Oral Answers to Questions

Oliver Letwin Excerpts

Wednesday 24th November 2010 Commons Chamber

[Diana Johnson (Kingston upon Hull North) (Lab)]

4. What assessment he has made of the likely effects of the outcomes of the comprehensive spending review on voluntary sector organisations over the spending review period.

[The Minister of State, Cabinet Office (Mr Oliver Letwin)]

Our programme of structural reform is opening up huge new opportunities for all sorts of voluntary and community sector organisations to take part in the delivery of public services. In the hon. Lady’s constituency, City Health Care Partnerships—which, I understand, is an employee-led spin-out from the health service—is providing health visitors, district nurses, pain clinics and a range of other services. That is an admirable example of what can be done, and we hope that it will be replicated in other parts of the country.

[Diana Johnson]

What message would the Minister send to the Hull Families Project, which is based in Orchard Park, given that £160 million of regeneration funds were stripped from that community on Monday, and to the Hull Churches Home from Hospital Service, which fears that the local authority and the NHS will cut its budget? What message does that send about the coalition Government’s real approach to disadvantaged communities?

[Mr Letwin]

The hon. Lady knows that the coalition Government have protected the NHS budget, for the very reason that we regard it as a priority. She may also know that the public health White Paper, which is on the way, will announce our proposals—already well foreshadowed—on the health premium. The health premium will specifically benefit those who are improving public health locally, and will organise funding so that it most benefits the most disadvantaged parts of the country, thus dealing with the precise points that the hon. Lady raises.

[Mr Mark Williams (Ceredigion) (LD)]

There are increasing pressures on independent citizens advice bureaux throughout the country. Debt management issues are an ever-present feature of their work. What assurances can the Minister give that expertise and resources will be available to CABs locally so that they can undertake their invaluable work?

[Mr Letwin]

The coalition Government certainly agree that citizens advice bureaux form a fantastically important part of the fabric of the big society and support for people locally, and I believe that Members throughout the House recognise the value of their services. We will support them in every possible way, and I should be delighted to talk to the hon. Gentleman about any specific issues in his constituency.

[Mr Liam Byrne (Birmingham, Hodge Hill) (Lab)]

I believe that strengthening civil society is a common cause between us. Labour is certainly very proud that the sector doubled when we were in government. Now, however, charities are saying that they face cuts of a little over £3 billion during the next couple of years. How many jobs does the Minister expect to be lost in charities that do not have Conservative advisers at their helms or on their boards? To the untrained eye it seems that, worryingly, some charities are now more equal than others.

[Mr Letwin]

The right hon. Gentleman is well aware that more than three quarters of charities receive no Government money, and therefore will not be affected. He ignores the opportunities presented by the new public service reforms. The Work programme, for example, is creating huge opportunities for the voluntary and community sector, and there will be increased funds from that source. There will be more funds for drug prevention, rehabilitation and recovery, and for the rehabilitation of prisoners. Payment-by-results contracts will be available for a huge range of new voluntary and community sector operators. I expect the right hon. Gentleman to see an expansion, not a reduction, in the sector and its activities.

[Michael Ellis (Northampton North) (Con)]

5. What plans he has to encourage opportunities for small and medium-sized enterprises to apply for Government contracts.

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[Jason McCartney (Colne Valley) (Con)]

15. What plans he has to encourage opportunities for small and medium-sized enterprises to apply for Government contracts.

[The Minister of State, Cabinet Office (Mr Oliver Letwin)]

On 1 November, my right hon. Friend the Minister for the Cabinet Office announced a package of measures to help small and medium-sized enterprises to obtain public sector contracts. They include halving the length and breadth of the pre-qualification process for small firms, and creating a single website called Contracts Finder, where small businesses can locate all the contracts that are available from Government.

[Michael Ellis]

Given that 95% of people in my constituency are employed by small and medium-sized enterprises and that some companies would relish the opportunity of a fair playing field in bidding for Government contracts, will my right hon. Friend make suitable changes to the bureaucratic burden that they currently bear, thanks to the previous Government, as soon as possible?

