI, and so that no matter how small a business is, if it has the ability to export, it is given that opportunity.

The report also suggests that UKTI should be a single entity. Ideally, I would like it to be an Executive agency. At the moment, it is split between the Department for Business, Innovation and Skills and the Foreign Office, so it straddles two Departments. I fear that when a body reports to two Departments, there may be a degree of overlap or too much interference. I would like it to be a single entity and an Executive agency. What is an Executive agency? The definition is as follows:

“Executive agencies are part of a government department which enables executive functions within government to be carried out by a well-defined business unit with a clear focus on delivering specified outputs within a framework of accountability to ministers.”

I believe that UKTI should be a single entity, with a chief executive who is directly accountable to Parliament for the strategy, focus and organisation of that body.

At this stage, I pay tribute to Mr Nick Baird, the chief executive of UKTI. I think that when I started the report, he must have had a voodoo doll of me in his office into which he stuck pins, because I have been a real pain, but he has always interacted with me, no matter how difficult I have been with him, no matter how many probing questions I have thrown at him and no matter what barbed comments I have thrown his way. He has always been extremely civil, courteous and polite. He is doing great things at UKTI. He is appointing more business people to the organisation. However, I want him to have more autonomy and to be accountable directly to Parliament.

Following all the research that I had done, I wanted to utilise all the passion that I had for exports for my constituency of Shrewsbury, so we have moved on to the next step. Let us not forget that although UKTI is meant to help companies to export, it is also responsible for attracting direct inward investment into our constituencies. We all know that the vast majority—a massively disproportionate amount—of direct foreign inward investment into the United Kingdom goes to London. I want to ensure that UKTI on the ground in Shropshire is working in conjunction with my local council, the local enterprise partnership and the chambers of commerce directly to identify the top 10 inward investment opportunities for Shropshire. I have therefore tasked the UKTI team in the west midlands—Mr Paul Noon is the director of UKTI in the west midlands, and his staff includes Nicky Griffiths and others—with getting round the table with Shropshire council, the chambers of commerce and the LEP. I have brought them all into the same room and said, “What are the top 10 inward investment opportunities for Shropshire?” They are currently working on identifying those opportunities.

However, I suspect that the level of activity that I have described is not going on in every part of the country. I have spoken to many Members of Parliament who have told me that they are unaware of any interaction between their local UKTI teams and their local councils and LEPs, yet in Shrewsbury we have taken the bull by the horns and ensured that that work is happening. My office and I are at this moment writing a case study of exactly what we are doing, which we will share with every Member of the House, so that they can experience what we are doing in Shropshire and, we hope, try to replicate it in their own constituencies.

I pay tribute to Paul Noon and Nicky Griffiths and to Mark Pembleton from Shropshire council for their co-operation, their sterling work and their enthusiasm for getting together, with my encouragement, to start working on the top 10 inward investment programmes.

The critical point that I want to make to hon. Members is that it is no good a council or a LEP coming up with 10 opportunities that are not costed or not properly tabulated in a business format. They must be agreed with UKTI staff in such a way that those staff are happy and confident to sell them overseas, and that is precisely the work that is being carried out now. To ensure that we get extra resources for that project, I have invited Mr Nick Baird to come to Shrewsbury on 5 November. The chief executive is coming to spend a full day in Shrewsbury, so I hope—I am sure this will be the case—that everybody completes the work on those top 10 inward investment opportunities before his visit. Once they have been identified, I will play my part, as someone who is passionate about exports to the middle east and who knows the area. All other Shropshire MPs and everybody else who has a passion for Shrewsbury will also have to play their part in selling the top 10 inward investment opportunities to foreign sovereign wealth funds and countries abroad.

I would like the Minister to follow very closely what is happening in the case study in Shrewsbury and to give us every support in the run-up to Mr Nick Baird’s visit. It is very important that we can show success—that we can show how UKTI can work with the local councils and LEPs on the ground.

I want UKTI to leave no stone unturned when it comes to scrutinising every market in the world as a potential market for British exports. Of course UKTI is focused on the large emerging markets of Brazil, India, Indonesia and others, but we must never forget the very small markets. I came back yesterday evening from Gibraltar, where I had the great honour of addressing thousands of Gibraltarians. Most of Gibraltar came to the square to celebrate national Gibraltar day. I have to say that seeing 20,000 people singing “God Save The Queen” and “Rule, Britannia!” and flying the flag meant that it was a very emotional day for me. I pay tribute to the Gibraltarian spirit. However, because of my passion for exports, I started to ask a few questions about what is happening with Gibraltar. Of course it is a tiny market; of course it has a population of only 30,000 people, but my goodness me, it is more British than we are in many aspects and if we cannot sell to the Gibraltarians, who can we sell to?

I spoke to the deputy to the Governor and was told, “Oh no, it’s not my job to relay any opportunities to UKTI.” Then when I asked the question of the Governor, he looked at me with incredulity: “Oh no, of course it’s not my job.” By the time I had got through everybody, I had found that nobody was relaying business opportunities in Gibraltar to UKTI. Luckily, I have spoken to the Chief Minister, Mr Fabian Picardo, and put him directly in touch with Mr Nick Baird, and they are having a telephone conversation this afternoon to see how UKTI can interact directly with the Government of Gibraltar to ensure that the United Kingdom is aware of every opportunity, whether in construction, tourism or anything else, that exists in Gibraltar.

However, the thing that really upset me was that I found out that exports to Gibraltar are run out of offices in Madrid. I hope that I am not the only one who finds that rather ironic, given everything that Spain is doing to try to strangle Gibraltar at this time. I said to the chief executive, Mr Nick Baird, that it is completely unacceptable. The Foreign Office and UKTI seem to have these hubs. They do not have officials on the ground in certain countries, but commercial activity in smaller areas is directed from a bigger hub somewhere else. I understand that in certain cases, but it is completely unacceptable in the case of Gibraltar. The gentleman in Madrid who is dealing with Gibraltar obviously is very focused on the Spanish market, which probably accounts for 99.9% of this trade. He does not want to upset his Spanish partners. We must have direct contact with the Government of Gibraltar at the highest levels, and I will be monitoring that very closely.

Over the past year, I have created the cross-party British middle east and north Africa council, which more than 200 parliamentarians have joined. I feel passionately about the importance of the Arab world. The 22 members of the Arab League are, after all, our neighbours and of huge strategic importance to the UK from a security perspective. Hon. Members will be horrified to learn that only 5% of British exports go to the region—just 5%, to the whole of north Africa and the middle east.

What is striking when travelling around the middle east is the incredible strength of the British brand. We have good commercial links in the United Arab Emirates, but there is almost no commercial activity in countries such as Mauritania. When I visited Mauritania a few years ago, I was the first British MP to go since 1960. I asked some of my colleagues what they thought of Mauritania and they said that they thought it was a ship. They did not understand that it is an important, up-and-coming country of huge strategic importance with huge mineral resources.

When I went to Tunisia and met the Anglo-Tunisian chamber of commerce, I was notified that only 60 British companies operate in Tunisia, compared with 1,800 French companies. Tunisia is a close, Mediterranean country on our doorstep.

[Jeremy Lefroy (Stafford) (Con)]

I congratulate my hon. Friend on obtaining this important debate. Does he think that a reason why countries such as France and Germany do much better in those markets is that their export guarantee schemes—what we now call UK Export Finance—are far more substantial than ours? For example, the German Hermes scheme protected or guaranteed €29.1 billion of exports last year, while our equivalent in the UK gave out insurance for something like £4.3 billion. Germany provided more than five times the amount of protection through the Hermes scheme than we provided in the UK. The Hermes scheme is profit making—people pay premiums—so it is not a direct pull on the state purse.

[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.

