UK Trade and Investment

Debate between Laura Sandys and Julian Smith

Thursday 15th March 2012 Westminster Hall

[Laura Sandys (South Thanet) (Con)]

I am extremely honoured to be speaking under your chairmanship, Mr Amess. From one seaside town Member to another, I should say that we ought to be on the beach rather than in here. However, some things are far more important for us and our constituents. I thank the Backbench Business Committee for giving us—myself and my friend the hon. Member for Brent North (Barry Gardiner)—the opportunity for this debate.

Although this place has paid little attention to UK Trade and Investment, the Government have put significant focus on the organisation. They announced an extra £45 million of funding in the autumn statement and they have recruited one of the most influential businessmen to be Minister for Trade and Investment. We have a Cabinet Committee that is focused on growth and that has a key input from UKTI. Even this week, we can point to results in which UKTI has been instrumental: Lockheed Martin, Nissan and Jaguar Land Rover investments and reinvestments in the UK. We can point to some very positive things that have materialised from the attention and focus that UKTI has put on our inward investment and trade initiatives.

UKTI has also created a key platform for some additional areas such as the global green growth initiative. I am very excited and keen that we promote that further. UKTI has forged and developed unilateral free trade agreements and last year launched the charter for business. There has also been a focus on high-value opportunities. The three areas of investment announced this week are part of that range of high-value opportunities that we need to secure for our long-term future.

I also hear from large businesses about how welcome Lord Green’s leadership is and about his commitment to the role. However, I am concerned to see the speculation that he might get pinched by the Bank of England. I hope that our Ministers in the Department for Business, Innovation and Skills are securing him—locking him in the office and pinning him down on his chair.

Although things are going well for UKTI, we cannot forget that we are not operating in normal times. As every clichéd politician has said, “We’re all in this together.” However, certain departments are more involved in the job of getting us out of this mess than others. There is probably no more important department involved in that than UKTI. I am therefore very pleased we are having this debate today.

For certain personal and constituency reasons, I am particularly interested in UKTI, not least because, a year ago, Pfizer—one of my largest employers—decided to withdraw many of its staff. It is therefore absolutely crucial for me and my constituency to understand more about how UKTI functions, and what it does to develop and attract inward investment.

On a personal level, I have worked for what was called the Department of Trade and Industry in its inward investment unit. I have also worked in many countries, from countries in the Caucasus to Peru and Argentina. I have seen for myself how people engage when it comes to inward investment and how trade missions work—or, as has frequently been the case, do not work. It is important that we in the House have an opportunity to debate something that has such an impact on our constituencies. Many of us have had experiences of inward investment and trade in our lives before we came into Parliament.

So if everything is going so well, why do we need this debate? Success is not enough if it is only expressed in our own terms. Unlike other departments, UKTI is operating in an aggressive, competitive environment and, in many ways, is not trading in isolation from others. A key national priority for any country—whether it is democratic or not—is domestic prosperity. That means that trade and inward investment for every country, particularly emerging countries, is becoming a very big priority.

If we really believe that, we must believe that, for example, a job from Samsung that goes to Hamburg is a job that has potentially been lost from the UK. If I have to declare this, I will: I happen to be half French—[Interruption.] It is something that I have to bear. I have therefore seen how the French operate globally in both the trade and the inward investment sector. All I can say is that our competitors certainly know how to finish the race sometimes before us.

[Julian Smith (Skipton and Ripon) (Con)]

Will my hon. Friend give way?

[Laura Sandys]

On the French aspect? I have apologised.

[Julian Smith]

Will my hon. Friend give some specific examples of how the French have managed to seal the deal?

[Laura Sandys]

Some examples are a bit difficult to repeat in public. On a serious note, the French have always had a very clear focus. Since the second world war, both their diplomats and their whole political structure have been focused on understanding economic diplomacy.

--- Later in debate ---

[Laura Sandys]

I welcome my hon. Friend’s intervention. As yet I am not too sure what an LEP is. I think that they are evolving and creating their own personalities. An interesting thing is that they do not fall into the same category as the RDAs, which were similar in every different region. My area is part of a large LEP, comprising Essex, Kent and east Sussex. In many ways, that creates a different sort of LEP than smaller ones. LEPs are evolving.

I am not concerned about the future of how LEPs operate. We have 18 months to two years of interregnum, in which we need to get our inward investment pitch out. We must put forward the best that we have to offer. The rest of the world is crawling all over business opportunities while we are waiting for structures. I do not have time for structures, particularly in my area, where, as I have said, Pfizer has decided to downsize quite dramatically. Life science jobs based in Sandwich are walking away every day, because the marketplace is an international one. The jobs are not fixed in Sandwich; they are leaving and going to Shanghai, and they are being recruited for around the world. Waiting for structures to be in place is not going to be good enough for some areas where we need to move fast and be nimble and commercial.

Are we sure that we have the right sort of people working in the area? The people are extremely bright, and I have met some of the most intelligent and committed people working at UKTI. However, we need to think about whether they are commercial people. I know that including PA Consulting is an extremely important part of involving the private sector. I put my hands up to say that I used to run a consultancy, and I worry that sometimes consultancies are not the private sector; they become an extension of a client, although it is still important to have that input. We need to be clear who has international experience working at the sharp end.

Perhaps my greatest surprise came when I was talking to someone about the issue in one of our Departments. They said, “We are spending a lot of money on languages. It is fantastic, Laura. We are going out there and ensuring that all our diplomats speak all these wonderful languages in all these emerging economies.” I looked a bit aghast, and they were a little disheartened that I was not excited about that. I said, “Do you know that 220 languages are already spoken in this country? Do you know that we have the opportunity to recruit people whose cousin, uncle, aunt or existing business partner already works and lives in these countries?” With absolutely no disrespect to anyone with a classics degree from Oxford or Cambridge, someone whose grandfather comes from Punjab is possibly a better person to build our relationships and business contacts with those particular countries, in those communities, than someone who is learning Punjabi for the first time.

One of the exciting things about this country is that we are the Commonwealth in minutiae—we are a reflection of our past, which gives us a huge asset for our future. We need to look again at the sort of people whom we are presenting as the face of Britain, and also at who can be effective. I throw a challenge to UKTI: if it recruits a selection of such people to be our face in the emerging markets and says, “Take 100 small businesses with each of you, try to nurture them and help them to have trade relations in particular areas, support them in the first year, ensure that they are not entering into contracts with someone who is a little sharp in the area or who will not deliver, and nurture them through the first year of export or joint partnership”, we will get a much bigger increase in exports and enter into global relationships with small and medium-sized businesses. We have a unique asset, but I am just not sure that we are using it.

[Julian Smith]

Does my hon. Friend agree that as well as the international face of UKTI, we potentially need to look at the skills that we are presenting to the domestic customer base of UKTI? What types of skill and commercial experience does she feel are required to seek out export-hungry companies throughout Britain?

[Laura Sandys]

I welcome my hon. Friend’s intervention. I have started two small businesses, both in the middle of recessions. We do not have enough people who have a business focus.

I was quite surprised that 1,000 people work in UKTI in different regions of the United Kingdom, and there may be great value in that. I would like to see a lot more of them in our constituencies, perhaps using the opportunities that Members of Parliament can offer, so that they can understand a particular constituency.

We need a much stronger commercial focus. Small businesses have one language; in a strange way, it is almost a universal language. It can travel even if people do not speak the same language. It is more important to have that business language when people talk to someone else than it is necessarily to have location or certain areas of expertise. We need more commercial people.