Oral Answers to Questions

Sajid Javid Excerpts

Tuesday 15th March 2016 Commons Chamber

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

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

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

Britain is one of the top 10 places in the world in which to start and run a business. We are boosting skills, boosting productivity, raising the quantity and quality of apprenticeships in England, cutting tax and regulations and building stronger trading links with emerging markets.

[Rishi Sunak]

My rural North Yorkshire constituency is home to many businesses with strong local roots but global aspirations. May I ask the Secretary of State what his Government are doing to help small and medium-sized companies become exporters?

[Sajid Javid]

My hon. Friend is a distinguished entrepreneur and speaks with a great deal of experience, and I take what he says very seriously. I can reassure him that my Department is first in leading cross-Whitehall work on exports. UK Trade & Investment is one of those entities that connects UK businesses to export opportunities around the world. Indeed, the UK export hub is continuing to travel across the country, meeting first-time exporters face to face. It has already visited Yorkshire, and, indeed, it is in Yorkshire today.

[Chris Leslie (Nottingham East) (Lab/Co-op)]

How on earth are small and medium-sized businesses going to be competitive if, in 100 days’ time, they find that their access to those level playing field markets will be firmly thrown away and that that door will be shut in their face? What will the Secretary of State do to be much more vocal in highlighting the phenomenal risk to our businesses if we end up losing access to some of those important markets?

[Sajid Javid]

The hon. Gentleman is right to raise that issue. There are many risks with that decision. It is my personal belief that the uncertainty that could be created will be bad for business and bad for jobs and growth. However, there is a lot that the Government have done and will continue to do to support businesses. For example, they have cut the corporation tax rate, which I hope he welcomes.

[Mr David Nuttall (Bury North) (Con)]

I have yet to speak to a businessman from a small or medium-sized enterprise who has said that what they want is more regulation, either from this place or the European Union. Does not my right hon. Friend agree that the thing that would most help small and medium-sized enterprises become more competitive both in this country and around the world is for this country to leave the European Union?

[Sajid Javid]

I think that my hon. Friend is right to raise the issue of red tape regulation, as it can strangle businesses. That is why we are proud that, in the previous Government, we made a £10 billion cut in red tape for businesses and we are committed to make a further £10 billion cut, which I know that he welcomes.

[Rachael Maskell (York Central) (Lab/Co-op)]

Small and medium-sized enterprises in York are struggling to be competitive. With the cuts to local authorities, business rates are soaring by 11%, and that is on top of the additional costs that SMEs are paying. I will, if I may, ask a question on behalf of Frank Wood, chair of York Retail Forum, who says, “Do you want the high street without any shops?”

[Sajid Javid]

I think that what Frank would want is a high street full of customers. That means making sure that our economy remains strong. Our economy grew faster than any other G7 country last year, and that was because of our long-term plan, of which we will hear more tomorrow from the Chancellor.

[Geoffrey Clifton-Brown (The Cotswolds) (Con)]

Is it not vital that my right hon. Friend’s target of 100,000 new businesses exporting by 2020 is met by lighting that spark in small and medium-sized businesses to export for the first time and, above all, to keep exporting?

[Sajid Javid]

My hon. Friend is absolutely right. Not enough British businesses export. More than double the number of businesses export in Germany compared with that in the UK, so we can do more and that is at the heart of the Government’s strategy.

[Hannah Bardell (Livingston) (SNP)]

I am sure that the Minister will agree that a big part of helping small and medium-sized businesses become more competitive is ensuring that there is access to a skilled workforce. In National Apprenticeship Week, the Young Women’s Trust has shown that some employment sectors are hardly welcoming any young women. Fewer than 2% of construction apprentices and 4% of engineering apprentices are female. Will the Minister tell me what his Department is doing to encourage more young women into apprenticeships?

[Sajid Javid]

The hon. Lady raises an important issue. We want all people, and that means more and more women, to benefit from our apprenticeship programmes in England, Scotland and elsewhere. In the past few years, we have tripled the number of women in England who take up apprenticeships in engineering, and that is something that Scotland can look at as well to see how we achieved that. I also think that trying to get more women to think about these subjects should start at a much earlier age. We should not point the finger just at colleges and others; we should start at a much earlier age to try to encourage women to look at lots of different careers.

[Hannah Bardell]

The Minister will be aware, I am sure, of the great work that the Scottish Government and our Education Minister, Cabinet Secretary Angela Constance, have been doing, but I would suggest that he also needs to work very specifically on the issue of pay for women apprentices. Their male counterparts can be paid as much as 21% more an hour, so what steps are the Minister and his Government taking to ensure that good apprenticeships offer fair and equitable pay for all?