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[Jeremy Corbyn]

I thank the hon. Gentleman for that. As someone who grew up in Shropshire, I fully appreciate the beauties of Shrewsbury.

My first point is that the hon. Gentleman’s comments about language and the British approach to the rest of the world are absolutely right. It is depressing to find that the number of students entering university this year to study foreign languages has gone down, as it did last year, and that the quality and quantity of language training in many secondary schools are wholly inadequate. We need to start language teaching much earlier, in primary schools as well as in secondary schools, and to give greater emphasis to the learning of all foreign languages at university—not just the obvious European ones, such as Spanish, French, German and Italian, but the Chinese and Arabic languages, as well as Hindi, Bengali and others. We are a country that has to trade and export, and if German and French companies can send people around the world who are competent in all the local languages, we should be able to do the same. It is extraordinarily arrogant for us to turn up in a country and assume that, because we are British, everybody will want to speak to us in English, so we just have to be prepared to make those changes.

The second point on which I am sure the hon. Gentleman will agree relates to the engineering base of much of British trade with the world. It is obviously essential to have a high degree of understanding of engineering and science teaching both in schools and universities, and to recognise the status of engineering, which has done so much in this country; I am thinking of the railways, shipbuilding, motors and all the other aspects of engineering. Engineering is often seen as a dirty-hands profession, rather than a mainstream one. I can say that because I come from a family of engineers who closely followed that whole narrative. The basis of an awful lot of our past trade was the export of high-quality, high-tech engineering products.

[Jeremy Lefroy]

I entirely endorse what the hon. Gentleman said about languages. The issue is about improving not only exports overseas, but employment opportunities locally. A company in my constituency cannot recruit staff from Britain, but has to look overseas to recruit its foreign-language speaking staff. There are job opportunities right here in the UK for people who speak the foreign languages he mentioned.

[Jeremy Corbyn]

I obviously completely concur with the hon. Gentleman, but I also recognise that many families in Britain who are bilingual in a variety of languages—I cannot put an exact figure on it, but I would think that about 70 different languages are spoken in my constituency—and many brilliant young bilingual people do not seem to get job opportunities in companies that are often trading with the countries that their parents came from. We should recognise that we have those resources in our society.

As I said in my intervention, I want to raise some arms trade issues, which are highly appropriate because the biennial arms fair, the Defence and Security Equipment International exhibition, is taking place in the London docklands. I think I am right in saying that more than 1,000 exhibitors—1,400, I believe—are now plying their wares.

I have many concerns, because if we compare the countries and companies involved in that arms fair in the London docklands with the Foreign Office’s report on human rights problems and abuses, we find an unfortunate coincidence between, on the one hand, the countries exhibiting at that international arms fair, countries that British companies that are exhibiting wish to sell to, or countries invited to send delegates, and, on the other hand, serious human rights concerns that the Foreign Office has drawn attention to, and countries with human rights records that it thinks we should be concerned about. Algeria, Bahrain, Iraq, Oman, the United Arab Emirates and Saudi Arabia are among the UK’s biggest customers for arms purchases, and Afghanistan, Turkmenistan, Uzbekistan and Libya, which were not on the list in 2011, have now received invitations, although human rights problems are legion in those countries.

An early-day motion was tabled two days ago, on 10 September, by the hon. Member for Brighton, Pavilion (Caroline Lucas), and has been signed by a number of colleagues, including me. It draws attention to the “Scrutiny of Arms Exports and Arms Controls” report, House of Commons paper 205, and states

“that the Government would do well to acknowledge that there is an inherent conflict between strongly promoting arms exports to authoritarian regimes whilst strongly criticising their lack of human rights at the same time”.

I look forward to the Minister’s response to that.

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[Charles Hendry]

That can be achieved within the focus of the Department, and we can certainly see if there are ways in which the chief executive of UKTI can be given the authority that my hon. Friend calls for. However, removing UKTI from the direct responsibility of individual Ministers would lead to a loss of a significant part of the working relationship—a part that brings real benefits.

[Jeremy Lefroy]

Does my hon. Friend agree that the work that the Foreign and Commonwealth Office has done since 2010 to make trade, business and exports a real part of the roles of our diplomatic missions overseas has been hugely important, and that we are already seeing the results in increased exports to some countries that we perhaps had not traded significantly with before?

[Charles Hendry]

My hon. Friend brings me absolutely beautifully to the final part of my comments, which is on exactly that point. We are incredibly well served by our missions around the world, and by the extent to which our ambassadors and their teams are now very focused on industry and trade opportunities.

Much as I and other trade envoys would love to meet every company in Shrewsbury that wants to become involved in a country, my job is primarily to help open the doors of Government Ministers in countries where often there is not a regular flow of foreign Ministers going through, so as to push that trade process forward. However, we could not do it without the expertise and focus of others. The extraordinary growth that we are experiencing in some of those markets—there has been a doubling of trade with Russia, and a trebling of trade with some countries in the middle east—shows how that policy has been working.

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[Richard Graham]

I thank my hon. Friend for his mathematical assessment of the situation. He makes an absolutely valid point—everyone in the House should champion business and exports for UK plc.

At the heart of my hon. Friend’s argument was whether it is effective for UK Trade & Investment to straddle two Departments. That is an interesting conundrum for the Minister—the Under-Secretary of State for Skills—who, of course, straddles two Departments himself, although they are not the same two Departments that UKTI straddles. Personally, I am all in favour of activities that straddle different Departments. Cross-departmental activity is a good thing, because silos do not exist in the real world. The key to it all is having autonomy for UKTI rather than independence, which I think is what my hon. Friend the Member for Wealden (Charles Hendry), who is the Prime Minister’s trade envoy to “the -stans”, was effectively advocating and supporting earlier. However, I will leave the Minister to comment on that.

What my hon. Friend the Member for Shrewsbury and Atcham was really advocating was the crucial importance of small and medium-sized enterprises, and the importance of exports to the future growth of SMEs. He knows as I do—as we all do—how vital that is to the growth of jobs, in Shrewsbury or in my constituency of Gloucester, where we have a long tradition of manufacturing and exporting. However, as I have said before in the main Chamber, in Gloucester we lost 6,000 jobs in business during the 13 years of my two Labour predecessors as Gloucester MP, although we have created 1,600 new jobs in business since 2010.

There is a great deal more to be done, which is precisely where SMEs come in, including the 500 members of the Gloucester branch of the Federation of Small Businesses and the members of many other branches all around the country. So how do we help SMEs to export? That question has been around for a long time. In fact, I wrote a paper on it as British trade commissioner for China, which, alarmingly, was 23 years ago. What has changed since then is the speed of communication and access to information through technology. We also have the new sectors and centres of UK expertise and, above all and most interestingly, the much higher standing of the brand “made in Britain”.

To bring alive that fact most immediately, at breakfast this morning I was with the CEO of the west Kowloon cultural district authority, which covers 40 acres of reclaimed land from Hong Kong’s harbour that will be transmogrified into a fantastic centrepiece for architectural design and creative arts from around the world, under a masterplan made by Foster and Partners. It will feature a huge number of UK stars from different sectors. The CEO of the cultural authority went yesterday to see some of the things achieved by Britain in time for the Olympics. He was staggered by the fact that the BBC sports hub was created in 21 weeks.

It is worth remembering that the west Kowloon cultural district authority has been in place for 16 years and has only just put a spade in the ground. The assumption that many of us had—I spent a large chunk of my life in that part of the world—that everything is done at great speed in Hong Kong and that nothing happens very fast in Britain has been turned around over the last few years by some of the achievements in this country. They help to reinforce the concept of “made in Britain” or “created in Britain” being a powerful brand, and they give our SMEs the chance to export to markets they previously might not have even thought of.

