Oral Answers to Questions

Kevin Hollinrake Excerpts

Thursday 7th March 2024 Commons Chamber

[Craig Tracey (North Warwickshire) (Con)]

3. What steps her Department is taking to support small and medium-sized enterprises through the Small Business Council.

[The Parliamentary Under-Secretary of State for Business and Trade (Kevin Hollinrake)]

On 1 February, the Government reaffirmed our commitment to all the UK’s 5.5 million small businesses with the creation of the new Small Business Council, which is looking at key areas, such as improving business support, access to finance, support and advice, and breaking down barriers, including barriers to female entrepreneurship.

[Craig Tracey]

As chair of the women and enterprise all-party parliamentary group, it has been fantastic to see the boom in female-led businesses over the past few years. We now want to see consideration of how some of them can grow. Can the Minister set out how the new Small Business Council can help them to do that?

[Kevin Hollinrake]

I thank my hon. Friend for his question and for all he does for women in entrepreneurship and on the APPG, on which he has worked for many years. The Small Business Council has excellent entrepreneurs on it, such as Emma Heal from Lucky Saint and Julianne Ponan from Creative Nature, who we rely on for expert advice. We also have the investing in women taskforce, which has helped to increase the number of female entrepreneur businesses from 56,000 in 2018 to 150,000 in 2022. The investing in women code has 240 signatories. We are keen to do more and to work alongside my hon. Friend to ensure that the world of entrepreneurship is as friendly as possible to female entrepreneurs.

[Mr Barry Sheerman (Huddersfield) (Lab/Co-op)]

Will the Minister ask the Small Business Council to wake up to the opportunities in the hydrogen sector, not only in terms of the engineering that supplies that sector, the coming replacement of batteries and all that transportation stuff, but in the infrastructure of our country? We have great engineering that is ready to go with a hydrogen future. When will he wake up to that opportunity?

[Kevin Hollinrake]

We already have woken up to that opportunity. As the hon. Gentleman knows, we have great opportunities in hydrogen in Teesside and in Yorkshire, with the Humber hydrogen cluster. It is something we are keen to support as a Government, and I would appreciate it if he offered his support, too.

[Mr Speaker]

I call the shadow Minister.

[Rushanara Ali (Bethnal Green and Bow) (Lab)]

The perfect storm of rising borrowing, rent and labour costs is continuing to cripple businesses, and the UK small business index fell 78 points last December, according to Xero Small Business Insights, to the lowest reading since the middle of the pandemic in August 2020. The Government have had 14 years to tackle the barriers facing SMEs. What specifically will the Small Business Council do, and what will Ministers do to halt the alarming trend of more businesses closing than opening?

[Kevin Hollinrake]

I am sorry that the shadow Minister is so pessimistic about the world of business. We have spoken at events together many times, and she hears the mood in those audiences, which is far more positive than she sets out. We are active in many areas, as she knows. At the event we both spoke at this week, I talked about access to finance, support and advice, and removing barriers. Access to finance has been key, with £1 billion of Start Up loans having been made to 100,000 businesses. If she listened to the Budget yesterday, she will have heard about the rise in the VAT threshold and the growth guarantee scheme. There are many opportunities for small businesses. We will have 200,000 more workers coming back into the workplace, tackling another barrier for businesses. Get with the programme; it is much more exciting than she thinks.

[Nicola Richards (West Bromwich East) (Con)]

4. What recent progress her Department has made on negotiating a free trade agreement with Israel.

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[The Parliamentary Under-Secretary of State for Business and Trade (Kevin Hollinrake)]

Some 130,000 children are in the care of close family members in England alone. We recognise the vital role that kinship carers play in looking after children who cannot live with their parents. Last year, the Government published the national kinship care strategy and announced a £20 million package of support for kinship carers in 2024-25.

[Munira Wilson]

The Minister just referenced the Government’s kinship strategy, which was published in December. Their own strategy has recognised that kinship carers in employment often report the need to give up work or reduce their hours to be able to care for the children they support; it cites a survey revealing that 45% of kinship carers give up work and a similar number have to reduce their hours permanently. Given the Minister’s desire to drive up employment and the fact that kinship carers stepping up overnight to look after children saves the taxpayer a huge amount of money in comparison with when children go into local authority care, why are the Government not making paid employment leave a statutory right and only publishing guidance?

[Kevin Hollinrake]

The hon. Lady raises a very important point. We call on local authorities to be considerate to people who are in employment when they take on a child to look after in a kinship care situation. We think that employers are the right people to make sure that any provision we provide is a floor, not a ceiling. Companies such as John Lewis take a very considerate approach to people in that situation. We urge them to do so, but we also encourage local authorities, which have budgets allocated to this particular issue, to provide support where they can.

[Matt Western (Warwick and Leamington) (Lab)]

12. If she will make an assessment of the potential impact of infrastructure on levels of business investment.

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[Christine Jardine (Edinburgh West) (LD)]

14. If she will make an assessment of the potential impact of regulatory costs on small and medium-sized enterprises.

[The Parliamentary Under-Secretary of State for Business and Trade (Kevin Hollinrake)]

We are hacking through the red tape, not least with our smarter regulation programme. We have announced reforms to employment law and the recording requirements of the working time directive, which will save UK businesses up to £1 billion, particularly benefiting SMEs.

