Oral Answers to Questions

Jonathan Reynolds Excerpts

Thursday 13th March 2025 Commons Chamber

[Luke Akehurst (North Durham) (Lab)]

6. What assessment his Department has made of the potential impact of the national minimum wage and national living wage on families.

[The Secretary of State for Business and Trade (Jonathan Reynolds)]

More than 3 million workers are expected to receive a pay rise due to increases to the national minimum wage in April, protecting the lowest paid in society. After our changes to the remit, we accepted in full the recommendations of the Low Pay Commission, which considers the impact of rates on business, competitiveness, the labour market, the wider economy and the cost of living. Our impact assessments are available only by region—estimates by constituency are not available—but the simple truth is that workers in every constituency are better off under this Labour Government.

[Kenneth Stevenson]

I thank the Secretary of State for that answer. Just yesterday, Parliament approved Labour’s new deal for working people—the biggest upgrade to workers’ rights in a generation. This will see a pay rise for more than 200,000 working Scots, many in the Airdrie and Shotts constituency, and a marked improvement to terms and conditions, which will be beneficial to our young workforce. Does he agree that with a Government committed to improving the pay, terms and conditions of workers across the country, the working people of Airdrie and Shotts will always get a better deal with Labour?

[Jonathan Reynolds]

The plan to make work pay is a core part of our mission to grow the economy, raise living standards and create opportunities for all, and there will be significant benefits for workers in insecure and low-paid jobs in central Scotland, including in Airdrie and Shotts. This plan is about making people stay in work. It is about making work more secure and more family-friendly, improving living standards and putting more money in workers’ pockets, but it is also about showing that politics can work for people who may have given up on this place as somewhere that can improve their living standards, their lives and those of their families. For that, I am very proud of this Government.

[Luke Akehurst]

The 6.7% increase in the national living wage in April clearly shows that this Labour Government are on the side of working people in North Durham and across the country and are making work pay. Can the Minister tell me how many families in north-east England will benefit from the increase in the national living wage and national minimum wage next month?

[Jonathan Reynolds]

I thank my hon. Friend for his support. Around 140,000 workers in north-east England will feel the benefits of this direct pay rise. I know his North Durham constituency well—I am no stranger to Chester-le-Street—and not only will his constituents get a pay rise, but his local shops, his restaurants, his pubs and more will get what they need most of all: customers who have got a bit of money to spend.

[John Lamont (Berwickshire, Roxburgh and Selkirk) (Con)]

Last Friday, I spent the day visiting local shopkeepers in Kelso, many of whom employ their staff on the national minimum wage and the national living wage. Their biggest pressure just now is dealing with this Labour Government’s national insurance hike. They are facing a very difficult choice about whether they continue to employ people. What is the message from the Minister to those hard-working local shopkeepers?

[Jonathan Reynolds]

The thing I would cite most of all to the hon. Member’s constituents is the doubling of the employment allowance in the Budget and the threshold being removed, which means that some smaller businesses will actually be paying lower national insurance contributions than they would have paid before the Budget. However, I never shy away from the fact that the choices we had to make in the Budget were out of necessity, due to the black hole that was left behind. I am yet to hear any offer from Conservative Members as to how they would fill it.

At these questions, we will talk about tripling compensation for victims of the Post Office Horizon scandal only because the money is there. It was not there under the Conservative party. We will talk about money for the steel industry, standing behind that industry. Again, money was promised but not delivered. If promises are made, the resources to do those things have to be there. They were not there under the Conservative party. They are under Labour.

[Robbie Moore (Keighley and Ilkley) (Con)]

Whether it be the increase in the minimum wage, the increase in employer national insurance, the increase in business rates, or indeed the changes made to the Employment Rights Bill, all of these measures collectively are negatively penalising many businesses across my constituency, whether in Keighley, Ilkley or further afield. As a result, redundancies are having to be made, or the price of products and services are having to increase, and these businesses cannot absorb the additional increase that this Labour Government are putting on them. Did the Government undertake any economic impact assessment of what all of these measures collectively would have on hard-working businesses across my constituency?