[Sajid Javid]

I am sure the hon. Lady will welcome the fact that under this Government the gender pay gap has fallen to its lowest since records began. Of course there is still much more to do, and at the heart of that is the fact that we will always require a strong economy, so I hope she will support tomorrow’s Budget.

[Callum McCaig (Aberdeen South) (SNP)]

2. What steps he is taking to help businesses increase their exports.

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

We are mobilising the whole of Government to improve the UK’s export performance. A refocused UKTI will be at the centre of a co-ordinated approach and relevant Departments will share their expertise to get British businesses exporting.

[Callum McCaig]

I thank the Secretary of State for that answer, but the reality is that the UK export story is one of declining market share in the global market. Does the Secretary of State agree with the assessment of the British Chambers of Commerce, and will he accept its calls for urgent and practical support for UK businesses to export?

[Sajid Javid]

What I do accept is that more needs to be done to get British businesses exporting. That includes the work of UKTI, but it also means that all Government Departments have a role to play. For example, UKTI works with the Great British Food Unit, an operation started by DEFRA. So I think a lot of Government can get behind exports by working more closely together.

[Richard Fuller (Bedford) (Con)]

If the UK left the single market, my understanding is that the highest tariff that could be applied on UK manufactured goods would be the World Trade Organisation’s simple average most-favoured nation applied tariff, which for non-agricultural products is 4.19%. Can my right hon. Friend write to me to confirm that is correct, and to provide a factual context for the so-called risks of leaving the European Union? Can he also write to me to confirm that that number is lower than the annual fluctuation in the euro/sterling exchange rate for each of the last three years?

[Sajid Javid]

In answer to my hon. Friend’s first question, of course I can check that tariff and write to him. He raises an important point about trade, and he has clearly raised the issue of tariffs, but he will be aware that there are lots of non-tariff barriers as well, particularly for services. It is important to look at those too.

[Alex Cunningham (Stockton North) (Lab)]

The Secretary of State’s word will do little for the 40 skilled staff of the Metabrasive steel foundry in Stillington in my constituency, which will close in May. So will he listen to the Materials Processing Institute and back its proposals for a materials catapult, which will provide productivity and innovation benefits for the production of metals, ceramics and other materials and promote our competitiveness and exports?

[Sajid Javid]

I am sorry to hear that that firm in the hon. Gentleman’s constituency may close. We should do everything we can to try to protect jobs like that, and certainly research has an important role to play. We are looking very carefully at that proposal and he will hear more shortly.

[Amanda Milling (Cannock Chase) (Con)]

Spartan Global Services in Cannock exports refurbished computers to businesses across the globe. Can my right hon. Friend outline what is being done to reduce barriers to exporting, and to encourage more businesses like Spartan to take up the opportunities that exports offer?

[Sajid Javid]

My hon. Friend has raised this issue before, and I know that many companies in her constituency could do a lot more if we had fewer barriers. One suggestion is that we should get on with the Transatlantic Trade and Investment Partnership deal between the EU and the US. That would be the world’s largest free trade agreement. It would be worth some £400 to each household, and it would certainly help companies like the one in her constituency export more to one of the world’s largest markets.

[Ms Margaret Ritchie (South Down) (SDLP)]

Will the Secretary of State have immediate discussions with his Cabinet colleague in the Department for Environment, Food and Rural Affairs regarding the need to ensure the export of pork from both Britain and Northern Ireland to Taiwan, which has been awaited since August 2015?

[Sajid Javid]

That is a very important issue. Food and drink is our biggest manufacturing industry, but a lot more can be done in terms of exports. I know that my right hon. Friend the Secretary of State for Environment, Food and Rural Affairs has taken this very seriously, and I will particularly look into the issue the hon. Lady has raised about Taiwan.

[Mr Nigel Evans (Ribble Valley) (Con)]

We have a massive trade deficit with the European Union but the balance is positive with the rest of the world. We have just celebrated Commonwealth Day. A relatively small amount of our trade is with the Commonwealth. As my right hon. Friend is refocusing his Department, will he embark on project Commonwealth so that we can export far more of our goods to our cousins abroad?

[Sajid Javid]

My hon. Friend is right about trying to do more with the Commonwealth. The links are strong and there has been a focus for many years on some countries, such as India. We have seen a big increase in exports and tourism, but there is always more we can do, so it is right to raise the issue.