[Jeremy Lefroy]

Does my hon. Friend agree—I lived in Tanzania for 11 years, and I declare an interest as chairman of the all-party group on Tanzania—that one thing that we need to turn around is complacency? In Tanzania, we saw “made in Britain” being a huge advantage as a brand, yet the advertising for some of our products, which in those days included Land Rover, was miserable compared with their competitors, such as Toyota. There have been many improvements since then, but we need to do far more on marketing in target countries.

[Richard Graham]

I agree on the advertising and marketing point, but in the case of Land Rover there have been more significant changes, not least in the speed, efficiency and quality of product that Jaguar Land Rover provides. It is a remarkable success story, as he would agree. I totally accept what he said about its presence in east Africa, which is a happy land in my experience.

To return to my point on the SME debate, in some ways it has not changed since I wrote that paper all those years ago. The debate focuses on what Government should do to best help SMEs export. For example, should they subsidise many trips abroad for SMEs so that they can get to know the countries to which they might export? Do the SMEs have the resources or the sales structure to be able to follow through, or are the trips an interesting but non-productive form of business tourism? Should we help only the larger companies, and through them indirectly boost SME exporters through the supply chains of those large companies?

Should we use Government offices for all export help, or can chambers of commerce be better partners for certain SME goals? In some cases, chambers of commerce can be more selective than Government can. If someone needs a lawyer in Jakarta and rings up the British embassy, the embassy will be obliged to provide a list of every lawyer in town. What that person is really looking for is just one reputable company that can do the business. Government cannot choose a lawyer for someone, but a chamber of commerce might say, “Other companies like yours have effectively used X, Y and Z.” There are situations in which a chamber of commerce can be a more effective partner for SMEs.

What about where the Government should focus? Do we think that the work on strategic goals, such as EU trade agreements made successfully with, for example, Korea will add most value, or do we need an unremitting focus through UKTI on high value added opportunities in selected sectors, such as energy and resources, on which my hon. Friend the Member for Wealden is focusing successfully in the “-stans”? I am focusing more on infrastructure and aerospace in Indonesia. Do we perhaps need something like an army—I apologise to the hon. Member for Islington North (Jeremy Corbyn) for using this metaphor—with a selection of weapons from which we choose the most appropriate for the opportunity and the market?

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[Jeremy Lefroy (Stafford) (Con)]

It is a pleasure to serve under your chairmanship, Sir Roger, and to follow my hon. Friend the Member for Windsor (Adam Afriyie). I want to dwell for a moment on the point that he made so forcefully about the importance of inward investment and to pay tribute to the work of UKTI, which has seen an advance in British exports and inward investment over the past few years. Those two things are intimately connected, as my hon. Friend says, because a lot of that inward investment results in exports for the UK.

To take my constituency and my county, Stafford and Staffordshire, our major private sector employer is a French inward investor, Alstom, which is a major exporter from the United Kingdom. Only last year, it won a large contract to supply the Swedish electricity authority with transformers. Another major employer is Perkins, which is part of the US Caterpillar group. I believe that at least 90% of its Stafford production of large generator sets is exported around the world to countries as diverse as Afghanistan, Nigeria and South Africa. Evo-Stik is a French direct investment, which is now owned by the Total group. While it is a consumer product company it, too, has exports. Broadcrown in Hixon also makes generator sets that are sold all around the world, and that company employs almost 200 people in my constituency.

Jaguar Land Rover, to which reference has already been made, is in the process of building one of the largest engine factories in the world in South Staffordshire, on the border with Wolverhampton, with excellent support from both councils. That plant will be of huge benefit not only to employment for the people of Staffordshire and Wolverhampton, but to the United Kingdom, because much of its production will go into cars that are eventually exported. JLR, under its Tata ownership, contributes a huge amount to British exports. The link between inward investment and exports is therefore important, and UKTI absolutely understands that the two things must not be seen in separate silos.

We have our own British manufacturers in my area. JCB is one of the largest and best known private British companies, employing the best part of 10,000 people in the UK. It not only exports but manufactures overseas, so it benefits workers not only in the United Kingdom, but in those other parts of the world where it manufactures—India, China, South Africa and Brazil. There are also the pottery companies in my area. People tend to think of ceramics as a business of the past but, when I last looked, pottery and ceramics were a net exporter for the UK—we export more than we import—because we export high-value ware that lasts much longer than other products and that is appreciated throughout the world by hotels, catering businesses and individuals.

That brings me to our own procurement in this country. Sometimes, those who procure—in the public sector in particular, but also in the private sector, such as those companies that have a big responsibility for our electrical infrastructure—tend to take a short-term view on value for money. They look at something and say, “This will wear out in 10 or 15 years, so we need to buy something that is cost-effective over 10 or 15 years.” In our country’s transport and electrical infrastructure, some transformers that were made in Britain—perhaps by English Electric, then General Electric—have been in place for 40 or 50 years. In effect, they have been working for free for the past 20 to 30 years. Customers overseas understand that buying something marked “Made in Britain” means that they will get a product that will last not five or 10 years, but 20, 30 or 40 years. They are therefore prepared to pay a premium for our products, yet our own organisations, which have a fairly short-term view when procuring for infrastructure, are not prepared to do so. I ask the Minister to consider how we can persuade British organisations, such as National Grid, to take a long-term view of the value of British products and to realise that they will last for not 10 or 15 years but 20, 30 or 40 years, as our overseas customers know that they will.

I also want us to concentrate on learning from the country with the best record in the world on exports: Germany. We need to learn from the Germans, because they do some things that we do not, but that we need to do. As I said, Germany’s Hermes export finance scheme covered €29.1 billion of exports last year, whereas UK Export Finance covered a little more than £4 billion.

The Germans also have a development bank, Kreditanstalt für Wiederaufbau, which was set up after the second world war and operates specifically in Germany as well as overseas. In Germany, it often enables the Mittelstand, or medium-sized companies, to access credit and equity. We do not have an equivalent here. If we are to build up our middle-ranking companies—the equivalent of the Mittelstand—which would probably be the ones to do most exporting, they need to have access to the kind of finance that their competitors in Germany can obtain through KfW and the banking system. I therefore urge the Minister to consider whether the UK business bank, which I welcome, could be developed into the kind of financial institution that KfW so ably represents in Germany.

That was all I wanted to say. In short, we should concentrate on long-term thinking in the UK. If UK organisations are not prepared to buy UK products, because they are only thinking about short-term value for money, how can we persuade our overseas customers that they should buy our very good products? Secondly, let us learn from the Germans. They are the best exporters in the world, so if we want to rival them, we have to look at why they are so successful.

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[Matthew Hancock]

It is indeed important to have a target for satisfaction, and if three quarters are satisfied or very satisfied, that shows we are heading in the right direction, but more can always be done. For instance, since 2011, a realignment of UKTI has taken place to ensure that it can better serve the needs of UK plc. The process has included: the introduction of stronger senior management with private sector experience; new private sector delivery of trade services in England, with incentivised contracts, which my hon. Friend the Member for Shrewsbury and Atcham asked for; improving performance overseas and strengthening teams in key growth areas, such as China and India; and reviewing targets to ensure that they incentivise the behaviour of individuals on the ground. The right balance is having strong direct accountability to Ministers, which is appropriate, alongside the right incentives to give individuals on the ground the autonomy to be able to promote trade.

Several hon. Members mentioned—favourably or otherwise—the fact that UKTI reports to two Departments. I am a Minister in two Departments, and it is true that it is necessary to have co-ordination between the two. It would not be right to remove accountability for UKTI from either the Foreign Office or the Department for Business, Innovation and Skills, because UKTI is precisely about the link between business and our international relations. This is about, on the one hand, strengthening links between UKTI and domestic business, for which the Business Department is responsible, and, on the other hand, strengthening links between UKTI and our diplomatic service, which has happened a great deal over the past two or three years. Both those are valuable and necessary if the service is to perform, so it is therefore right that UKTI reports to a Minister who sits in both Departments but, of course, it is accountable to one Minister—my noble Friend in the other place—so there is a clear line of sight for ministerial accountability.