[Jonathan Reynolds]

As I have said to Conservative Members before, of course we are very sensitive to the aggregate impact of Government policy, because, frankly, having observed the Conservative Governments of the previous 14 years, I thought they completely missed this point and at many times had different Departments doing completely opposing things.

I want to say something specific on business rates. No business rates relief was planned had the Conservative party won the election. The reduction to 40% was an increase in what was in the national accounts—again, short-term decisions for short-term, partisan, political benefit; no serious plan for the future.

The hon. Gentleman will have seen the figures from the Insolvency Service this week, which are very interesting. They show that fewer people have been made redundant over the past 12 months than in the year before, so I am afraid that the doom-mongers of the Conservative party have been proved absolutely wrong by the statistics that we have.

[Tony Vaughan (Folkestone and Hythe) (Lab)]

7. What steps his Department is taking to help microbusinesses comply with the general product safety regulations.

--- Later in debate ---

[Dr Allison Gardner (Stoke-on-Trent South) (Lab)]

14. What steps his Department is taking to support small businesses.

[The Secretary of State for Business and Trade (Jonathan Reynolds)]

Small businesses need a better deal—certainly better than the one they got from the last Government—and our small business strategy, which is due this year, is designed to do that. We have already provided more support through the British Business Bank; we have worked with the Federation of Small Businesses to take action on issues such as late payment and retail crime; and we have announced the creation of the new business growth service, which aims to transform business support services. Later today I will attend a small business summit in Sussex to progress those plans and meet small business leaders.

[Alex Baker]

Too many small and medium-sized defence businesses in my community struggle to access the banking and finance facilities they need, often on the basis of self-imposed ethical criteria. Will the Business Secretary join me in welcoming how many investors and financial institutions have responded to the campaign I am leading with my hon. Friend the Member for York Outer (Mr Charters) and 100 other Labour parliamentarians, calling on our banks and fund managers to broaden their approach to defence investment? Will he call on investors to take action so that we can defend our country, support Ukraine, and fire up our industrial base?

[Jonathan Reynolds]

I agree 100% with my hon. Friend and thank her very much for her question. She will know that my Department, alongside the Treasury and the Ministry of Defence, convened a roundtable in December to listen to these perspectives, and now all three Departments are working together to ensure that the problems she has articulated do not occur.

It is essential that the British people do not think that the substantial, significant and historic investments in defence that this Government are making come in some way at the expense of domestic prosperity. There is no prosperity without security, but we should also acknowledge the tremendous economic contribution made by our defence sector—there is not a foreign and domestic split in that regard. I thank my hon. Friend for her outstanding leadership in galvanising parliamentary support for that campaign, and I hope it will have unanimous agreement in every part of the House.

[Dr Gardner]

As the Secretary of State is aware, the ceramics industry, including in my constituency of Stoke-on-Trent South, is facing immense competition from imported counterfeit goods. Many of those goods contain false backstamps that mislead consumers and—as the GMB union has raised with me—threaten great British companies such as Dunoon, Duchess and many others. Will the Minister meet me again to discuss in more detail creating offences and tabling regulations to deal with imported counterfeit ceramic goods?

[Jonathan Reynolds]

My Department has a very strong relationship with the ceramics sector through the Energy Intensive Users Group. We have regular meetings with that group, and I would also like to mention the British Ceramic Confederation and our old friend Rob Flello, who is a strong voice for the sector. There are many challenges for the ceramics sector, not least decarbonisation, but on the subject of consumer protection, it is firmly against UK consumer law for firms—wherever they are located—to give consumers false information, such as through fake product markings. We have strengthened the regime in this regard, with new enforcement powers for the Competition and Markets Authority coming into force next month, but I will of course get my hon. Friend any meeting she requires.

[Mr Gagan Mohindra (South West Hertfordshire) (Con)]

A constituent in Chorleywood recently contacted me after needing an emergency locksmith due to a broken key. Initially quoted £40 over the phone, she was later charged £1,460, and was only given the new key after making that payment. While I applaud this Government’s ambition to reduce regulation, can we ensure that there is appropriate regulation so that consumers are not unfairly overcharged, as in this instance?

