Economy: Productivity

Lord Howarth of Newport Excerpts

Thursday 28th June 2018 Lords Chamber

[Lord Bates]

There are incentives for R&D spend. We know that things such as infrastructure and capital investment—we have had a patient capital review—contribute to improvements in productivity. We know that education and skills are a key part, and that is why we have T-levels and the apprenticeship levy. We also know that investment is very important, and that is why the capital breaks we have for R&D, particularly in small firms, are very important. But this is a whole-economy effort in which small and medium-sized enterprises, as well as the large companies, need to play their part.

[Lord Howarth of Newport (Lab)]

Will the Minister respond to one of the questions asked by my noble friend Lord Haskel about share buybacks and, indeed, excessive dividend payments? There is a management culture that all too often seems more interested in the extraction of wealth than the creation of wealth.

[Lord Bates]

If that criticism were true, we would not see that the UK is regarded as the number one location for foreign direct investment and we would not see companies coming here in the numbers that they are. We have a great strength in our economy. We have an historic weakness in productivity and we need to look at all the possible contributions to that and address them; that is what this review is all about.