Michael Fallon
Main Page: Michael Fallon (Conservative - Sevenoaks)
The Minister of State, Department for Business, Innovation and Skills (Michael Fallon)
The UK automotive industry is in great shape: last year UK car production increased by 9% and car exports exceeded imports by value for the time since 1976. The new automotive investment organisation, which we are announcing today, will build on that strong performance, which has already attracted more than £6 billion in global investment over the past two years.
Neil Carmichael
I thank the Minister for that impressive description of the current state of the British car industry. What measures is he taking to ensure that we have sufficient skills, particularly in engineering, to develop the components industry in the car sector as well as recognising the need to provide new technologies?
Michael Fallon
Addressing the skills challenge and increasing the supply of engineers is critical for the automotive industry and others. It needs attention in schools, where the Department for Education is investing £135 million in science and maths education, and from industry itself. I hope that more car companies will follow Nissan’s lead in taking up the employee ownership pilots.
Mr John Spellar (Warley) (Lab)
As a west midlands MP, I join the Minister in welcoming the success of the British car industry, which is a tribute to the industry, its work force and trade unions and his Department under both Administrations. Is it not extraordinary that other Government Departments do not back the British car industry, especially the police, who are buying more and more foreign vehicles? Will he talk with the Home Secretary to get her to back British industry? It might even help her leadership ambitions.
Michael Fallon
They may not need that much help.
The right hon. Gentleman makes an important point about procurement by public authorities. He has been to the Department recently to discuss the matter with me and I have written to him about it.
Gavin Williamson (South Staffordshire) (Con)
In South Staffordshire we are seeing the construction of a £500 million new engine plant for Jaguar Land Rover. However, one of the great constraints on the automotive sector is the need for more engineers coming through our university system. What more can the Government do to encourage more engineers to drive forward our wonderful automotive sector?
Michael Fallon
We are encouraging more children to take up science subjects and to study maths earlier and for longer, and to be more aware of the high-value, highly regarded careers that are available in engineering. We are urging companies to open up their premises to more visits from schools, particularly in connection with the See Inside Manufacturing initiative that we are launching again this October.
Charlie Elphicke (Dover) (Con)
5. What steps he is taking to ensure that small business suppliers are paid promptly by large businesses and by government; and if he will make a statement.
The Minister of State, Department for Business, Innovation and Skills (Michael Fallon)
I have written to all the FTSE 350 companies urging them to sign up to the prompt payment code. Signatories must pay their invoices on time to maintain membership. Three quarters of FTSE 100 companies are now signatories, and over 1,400 large companies have signed in total.
Charlie Elphicke
Last year a Federation of Small Businesses report showed that 40% of small businesses had faced problems with payment from Government agencies and quangos. Will the Minister make the prompt payment code mandatory for all public sector organisations and consider budget cuts for persistent offenders?
Michael Fallon
There is now a statutory obligation for all public bodies, including the NHS and local authorities, to pay invoices within 30 days.
Mr Barry Sheerman (Huddersfield) (Lab/Co-op)
Does the Minister agree that paying small and medium suppliers on time is part of the broader responsibilities of the large company? Will he look at the Public Services (Social Value) Act 2012, which is making a real difference for small and medium-sized enterprises and their relationships with taxpayer-funded local authorities and health authorities? Will he try to ensure that large companies pay taxes and have a broader responsibility to the community in which they sit?
Michael Fallon
That goes a little wider than the original question, but I agree with the hon. Gentleman. There are large companies sitting on large amounts of cash, and it is not right that smaller businesses in their supply chains should have to wait longer than 30 days to be paid promptly.
Valerie Vaz (Walsall South) (Lab)
6. What recent assessment he has made of the adequacy of his Department’s budget for medical education and research.
Mr John Baron (Basildon and Billericay) (Con)
9. What steps his Department is taking to help small and micro-businesses grow.
The Minister of State, Department for Business, Innovation and Skills (Michael Fallon)
I announced last week that we will extend the exemption from burdensome new regulation to firms with up to 50 staff, and that will continue after 2014. Our growth accelerator scheme has supported more than 6,000 small businesses with high growth potential. We are encouraging more businesses to exploit export opportunities, and UK Trade & Investment is on track to double the number of SMEs it supports to 50,000 by 2015.
Mr Baron
Although I welcome the Government’s initiatives to date, given the importance of small and micro-businesses to the economy will Ministers use their influence to push for further tax incentives to encourage growth and employment? After all, cash flow is king for such businesses and history suggests undeniably that financial payback does not take too long to come around.
