Oral Answers to Questions

Sajid Javid Excerpts

Tuesday 30th June 2015 Commons Chamber

[Alan Mak (Havant) (Con)]

1. What steps he is taking to support small and medium-sized businesses to become more competitive.

[The Secretary of State for Business, Innovation and Skills and President of the Board of Trade (Sajid Javid)]

Our business growth service provides expertise to ambitious firms who want to grow and become more competitive, and over this Parliament we will make extensive cuts to red tape which will save businesses £10 billion.

[Alan Mak]

I thank the Secretary of State for his answer. Headromance is a Havant-based hair salon launched in 2012 by two young entrepreneurs. It now employs 10 stylists and five apprentices. Will my right hon. Friend update the House on the measures this Government have taken to support the growth of apprenticeships?

[Sajid Javid]

I warmly welcome my hon. Friend to his place. I am not sure I would have much need of the services of Headromance—I am sure that applies to the shadow Business Secretary too—but that does not stop me warmly congratulating its owners on their success and in particular on backing apprentices. As my hon. Friend knows, during this Parliament we want to see apprenticeship starts rise to 3 million, and we have a number of measures in place to achieve just that.

[Robert Flello (Stoke-on-Trent South) (Lab)]

I draw attention to my entry in the register of interests. Many small and medium-sized freight businesses struggle with the cost of training drivers. Have the Government any plans to look at this afresh with a view to helping people train to become lorry drivers in the UK?

[Sajid Javid]

As the hon. Gentleman will know, it is very important for the Government to listen to all industries about their skills and training needs, including for freight drivers. Of course, the option of apprenticeships is open to that industry, but we must look at other measures too.

[Mike Wood (Dudley South) (Con)]

The business rates system is one of the major barriers to competitiveness for small and medium-sized enterprises. What plans do Ministers have to reform and alleviate some of that burden?

[Sajid Javid]

My hon. Friend will know that the Chancellor announced a full review of business rates in the last Budget. It is important to note that although that will be a proper full review looking at what sensible changes can be made, it will stay fiscally neutral, so it will not be possible to satisfy everyone.

[Peter Kyle (Hove) (Lab)]

Brighton and Hove is the most entrepreneurial city in the country but still lags behind the region for productivity. What is the Secretary of State doing to increase productivity among small businesses?

[Sajid Javid]

There are a number of actions that Government can take, and some of them were taken by the coalition Government and are now bearing fruit, such as cutting taxes and the employment allowance. During the lifetime of this Parliament, there will be a big focus on productivity, and there will be further measures, including on deregulation.

[Rishi Sunak (Richmond (Yorks)) (Con)]

The last Labour Government had an appalling record on regulation, introducing something like six new regulations a day. What does my right hon. Friend think that did for the productivity of small and medium-sized companies in the UK?

[Sajid Javid]

I welcome my hon. Friend to the House, and he is absolutely right: the last Labour Government had an appalling record on so many things, including regulation, and the more we can keep the red tape challenge going, and our policy of one in, two out, the more we will help businesses.

[Jim Shannon (Strangford) (DUP)]

In Northern Ireland 99.9% of small businesses are the core of the industrial base. They create some 347,000 jobs. What can the Secretary of State do to ensure that those jobs can be retained and more jobs can be created?

[Sajid Javid]

The hon. Gentleman is right to point out the importance of small businesses, particularly in the context of Northern Ireland. He will know that many of the policies that impact on small businesses in Northern Ireland are devolved, but there are a number where we can make an impact through the UK Government. One is foreign investment, which has been going up in Northern Ireland, and we will continue to focus on that.

[David Morris (Morecambe and Lunesdale) (Con)]

2. What steps he is taking to simplify regulation for self-employed people.

[The Secretary of State for Business, Innovation and Skills and President of the Board of Trade (Sajid Javid)]

The enterprise Bill will help to save businesses £10 billion through further deregulation. We have committed to launching a review into tackling the specific disadvantages faced by the UK’s 4.5 million self-employed.

[David Morris]

I thank my right hon. Friend for that answer. As the self-employment ambassador, the issue of the IR35 constantly crops up when self-employed people write to me. Can we meet to see how we can simplify this?

[Sajid Javid]

I thank my hon. Friend for the work he has done and continues to do as self-employment ambassador. I would be delighted to meet him to discuss how we can make the system fairer, quicker and simpler for the self-employed. He will know that tax policy, in particular, is an issue for the Treasury, and I will bring it to the attention of my hon. Friend the Financial Secretary.