Several hon. Members talked about the links between UKTI and the Department for International Development. UKTI has an aid-funded business service that works with DFID to try to ensure that opportunities for procurement through DFID, not least from SMEs, are valuable. UKTI holds seminars with businesses, including SMEs, and it will hold another seminar in November to ensure that SMEs and domestic British companies have the opportunity to make the most of procurement through DFID, which these days, of course, bears the Union Jack.

My hon. Friend the Member for Stafford (Jeremy Lefroy) talked about the importance of inward investment and the business bank. It is vital to ensure that finance is available for exports, and funding for lending and strengthening the domestic private banking system are important parts of that. We are also seeing the growth of challenger banks, which are increasingly providing business finance. We will, of course, have the first ever British business bank, which is being set up precisely to look at the sorts of investments that he talked about. It is right that the British business bank does not take direct instruction from Ministers for each loan because, quite properly, they have to be made on a commercial basis.

[Jeremy Lefroy]

Will my hon. Friend examine the relationship between UK Export Finance and the commercial banks? My constituents have said that some commercial banks—not all but some, including very large ones—do not seem to be interested in promoting export finance and are unaware of the new products that are available. As the hon. Member for Hartlepool (Mr Wright) said, they are not interested in exports at all. Will the Minister challenge the major UK banks to say what they are doing to promote exports?

[Matthew Hancock]

I can go one step further because we have already been raising those challenges with UK banks to ensure that the facilities on offer are better integrated into their services. My hon. Friend will also know that the GREAT campaign to which many hon. Members referred, which brings together the promotion of UK export under one strong brand, is being piloted domestically in the north-east of England to promote export by UK companies in addition to Britain overseas, as has been the case hitherto. The promotion of the different Government schemes available for British-based businesses will be brought together under that brand in the pilot, which I hope is successful and can be rolled out further, to do exactly what he talks about.

Regarding the broad discussion about the recognition of UKTI, I strongly agree that it is important to ensure that every business, as appropriate, knows about UKTI and its services. We are doing an awful lot to try to make that happen, not least through local engagement. More than 100 constituency seminars have been put on by UKTI with local MPs, serving about 150 constituencies. A seminar in my constituency was very well attended and has led to increased contacts between UKTI and local businesses. If any Member wants UKTI to come to their constituency, we can look at that, because I think that we have been able to meet every request that has been made. Such events mean that UKTI, with the help of the local MP, can reach businesses that it has not yet reached. I am sure that the hon. Member for Hartlepool knows of many businesses in Hartlepool, so that is the sort of thing that we can put on for MPs of all types.

Manufacturing and SMEs

Jeremy Lefroy Excerpts

Wednesday 4th September 2013 Westminster Hall

[John Stevenson]

I do not disagree. The improvement in the view of apprenticeships is helping enormously, because people now view apprenticeships as a serious career choice, rather than people always going off to university.

We need to move to a more balanced economy so that we become a balanced country in which manufacturing has a central role. In my own county of Cumbria and constituency of Carlisle, we still have a very strong manufacturing base. There is defence, power, engineering and food, and in Carlisle itself 20% of the local economy is still based on manufacturing.

In my constituency, we have large players such as Pirelli, Nestlé and McVitie’s, and there are also smaller players that are significant locally such as Carr’s Milling Industries, Clark Door and Mallinson Fabrications. For both local and national reasons, I am delighted that the role of manufacturing is back on the Government’s agenda. A huge amount of credit must be given to the Government and to Parliament for achieving that change.

We all acknowledge that there has been a steep decline in manufacturing over many years, which has created a number of problems. Obviously, there is the balance of payments issue, because we are simply not paying our way in the world. The decline has also created a skills problem. Many skills have gone overseas, with some potentially lost for ever. We have an ageing work force in some sectors, with the food and drink sector being an obvious example of where many thousands of people need to be recruited over the next few years just to stand still.

The decline in manufacturing has created a problem for the long-term success of our economy. Thankfully, there is growing recognition that we, as a nation, need to produce goods, as well as to provide services. Growth in our economy can only be helped by the expansion of industrial production—the rise of the makers once more. Such a revival would immediately help to correct our trade imbalance, and more tax would be paid, so the Government could start to balance their books.

[Jeremy Lefroy (Stafford) (Con)]

Does my hon. Friend recognise that, with an increase in manufacturing, we would also see a positive knock-on effect for services? Manufacturing and services cannot be split from each other; one gives rise to benefits for the other.

[John Stevenson]

Yes, I agree. Ultimately, we want to see all sectors of the economy grow, and they are all interlinked. Clearly, if manufacturing improves, the services side will also benefit. The reverse does not always work in quite the same way; there is a greater benefit for services when manufacturing succeeds.

As for my personal involvement, I have to confess that in my previous life I had little knowledge of or involvement with manufacturing. My constituency has a significant number of employers in the manufacturing sector that make a major contribution to the local, national and international economies. I recognise the importance of those employers, and I want to support them wherever possible. That is why I became heavily involved with the all-party group on food and drink manufacturing, which is well supported across the House and which I now chair, and with the associated all-party group on manufacturing—I am delighted to see leading members of that group here this afternoon. There is much overlap between those all-party groups and others, and it is useful to have such differentiation because it demonstrates that although there are many similarities between manufacturers, there are also many important differences.

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[Mr Bailey]

I certainly join the hon. Lady in welcoming that. In fact, one of the unintended, beneficial by-products of the problem has been the resourceful and inventive ways that communities and businesses have got together to overcome it. Peer-to-peer lending is an example of that. In my area, we have the Black Country Reinvestment Society, with which my fellow west midlands MPs will be very familiar. However, the scale of the entrepreneurial alternative lending sources still does not match what is needed for our manufacturing base as a whole.

I turn to a specific issue that applies not only to my constituency, but to the whole of the west midlands and the black country—other west midlands MPs may refer to this, too. First, I pay tribute to the Tata brothers for their investment in Jaguar Land Rover, which, I think it is fair to say, has transformed manufacturing prospects in the west midlands in a way that we have not known for 30 years. It is an indication of the value of our relationships with the Indian subcontinent and that growing market and growing access of capital, and of the historic association between the Indian diaspora in this country, and of course, the native India.

[Jeremy Lefroy]

I entirely agree with the hon. Gentleman. It is also testament to the wonderful co-operation between Wolverhampton city council and Staffordshire county council, which, together, put £40 million forward to build a motorway junction on the M54, without which that project might not have been able to go ahead.

[Mr Bailey]

I pay tribute to both of them. All the players in the i54 development on the borders of Staffordshire and Wolverhampton deserve credit for the united way in which they have seized the opportunity. For the benefit of non-west midlands MPs here, it is a huge expansion in the engine production capacity of JLR that will result in 1,400 jobs. It has really transformed the supply prospects of foundries in the area. In that context, I would also mention the £45 million that the Tata brothers have invested at Warwick business school’s centre for research and innovation. Collectively, they have transformed the prospects for manufacturing in the west midlands.

My constituency still has the highest number of foundries—I think—of any constituency in the country, but there are plenty in the surrounding areas as well. The prospect offered to them of being part of the supply chain to Jaguar Land Rover is very significant. In the regional growth fund applications, there have been a number of successful bids from JLR and companies locally. However—I mention this to the Minister, because it highlights some of the problems that we have with the support that the Government give industry—I understand from the Cast Metals Federation that the engine blocks for the new Jaguar Land Rover development at the i54 will have to be made in Germany, because there is not, would you believe it, the capacity for foundries to produce them locally.