[Mr Speaker]

A most extraordinary noise has just radiated around the Chamber. Is it a singing tie? That is very irregular. [Interruption.] No, it was not the Minister.

[Sajid Javid]

If I heard the hon. Gentleman correctly, he suggested that the SNP should get the credit for the rise in exports in Scotland. Scottish businesses have worked very hard to achieve that and I do not think anyone would credit the SNP with that. Where Government policy is important is in making sure that we have a stable, strong economy, and that is down to the economic plan that comes from Westminster.

[Mr Speaker]

I call Alison McGovern.

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[Alison McGovern]

3. What assessment he has made of trends in the level of lending to small businesses by (a) banks and (b) alternative finance institutions in the last five years.

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

I was about to get a warning. Maybe I will get it in a moment. The stock of bank lending to small businesses fell after the financial crisis but is now recovering, with four consecutive quarters of positive lending. Peer-to-peer business lending is becoming increasingly important as an alternative to bank finance. It has grown from £20 million in 2011 to nearly £1.5 billion in 2015.

[Alison McGovern]

I am sorry, Mr. Speaker. Given the Secretary of State’s proximity to the Chancellor, perhaps he does not need a warning. Perhaps he has already given a warning about the Budget, as he probably knows that in the north-west we have seen just half the business investment in SMEs of that in London. Clearly, something has gone wrong with the long-term economic plan if we are not seeing rebalancing, so what conversation have the Secretary of State and his Ministers had with the Treasury about its attack on other financial institutions—for example, building societies?

[Sajid Javid]

The hon. Lady is right to raise the importance of credit throughout every region of the UK for everyone who thinks a vibrant growing economy is important. We talk regularly with the Treasury about these issues—for example, about the work we do through the British Business Bank, which has provided more than £2.4 billion of financing over the past four years, helping some 40,000 businesses, many of them in the north-west.

[Andrew Bridgen (North West Leicestershire) (Con)]

When people take the decision to start their own business, it is on the back of a great idea or they have skills which are useful, but for most people turning a great idea or skills into a business requires expert advice. What steps is the Secretary of State taking to ensure that that advice is available to potential entrepreneurs?

[Sajid Javid]

First, I know my hon. Friend speaks with experience. He is a very successful businessman and no doubt he has talked to many businesses about this. One of the ways we try to help is through the growth hubs. We have made sure that every local enterprise partnership in England has a growth hub and we have increased the financing that goes into that, so locally tailored advice is available to local companies.

[Stephen Metcalfe (South Basildon and East Thurrock) (Con)]

4. What discussions he has had with the Secretary of State for Culture, Media and Sport on improving access to broadband for businesses.

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[Richard Graham (Gloucester) (Con)]

5. What estimate he has made of the UK’s balance of trade in services.

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

The balance of trade in services has increased from a surplus of £54.3 billion in 2010 to a surplus of £88.7 billion in 2015.

[Richard Graham]

The Secretary of State’s answer highlights the fact that, while exports in goods are vital, especially to manufacturing cities such as Gloucester, our surplus in services might be more vulnerable if we leave Europe. What assessment has he made of sectors such as insurance and investment managers, whose businesses are passported across Europe, and other service sectors, such as advertisers, accountants, animators, designers and film producers?

[Sajid Javid]

My hon. Friend speaks with experience: he is a distinguished former pension fund manager—a very important service that the UK industry provides. He is right that the EU’s financial services passport means that financial services firms authorised in the UK can provide their services across the EU, without the need for further authorisations. That is, of course, a significant benefit that they receive. Services represent almost 80% of our economy, and access to the world’s largest single market helps them to create thousands of British jobs.

[Mr Barry Sheerman (Huddersfield) (Lab/Co-op)]

The Secretary of State must know that however good the growth in services exported from this country is—and we all applaud it—it must go hand in hand with an increase in manufacturing. Is he not worried that Syngenta—one of our leading agritech companies—will be taken over by ChemChina, backed by the Chinese Government? What will that do for our competitiveness and our supply chains? Why will he not meet a cross-party group of MPs that has begged to meet him?

[Sajid Javid]

Of course the hon. Gentleman is right about the importance of manufacturing in our economy, which is why it has increased in terms of output, employment and value since 2010. The company he mentions, Syngenta, has itself said that there should be no change in its footprint in terms of employment—in fact, we expect that to increase. Also, when it comes to foreign investment in British industry, I see that as a vote of confidence. Since companies such as Jaguar Land Rover have received foreign investment, employment has gone up threefold, and that is great for British manufacturing.