Michael Fallon
As my hon. Friend knows, the Government are making the tax system in the United Kingdom the most competitive in the G20. In 2011, we reduced the small companies rate to 20%. More than 1 million employers will benefit from the new £2,000 employment allowance from next April and nearly 500,000 employers will pay no employer’s national insurance contributions at all from that date.
Michael Fabricant (Lichfield) (Con)
10. What progress he has made on making shares in Royal Mail available to its employees; and if he will make a statement.
David Wright (Telford) (Lab)
11. What recent assessment he has made of the long-term prospects for high street businesses.
The Minister of State, Department for Business, Innovation and Skills (Michael Fallon)
High streets are changing and the Government are committed to helping communities adapt their high streets to those changes. We have taken action following the Portas review by lifting planning restrictions, doubling small business rate relief, and providing towns with a package of support to drive forward their local economy. I look forward to giving evidence to the Business, Innovation and Skills Select Committee inquiry into retail in due course.
David Wright
High streets obviously need to provide a diverse offer in order to succeed, and the provision of street markets and farmers markets are particularly important to many high streets. There is a significant problem in a number of areas because we cannot get road closure orders to allow such markets to go ahead. What work is the Department doing, together with the Department for Communities and Local Government, to ensure that markets thrive, and what will the Government do to develop a market strategy?
Michael Fallon
I hope that the hon. Gentleman, like other hon. Members, will support his local market. I had the pleasure of supporting Sevenoaks local market last month, and there is an initiative across the country—love your local market—in which I hope he is participating. I will look into the particular point he raises about highway closures.
Mr Peter Bone (Wellingborough) (Con)
In my constituency, a number of businesses in the high street have unfortunately closed. If they go into liquidation, their employees receive pay arrears, holiday pay and notice pay, if necessary from the national insurance fund. If the business just ceases trading and is eventually struck off, its employees do not get pay arrears, holiday pay or notice pay. Will the Minister meet me to discuss that anomaly in the law?
Michael Fallon
I would be happy to do so, but I hope my hon. Friend will not be too gloomy about the state of the high street. He will know that, in the most recent year for which we have figures, some 22,900 store-based retailers opened and 21,000 closed—more stores were set up than were closed.[Official Report, 18 June 2013, Vol. 564, c. 3MC.]
John Pugh (Southport) (LD)
Is it not time that we looked at the impact of business rates on the high street, and particularly at the glacial speed of appeals and revaluations?
Michael Fallon
My hon. Friend will know that we have doubled the small business rate relief for the past three and a half years, which has helped more than 500,000 businesses. In the Growth and Infrastructure Act 2013, we postponed the revaluation to give businesses more certainty—a larger number of them were forecast to lose under the revaluation than would have gained.
Mr David Nuttall (Bury North) (Con)
Does the Minister agree that the prospects for our high streets would be a lot rosier if local authorities did more to encourage motorists into our town centres by reducing parking charges?
Michael Fallon
I agree with my hon. Friend. We must get the balance right. It is important that local authorities do not freeze trade out of their local high streets. One action we have taken following the Portas review is to encourage local authorities to look at the total local economy and ensure that there are not undue restrictions on encouraging people to come into the high street.
Mary Macleod (Brentford and Isleworth) (Con)
12. What support his Department is providing to female entrepreneurs.
The Minister of State, Department for Business, Innovation and Skills (Michael Fallon)
Women play an important role in growing our economy. We commissioned the Women’s Business Council to investigate how we can help remove barriers and maximise women’s contribution to economic growth. Following its excellent report last week, the Government will publish an action plan this autumn that will improve web-based support for entrepreneurs. We will work with the British Bankers Association to improve women’s awareness of the financial support available.
Mary Macleod
If women set up businesses at the same rate as they do in the US, benefits of up to £42 billion could be delivered to the economy. When I recently organised Start-up Challenge seminars for women in my constituency, they were full of excellent, enthusiastic and dynamic women who were keen to be entrepreneurs. What more can we do to stretch out to those women and encourage more of them to be great entrepreneurs for the country?
Michael Fallon
If women were setting up and running new businesses at the same rate as men, we would have an extra 1 million female entrepreneurs in this country. Despite progress in recent years, women remain less likely than men to start a business, so we have more to do.
