Brexit: Domestic and International

Lord Sterling of Plaistow Excerpts

Thursday 27th October 2016 Lords Chamber

[Lord Sterling of Plaistow (Con)]

First, I thank noble Lords for allowing me to speak rather belatedly. I thank my noble friend Lord Leigh for outlining the global situation. It may not be everybody’s cup of tea but those are the facts. It goes without saying that my noble friend Lord Gadhia spoke not just emotionally but with huge experience and knowledge. I very much appreciated sitting behind him and listening to his speech.

I spent my working life in delivering international trade—driving international trade and tourism. The latter has not been talked about today. My company has operated for nearly 200 years in 110 countries. Everybody keeps talking about Brexit—a word I dislike intensely. I suggested recently to the Prime Minister that we should think of something different, because it is a toxic word. However, in practice, economic power and strength have been dominant in every country in the world that has ever made its name. That is what it is all about. If we do not retain and create further economic strength, everything means nothing. One cannot have hard power without economic strength.

People talk about protectionism. Does one honestly believe that the Germans, with their memory of the Weimar Republic, or America, given what happened in the 1920s and 1930s, want to go back to that form of protectionism? Never—because there is too much knowledge and experience around.

Big companies know their way around. In practice, we must remember that the SMEs and self-employed in this country comprise 58% of our workforce. They are the middle class and the real driving force. As time goes on, they will be key. It may not be widely realised, but those who get involved in exports usually achieve at least a 7% improvement in productivity. The day has to come, therefore, when the SMEs need and must have encouragement; this is one of the problems with the current uncertainty. Encouragement is key because we are dealing with people, not just institutions. When they get encouragement, there will be a moment, as happened in the 1980s, when they start to invest, including in R&D. That is when the country will start to move forward. We could do that in spades.

I ask the Minister to consider the following. One of the problems for SMEs is that the banking system does not help them—not deliberately, but it has not been created in a format that can help. Anyone who has worked with SMEs recently will know that the cost of money is horrendous for them, as against rates that are nearly zero for everybody else. I ask my noble friend to inquire about this, and for the Chancellor to consider, in advance of his Statement later this month, putting it right.

One can see that we are in a very strong position to take advantage of our leading technology in all areas. There is much talk of deals. Those of us in business are negotiating every day of the week. As Peter Lilley, who has been involved in major negotiations and trade talks, said only yesterday in the other place, one does not remember trade deals as history progresses. They are made out to be much more important than they really are. We are constantly talking about deals here and negotiations there, and what they will do to us. It does not matter.

I conclude by asking why entrepreneurs—there are many in this House; and I have been one all my life—here and elsewhere, who put their own money at stake, are not worried about the future. As far as they are concerned, there is a great future and in 10 years’ time we will look back and realise that we made the right decision.