[Mr Philip Hollobone (Kettering) (Con)]

Our strong performance in services is still not enough to offset the difficulties we are having with our trade with the European Union, with which we now have an annual trade deficit of £62 billion. Given that non-EU trade exports have increased by 30% since 2010, is not it clear that the best future for this country is to be outside the European Union, so that we can negotiate free trade agreements with China, India, Brazil, the Commonwealth and the rest of the world?

[Sajid Javid]

I agree with my hon. Friend that it is clear that trade agreements can lead to more trade with those countries and reduce any other barriers. Through the EU we have access to over 50 trade agreements at the moment, whereas other countries such as the US or China have 14-odd trade agreements. I agree that we need to focus a lot more on trade, but the trade agreements to which we have access today are very valuable in terms of global trade, not just with the EU.

[George Kerevan (East Lothian) (SNP)]

Is the Secretary of State aware that productivity in our flagship service industry—financial services—has fallen behind similar productivity in the United States, in France, and even in Italy? Can he explain that? Is it something to do with the regulations that his Government have imposed on financial services?

[Sajid Javid]

I am not sure whether it is to do with regulations, because all the other markets that the hon. Gentleman mentions have also had to look at regulations after the financial crisis. However, he rightly highlights a general productivity problem across British industry in all sectors, where we are some 25 points behind with our G7 competitors. That is why we have a productivity plan, working with industry to turn that around.

[Rehman Chishti (Gillingham and Rainham) (Con)]

6. What steps he is taking to protect consumers from faulty and unsafe products.

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[Karl MᶜCartney (Lincoln) (Con)]

10. What recent steps he has taken to promote regional growth in the Midlands.

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

I continue to promote the long-term economic plan for the midlands engine, which aims to add an extra £34 billion and 300,000 jobs to the midlands economy by 2030. Just last week, I opened a new factory and also an innovation centre in the midlands.

[Craig Tracey]

In National Apprenticeship Week, we can all welcome the creation of over 2.6 million apprenticeships since May 2010, including 500,000 in the midlands and 5,140 in my constituency of North Warwickshire. Will the Secretary of State join me in welcoming a report published today by Universities UK? It shows the potential for new degree apprenticeships to help to meet the needs of employers in my constituency and across the whole country, and to encourage more universities to deliver these important degree apprenticeship courses.

[Sajid Javid]

Yes, I will. Let me congratulate my hon. Friend on the hard work he has already put in during his short time in his new role. He will know that there has been an increase of 137% in apprenticeship starts in his constituency in the past five years. He is absolutely right to raise the importance of degree apprenticeships, because he knows this is about quality, not just quantity. I welcome the report from Universities UK today on this issue, because we will do everything we can to support more degree apprenticeships.

[Karl MᶜCartney]

My constituents in Lincoln, along with the people of Lincolnshire, are grateful for the Government’s investment so far in diverse areas such as our transport infrastructure and apprenticeships, which are delivering clear business benefits. Will my right hon. Friend advise me whether I should be hoping for any further investments, like those that he and I have previously discussed with our right hon. Friend the Chancellor of the Exchequer, in the Budget tomorrow?

[Sajid Javid]

My hon. Friend is an incredibly powerful advocate for the people of Lincoln. His energy is legendary: he is like the Duracell bunny. Let me congratulate him on the success he has already achieved on behalf of his constituents in securing local investment. Like him, we are all waiting to see what the Budget holds.

[Mr Speaker]

I think that was intended as a tribute. It will doubtless be communicated by the hon. Gentleman to the good burghers of Lincoln the length and breadth of his constituency.

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[Lucy Allan (Telford) (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)]

It is a busy week for the Department. We are in the middle of British Science Week, which will see millions of people attend thousands of events across the country. Yesterday, I helped to launch National Apprenticeship Week and met some remarkable young people learning the skills needed to do the jobs of tomorrow. Tomorrow, of course, is Budget day. We will hear from the Chancellor about our long-term plan to make Britain the best place in the world to start and to grow a business.

[Lucy Allan]

The Secretary of State will remember the several visits he made to my constituency, so he will be delighted to know that on Thursday this week the Telford International Centre is hosting a national apprenticeships show, including local employers Capgemini, Stadco and Juniper Training. Telford has had a dramatic fall in youth unemployment. Will he join me in congratulating Telford businesses, colleges and the many other people who have helped youngsters to get the first step on their career ladder?