Chi Onwurah (Newcastle upon Tyne Central) (Lab)
The Secretary of State has recently made a number of welcome speeches in support of women in engineering, enterprise and the boardroom, but unfortunately, they are not matched by action from his Government. Why, for example, has the number of investments by the Aspire fund, which was set up specifically to support women-led businesses, fallen under his Government to a quarter of what it was under the previous Government?
Michael Fallon
Forty per cent. of start-up loans have been taken up by women, which is an important advance. In the two-month period from 1 March, 12% of FTSE 100 board appointments and 40% of FTSE 250 board appointments were secured by women.
Diana Johnson (Kingston upon Hull North) (Lab)
19. What discussions he has had on taking forward the recommendations of Lord Heseltine that regeneration funding be devolved to local enterprise partnerships.
The Minister of State, Department for Business, Innovation and Skills (Michael Fallon)
I have regular discussions. As our response to Lord Heseltine’s report made clear, the Government will be creating a single local growth fund for local enterprise partnerships from April 2015, which will include housing, transport and elements of skills funding. The size and content of the single local growth fund will be confirmed at the spending review.
Diana Johnson
On 18 March, the Treasury accepted Lord Heseltine’s proposals on devolving regeneration funding to local enterprise partnerships from 2015, but in late April the Business Secretary briefed journalists that we will not be going down that road. Will the Minister tell us whether the Business Secretary backs the Government’s plans to implement Lord Heseltine’s recommendations by 2015?
Michael Fallon
My right hon. Friend certainly does so. It is up to local leaders in each local enterprise partnership to identify their growth priorities and to set them out in their local economic strategies, and those growth strategies might well include regeneration. The hon. Lady will know that Humber has the largest enterprise zone in England. It has already had some £50 million of assistance from the regional growth fund and is well placed to exploit the opportunities arising from offshore renewable industries, as I saw when I met the partnership there earlier this year.
Andy McDonald (Middlesbrough) (Lab)
T1. If he will make a statement on his Departmental responsibilities.
Zac Goldsmith (Richmond Park) (Con)
T4. It is one thing the Government not following through on their promises to tackle plastic waste in this country, but what on earth was my right hon. Friend doing complaining to the EU about Italy’s plans to ban or phase out the use of single-use plastic bags, and why was the Department for Environment, Food and Rural Affairs not even consulted, given that it is one of its policy areas?
The Minister of State, Department for Business, Innovation and Skills (Michael Fallon)
The Italian proposal would allow for only biodegradable bags, so would discriminate against British businesses that sell similar recyclable or other forms of degradable bag—for example, oxo-degradable plastic bags, with which I am sure my hon. Friend is familiar.
Charlie Elphicke (Dover) (Con)
T7. The late payment of commercial debt regulations provide for a 60-day payment period, unless agreed and not grossly unfair. Will Ministers consider a longstop date of 90 days to give small businesses certainty?
Michael Fallon
I know that my hon. Friend has continued to raise the case of Mr and Mrs Langstaff in his constituency. The “Insurance: Conduct of Business” rules require insurers to handle claims promptly, and redress is available through the Financial Ombudsman Service if they do not do so. I note that a number of insurance companies have now signed the prompt payment code.
Mr Adrian Bailey (West Bromwich West) (Lab/Co-op)
What assessment has the Minister made of the take-up of post-24 advanced learning loans and the potential impact on further education colleges’ finances?
Mr Marcus Jones (Nuneaton) (Con)
The resurgence of the motor manufacturing industry has had a tremendously positive effect on the supply chain across the west midlands, but further growth in that supply chain is now being challenged by the lack of available skills. Will my right hon. Friend tell me what more he can do to address that pressing problem?
Michael Fallon
This is a pressing problem right across the automotive industry and other engineering industries, and it has to be attacked on a number of fronts, including through more investment by the Department for Education to encourage more children to take up science, maths and technology, and through industry itself getting more involved in the employer ownership pilots and opening up its premises so that people can see the kinds of rewarding career that are now available in manufacturing and engineering.
Ian Mearns (Gateshead) (Lab)
I am sure the Secretary of State will have noted that, while unemployment fell by 5,000 this week across the UK, it rose in the north-east of England by 4,000 to 131,000. That means that 10.1% of our working population, and 24.9% of our young people, are now unemployed. Will he meet me and other colleagues to discuss how we can alleviate that individual suffering and unleash the potential of the north-east economy?
Michael Fallon
I will certainly have a look at that. It was a point made to me on Tuesday when I had the pleasure of addressing the stainless steel annual conference and celebrating the 100th anniversary of Harry Brearley’s invention of stainless steel.