[Marie Rimmer (St Helens South and Whiston) (Lab)]

The number of self-employed people is growing, but they are often disadvantaged and face additional burdens when applying for a mortgage or to set up a pension scheme for themselves. What steps is the Minister taking to ensure that these barriers are not erected and do not attack the self-employed?

[Sajid Javid]

The hon. Lady is right to point out that issue. She may know, as I am sure she read it carefully, that the Conservative party had a very pro-business manifesto. We have rightly committed ourselves to having a review of the challenges faced by self-employed people and their businesses, and that would include looking at the issue she raises: access to mortgages.

[Mr Philip Hollobone (Kettering) (Con)]

The self-employed in Kettering and across the country are the unsung heroes of the economic recovery, yet their terms and conditions, with no sick pay, no holiday pay and inadequate pension provision, are akin to those on zero-hours contracts. What will the Secretary of State do in this Parliament to ensure that the rewards for the self-employed, with their enterprise and endeavour, are properly recognised?

[Sajid Javid]

My hon. Friend, as usual, is spot on. He should know that this review will look at precisely those issues. A number of challenges are faced by the self-employed and it is about time the Government took a careful look at them. That is exactly what we will be doing.

[Andrew Gwynne (Denton and Reddish) (Lab)]

The Government’s universal credit plans are set to burden 600,000 self-employed people with additional red tape requiring them to provide a new set of monthly accounts. Given that the Secretary of State is responsible for cutting red tape, what is he doing about that? What is he doing to put self-employed people first?

[Sajid Javid]

The hon. Gentleman will know that the universal credit plans are essential to make sure that work pays, and I would have thought he would support that. On the issues that it might raise for small businesses and the self-employed, it is important that we look at the net burden of regulation on businesses and keep reducing it.

[Ian C. Lucas (Wrexham) (Lab)]

3. If he will implement an active and interventionist industrial strategy to assist economic growth in the UK.

[The Secretary of State for Business, Innovation and Skills and President of the Board of Trade (Sajid Javid)]

The biggest challenge facing the economy is improving productivity, and that challenge varies by sector. Dialogue with business, including through the sector councils, as part of our industrial approach, is key to addressing this issue.

[Ian C. Lucas]

As a member of the last Labour Government, I am very proud that the Labour party, in government, established the Automotive Council, which has provided the framework for the most successful decade in UK car production for a very long time. Will the Secretary of State confirm that he will not, on the altar of ideology, endanger that success?

[Sajid Javid]

I look forward to working with the Automotive Council. In fact, I have already had a meeting with it and I told it something the hon. Gentleman would agree with, which is that the automotive industry is one of the brightest stars in the constellation of British business.

[Mr Steve Baker (Wycombe) (Con)]

May I reassure my right hon. Friend that if he does wish to follow a more liberal policy than his predecessor, he will have plenty of support from Conservative Members?

[Sajid Javid]

I can tell my hon. Friend that we will have active dialogue with various industries, across sectors, and we will make sure that we are listening and seeing what the Government can do.

[Andy McDonald (Middlesbrough) (Lab)]

Given tomorrow’s eagerly awaited announcement by the Teesside Collective on its ambitious industrial carbon capture and storage proposal, will the Minister, with his colleagues, ensure that industrial, energy and climate change policies are aligned and that every other assistance is given to the collective in bringing about an early realisation of this vital project?

[Sajid Javid]

I have listened very carefully to the hon. Gentleman, and if he would like to furnish me with more information about the Teesside Collective and how we can help, I would be happy to take a look.

[Mr David Jones (Clwyd West) (Con)]

The Government’s northern powerhouse strategy has the potential to offer huge benefits to north Wales. What discussions has my right hon. Friend’s Department had with the Welsh Government with a view to developing it?

[Sajid Javid]

As my right hon. Friend will know, this is a one nation Government. We want to make sure that, as the economic recovery continues, it includes every part of the UK, and that will of course include Wales. We are more than ready to talk to the Welsh Government. I have had a number of discussions with my right hon. Friend the Secretary of State for Wales, who at this point is a lot more interested than the Welsh Government in economic development in Wales.

[Stephen Doughty (Cardiff South and Penarth) (Lab/Co-op)]

The Chancellor says that he supports modern industrial policy and the Prime Minister has said that he wants an active industrial policy, but, according to the Financial Times, the new Business Secretary has told officials in the Department that they should not talk about industrial policy. Now we hear him talking about an “approach”. Can he tell industries around the country whether he still has an industrial policy and, if so, what on earth it is?

[Sajid Javid]

I think I have already answered the hon. Gentleman’s question, but I am happy to repeat that answer. This Government will have an active dialogue with all industrial sectors. We will listen to their needs on skills, infrastructure and training, and work with them. That includes the sector councils. We will also make sure that we are open to new industries, to competition and to disruptive industries, and that we become the most open economy in the world.