[Mr Letwin]

The short answer is yes—and abundantly so. The measures I just described are intended to do that. In addition, we are looking at the causes of delay in the procurement process because, as was mentioned earlier, that is often part of the problem. We are also requiring suppliers to pay their subcontractors within 30 days, and encouraging them to pass those payments right down the line to the smallest businesses.

[Julian Smith]

These are great measures for small business, but may I impress upon the ministerial team the need to move forward with them now, because British small business is desperate for access to these contracts? So—please, please, please—get on with it now.

[Mr Letwin]

I am happy to be able to tell my hon. Friend that that is precisely what we are doing. That is why we are publishing every contract for tender of over £10,000 on a website, enabling people to see the opportunities. It is also why we have put in every Department’s business plan the requirement to report on the percentage by value of contracts they have let to small and medium-sized enterprises. We shall measure the extent to which Departments fulfil that requirement. [Interruption.]

[Damian Collins]

Will the Minister consider organising an event or exhibition at which small businesses could show what they can offer to Government procurement? Perhaps we could have a street fair in Downing street, and invite people out of their offices to come and see for themselves?

[Mr Letwin]

I cannot offer my hon. Friend a street fair in Downing street, but I can certainly promise that we will take up his suggestion of looking into ways of enabling small businesses to bring home to those responsible for procurement just what a valuable contribution they make.

[Jason McCartney]

Perhaps we could have a street fair in Colne Valley. SMEs in my constituency will certainly welcome the measures, which will make it easier for them to do business with the Government, but can the Minister assure them that the process will be more accountable and transparent?

[Mr Letwin]

Yes, indeed, I can; in fact everything I have been describing tends to that end. We are going to make sure SMEs know what contracts are available; we are going to make sure they get a proper account of what is awarded; and we are going to make sure that Departments are held to account in awarding to SMEs. We want transparency all the way through the process because that is what will drive Government to let contracts to SMEs.

[Mr Michael McCann (East Kilbride, Strathaven and Lesmahagow) (Lab)]

Now that Lord Young has gone, does the Minister agree that SMEs have never had it so good in respect of their share of Government procurements given the scale of cuts announced in the spending review?

[Mr Letwin]

Lord Young has resigned. My personal view is that the longest and deepest recession since the war, and the vast fiscal deficits that the Labour party bequeathed to us, have left not only SMEs but the entire country, and, of course, the Government, with an enormous challenge that we are now trying to meet.

[Richard Burden (Birmingham, Northfield) (Lab)]

Some of the enterprises of relevance in this context are third sector or voluntary sector organisations, for which the operation of the compact is important. How will the Minister respond to the concerns expressed by a number of those organisations that the compact is not working and that the new compact’s accountability mechanisms are not robust enough? The reality is that voluntary sector organisations are first in line for cuts, and this Government are doing nothing to address that.

[Mr Letwin]

Let us be clear: the compact is not about the level of expenditure but about the extent to which, in each contract, the Government play fair by those with whom they are contracting. We absolutely accept that the operation of the compact under the previous Government was not adequate. We are introducing new measures to make it more transparent, and the entire structures of our payment by results contracts will be totally transparent and in line with the spirit, as well as the letter, of the compact.

[Mr Brian H. Donohoe (Central Ayrshire) (Lab)]

Will this include Scottish enterprises?

[Mr Letwin]

Of course. If the Scottish Government take the correct measures, it will apply in Scotland; and in the UK as a whole, and in England in particular, we will make sure there is transparency and that the compact is totally observed regardless of where the contractors come from.

[Hugh Bayley (York Central) (Lab)]

The cuts in public expenditure will put enormous pressure on construction industry firms, and the smaller and medium-sized firms will be particularly badly hit. What are the Government going to do to protect those companies so that when the economy improves they will still be there to do the construction that is needed?

[Mr Letwin]

The greatest protection for small and medium-sized enterprises in the construction sector and elsewhere is, of course, a macro-economic framework that enables them to survive the recession, prosper and grow. That is why my right hon. Friend the Chancellor has taken the steps that have led the world in providing a solid macro-economic framework and low interest rates that enable—

[Mr Speaker]

Order. I am grateful to the right hon. Gentleman. I call Mr David Amess.