Small Businesses

Lord Empey Excerpts

Tuesday 3rd February 2015 Lords Chamber

[Lord Empey (UUP)]

My Lords, I, too, congratulate my noble friend Lord Risby on securing this debate.

I want to focus on trade issues and the contribution SMEs can make to our economy. A recent statement from the European Commission forecast that the UK is on course to record the worst trade deficit in the industrial world in 2014. Howard Archer, chief UK economist at IHS, said that trade was unlikely to be a major driver for UK growth in the near term.

Even a superficial examination of our trade statistics illustrates that, even with our exports to partners in the European Union, we are achieving a monthly deficit of up to £3 billion, £4 billion or £5 billion a month. This has gone on since the 1980s, which was the last time that we had a trade surplus in this country. If the same statistics were coming out of the health service or our education service, there would be a revolution in this place. We are sleepwalking our way through the fact that we are living and paying our bills by doing two things. First, we are selling our assets. Secondly, we are borrowing. That, added to what we do sell, is how we pay our bills. How long can that go on? SMEs are where the solution lies, because we have proved conclusively that reliance on the large corporations is no solution.

I have asked my next question on a number of occasions but never had a clear answer to it. I hope that the Minister will tell us whether we as a country have any policy on import substitution. If there is one, I would like to know what it is. I have never heard it. We are ignoring something vital. It is not that we support the production of articles that are completely unprofitable but we can do things in this country on the land, in manufacturing and in our services that are done elsewhere that I believe we could do just as well here.

The second thing is really a training issue. We say that we are committed to exports and that we want to see small companies and others take the leap and start to export. But do we? For instance, we train our dentists and doctors. Would you send a car to a garage that had no trained mechanics? However, we are perfectly happy to try to see exports grow in companies where there is no training for people to export. I am a vice-president of the Institute of Export, an educational charity providing training for people in business so that they understand what exports are, how they do them and the pitfalls. Surely it would be possible for government to give an incentive, even through a capital allowance, for people to be trained in export qualifications, so that the small companies at least are encouraged, and so that we send a signal as a Government and a country that we are serious about trade.

These figures, which have now been going for 30 years, indicate that we are not serious about trade. We are prepared to run huge deficits almost indefinitely and pass on a huge burden of debt to the next generation. I hope that the Minister can address those issues in his response.