[Anna Turley (Redcar) (Lab/Co-op)]

4. What recent assessment he has made of the effectiveness of the Government’s strategic support for industries and sectors.

[The Secretary of State for Business, Innovation and Skills and President of the Board of Trade (Sajid Javid)]

In preparation for the forthcoming spending review, I am assessing the effectiveness of BIS policies, including strategic support for industry. We will continue an open dialogue with business, including through sector councils.

[Anna Turley]

A long-term industrial strategy is vital for my constituency, which boasts a major chemical process complex in Wilton. Recently, the workforce have been taking to the gates because they believe that long, hard-won, nationally agreed terms and conditions are being undercut on the site. What assurance can the Minister give me, and what steps is he taking to make sure, that nationally agreed terms and conditions are being applied on such sites, and that the British workforce are not being undercut by recruitment from overseas?

[Sajid Javid]

I welcome the hon. Lady to her place. I know that a number of industries, including the one that she has mentioned, are important to Redcar. I am more than happy to take a closer look at the issue that she raises. I am afraid that I do not know the details of it, but if she would like to furnish me with them, I or my right hon. Friend the Minister for Small Business, Industry and Enterprise will take a closer look.

[Tom Pursglove (Corby) (Con)]

Steel producers are an important employer in Corby. Will my right hon. Friend meet representatives of the steel all-party parliamentary group, who are working closely together, to talk about strategic support, especially on carbon taxation?

[Sajid Javid]

I welcome my hon. Friend to his place and congratulate him on his work to help the steel industry to meet those challenges. I will be more than happy to meet him and representatives of the APPG and see what more we can do, especially on the high energy costs that the industry faces.

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

I have previously suggested a strategic support mechanism for the open-cast coal industry—a carbon tax exemption for specific sites. An independent economic analysis suggests that an exemption with a value of £195 would produce a net income to the Treasury of £57 million and would also allow the sites to be restored. Will the Secretary of State consider that urgently and work with the Treasury to include the exemption in the July Budget or, following a previous offer, meet me to discuss it?

[Sajid Javid]

Steel is a very important industry, employing thousands of people in Britain. It is important to see what we can do to help, so I or my right hon. Friend the Minister for Small Business, Industry and Enterprise will be more than happy to meet the hon. Gentleman.

[John Pugh (Southport) (LD)]

What plans, if any, do the Government have to make local enterprise partnerships more democratically accountable? They have more funds than the regional development agencies, but are less accountable.

[Sajid Javid]

It is right that LEPs are business-led, but it is also important that they include democratically elected people, and that is how they are working. It is important to review LEPs after a few years of operation and to ensure that they are truly accountable.

[Huw Irranca-Davies (Ogmore) (Lab)]

5. What steps his Department plans to take to improve productivity in businesses and industries.

[The Secretary of State for Business, Innovation and Skills and President of the Board of Trade (Sajid Javid)]

Productivity growth ultimately comes from business and the hard-working people of Britain, but the Government can, of course, help. That is why my Department is working closely with the Treasury on a forthcoming productivity plan.

[Huw Irranca-Davies]

The Minister is right about the reliance on individual workers to drive up productivity and about what the investor community can do as well, but he will know that the Office for Budget Responsibility has said that if productivity per worker was 4% higher during this Parliament, that would have a significant effect on reducing the national debt, and correspondingly, that if it was not, the national debt could rise. Does he agree with this rather gloomy assessment and, if so, what does he think the figures for individual growth per worker will be by the end of this Parliament?

[Sajid Javid]

The hon. Gentleman will know that the UK has had a long-running productivity challenge, which was made all the worse by Labour’s great recession. An increase in productivity is the surest way to raise real wages and I can assure him that it will be a major focus of this Parliament. We will shortly publish a productivity plan which I hope will reassure him that the Government take this very seriously.

[Neil Carmichael (Stroud) (Con)]

Does the Secretary of State agree that in challenging the productivity problem, we need to address our minds to skills and making sure that we have the appropriate pipeline of skills running through the education system to the businesses that desperately need them?

[Sajid Javid]

I congratulate my hon. Friend on becoming Chair of the Education Committee. He is right to talk about the link between better skills and increased productivity, and I hope that in his new role he can make a valuable contribution to that.

[Michelle Thomson (Edinburgh West) (SNP)]

Given that we are five years into the long-term economic plan and regrettably our productivity is 17% lower than the average among G7 economies, with growth in the EU 5% over the same period, why does the Minister believe that productivity will rise during the lifetime of this Parliament, since it fell during the last Parliament?

