Department for Business, Innovation and Skills (Performance)

Nigel Evans Excerpts

Wednesday 2nd February 2011 Commons Chamber

[Several hon. Members]

rose—

[Mr Deputy Speaker (Mr Nigel Evans)]

Order. This is a popular debate and a six-minute limit has been introduced on all Back Benchers’ speeches, with the usual injury time for two interventions.

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[Mr Bailey]

We would have sustained the level of support at local level that would have allowed manufacturers to benefit from the sort of programmes that were being developed to get us out of recession. However, the hon. Gentleman must forgive me if I concentrate on the issue at stake, which is the performance of BIS in promoting growth.

On LEPs, I am second to none in my praise for my local Black Country chamber of commerce and those who are committed to making it work. I shall do everything I can to support the LEP, but I know that there are serious reservations about the lack of funding it has for submitting applications and about the delay that occurred when its original application to become an LEP was turned down.

What, above all, is very worrying as regards the potential for LEPs is the fact that the planning proposals in the Localism Bill do not include LEPs having any role whatever in the process. How the Government can create a local organisation with a brief to drive growth but not include it in the local planning plans for a local community defies all credibility and belief. Without the support of local planning authorities, it will be difficult for local businesses to push for growth.

Immigration has already been mentioned. The revelations that we heard yesterday in the Business, Innovation and Skills Committee on the impact of the Government’s cap on recruiting people for vital, iconic businesses that have demonstrated time and again their ability to deliver jobs and growth are a real worry. Some of us thought that the Secretary of State had had some success in that regard, but it looks as though the headline announcements are not being reflected by the attitudes of the Departments involved. That is, in itself, a reflection on this particular Department’s ability to get what it needs from other Departments in delivering on an agenda that is essential for the Government and the economy.

BIS should be taking a lead role and ensuring that there is a growth impact test on the actions taken by other Departments. That is not so. This is why, under a Labour Government, we were growing ourselves out of—

[Mr Deputy Speaker (Mr Nigel Evans)]

Order. I call Simon Kirby.

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[Gavin Williamson]

I thank my hon. Friend for such a—

[Mr Deputy Speaker (Mr Nigel Evans)]

Order. Will the hon. Gentlemen resume their seats? There is a time limit on speeches, and also a time limit on interventions—it is called “short”.

[Gavin Williamson]

Thank you, Mr Deputy Speaker. I also thank my hon. Friend the Member for Stroud (Neil Carmichael) for making such lucid points.

My hon. Friend is right about training and giving business the freedom to succeed—freedom from regulation. That is why I pay tribute to Ministers in the Department. They have introduced a one-in, one-out policy on regulations —or I very much hope they will do so shortly. I would encourage them to be bolder, and certainly to be bolder than the Labour Government, and to make that a one-in, two-out policy. Let us be bold. Let us free industry from the shackles of government.

The hon. Member for Penistone and Stocksbridge (Angela Smith) made a valid point on intensive users of energy. We must be wary of environmental regulation. If we are not careful, we will ship business from this country to countries such as Ukraine, which do not have a care for environmental regulation. We will not just be shipping carbon abroad; we will also ship jobs. I ask my right hon. and hon. Friends on the Treasury Bench to bear that in mind.

The hon. Member for Middlesbrough South and East Cleveland (Tom Blenkinsop) made the valid point that we need to encourage jobs right across the manufacturing sector. We must be careful with all regulation, but especially with environmental regulation.

Opposition Members sometimes seem not to accept the fact that businesses do not always want to be involved in the intricacies of government. Businesses want the freedom to get on, but they need help with financing. There is a real squeeze for many small and medium-sized businesses in getting the finance that they need. The Black Country Reinvestment Society helps many SMEs in my constituency and much of the black country, including new businesses. It uses small amounts of capital to give those businesses the opportunity to grow and expand. I encourage Ministers to look at the model to see how it can be expanded across the country.

I also encourage Ministers to look at the German model. Many German banks do not simply lend to businesses and provide mortgages and banking facilities; they actually take an equity stake in the businesses. That stake means that they have a long-term vision for those businesses. More support, rather than more interference, is what is needed in this country.

Businessmen do not want a constant dialogue with civil servants and politicians. They want and need low taxes, low levels of regulation and most important of all, a stable economy. I encourage Ministers not to think that more government will lead to more business, but to think that less government will lead to more business.

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[Mr Marcus Jones (Nuneaton) (Con)]

It is an honour to follow the hon. Member for Birmingham, Erdington (Jack Dromey) who has a very positive outlook on the current situation. I welcome the opportunity to speak in this debate. We should not underestimate the importance of getting economic growth back into our economy. We still face difficult economic times. We must not forget that we have had the worst recession since the second world war, with six quarters of negative growth. We are now suffering from the hangover from that, and from the debt inherited from Labour.