I also understand that Jaguar Land Rover is happy to look at repatriating some of its supply chains, where it has to source from abroad at the moment, but obviously, that will depend on the capacity of local SMEs to deliver. Despite all the Government sources of support, the regional growth fund and the grants that it has given, a crucial gap still remains in the potential economic benefits that will accrue to the west midlands because of the failure to secure this vital market. Aluminium engine blocks for that development will be crucial.

The Society of Motor Manufacturers and Traders has identified something like £3 billion-worth of potential extra business in the supply chain—if the Government and the industry can get together to maximise that potential. Although I do not condemn any of the attempts that have been made to provide finance for business and for SMEs so far—but certainly with the regional growth fund, there are all sorts of issues relating to length of time and so on—I ask the Minister to look at working with the Automotive Council to develop some sort of package that would enable the existing gaps in provision to be filled. The potential benefits, both for regional policy and for our overall national economic situation, are absolutely enormous.

I have spoken for longer than I intended, partly because I have taken interventions, so I will cease my remarks with that plea to the Minister.

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[Jeremy Lefroy (Stafford) (Con)]

It is a pleasure to serve under your chairmanship, Dr McCrea, and I congratulate my hon. Friend the Member for Carlisle (John Stevenson) on securing this welcome debate.

Government support for business has always been crucial. My first job was as a production foreman at Ford Motor Company in Bridgend, a plant brought to the UK under Prime Minister Jim Callaghan in the late 1970s. I am glad to say that that factory has expanded since then; it is one of the largest engine factories in Europe, if not in the world, and is still exporting around the world.

In Staffordshire and Stoke-on-Trent there has been strong Government support for manufacturing business—for instance, through the regional growth fund to Alstom in my constituency, which has become a world leader for research in high-voltage direct current manufacturing. The hon. Member for West Bromwich West (Mr Bailey) earlier mentioned Jaguar Land Rover on the i54 site on the edge of Wolverhampton and South Staffordshire. South Staffordshire council has played a major role in that, and that was a great example of co-operation between government and the private sector.

However, that is all about the largest companies, which have access to the Government. We really want to talk more about smaller projects and companies. We have already heard talk about procurement, and how Government procurement from SMEs has increased substantially under the present Government. There is still a long way to the 25% target, but I welcome that progress.

My hon. Friend the Member for Gosport (Caroline Dinenage) talked about oligopoly in procurement. It is not just in manufacturing companies; among service companies it seems that the Government will procure only from a very small number. For instance, there are the big four consultancy firms. In my constituency, health administration is being carried out by Ernst and Young. I should prefer some specialist medium-sized consultancies to do that work if, unfortunately, it should become necessary for a Government to procure it.

We have heard about training and apprenticeships, and the 21.5% increase in engineering and manufacturing technology apprenticeships starts in the past year. However, there is still reluctance from smaller firms, as they do not necessarily have the facilities or expertise to allow those apprentices to start. I welcome the idea of training networks, which could operate under the employer ownership pilots that BIS has started in the past year. I look forward to more of that, with small businesses taking advantage of the facilities and expertise of larger manufacturing businesses in their area.

We have also heard about the supply chain in the debate. Yes, that is an area where small businesses can do things for each other, but there is an increasing realisation of the benefit of having suppliers on the doorstep. The previous Government supported programmes in relation to the automotive sector supply chain, and the present Government are considering the aerospace sector in that regard. I should like to know from the Minister whether there are plans to consider other sectors—and to bring major sectors’ supply chains back into the UK.

I want to spend a little time discussing exports. There has been an increase in the services offered by UK Export Finance. Indeed, just this week BIS announced a direct lending scheme of £1.5 billion under UKEF, in which foreign buyers can get access to support to buy UK products. It is the first time that that has happened, and I encourage all hon. Members to point it out to exporting companies in their constituencies.

UKEF is still very much focused on large businesses, although I was glad to see from its last report that it was used to enable British companies to export, for example, cheese to Greece, a hospital to Ghana and tractors to Israel. However, those were the exceptions rather than the rule. UKEF tends to be dominated by Airbus, Rolls-Royce and BAE Systems. That is welcome—we need those exports—but in the past year the total was only something like £4.3 billion, compared with €29.1 billion under the Hermes scheme in Germany. Under that scheme, Kenya had €156 million of credit, South Africa had €461 million and India had €1 billion. Those are all developing countries, to which our businesses need to export.

I shall cut my remarks short, because colleagues want to come into the debate, but I reiterate what has been said so many times about the importance of the availability of long-term, patient capital and equity finance. It is ironic that Britain has a major institution that deals with that, which has nearly £3 billion of investments throughout the world, in some of the most difficult situations in developing economies—it is called the Commonwealth Development Corporation—but that we do not have a similar development corporation for some of the more challenged areas in our country.

Curriculum and Exam Reform

Jeremy Lefroy Excerpts

Thursday 7th February 2013 Commons Chamber

[Michael Gove]

My hon. Friend makes a good point. I think there was a case for the change he describes, but I felt that the best was the enemy of the good, and we agreed it would be better to put this to one side. We are still not clear whether Labour believes we should move towards having a single exam board. That was its position last September; we do not know whether it has U-turned since then. It is important that we give the exam boards a chance to show that they can improve GCSEs, but if they have not done so in the next Parliament, more steps could be taken.

[Jeremy Lefroy (Stafford) (Con)]

“A Bridge Too Far” was a fine British artistic achievement, and I welcome my right hon. Friend’s embrace of it. Will he underline the importance of arts and design in the curriculum?

[Michael Gove]

I am a great fan of that movie, especially the role played by Sean Connery, who is one of my heroes.

Oral Answers to Questions

Jeremy Lefroy Excerpts

Thursday 7th February 2013 Commons Chamber

[Jo Swinson]

It is a little rich of Labour Members to talk about the difficult situation that people are in as if they had nothing whatever to do with it. They forget that they left this country in a perilous economic situation. The hon. Gentleman is right to recognise that people are finding it very difficult. That is why the Government are helping by cutting income tax for 20 million people and taking more than 2 million of the lowest-paid people out of paying income tax altogether.

[Jeremy Lefroy (Stafford) (Con)]

13. What steps he has taken to raise awareness of export support services among small and medium-sized enterprises.

[The Parliamentary Under-Secretary of State for Skills (Matthew Hancock)]

We have reformed UK Trade & Investment to ensure that it better supports small and medium-sized enterprises. Some 90% of UKTI’s trade customers are SMEs, and its awareness raising includes a plethora of local activities, including MP constituency trade seminars. One hundred and forty colleagues, including me and my hon. Friend, are holding UKTI trade seminars in their constituencies, and I urge Members from all sides to get involved.

[Jeremy Lefroy]

I thank the Minister for that response. In my experience, and that of my constituents, UK commercial banks could do more to promote trade finance. Does my hon. Friend think they are doing enough to promote services offered by UK trade finance?

[Matthew Hancock]

Not yet, but they are about to. UK Export Finance is establishing a series of regional advisers who through banks, lawyers and accountants will reach more SMEs. That is part and parcel of a widespread message going out to all businesses that if they want help exporting, UKTI is there. The trade seminars in Members’ constituencies will be an important part of that.

Industrial Policy and Manufacturing

Jeremy Lefroy Excerpts

Thursday 22nd November 2012 Commons Chamber

[Sir Gerald Howarth]

It is important to make the point that the contribution of manufacturing to output halved. That is a figure that the public will understand as indicative of what was happening.

