Oral Answers to Questions

Sam Gyimah Excerpts

Wednesday 3rd November 2010 Commons Chamber

[The Prime Minister]

Because we face the biggest budget deficit of any country in the developed world. That, frankly, is the prism through which such decisions must be seen. In politics there is a choice: either confront the problems in front of you and deal with them—that is what this Government are doing—or run away from them, like the Labour party. We are putting in place something that will be more targeted and more effective, but we must deal with the mess that we were left.

[Mr Sam Gyimah (East Surrey) (Con)]

Q6. What recent representations he has received on the likely effects on small businesses of the implementation of the Government's proposals for automatic enrolment in pension schemes.

[The Prime Minister]

I thank my hon. Friend for the question. The making automatic enrolment work review, which was published last week, examined the impact on businesses of the reforms. It concluded that small businesses did need to be included in the reforms if we are to bring about the improvement in savings for retirement necessary to tackle the consequences of an ageing population and widespread under-saving for retirement. These reforms will give 1.2 million people who work for small businesses the opportunity to save for their retirement. The review made a number of recommendations to try to help small businesses to introduce those reforms. We shall look at them extremely carefully to ensure that they are not too onerous.

[Mr Gyimah]

I welcome the Government’s desire to encourage a savings culture. However, for many small businesses, every new piece of legislation, no matter how small, has a significant impact on the bottom line. Will the Prime Minister introduce a scheme that allows us to road-test all new legislation and its impact on small businesses?

[The Prime Minister]

My hon. Friend makes an extremely good point, and this policy will be road-tested on the bigger companies that must introduce it first. However, we must accept that there is a problem with only 10% of very small businesses having pension provision, so 1.2 million people will have the chance to save. We will look very carefully at the reforms, and they will not be introduced for small businesses until at least 2014.

My hon. Friend will know that I have appointed Lord Young to look at all the impacts on small businesses. We also have the one-in, one-out rule under which every new regulation must mean that another regulation is scrapped.