[Christine Jardine]

I note that the Minister welcomed yesterday’s Budget as helping small businesses, particularly in the hospitality sector, which is very hard hit in my constituency. One of the problems that many businesses tell us about is the business rates system. More businesses have failed in the past two and a half years than have been established. In Scotland, we often find that while the downsides of this Government’s policy are happily passed on by the Scottish Government, any benefits are not. We would like to see complete reform of the rating system—not tinkering but reform. Can the Minister tell us whether widespread reform is planned? How would he plan to do it? How could businesses in Scotland also benefit?

[Kevin Hollinrake]

The hon. Lady is absolutely right to point to some of the difficulties in the hospitality sector. I speak to hospitality entrepreneurs in my constituency and across the country who are finding it difficult, which is why we stepped in with, first, a package of about £13 billion of business rates support, and there was £4.3 billion of business rates support last autumn. We passed the equivalent moneys on to the Scottish Government to pass on to their hospitality venues, but they passed on none of it.

A typical pub in Scotland is £15,000 worse off than a typical pub in England, and a typical guest house is £30,000 worse off. That is why Scotland has a 30% higher failure rate than England. Similarly, a typical pub in Labour-run Wales is £6,000 worse off and a typical guest house is £12,000 worse off, and there is a 19% higher failure rate. It is critical that the benefits are passed on to those businesses, and that we look for structural reform. Anyone who wants to scrap business rates needs to show where the £22.5 billion of income will come from, rather than simply saying that they will scrap them without announcing a replacement.

[Christian Wakeford (Bury South) (Lab)]

15. What assessment she has made of the effectiveness of publicly naming employers for the enforcement of the national minimum wage.

[The Parliamentary Under-Secretary of State for Business and Trade (Kevin Hollinrake)]

Since 2011, we have published 20 press releases and named around 3,200 employers that have, in total, repaid over £41 million in arrears to over 460,000 workers. We have recently had round 20 of the scheme.

[Christian Wakeford]

Naming and shaming serves as a deterrent, but should we not go further against persistent offenders? Paying the minimum wage is not an opt-out; it is a law that no company is above. Stronger penalties, including fines proportionate to the severity of the violation, to ensure that no employer can exploit its workers with impunity, would level the balance between employers and employees. Will the Minister commit to exploring these measures to safeguard the rights and the dignity of workers?

[Kevin Hollinrake]

The hon. Gentleman is right to point to this measure. We know that naming and shaming is a significant deterrent against underpayment of the national minimum wage, and we are very keen to ensure that naming continues. Alas, in the most recent naming and shaming round, 2,800 minimum wage investigations returned more than £16.3 million in arrears to over 120,000 workers. His Majesty’s Revenue and Customs issued businesses with nearly 700 fines, totalling £13.2 million. As the hon. Gentleman recognises, naming and shaming alone is a significant deterrent and we intend to continue doing it.

[Mr Speaker]

I call the shadow Minister.

[Justin Madders (Ellesmere Port and Neston) (Lab)]

My hon. Friend the Member for Bury South (Christian Wakeford) is right that too many employers still think they can opt out of paying the minimum wage. Earlier this week, the Low Pay Commission published its 2023 report, which said that non-compliance “appears persistent” in the social care sector. I have heard a range of evidence citing problems with record keeping, exploitation of migrant workers, and workers routinely not being paid for travel time.

It is clear that the social care sector has a real issue with the minimum wage but, when browsing through the latest naming and shaming list published by the Department a couple of week ago, I found only 17 employers classed as being within the social care sector, which is less than 0.1% of the total number of employers in the sector. What will the Minister do to ensure that everyone working in the social care sector gets at least the minimum wage?

[Kevin Hollinrake]

The hon. Gentleman is right to raise this issue, on which we do much. For example, we make sure that people can anonymously report the underpayment of the national living wage through either His Majesty’s Revenue and Customs or ACAS. It is really important that we do that. We have labour market enforcement undertakings and orders, and we provide the tools for serious cases. As of April 2022, 40 employers were on labour market enforcement undertakings and 18 employers have been prosecuted. The message should be loud and clear to employers that if they do not comply with the law, we will take action.

[John Penrose (Weston-super-Mare) (Con)]

17. When she plans to publish the smart data road map.

[The Parliamentary Under-Secretary of State for Business and Trade (Kevin Hollinrake)]

My officials are co-ordinating and leading on the drafting of the road map, which will set out the Government’s ambition for future smart data scheme development across seven different sectors. We will publish that very shortly.

[John Penrose]

I am delighted to hear that the road map is coming very shortly. My hon. Friend will recall that I asked this question just before Christmas and he said it would be out in January. We were then hoping it might be coming out in yesterday’s otherwise excellent Budget, but it did not. Other countries are coming up on the rails and trying to overtake us. The noise of the approaching herd is growing in our ears, so can we please move as fast as possible on this?