[Sajid Javid]

I welcome the hon. Lady to her place. She is right to point out the challenges of productivity, which have been a long-term challenge for this country. I hope she recognises that over the past five years the previous Government did a huge amount to turn around the economic fortunes of this country. We are the fastest-growing country in the G7, and just today we saw the Office for National Statistics revise growth figures for last year. That means thousands of jobs throughout Britain, including Scotland, making us the jobs factory of Europe.

[Michelle Thomson]

The Scottish Government, of course, are focused on growing our economy, using our four Is—innovation, internationalisation, investment and inclusion. Will the Minister support the Scottish National party call for a change to remove the sudden decrease in the investment allowance from £500,000 down to £25,000 from 1 January 2016 to help continue our success?

[Sajid Javid]

If the SNP wants to help business in Scotland, it should look at deregulating much more. In many of the areas that are devolved to Scotland, whereas the UK Government have been working hard to cut regulation, the Scottish Government have been working hard to boost regulation. Deregulation is one of the best ways to help productivity and growth in Scotland.

[Rebecca Pow (Taunton Deane) (Con)]

6. What discussions he has had with the Secretary of State for Culture, Media and Sport on the importance of superfast broadband to rural businesses.

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[Kit Malthouse (North West Hampshire) (Con)]

T1. If he will make a statement on his departmental responsibilities.

[The Secretary of State for Business, Innovation and Skills and President of the Board of Trade (Sajid Javid)]

May I first pay tribute to my predecessor, the equally hirsute former Member for Twickenham? As part of the coalition Government, Dr Cable did a great deal to support British business.

Speaking of former members, I see that last month Lord Sugar resigned his membership of the Labour party, citing its negative business policies and general anti-enterprise approach. It seems that while the Government are busy creating 3 million more apprenticeships, Lord Sugar has told the Opposition that they are all fired.

[Kit Malthouse]

As a small businessman—I draw the attention of the House to my entry in the Register of Members’ Financial Interests—I welcome the Government’s work in the past four years to roll back the red tape that has dogged small businesses. Now that the Government are firmly in control of the Department, can Ministers reassures us that they will redouble their efforts? In particular, will they develop measurable targets, for cutting red tape and administration for small business, against which we can measure success?

[Sajid Javid]

I fully agree with my hon. Friend. We will continue to work very hard to cut regulations, building on the very successful red tape challenge in the previous Parliament and the policy of one in, two out. Cutting regulation for businesses is like a tax cut for those businesses. The only difference is that it does not cost the Exchequer anything, so we should cut as much regulation as possible.

[Mr Chuka Umunna (Streatham) (Lab)]

Britain has the worst productivity in the G7, bar Japan. Proper adult skills provision, not just apprenticeships, plays a vital role in addressing that, but the adult skills budget has been cut by 35% in the past five years. Now the Chancellor tells us that a further £450 million is to be taken out of the Department’s budget, which could lead to the end of further education as we know it. In the light of these very real concerns, what assessment has the Business Secretary undertaken on the risks posed for the sector? Will he now guarantee that no college will close as a result of what he and the Chancellor are going to do?

[Sajid Javid]

One of the most important things for businesses, and for a vibrant economy, is making sure we continue to deal with the record budget deficit we inherited from the previous Labour Government. The hon. Gentleman knows that himself. He has been busy telling the press very recently:

“to be running a deficit in 2007, after 15 years of economic growth, was…a mistake.”

He understands the importance of this, and it means the Government have to make difficult decisions. He also said very recently to the Financial Times that

“We are starting from square one.”

I think he was talking about the economic credibility of the Labour party. I do not think that was an accurate statement; I think he was—

[Mr Speaker]

Order. The Front-Bench exchanges have to be brief. A lot of Back Benchers want to get in. It is very self-indulgent to have these long-winded exchanges from the Front Bench.

[Mr Umunna]

When consolidating, you have to make appropriate choices—you do not want to cut off your nose to spite your face. If we want to increase revenue, we need to increase productivity. Look at South Gloucestershire and Stroud College, which the Secretary of State attended: this month it confirmed that 70 staff posts are in danger due to the reduction in its adult learning funding. The principal of that college said:

“we need to reduce our costs in line with the reduction in funding to maintain our solvency.”

Should the alarm bells not be ringing when his own college is citing issues of solvency before we have seen the full scale of what he is going to do to the productive capacity of the economy?

[Sajid Javid]

It was an excellent college—[Hon. Members: “Was!”] And it still is. I know many people who attend the college and they speak of it very highly. The important point is that all colleges, not just that college, have the resources they need to do their jobs. We will not put that at risk, especially as they continue to invest in apprenticeships, which are one of the surest ways to give people the training they want and to ensure they have skills that are wanted in the marketplace.