[Jonathan Reynolds]

I, too, have heard the kinds of stories that the hon. Gentleman has articulated—there are definitely concerns in that regard. Broadly, the Government’s regulation agenda is not necessarily about deregulation, but about effective and proportionate regulation. I feel that our regulatory sector has grown a lot in recent years, and that it does not always compare well to those of other countries in terms of timeliness and business response. That is the agenda we are pursuing, but I will certainly write to the hon. Gentleman about the issues he has raised, which are very relevant. I appreciate the opportunity to do so and thank him for raising them today.

[Alison Bennett (Mid Sussex) (LD)]

Many families are supported by the work of my constituents, Alison and Kevin, who run a small care business. They tell me that they already operate on tight margins in a sector under huge pressure. The hike in employer national insurance contributions will force them to make tough decisions on staffing and simply reduce the amount of care they can offer. Kevin and Alison rightly say that this hike makes no sense at a time when the Government tell us that they want to move to community care provision and get people out of hospitals. Does the Secretary of State not agree?

[Jonathan Reynolds]

I thank the hon. Member for her question, and I thank Alison and Kevin for their important work. We already talked about the difficult choices that the Government faced and the unenviable choices that had to be made. Health and social care was a beneficiary of the additional revenue that needed to be raised to meet some of the challenges we face, but we are not casual about the impact of that, and we recognise the pressures that come from that. I would say that I do not agree. Taxes have to apply to every sector, and we cannot carve out certain sectors. However, I appreciate the pressures that she articulates. That is why the rest of the Government’s agenda is set to address all those factors.

[Mr Speaker]

I call the Liberal Democrat spokesperson.

[Clive Jones (Wokingham) (LD)]

Small businesses are the backbone of the British economy. Up and down the country, we have success stories of innovative start-ups and family-run businesses that should be part of the Government’s plan to get Britain growing again. Under the Conservatives, the number of small businesses in my constituency decreased by 360 between 2021 and 2024. The Tories messed up our national and local economy. Is the Minister concerned that his Government’s national insurance rises will damage the economy, just as the Conservatives did?

[Jonathan Reynolds]

If we were listing the difficult things that small businesses had to deal with in the previous 14 years, we would be here for most of the day and the weekend, if we are being honest. Whether it is how the Conservatives handled Brexit, the mini-Budget or austerity, we could go on and on. I say to the hon. Member that we are not casual about what we have had to ask of business because of the unenviable situation we inherited, but the fundamentals of the UK are incredibly strong in political stability and openness to the world, and we have the changes we are making to planning, skills, regulation and energy to make sure we are delivering.

[Mr Alistair Carmichael (Orkney and Shetland) (LD)]

13. What recent assessment he has made of the potential impact of changes to employer national insurance contributions on small and medium-sized enterprises.

--- Later in debate ---

[Joy Morrissey (Beaconsfield) (Con)]

T1. If he will make a statement on his departmental responsibilities.

[The Secretary of State for Business and Trade (Jonathan Reynolds)]

My Department works night and day to deliver our plan for change by making Britain the best place to invest, work and do business. This Government have provided political stability and openness to the world, and we are continually improving the business environment.

Since the last Business and Trade questions, we have published a new steer for the Competition and Markets Authority so that it has growth and investment in mind, and more pro-business regulatory reforms will follow. In Delhi last month, I relaunched our trade negotiations with India, and I have just returned from Tokyo, where the Foreign Secretary and I announced a first-of-its-kind industrial strategy partnership with Japan. We are also ensuring that our “make work pay” reforms deliver for businesses and workers.

Finally, we have engaged closely with the new US Administration, including Commerce Secretary Howard Lutnick and the new US trade representative, Jamieson Greer. The new US trade policy is challenging, but we believe that our decision to engage and seek potential agreement on a new economic deal between the UK and the US offers us an opportunity to ensure that the UK is the best-connected market in the world.