[Kevin Hollinrake]

My hon. Friend is right to hold our feet to the fire on this. We are pressing forward and we are determined to get it right, not just out quickly. He rightly said that I set the ambition to get it out in January, and that has put officials’ feet to the fire as well in getting it out. I signed off the road map yesterday, so it should be out very shortly. I do not agree that other nations are hot on our heels on this issue, as we are way ahead. There are billions of calls in open banking every month, and millions are using this every day without even knowing it. We are going to extend those opportunities to energy, telecoms and, crucially, small and medium-sized enterprise finance, making the journey for SMEs to get business finance far easier.

[Grahame Morris (Easington) (Lab)]

T1. If she will make a statement on her departmental responsibilities.

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[Munira Wilson (Twickenham) (LD)]

T8. Quarter 4 of 2023 was the 10th quarter in a row in which more British businesses closed their doors than opened up. Just yesterday, a small business owner in Twickenham contacted me to tell me that his business was on the brink. If the Secretary of State will not consider business rate reform, as my hon. Friend the Member for Edinburgh West (Christine Jardine) suggested, what is she doing to help our small and medium-sized businesses, and to stem the tide of insolvencies?

[The Parliamentary Under-Secretary of State for Business and Trade (Kevin Hollinrake)]

The hon. Lady raises an important point. We do not shy away from the fact that things have been difficult for businesses, with the covid crisis, of course, followed by the cost of doing business crisis. That is why we stepped in to support businesses, with a £4.3 billion package for rates last autumn, which has helped many businesses to get through a difficult time. Unfortunately, that support has not been passed on in Scotland and Wales, but it certainly has in England. I am very happy to meet with her to discuss her particular business problem.

[Mr Laurence Robertson (Tewkesbury) (Con)]

T7. Because of its very large population and economic activity, Nigeria offers many opportunities for British businesses. I understand that there was a recent ministerial visit to that country. Could we have a brief report of the outcome of that visit?

[Liz Twist (Blaydon) (Lab)]

T9. Last week, Carl Cresswell, director of business resilience in the Department for Business and Trade, told the Select Committee that he personally thinks that we will end up spending more money on Horizon compensation overall than that £1 billion currently allocated by the Treasury, but we did not hear anything about that in yesterday’s Budget. Does the Secretary of State share that view?

[Kevin Hollinrake]

We have always been clear that the £1 billion is not a cap. Clearly, the amount of compensation that needs to be paid for redress is to get people back to where they were before the scandal took place. At the moment, we are not nearing that £1 billion, but I think that over time we will be. As I say, it is not a cap; if we need to raise the amount, we will.

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[Liam Byrne (Birmingham, Hodge Hill) (Lab)]

The Secretary of State will have seen the recommendations that our Committee set out this morning for ending the circus of the Post Office administration of the redress schemes for victims of the Horizon scandal. I know that she takes this incredibly seriously and so I know that she will study our cross-party recommendations for the new legislation that she is about to bring before the House. The question for today is this: if we put all the ongoing investigations to one side, on the basis of the facts as they are known today, does she still have full confidence in Nick Read as the chief executive of the Post Office to run the redress schemes currently under way?

[Kevin Hollinrake]

We thank the right hon. Gentleman for his work. I have taken a quick look at the report, although it was only issued this morning. All the recommendations he makes in that report we have either fixed or are fixing with the assistance of the Horizon compensation advisory board. We agree with him that we need to bring the compensation schemes in house. The GLO—group litigation order—scheme is already being delivered by the Department for Business and Trade. We believe that further compensation will flow from our overturning of convictions. We will be overturning hundreds of convictions through legislation in this House very shortly, as quickly as possible, and that will provide a flow of hundreds of millions of pounds in compensation for those individuals. That will be done by the Department for Business and Trade.

[Martin Vickers (Cleethorpes) (Con)]

As the trade envoy to the western Balkans, the issue of Government-to-Government agreements is raised with me frequently. There is no doubt that if they were available, more deals could be done with the Balkan countries. Will the Minister give an update on the Government’s position, please?

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[Richard Foord (Tiverton and Honiton) (LD)]

Mr Hussein from east Devon, whom I represent, has effectively been robbed of £100,000, given that £40,000 of sub-standard building work has to be levelled and destroyed. The Federation of Master Builders has campaigned for a compulsory licence scheme for construction companies. The Domestic Buildings Works (Consumer Protection) Bill would outlaw cowboy builders, provide compensation for consumers and ensure that reputable builders were not undercut by unlicensed rogues. Will the Minister take a fresh look at that Bill?

[Kevin Hollinrake]

The hon. Gentleman raises an important point. Some of the most frequent correspondence that I get from colleagues from across the House relates to rogue builders. We are determined to ensure that this does not happen to our constituents. We advise them to use builders registered with TrustMark, which is a trusted scheme, to ensure that work is done properly. I would be very happy to meet him to discuss that potential legislation.