I want to be positive, because the United Kingdom has historic and current industrial manufacturing flair and capability. I single out just two companies—JCB, a brilliant private family company in Staffordshire, and Dyson, the inventor of the bagless vacuum cleaner. [Interruption.] Indeed, Hoover too, as my hon. Friend the Minister says. Formula 1 as well has been a stunning success for advanced United Kingdom manufacturing, as has aerospace, which I shall come to in a moment.

I remind the House that JCB employs 10,000 people worldwide, of whom 6,000 are employed in the United Kingdom. JCB’s revenues rose last year by 37% to £2.75 billion. Dyson sold eight out of 10 of its appliances abroad, with revenues of £770 million and profits of £206 million—a serious success story.

[Jeremy Lefroy (Stafford) (Con)]

I am glad my hon. Friend mentioned JCB in my county, Staffordshire. Does he agree that one of the reasons why such companies have been successful is that remaining in family hands over such a long period, they are able to take long-term investment decisions without necessarily looking to the needs of quarterly reports to the market?

[Sir Gerald Howarth]

My hon. Friend in my old county makes my point admirably for me. A common feature of both companies that I mentioned is that they both invest heavily in research and development, which the chief executive of Dyson, Max Conze, describes as “the key to success on the world stage”.

I want to concentrate on defence. BAE Systems and QinetiQ both have their headquarters in my constituency and I make no apology for being a strong supporter of Britain’s defence industry. According to Peter Rogers, who was last year president of ADS—the aerospace, defence and security trade body—the UK’s defence industry employed 110,000 people, of whom 25,000 were graduates and engineers, and supported a further 314,000 jobs. Turnover was £22 billion and export sales were just short of £10 billion—a fantastic record and a fantastic success story in manufacturing industry.

The United Kingdom is a world leader in both civil and military aerospace—as you, Mr Deputy Speaker, know better than almost anybody in this House apart from myself, Sir—with Rolls-Royce in advanced aero engineering and propulsion and Airbus providing the most advanced wing manufacturing in the world. On the military front we have Typhoon, with SELEX supplying the radar and MBDA the missile systems. We have a range of companies, from Rolls-Royce and BAE Systems, to EADS UK, Thales, Ultra, Chemring, Cobham, and Marshalls, to tiny bespoke hi-tech companies that should not be ignored given the fantastic contribution that they make to the cutting edge of technology. We need to maintain our leadership of that cutting edge, not only to win wars but to enable us to compete against newly emerging economies.

If I can single out one man for his contribution to this, it is Lord Drayson, who in 2005, when he was the Minister with responsibility for defence procurement, produced a fantastic paper called “Defence Industrial Strategy” in which he said:

“Well targeted investment in R&T is a critical enabler of our national defence capability; it strengthens innovation in our defence industry, produces more capable equipment for our Armed Forces and underpins our ability to operate with high technology allies like the US or France”.

I could not put it better myself.

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[Eric Ollerenshaw]

I am grateful to my hon. Friend for that example.

When I make inquiries, I am told that the problem in defining and facilitating university enterprise zones lies apparently with the Treasury. The Under-Secretary of State for Skills, my hon. Friend the Member for West Suffolk (Matthew Hancock), is an expert in these areas and I am not. However, I am told that the Treasury rules are that it has to make a calculation about the taxes it would have received from companies that have not yet been set up in order to make a decision about whether to allow an enterprise zone to be created. How civil servants can calculate the tax of non-existent companies—or new companies that have not even been dreamed up—I am not quite clear, but to me there is something wrong with the system.

Our universities have pushed forward the science park idea—Cambridge is a notable example—and it is being pursued by Lancaster university to enable graduates with skills and ideas to stay in the local area. To underline my theme, we have to use this policy to rebalance the contribution to growth that the regions make. The council, under general powers of competence, has the power to vary business rates. The concept suggested by the university, the council and myself was to have an enterprise zone-lite. The local council could define the area of the science park and lower business rates. The problem then—going back to the Treasury rules—is that the local council would then have to calculate the difference between the full business rate and an estimate of what those companies, some of which might not have even been set up, might have to pay. That seems to defeat the whole object, but watch this space. We are still trying to pursue where we can go with this. It is key that policy is not only about what Government can do—I will say a little bit more about that—but about what local councils and local authorities can do, on their own volition, with the new powers that the Government are giving them. That policy, based around universities, is the key to top-level manufacturing and to growing the economy of the north and, in particular, my constituency.

Hon. Members have mentioned exports. Lots of companies in my constituency export. I have mentioned before a company in Fleetwood that exports 50 tonnes of whelks to Korea. Only the other week, I was called by someone from another company in Fleetwood. I do not know if this counts as manufacturing, but the gentleman there reconditions and patches up end-of-life heavy trucks. He has found that the market in developing countries is either for brand-new Chinese trucks or British Bedford ex-defence vehicles—probably the kind that my hon. Friend the Member for Aldershot secured the contract for many years ago. He says that the Chinese trucks do not last five minutes. I have no comment to make—I am not a truck expert—but he says that although they are glittering they do not survive very long.

The gentleman in question, then, has found a market in the developing world for reconditioned heavy vehicles, so why did he approach me? He wanted to know whether I had contacts with other countries that might want to get involved. Having been a member of the all-party group on Kurdistan, I mentioned Kurdistan. That taught me a lesson, because he came back and said, “We’re looking at Kurdistan”. Where was UK Trade & Investment? Through contacts in the all-party group, he contacted the consular staff, who were extremely helpful, and now he is on his way to selling reconditioned trucks to Kurdistan. Where was UKTI? Its role is pivotal. A small business that wants to be in the export market needs a simple lead.

[Jeremy Lefroy]

I welcome my hon. Friend’s comments about reconditioned British vehicles, which are much-sought-after all around the world, but does he agree that there is another problem, as experienced by a company in my constituency? Reconditioned UK Army vehicles, which cannot be described anymore as military vehicles, are banned from export to certain countries, yet similar German army vehicles are available in those places, because German companies face no such obstacles.

[Eric Ollerenshaw]

My hon. Friend clearly demonstrates his point about reconditioned vehicles. I do not want to prolong this debate, but clearly there is a market. Small businesses at—I would say “the coal face”, but we do not have one anymore—the end of manufacturing do not have time to make the phone calls and make the contacts. They need support. For that reason, I welcome some of the changes to UKTI. In particular, I welcome its approach to Members about getting these meetings going in their particular areas. That will, I hope, provide the contacts, so that no longer do I have to be called in to make the contacts myself. As I learnt, we should not assume that these small businesses are not looking at what is available on the global market. All they want is the assistance to get into that global market, and obviously we should do everything we can to address our concerns about manufacturing.

I supported the abolition of regional development agencies, although I should declare an interest, as a past member of the London Development Agency—why London needed an RDA I never understood, even though I sat on the board. I have, however, been a great supporter of local enterprise partnerships, and I take Lord Heseltine’s point about giving them greater support. I support LEPs because areas such as Lancaster and Fleetwood—at the north end of Lancashire—and surrounding constituencies, are dominated by Manchester and Liverpool. So despite serious concerns about the proposal for city regions and the dominance of those areas, which in my constituency resulted in little help from the RDA, I hope that we will get some help from the LEP.

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[Jeremy Lefroy (Stafford) (Con)]

I refer Members to my entry in the Register of Members’ Financial Interests. I congratulate the hon. Member for Corby (Andrew Sawford) on his excellent maiden speech. I also congratulate the hon. Member for Stalybridge and Hyde (Jonathan Reynolds) and my hon. Friend the Member for Warwick and Leamington (Chris White) on securing this important debate.