[Sajid Javid]

I am pleased to see my hon. Friend is wearing an apprenticeship badge today to mark this important week. I recall fondly a number of visits to Telford and meeting local businesses. I join her in warmly congratulating those local businesses, colleges and training providers on the work they have done to boost apprenticeships, which are up 120% over five years in her constituency. That means thousands of young people being helped to achieve their full potential.

[Ms Angela Eagle (Wallasey) (Lab)]

It is National Apprenticeship Week, British Science Week, Global Consumer Day—and the Ides of March. Today, the CBI has released a survey showing that 80% of its members support the case that staying in the EU is best for jobs, growth and investment. They are right, are they not, Secretary of State?

[Sajid Javid]

The best outcome of the referendum for business, jobs and growth in Britain is that we remain. That provides us with the opportunities we need. The uncertainty of a leave vote would be the enemy of jobs and growth.

[Ms Eagle]

I thank the right hon. Gentleman for that response. It was not heard brilliantly on parts of his Back Benches. Is his lukewarm response for remaining not now irritating both sides of his divided party and damaging the Government’s case to remain in the EU? When the Prime Minister launched the Conservatives’ “in for Britain” campaign, the Business Secretary conveniently had a prior engagement, announcing that:

“with a heavy heart and no enthusiasm, I will be voting for the UK to remain a member of the European Union.”

He asserted that he would remain a “Brussels basher”, but is he not really increasingly seen in his own party as a Brexit betrayer? With 100 days to go to the EU referendum, does the overwhelming case for remaining in the EU not deserve a Business Secretary who can campaign with his heart as well as his head?

[Sajid Javid]

It is a shame that that is the best the hon. Lady can come up with. One would think she would want to make a positive case. I think she should focus on speaking to her own boss and asking him about the contribution he wants to make to this debate.

[Andrea Jenkyns (Morley and Outwood) (Con)]

T3. I was a comprehensive school girl who left school at 16, so social mobility is very important to me, and I am pleased to be involved in the new inquiry by the all-party parliamentary group on social mobility into getting people from diverse backgrounds into top professions. Will my hon. Friend tell me what steps the Government are taking to ensure that more people, regardless of their background, can secure further education or employment?

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[Craig Tracey (North Warwickshire) (Con)]

T8. Like many in the House, I welcome the Chancellor’s moves to develop a northern powerhouse, but my constituents are also interested in the Secretary of State’s work to drive forward the midlands engine. Will he assure me that tomorrow’s Budget will contain welcome news for my constituents and people across the west midlands?

[Sajid Javid]

I can reassure my hon. Friend that the Government are absolutely committed to a long-term economic plan for the midlands engine, and he will know that I was involved in the launch of the midlands engine prospectus. We are looking for a £34 billion increase in the local economy and 300,000 jobs by 2030, which will benefit his constituents as well as mine.

[Greg Mulholland (Leeds North West) (LD)]

T4. I welcome the Minister’s reiteration last Wednesday of her and the Department’s view that they will abide by the will of the House of Commons regarding the pubs code, which currently includes an outrageous measure whereby tenants have to surrender the length of their lease for the market rent only option. To ensure that she abides by the will of the House, will she see that that measure is taken out at the final stage of drafting?

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[Andrew Griffiths (Burton) (Con)]

The Secretary of State will know that the beer and pub industry in the west midlands employs 86,000 people in 5,000 pubs, has 124 breweries and contributes £1.3 billion in tax. Given his support for the brewing industry when he was in the Treasury, when he led the call for the duty cut, will he outline what his Department is doing to support the beer and pub industry—and will he pick up the phone to the Chancellor and ask him for another cut?

[Sajid Javid]

My hon. Friend has been an excellent advocate of that industry, helping it to grow and create thousands of jobs. He will have just heard from the Minister for Small Business, Industry and Enterprise, my right hon. Friend the Member for Broxtowe (Anna Soubry) about the Pubs Code Adjudicator, which I think is a very positive development. I have heard my hon. Friend loud and clear on the desire for a further cut, and I know he has made his representations to the Chancellor. When I was Economic Secretary to the Treasury, I recall getting a beer named after me—Sajid’s Choice, which was a fine brew—so there are many reasons to cut beer duty.

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[Michelle Donelan (Chippenham) (Con)]

Does the Minister agree that we need to give more training support to small businesses to encourage them to hire women who are re-entering the labour market after significant career breaks post-children?

[Sajid Javid]

I absolutely agree with my hon. Friend. We are focusing strongly on the issue, and we are working on it with the Women and Equalities Minister. We want to ensure that women have the same opportunities as men to re-enter the work force, and we will treat that as a big priority.