Trade and Investment for Growth White Paper

Pat McFadden Excerpts

Wednesday 9th February 2011 Commons Chamber

[Vince Cable]

As far as the ECGD is concerned, one of the things that we discovered when we investigated this matter is that Britain is far behind countries such as France—which has COFACE and other such agencies—in providing trade finance. That is the gap—the market failure—that we are trying to fill. I hear my hon. Friend’s point about banks in general—a point that the Chancellor dealt with a few moments ago. There is clearly an issue about the extent to which the FSA has overreacted in its interpretation of international rules.

[Mr Pat McFadden (Wolverhampton South East) (Lab)]

I am sure that the whole House will welcome measures to help small and medium-sized businesses to export more, but how are small businesses helped to export by the abolition of the grants for business investment scheme? The figures from the Secretary of State’s own Department show that this money produced £10 of private sector investment for every £1 of public money spent. The money was directed overwhelmingly at small and medium-sized businesses, and overwhelmingly at manufacturing companies, and it was available only in the assisted areas that the Government say they want to help. Does not the abolition of the scheme show that there is now a widening gulf between the rhetoric about rebalancing the economy and the reality of the policies that the Government are pursuing?

[Vince Cable]

We want to help small businesses, but we intend to do so in a more cost-effective way, and in a more effective way overall. The support for trade finance that I have described is specifically directed at small enterprises. As for the other schemes, such as mentoring, which the right hon. Gentleman will know about through my colleague the Minister of State, Lord Green, we are putting in place a whole series of measures that are focused specifically on the SME community.