I firmly believe that the United Kingdom needs a long-term industrial policy, but it must be rooted in growth. There is no point in focusing on economic sectors that will not create jobs and wealth for the UK in the future. We have fought shy of introducing an industrial policy in the UK for many years, because we believe that Governments should not be in the business of picking winners. It is true that a Government should not select one company over another, but we will be failing our country and future generations if we do not look ahead to see which economic sectors are likely to prosper and which are likely to fade away.

Suspicious as we have been about industrial policies, we have nevertheless had them over the years. In the midlands, in and around my constituency, I can see the positive results of at least three of them. Rolls-Royce aero-engine manufacturing was saved—perhaps fortuitously, and not as a result of a deliberate policy—by a Conservative Government intervention in 1971 after the company overreached itself with the development of the RB211 engine. Rolls-Royce employs tens of thousands of highly-skilled staff, contributes greatly to UK manufacturing exports—I entirely agree with the hon. Member for Luton North (Kelvin Hopkins) on the need for rebalancing—and is one of the best-known British products on earth.

Alstom, the largest private sector employer in my constituency, was assisted by a French Government intervention in 2003. Since then, it has consolidated its world-leading role in developing high-voltage direct current transmission as well as being the only remaining manufacturer of large transformers in the UK. It, too, makes a significant contribution to the UK balance of payments.

Jaguar Land Rover is investing heavily in south Staffordshire, as the hon. Member for West Bromwich West (Mr Bailey) said earlier. My hon. Friend the Member for South Staffordshire (Gavin Williamson) and other neighbouring MPs have worked hard to secure that investment, alongside the strong support of both Staffordshire county council and Wolverhampton city council. In recent years, the UK Government have made a determined effort to attract automotive investment, and this is one of the many fruits of their and the local councils’ efforts.

So industrial policy can work, but only that last one could be said to be the result of a determined effort by the UK to establish a proper policy that is consistent, long term and based on a competitive advantage. That is happening in the automotive industry. Another industry that needs a long-term policy is energy, in regard not only to the consumers of energy but to the manufacturers of the equipment used in the industry. Such manufacturers in my own constituency and many others across the country are world leaders.

What are the building blocks of a successful industrial policy that will stand our country in good stead for the 21st century? I shall make a few suggestions. First, we need a clear understanding of what we will concentrate on. The Netherlands, as so often, provides a good example, as has been set out in Lord Heseltine’s excellent report. The report sets out the nine top sectors in which it believes the Netherlands has a competitive advantage and on which it wishes to concentrate. They include agro-food, horticulture and water—all of which the Netherlands has a lot of—as well as manufacturing and service industries such as chemicals and logistics. The report identifies a “golden triangle” involving links between businesses, research institutions such as universities, and the Government.

Secondly, we need to ensure that we not only make the end products but control as much of the supply chain as possible. That is particularly the case in the aerospace and automotive industries, which are making efforts in that regard. The supply chain has been relatively hollow in those industries until recently. It has become clear that the UK’s manufacturing base has become increasingly reliant on imported components.

Thirdly, we have to ensure that our education and training system is more closely integrated with the needs of the sectors on which we are concentrating. It has been said in this Chamber more times than I can remember that we face a critical shortage of engineers. That is why, this week in Stafford, we are looking into forming a local engineering partnership between universities, colleges, schools and industry. Science and research are an easy target for cuts in both public and private sector budgets because the results are further down the road, whereas the benefits of the cost reduction are felt straight away. But that investment must be maintained. I welcome the Government’s action in protecting the science budget in cash terms in the last spending review, and I urge them to do the same and more in the next one.

[Paul Farrelly]

The hon. Gentleman is also a great friend of the ceramics industry in north Staffordshire. Does he agree that a laissez-faire approach often translates in government to a “faire rien” approach—doing nothing. I mentioned country-of-origin marking a few moments ago. A measure such as that, we agreed, is not protectionist, but it would afford some support to our industry and is much needed.

[Jeremy Lefroy]

I totally agree. I have supported country-of-origin marking for many years to ensure that people know that they are getting the best of British and not some foreign substitute or import. It is vital to maintain the quality of our products around the world.

An industrial policy must set out quite clearly how much we as a nation value research and back up warm words with action. Here, I mention research and development capital allowances. Capital allowances are vital for encouraging companies to invest the cash they have on their balance sheets—some £70 billion at the last count—into productive plant, equipment and other capital investments.

Finally, I turn to finance. It is naive to think that all good projects will attract commercial finance in the UK. If that were the case, we would be the home of many more of the largest companies in the world because the technologies were invented here. The first large computer was built on the work of people such as Alan Turing, and the plasma screen was invented in Malvern by what is now QinetiQ but was then the Royal Signals and Radar Establishment. Then there is the work on the human genome, which my hon. Friend the Member for Mid Norfolk (George Freeman) mentioned. We should have more of these large companies, but we lack them because the finance was not available.

That is why I think the Government’s business bank proposal is a good start, but it needs to be the source of long-term patient capital. Lord Heseltine’s reminder in his report of the work that the Industrial and Commercial Finance Corporation did after the war is welcome, and I urge the Government to consider his suggestion of providing more such long-term capital through the business bank.

In conclusion, an industrial policy is not a panacea, but it is a structure that provides the inventiveness and entrepreneurship of the people of the United Kingdom with the best possible chance to thrive in a competitive world.

Diabetes (Care in Schools)

Jeremy Lefroy Excerpts

Tuesday 11th September 2012 Westminster Hall

[Pauline Latham]

Yes. I thank my hon. Friend for her intervention. Young children and those in their teens hate to be different and need such support to ensure that they do not feel that they are different. Parents also need support, because it is difficult if they are not completely confident, when leaving a vulnerable child at school, that the school is in full control of care and what is going on with the child.

It is important that all school staff have a good awareness of type 1 diabetes and know what to do in an emergency, for example, a hypoglycaemic episode. Sadly, this is not so and there are huge discrepancies across England in the quality of care provided to children at school. It is a postcode lottery.

While working alongside my constituent to ensure that the required care is put in place for the boy in question, the Essex protocol was brought to my attention. The Essex protocol is a set of guidelines produced with parents and partners by Essex county council to ensure that school staff are supported and given the right equipment to support pupils with diabetes. These guidelines are invaluable when it comes to protecting the safety of a child and, of course, parents’ peace of mind.

If a school in Essex is insured through the council and has followed the protocol guidelines, they are fully covered by the school’s insurers. Leeds, Birmingham and Exeter also have appropriate guidelines. The guidelines should be of the same standard and applied throughout the UK, because at the moment there is huge variation in the quality of care that a child receives in their school. The very existence of this variation raises serious questions about the confidence that can be placed in those who have the duty of care for the child throughout the school day.

[Jeremy Lefroy (Stafford) (Con)]

I congratulate my hon. Friend on securing the debate. My constituent, Darcy Evans, who suffers from type 1 diabetes is fortunate to have an excellent school nurse in her school, but is concerned that other children should have the same access. What does my hon. Friend think could be done to even out, to a higher standard, the quality of care across schools and to ensure that it is not only teachers who are informed, but even pupils, because the reaction of fellow pupils is also important?

Oral Answers to Questions

Jeremy Lefroy Excerpts

Monday 3rd September 2012 Commons Chamber

[Jeremy Lefroy (Stafford) (Con)]

2. What progress his Department has made on steps to speed up the adoption process.

[Charlie Elphicke (Dover) (Con)]

15. What progress his Department has made on steps to speed up the adoption process.

[The Secretary of State for Education (Michael Gove)]

In May, my Department published scorecards for local authorities to enable them to identify and tackle the causes of delay in the adoption system. My Department will shortly launch a consultation on changes to speed up processes for prospective adopters, and we plan to introduce legislation thereafter.

[Jeremy Lefroy]

I thank the Secretary of State for his answer. Will he confirm that he is looking at all the barriers to adoption that prospective parents can encounter—including, on occasions, their religious faith?