[Joy Morrissey]

Businesses across Beaconsfield, Marlow and the south Bucks villages are facing crippling costs from the Government’s national insurance tax raid and the Employment Rights Bill. Can the Secretary of State reassure or advise my businesses? Should they stop hiring, cut staff, increase prices, or all of the above?

[Jonathan Reynolds]

I would say that businesses in the hon. Lady’s constituency should contact their local Conservative MP and say, “What was your plan?” because I think we have had three oral question sessions where this has broadly been the only thing that the Conservatives have to say. I genuinely want to know: what was the plan to pay for Post Office compensation? What was the plan to pay for the steel industry? When the Conservatives commissioned the public sector pay bodies with the remit that they were given, got the findings back, hid them and did not tell the British people during the general election campaign, what was the plan? How would they have reconciled that? The small business leaders, and businesses of every size, in the hon. Lady’s constituency know how to make difficult decisions. What—

[Mr Speaker]

Order. Look, this is getting ridiculous. We are on topicals, and that is the worst example I have seen of an answer to a topical.

--- Later in debate ---

[Andrew Griffith (Arundel and South Downs) (Con)]

How have we got to this point? After 35 weeks as Trade Secretary, 18 weeks since the US election, and an entire month since steel and aluminium tariffs were first announced, the Secretary of State is only now going to sit down with the Secretary of Commerce of our closest ally. While he has been correcting his CV, steelworkers and businesses are hurting today. This is a colossal failure of trade policy on his watch. Why has it taken so long, and when can we expect an agreement?

[Jonathan Reynolds]

The hon. Gentleman may have not seen the news recently, but the UK, led by our Prime Minister, has had the best engagement of any country with the new US Administration. Is it not good to see again a British Prime Minister who is respected on the world stage and delivering for Britain? We have had tremendous engagement with the new US Administration, and I am looking forward to meeting them in person next week.

[Andrew Griffith]

Once again, no answers come there forth. Over 1 million jobs in this country depend on trade with the United States, including thousands of jobs in our steel industry. The Secretary of State does not know when he is going to get a deal. Will he publish his red lines for that deal, his objectives and what he hopes to achieve from meetings next week?

[Jonathan Reynolds]

On steel and aluminium tariffs, the US Administration’s position is that there are no exemptions for anybody—that is across the board. I think they recognise the very strong case that we have, but that is their position.

No, I will not publish my negotiating red lines before a negotiation. Frankly, that is the worst advice I have ever heard in the House of Commons. The Conservative party fell out with the EU, would not deal with China and could not do a deal with India. It fell out with the United Arab Emirates and could not do a deal with the Gulf. It got nothing out of the US. It did deals with Australia and New Zealand, then disowned them. We will take no lessons from the Conservatives.

[Jo Platt (Leigh and Atherton) (Lab/Co-op)]

T4. Social enterprises contribute 3.4% of GDP, and towns such as Leigh and Atherton benefit greatly from them. Will the Minister outline what the Department is doing to support social enterprise and co-operatives so they can contribute to the growth agenda in the UK?

--- Later in debate ---

[Clive Jones (Wokingham) (LD)]

If the Government have to push forward with retaliatory measures against the United States for its steel tariffs, they must strike at the political allies of the President to meaningfully move on the conversation. Can the Secretary of State confirm whether Elon Musk’s Tesla is being considered as a potential target for retaliatory measures?

[Jonathan Reynolds]

We reserve the right to take any action in response to any changes to our trading relationships, but I do think we can look to the opportunity for the UK, which is greater than for any other country, to get to an agreement that improves our terms of trade with the US. I reserve the right to take any action, but I think we can look forward in a positive way to improving that trading relationship, and that right now is my message and focus.

[Mr Speaker]

I call Chris Bloore.

--- Later in debate ---

[Mr Speaker]

It was Chris Bloore’s turn. I am following the Order Paper, but I am going from side to side. Chris Law will come afterwards; he was not next.

[Jonathan Reynolds]

There are many Members called Chris.

I thank my hon. Friend for his question. As he will know, the creative industries are part of our industrial strategy. We are hugely proud of their soft power and economic impact, and of course we will get him the meeting he requests.