The deficit is one of the greatest barriers to growth. My right hon. Friend the Chancellor is right to stick to his guns on his deficit-reducing strategy. The IMF agrees: it has identified that insufficient progress with fiscal consolidation in the medium term would be a key downside risk to growth. We should all remember that.

The path to growth is likely to be rocky, but we must put the building blocks in place to rebalance our economy into a more sustainable and resilient model, based on a broader spread of industry, rather than put all our eggs into one basket. We must also listen to business. Before and after the election, business was looking for three things—lower taxes, less regulation and more bank lending. Some progress has been made by the new Government and there is far greater intent than there was in the past. But there is still some way to go.

I read today’s motion with interest. It seems to hark back to a golden age in which the previous Government proclaimed the success of the RDAs. The former Prime Minister, the right hon. Member for Kirkcaldy and Cowdenbeath (Mr Brown), and his then Business Secretary toured the country handing out rubber cheques that no one ever mentioned in the Budget, and which could never have been cashed. Their tenure did not result in an enviable record. The RDAs were top-heavy, with £246 million spent on administration alone in 2008-09. That is not a record to be proud of. However, despite the RDA my region—the west midlands—saw a contraction in private sector employment. That does not make sense, because the RDA was there to promote private sector employment, not throw money into the public sector. Across the country we saw a reduction in manufacturing jobs of 1.8 million under the Labour Government. That is not a record to be proud of, nor is it a golden legacy; it is something that this Government have inherited and are having to deal with.

Let me turn to the coalition Government and the difficult balance that we are having to strike between dealing with the deficit and getting sustainable growth. Despite the Opposition’s rhetoric, the coalition parties do have a plan for sustainable growth. There is a common theme or thread running through many policy areas. We have the LEPs, which are far more focused and business-led. I am sure that they will not be like Labour’s talking shops, which disengaged business. In particular, the Coventry and Warwickshire LEP, with which I have been proud to associate myself, is doing a fantastic job promoting the Coventry and Warwickshire area. I look forward to the progress that it will make in future.

Nor should we dismiss the £30 billion of investment being pumped into our transport infrastructure, or the fact that the regional growth fund is bringing £1.4 billion into the economy to pump-prime projects such as those being considered at MIRA—the Motor Industry Research Association—on the A5 on the edge of my constituency, which will bring in £250 million of private sector investment and could create 2,000 jobs. [Interruption.] Opposition Members shake their heads. They obviously do not want such investments to be made. I am also encouraged by the way in which the Government have started to reduce red tape and regulation, with the one-in, one-out strategy, reducing gold-plating and introducing business mentors to help new businesses grow. All those measures will create jobs. I hope that when the Minister winds up he will elaborate on how we will expedite that process and ensure that it moves forward far more quickly.

I am also pleased that we are committed to reducing corporation tax, which we need to do to move all businesses forward. Lower taxes are a way of stimulating the economy, benefiting not just the banks, as Opposition Members have said. I am also absolutely delighted that my hon. Friend the Minister for Further Education, Skills and Lifelong Learning has introduced another 75,000 apprenticeships this year to close the skills gap left by Labour. We had to bring in labour from abroad to fill the skills gap when the economy was expanding, when we had many people here who could have filled it themselves. I have only a short time left, so I hope that when the Minister winds up he can give me more information on what is happening with bank lending, which is an extremely important part of the package. I know that the previous Government failed miserably on that, and that the new Government are grappling to get it right, but if the Minister can tell us what is happening, that would be very helpful for us to pass back to our constituencies.

To conclude, we do have a package for growth and we are moving it forward. There are areas where it needs to be moved forward more quickly—

[Mr Deputy Speaker (Mr Nigel Evans)]

Order.

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[Alison McGovern]

I am glad to hear the Minister’s intervention; I have often found him to be a partner for peace on this subject. However, I still worry about investment in business and about business growth. Money might well be set aside, but we still might not see the increase in opportunities for young people that we need.

Let me leave the Minister responsible for further education and the Business Secretary with this final point. They must work with local government. In Wirral, the one thing that has made a real difference to apprenticeships and young people’s employment is the Wirral apprentice scheme. It was funded with working neighbourhoods fund money via the local authority, which meant that that small and medium-sized enterprises could access support to hire apprentices. That is the one thing that has worked. Making local government suffer the biggest cuts in any part of government is not fair, and the impact will be worse on young people. I plead with the Secretary of State and the Minister—

[Mr Deputy Speaker (Mr Nigel Evans)]

Order.