[Michael Gove]

My hon. Friend is quite right to raise that issue. There have been a number of occasions in the past when, for the best of motives, social workers have felt it inappropriate to match children with prospective adopters because faith might have been seen as a barrier. I do not believe that faith should be a barrier to ensuring that children find a loving home.

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[Michael Gove]

I am grateful to the former Chairman of the Select Committee for his points about Ofqual. The most important of his series of comments was his assertion that none of us would like Ministers to interfere in Ofqual’s operations on grade boundaries and grade setting—a mature and appropriate point. More broadly, he asked where I was when the GCSE results were announced. On that day, I took the opportunity to give interviews to the BBC, ITV and Sky to explain my concerns about the situation that we inherited from the previous Government. Ever since then, I have been doing everything I can in my Department, with the help of my Ministers and the superb team of civil servants we have, to ensure that we can reform examinations for all students.

[Jeremy Lefroy (Stafford) (Con)]

T8. I welcome the help that the Minister for Further Education, Skills and Lifelong Learning and the Skills Funding Agency have provided in showing flexibility over the number of 16 to 18-year-old apprentices taken on by my local college in Stafford. How can he ensure that this common-sense attitude always prevails?

[Mr Hayes]

I am grateful to my hon. Friend, who has been a doughty champion of his local college and has visited me with its representatives to make its case. The answer is that we need to give colleges more freedom and flexibility to respond to local demand. That is why I simplified the funding regime, why I cut the number of statutory duties that colleges are burdened with, and why we removed a number of intermediary bodies. We believe in trusting colleges to respond to local learners and local businesses in Stafford and elsewhere.

School Funding

Jeremy Lefroy Excerpts

Tuesday 24th April 2012 Westminster Hall

[Andrew Selous]

I thank my hon. Friend for making that point powerfully, because that is my point, too.

[Jeremy Lefroy (Stafford) (Con)]

I congratulate my hon. Friend the Member for Gloucester (Richard Graham) on securing this debate.

The point that my hon. Friend the Member for Loughborough (Nicky Morgan) made about teachers’ salaries is vital, because those constitute, as all hon. Members who have been school governors know, the vast majority of a school’s budget. I am not in favour of differential salaries throughout the country. We need standard salaries. It is all the more important that schools funding should be fair, per head, because those basic costs should be the same throughout the country.

[Andrew Selous]

I thank my hon. Friend for speaking with passion and for further illustrating the point, which all hon. Members are making.

Some hon. Members have already mentioned that relatively wealthy areas often have significant pockets of deprivation. That is true in my constituency. There is deprivation in Houghton Regis, for example. The indices of multiple deprivation in some wards in that town are not dissimilar to those in much higher-funded Luton next door. The formula fails poorer children in wealthier areas. We need to look at that to see whether the formula could drill down and give additional funding for poorer children in slightly wealthier areas.

Disadvantaged Children

Jeremy Lefroy Excerpts

Thursday 20th January 2011 Commons Chamber

[Jeremy Lefroy (Stafford) (Con)]

In common with all colleagues, I pay tribute to my hon. Friends the Members for East Hampshire (Damian Hinds) and for Salisbury (John Glen) for helping to arrange this debate. I also pay tribute to the right hon. Member for Birkenhead (Mr Field) and the hon. Member for Nottingham North (Mr Allen) for their reports. Before I was elected to this House, the hon. Member for Nottingham North gave an excellent talk in my constituency which opened my eyes to this subject for pretty much the first time. I am grateful that the Government have sought to enlist those Members’ expertise.

There is great expertise, too, among Government Front Benchers, to whom I also pay tribute. I remember a visit to my constituency by the Under-Secretary of State for Education, my hon. Friend the Member for East Worthing and Shoreham (Tim Loughton), who travelled an awfully long way to find out about a particular scheme that was going on at Wolgarston high school in Penkridge. He did not have to do it, but he did so because he was interested.

I should like to take up three points from the report by the right hon. Member for Birkenhead. The first is the key fact that we have to get more young men, in particular, into work. That is absolutely essential. The unemployment figures that came out yesterday were disturbing, and the Government must address that. I look forward to the Work programme coming into place, but I urge the Government to ensure that in the months before that happens people do not drop out of the system. I know that things have been done to address that potential problem.

I reiterate what my hon. Friend the Member for Beverley and Holderness (Mr Stuart), the hon. Member for Slough (Fiona Mactaggart) and various other Members said about the importance of having men involved in primary teaching. This week, I was at St Michael’s first school in Penkridge in my constituency, where the head made that very point, saying that there were not enough men in primary teaching and she would love to see more come into it. The right hon. Member for Birkenhead makes the same point about children’s centres:

“The lack of male staff is an equally pressing issue needing to be addressed.”

[Sarah Newton]

Does my hon. Friend agree that to address that imbalance, we might encourage more men to volunteer? In my town of Falmouth, the Rotary club does excellent work in a local primary school to help with reading, which has really improved reading standards.

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. I remind Members that they must speak to the Chair and not in the opposite direction.

[Jeremy Lefroy]

I entirely agree with my hon. Friend. In my constituency, the Rotary club does work on reading in Doxey primary school. I remember how much I enjoyed reading to my children. I am not sure whether the feeling was mutual, although they told me later that it was.

My second point, which was mentioned by the hon. Member for Stretford and Urmston (Kate Green) and many other hon. Members, is the critical role of children’s centres. We should ensure that, with the changes, we do not lose what has been achieved. The report by the right hon. Member for Birkenhead states that Sure Start centres

“should maintain some universal services so that Centres are welcoming, inclusive, socially mixed and non-stigmatising, but aim to target services towards those who can benefit from them most.”

I urge the Government to take note of that, and I am sure that they will.

My third point regards television and media. I take up a point made by the hon. Member for Upper Bann (David Simpson), who is no longer in his place, about Staffordshire university—[Interruption.] I beg his pardon; I missed him. He referred to a particular media studies course at Staffordshire university. I must say that Staffordshire university has a very high reputation in media studies and is one of the major institutions in the country for developing state-of-the-art video games technology, which is a major export industry for this country. I just want to give some balance to the impression that people may have got from his comment, which I am sure was not intended as a generalisation.

The right hon. Member for Birkenhead talks about the role of the BBC. He recommends that it kitemark the children’s programmes that are most beneficial to parents in the development of language. I urge the BBC and other broadcasters to pay attention to that.

I grew up in a house without a television, and indeed still live in a house without one. I do not recommend that for everybody, although it has certainly done me, my family and my children no harm. However, I do think that parents should be encouraged to consider their use of television, and whether it is necessary to have one in every room in the house, including the bedrooms. Perhaps television could become a social activity with the whole family watching it together, rather than an individual activity with everybody watching their own programmes.

I echo the point made by the hon. Member for Slough about reading. Again, that is absolutely essential and something that we must never forget. I underline the point made by my hon. Friend the Member for East Surrey (Mr Gyimah) about character—something that is sometimes forgotten. We have to have qualitative, not just quantitative, measures in approaching this subject.

I and my family spent many years living in Tanzania. A Swahili proverb says, “It takes a whole village to raise a child.” Many hon. Members have made that point in various ways. My hon. Friend the Member for Congleton (Fiona Bruce) talked about the importance of community as well as family. My hon. Friend the Member for Stroud (Neil Carmichael) talked about the way in which the built environment can help or hinder the sense of community.

I look forward to several further debates on this matter in this Parliament. It is absolutely essential that we take note of everything that has been said today and return to it time and again to see what progress is being made. We are talking about something that is vital to the future of this country and of our children, and it is essential that we do not just leave it to one debate and one day in a Parliament.