[Mike Wood (Kingswinford and South Staffordshire) (Con)]

T3.   I draw the House’s attention to my entry in the Register of Members’ Financial Interests. Some 66% of hospitality firms say they will have to cut staff or staff hours, 75% say they will cut investment, and 97% say they will increase prices because of the Chancellor’s manifesto-breaking national insurance increases. What assessment has the Minister made of the number of workers being dragged into national insurance contributions for the first time, and if the Government must continue with this disastrous policy, will they at least delay it for 12 months to bring it into line with the introduction of business rates reforms?

--- Later in debate ---

[Chris Law (Dundee Central) (SNP)]

T5. Thank you, Mr Speaker. The US President said that the EU was created to “screw over the US”. However, while the EU stood up for its economy and imposed a $28 billion counter-tariff, the UK is being screwed by the US, which has made it clear that the UK will not be an exception to its levies, despite the Prime Minister’s pleading. Will the Secretary of State tell me whether the Government are content to remain a bridge between the EU and the US if it is a bridge that the US continues to walk all over, risking the UK economy with every single step?

[Jonathan Reynolds]

The simple position is that we will represent the UK’s national interest in this matter. The US has objections about its significant deficits in manufacturing goods with China and the EU, but that is not the relationship between the US and the UK, so there is a chance for the UK to pursue a different policy —one that produces greater benefits for every part of the UK than perhaps are available to other countries. Of course we are cognisant of the overall impact—no one wants to see this type of turmoil in the global economy—but our job is to deliver for the UK, and that is exactly what we are focused on doing.

[Amanda Hack (North West Leicestershire) (Lab)]

T8. Rural businesses in North West Leicestershire highlight the lack of accessible public transport, including having no passenger rail, as a barrier to attracting new employees and to growth. What conversations has the Minister had with the Department for Transport about the barriers that rural businesses are facing?

--- Later in debate ---

[Liam Byrne (Birmingham Hodge Hill and Solihull North) (Lab)]

President Trump’s new tariffs are double trouble for Britain’s steel and aluminium suppliers. They will dent £350 million of sales, but they also risk swamping the UK with over-subsidised Chinese steel diverted from America. What is the Secretary of State’s game plan now to redouble defences for our UK metal makers?

[Jonathan Reynolds]

I am incredibly grateful to the Chair of the Business and Trade Committee for that question. He is right to say that the challenge here is not just the direct trade we have with the US, but the impact of trade diversion. He knows we already have 16 anti-dumping, anti-subsidy measures in place against 14 separate product categories. Once the annual tariff-free quota is hit, a 25% tariff applies to those. I can tell him and the House today, though, that I will support UK Steel’s application to the Trade Remedies Authority for a review of the steel safeguards—we do have to think about what will be coming—and a new one for the aluminium sectors.

[David Mundell (Dumfriesshire, Clydesdale and Tweeddale) (Con)]

I am sure that Ministers will join me in welcoming the £90 million investment by dairy firm Arla in the plant in my constituency, which will create up to 90 jobs. Does not that reinforce the fact that agriculture remains at the heart of the rural economy in constituencies such as mine? Should not the Government be supporting that industry, rather than trying to destroy it?

--- Later in debate ---

[Ellie Chowns (North Herefordshire) (Green)]

In my constituency, a planning moratorium has been in place for more than five years due to water pollution, with an estimated effect on the local construction industry of half a billion pounds, despite the fact that new house building is a minute proportion of the problem. Will the Secretary of State meet me and representatives of the Herefordshire construction industry to try to find a solution to this devastating problem?

[Jonathan Reynolds]

The frustration that comes across in the hon. Lady’s question relates to exactly the sort of problem the Government are fixing. I would be more than happy to work with her and any Secretary of State or Department necessary to unblock that for her.

[Julia Buckley (Shrewsbury) (Lab)]

Will the Minister outline what steps the Department is taking to help increase trade with the Asia Pacific, and in particular the Philippines, where a major local company in my constituency, Beaver Bridges, is hoping to expand and grow significantly, with the trade support of this Government?