Covid-19: Support for UK Industries

Jerome Mayhew Excerpts

Thursday 25th June 2020 Commons Chamber

[Jerome Mayhew (Broadland) (Con)]

I make specific reference to my register of interests; I am associated with a business that has received a CBIL.

Faced with a profound crisis, the Government responded magnificently with a suite of measures of emergency loan schemes to support businesses badly affected by covid-19, in particular CBIL and the bounce back loan scheme. Put together at great speed, the schemes shovelled money from lending banks into viable businesses to support their cash flow in the short term, with capital sums repayable over five or six years—a vital support to large sectors of our economy and one that we will look back on with awe.

As we come out the other side of the initial crisis, the requirement to repay those debts in just five to six years will, in its turn, damage our ability to grow the economy. Just when we need businesses to be investing in growth and creating employment, they will have to focus on repaying their covid debt, in addition to any other pre-crisis leverage repayment plans. Just when we want banks to lend money to support employment-enhancing growth, they will have swollen covid-19 balance sheets and so be less likely to lend more. That is the opposite of what we need to happen.

There is a simple-ish solution: if we take the covid loan books of the banks and place the loans in a special purpose vehicle, turning them into covid loan-backed securities with varying maturities of up to 30 years, we could transform our economic recovery at a stroke and reduce capital repayments by a factor of six. We would free up whole swathes of the economy from zombie status, releasing funds for investment in growth. It would reduce business failures and increase the market for investment debt as effective business debt ratios are reduced.

At the same time, it would increase the banks’ lending appetite, since their current covid loan books would have been sold to institutional investors, so reflating their balance sheets. It would create the long-term, very low-risk, fixed income investment sought after by pension funds, particularly if the coupon were tax-free. The risk, after all, would be made up of businesses that were confident that they could repay sums over five or six years now doing so over 30 years, with individual risk further softened by their amalgamation.

Finally, it would create a whole new sector in finance in which the City could excel. I cannot think of a single policy that could do so much to re-establish our growth businesses so quickly, and all without significant recourse to the taxpayer. Does that sound too good to be true? Well, like any complex financial product, there are risks that will need to be explored both by the Treasury and by the Bank of England, but my earnest hope is that this proposal will be given the serious and immediate consideration it deserves.

BBC Regional Politics Coverage

Jerome Mayhew Excerpts

Monday 22nd June 2020 Commons Chamber

[Mr Toby Perkins (Chesterfield) (Lab)]

I pay tribute to the hon. Member for Tiverton and Honiton (Neil Parish) for securing this debate. The level of interest that there has been shows the desire across the country to protect this incredibly important institution. He was encouraged by the hon. Member for Stoke-on-Trent North (Jonathan Gullis) to lead the campaign by setting up a Zoom call for us all to contribute to, but it seems to me that he has created a sort of face-to-face Zoom call that might be familiar to some of us who were here before the coronavirus era. It is a way for us all to get into the same room and discuss this, and that is great.

Taking up the challenge set by the hon. Member for Cleethorpes (Martin Vickers), I think it is incredibly important to recognise the contribution that the BBC makes in my area, not just with “Sunday Politics”, but also with radio stations such Radio Sheffield and Radio Derby and, of course, to recognise the broader role of local media such as the Derbyshire Times and Peak FM, which ensure that, as local Members of Parliament, we are held to account and that we can communicate with our local communities and be on the receiving end of some wise and frank advice from our local constituents about the issues.

It is incredibly important for our democracy that we are not just 650 people here to serve our parties, but we are people here to serve our local communities, to hear about local issues, to be asked about those local issues and to respond to those local points. That is the role that “Sunday Politics” plays, and there is no way that a politics programme for England would be able to do that. The idea that the issues that my constituents care about in Chesterfield and the local issues in the north-east or in Cornwall are all the same is just nonsense. The local holding to account that “Sunday Politics” does is incredibly important.

[Jerome Mayhew (Broadland) (Con)]

Does the hon. Gentleman agree that now is a particularly bad time for the BBC to be considering this move? We heard in the previous contribution about devolution to metropolitan mayors, and the like, which needs extra examination. Our response to covid has, in large part, been led by our county councils and second-tier councils, as well as by local resilience forums. Those bodies are increasingly powerful, and increasingly relevant to our constituents and the population of the regions. Now, more than ever, the BBC should be focusing on that issue, and not withdrawing from it.

[Mr Perkins]

I could not agree more. Coronavirus has brought into sharp focus the need for a local response, given the extent to which local areas are experiencing a global pandemic in different ways. In London, coronavirus hit hard up front, and there were then regional variations as it went on, and differences in local responses. Local clinical commissioning groups responded differently regarding testing and the availability of personal protective equipment, and the public must be able to learn about such issues locally, and to scrutinise and question their politicians about that response. Ministers have stood at the Dispatch Box and been asked to respond on a national basis, but politicians must also be held to account for what is happening in our local areas with testing, PPE, care homes, and all those sorts of things.

--- Later in debate ---

[Jerome Mayhew (Broadland) (Con)]

There have been many good contributions this evening in which hon. Members have raised all the broad issues relating to the decision the BBC has to make. I will not follow those; instead, I will focus on a single specific issue, which is the nature of political discourse and the contribution that local and regional BBC coverage makes to supporting good-quality political discourse. That is a very important issue for our time.

Perhaps it is because of the rise of social media, but there is an amplification of anger, which we all experience in our political lives and in the political life of the nation. Anger and confrontation, the virtue-signalling “gotcha” moment, the classification of the opponent as the “other”, the near-dehumanisation of political opponents —all these things are corrosive of our national political life. In my view, the BBC’s national political output is running very close to following that negative development.

One has only to look at “Newsnight” to start thinking of it as the telecast equivalent of the “gotcha” tweet, with constant interruptions and the imposition of the journalist’s viewpoint over that of the politician, regardless of their party or political viewpoint, who is being asked to express their view and is then prevented physically from doing so. Compare that with “Sunday Politics” and the regional coverage of the BBC, where we see time being given to politicians to make their political point and then to be challenged on it—not shouted at or interrupted, but respectfully challenged in a hard-hitting manner in a discourse that is polite, where the nuances can be seen, rather than the black versus white that the “Newsnight” type of environment encourages. It is discursive, not abusive, and it can focus on local issues which, as I mentioned in an intervention, are becoming more, not less, important as time goes on. As we devolve power to the regions, as we get more elected metropolitan mayors, as the impact of the actions of our county and second-tier councils is more apparent in the lives and the quality of life of our constituents, so we should focus more, not less, on local issues.

I regard the national political focus of the BBC as being more equivalent to PMQs, and “The Politics Show” and the time that is given to it as being more equivalent to the quality of this debate. I leave it to the House to decide which is the most edifying.