[Bob Blackman (Harrow East) (Con)]

T3. I have been contacted by further education colleges in my constituency that are concerned about the decisions being made in-year to reduce funding. Will my right hon. Friend lay out a strategy that enables colleges to have a five-year programme, even if it means a gradual reduction in funding?

[Jeff Smith (Manchester, Withington) (Lab)]

T2. Will the Secretary of State tell me what discussions he has had with the Secretary of State for Transport to ensure that business and growth do not suffer as a result of the delay to the electrification of the trans- Pennine line?

[Sajid Javid]

I was disappointed by that recent news, because it is important that we continue to invest in infrastructure—not least for increased productivity and, therefore, jobs growth. I have not yet had a discussion with the Transport Secretary, but I am looking forward to doing so.

[Mr Christopher Chope (Christchurch) (Con)]

T5. Does my right hon. Friend think that the CBI’s poverty of ambition for a radical new relationship with the EU is attributable to the fact that the CBI receives funding from the EU?

[Sajid Javid]

The point I made yesterday to the CBI was not just about the CBI, but was a call to all business groups. The best way to get the EU reforms that many of them seek is for them to help the Government with their negotiations, speak to their partners in other European countries and then make up their minds at the end of the process.

[Simon Danczuk (Rochdale) (Lab)]

T4. I am sure the Secretary of State will agree that helping businesses to grow and develop is a key aim of the devolution and northern powerhouse agendas. Will he explain, therefore, why the word business does not appear anywhere in the Cities and Local Government Devolution Bill?

[Sajid Javid]

Not only do I agree with the hon. Gentleman about the importance of business, but my father’s first business began in his constituency, so I understand the importance of this to people in Rochdale and elsewhere. It is important that the word “business” and the importance of business appear throughout Government policy, as they do in the Conservative manifesto and, as I am sure he will hear next week, in the Budget.

[Paul Maynard (Blackpool North and Cleveleys) (Con)]

T6. Low-paid workers in my constituency will have been pleased to see the first above-inflation rise in the minimum wage since the financial crash, but what more can the Government do to encourage employers to pay the living wage where affordable?

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[Mr Iain Wright (Hartlepool) (Lab)]

May I congratulate the Secretary of State on his appointment and wish him and his ministerial team every success? On Thursday, he announced the sell-off of part or all of the UK Green Investment Bank, but it is unclear what proportion will be sold off. When it was established in 2012, the bank’s impact assessment said it was the only option that addressed market failure and barriers. How have these market failures been fully addressed and how will the Government’s sketchy plans for the most active green investor in the UK not undermine market confidence?

[Sajid Javid]

I congratulate the hon. Gentleman on being elected Chairman of the Business, Innovation and Skills Select Committee and look forward to working with him. Since it was set up three years ago, the UK Green Investment Bank has been very successful. In fact, this year, for the first time, it is expected to turn a profit. I want to make it stronger and even more successful, however, and one of the best ways to do that is to ensure it can access both private capital and private equity—

[Mr Speaker]

Order. I call Michael Tomlinson.

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[Susan Elan Jones (Clwyd South) (Lab)]

The Secretary of State will be aware of the great concern about the Government’s failure to meet export targets. With UK Trade & Investment’s own surveys saying that more than a quarter of businesses reckon that there is no business benefit from UKTI, how does he propose to deal with this problem?

[Sajid Javid]

We have seen some growth in exports over the last five years, but not enough. This remains a challenge, which means looking carefully at UKTI and improving what it does. That is exactly what the Minister for Trade and Investment, Lord Maude, is doing. The hon. Lady may know that we have seen record inward investment, which is also important and a job of UKTI to promote. It has now topped £1 trillion—the highest in Europe.

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[Gavin Robinson (Belfast East) (DUP)]

Has the Secretary of State had an opportunity to consider last week’s report from the Northern Ireland Consumer Council, which highlights the barriers to online consumers getting postage to Northern Ireland, the islands or the highlands of the United Kingdom? What steps can the Secretary of State take to create, dare I say it, a “one nation” consumer market where the inhibitors and the barriers are removed once and for all?

[Sajid Javid]

I have not yet had an opportunity to look at the report, but now that the hon. Gentleman has mentioned it, I shall certainly do so, and I shall then be able to respond to him on the issue that he has raised. He may be interested to know, however, that just today it was reported that consumer confidence throughout the United Kingdom had hit a 15-year high, which means that the Government’s long-term economic plan is working.

[Several hon. Members]

rose—