Oral Answers to Questions

Stephen Hammond Excerpts

Tuesday 17th January 2023 Commons Chamber

[Maggie Throup (Erewash) (Con)]

4. What steps he is taking to support small and medium-sized businesses.

[Stephen Hammond (Wimbledon) (Con)]

16. What steps he is taking to support small and medium-sized businesses.

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Kevin Hollinrake)]

It is absolutely right that we direct support where we can to our SME community. We have reversed the national insurance rise, saving SMEs approximately £4,200 a year on average; provided £13.6 billion of business rates support over five years; cut fuel duty for 12 months; and raised the employment allowance to £5,000. The energy bill relief scheme is also protecting SMEs from high energy costs, as will, from April, the energy bills discount scheme.

--- Later in debate ---

[Kevin Hollinrake]

I thank my hon. Friend for raising that point. This is a very significant problem for many businesses, particularly micro-businesses. Our prompt payment and cash flow review will examine business behaviours and small business experience of late payment and long payment terms, to help ensure that the UK has arrangements in place to best support small businesses. It will include looking at the payment reporting obligations and a review of the role of the Small Business Commissioner.

[Stephen Hammond]

Wimbledon’s clubs and pubs are at the heart of our community and, like my hon. Friend the Member for Ruislip, Northwood and Pinner (David Simmonds), several have asked me how the Government will ensure that the scheme meets the needs of hospitality. Will my hon. Friend ensure that Ofgem takes action against suppliers whose actions damage small businesses in my constituency and across London?

[Kevin Hollinrake]

My hon. Friend raises a very important point. My r hon. Friend the Minister for Energy and Climate and I recently had a roundtable with energy suppliers to discuss exactly that point: ensuring that the support the Government are providing is passed on to SMEs. The energy suppliers assure us that that is happening. We have asked Ofgem to take a closer look at that and it will report back to us shortly.

--- Later in debate ---

[The Minister for Science, Research and Innovation (George Freeman)]

We agree that the most vulnerable consumers in this country should be protected. Those duties already lie with Ofgem. I shall repeat what my right hon. Friend the Secretary of State said earlier: it is completely unacceptable that vulnerable patients leave hospital and find that they have been automatically disconnected. We are convening a roundtable meeting and my right hon. Friends the Secretary of State and the Minister for Energy and Climate are putting pressure on Ofgem to make sure that vulnerable consumers are looked after.

[Stephen Hammond (Wimbledon) (Con)]

T4.   Wimbledon is one of the best places for young diverse entrepreneurs to start up. The recent London Chamber of Commerce and Industry report suggested that there were problems and additional problems for those entrepreneurs to access finance. What exactly are the Government doing to make sure that access to finance is open to as many people as possible?

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Kevin Hollinrake)]

The UK, including Wimbledon, is one of the best places in the world to start a business, as evidenced by the OECD report. My hon. Friend is right to raise the issue of access to finance, particularly for diverse groups. The Start-Up Loans Company has provided £1 billion of loans to around 100,000 businesses, including £2 million of loans to businesses in his constituency, and 40% of those loans go to people from a black, Asian and minority ethnic background.

Royal Mail and the Universal Service Obligation

Stephen Hammond Excerpts

Thursday 12th January 2023 Westminster Hall

[Stephen Hammond (Wimbledon) (Con)]

It is a pleasure to serve under your chairmanship, Ms Ali, and to contribute briefly to the debate. I will read out two emails from constituents. One says:

“My son was sent a Penalty Charge Notice”

on 25 November, but it did not arrive until 15 December. That was from Mrs Martin, of Dora Road in my constituency. Today I had an email from Mr Smith, who said that the “shambles” continues; the Christmas decorations are down and the left-overs have been consumed, but he is “still receiving Christmas cards”. The first email was from December 2021, and the second from December 2022. The problems we in Wimbledon are experiencing with Royal Mail are not just this year’s problems. I have had numerous meetings with Royal Mail and my constituents, and the unions attended one of them. The postal service in Wimbledon is not delivering for my constituents. There was a short-term improvement, and management promised that they would change some working practices, but none of that has happened.

Wimbledon suffers particularly. I heard the complaints of the hon. Member for Jarrow (Kate Osborne) about Royal Mail’s management, and I agree that they are undoubtedly partly to blame. However, the CWU headquarters are in Wimbledon, and the CWU sees the operation in my constituency as a trial of strength with management. That undoubtedly means that we get a worse service than pretty much anywhere else in London—probably than in most of the country. Frankly, that confrontational attitude hinders my constituents.

The debate is about the future of the universal service obligation, as the hon. Lady said. The universal service obligation set out in the Postal Services Act 2011, which privatised Royal Mail, should be adhered to for my constituents, as well as for everyone across this country. I note that the Government have said that they will not change the universal service obligation from six days to five. Can my hon. Friend the Minister confirm that, if the Government are ever minded to do so, they will set out a way for other industries not to be impacted by a decline in the service? Can he also confirm that they have instructed Royal Mail not to become a parcel-only service? Despite so much being done by email, the postal service is still hugely important to many of my constituents and, I am sure, those of other hon. Members.

What will the Minister do to ensure that Ofcom meets its obligations as a regulator? We have very few levers to pull that will influence Royal Mail, tell it what to do or tell it how to improve its service; Ofcom has those levers. I often receive emails from constituents who ask me why I have not done more, or why Ofcom is toothless. What will the Minister do to ensure that Ofcom, which seems to have been largely absent during the poor delivery of the service, meets its obligation to hold Royal Mail to account, and to ensure that Royal Mail meets its universal service obligation?

Clearly, the current dispute is a problem and results in pressure from both sides. I hope that the Minister can reassure us that the universal service obligation, which is so important to the constituents of Wimbledon and other places, will be met.

Community Energy Schemes

Stephen Hammond Excerpts

Tuesday 30th November 2021 Westminster Hall

[Stephen Hammond (Wimbledon) (Con)]

Is the hon. Lady not right that clause 3 is the nub of this Bill, because all too often in regulation we have a one-size-fits-all approach that is not proportionate to the scale of the operation or the ambition? If a specific duty was placed on Ofgem to ensure that both the regulation and the cost were proportionate to the size of the ambition and the operation of the local generator, we would see that 0.5% figure rise quite dramatically.

[Wera Hobhouse]

Indeed—I completely agree. I urge the Minister to look at clause 3 of the Bill, which would give Ofgem the task of setting up the local supplier licence process, which should be proportionate to the size of the operator.

The Government have said many times that they support community energy; I am grateful for that, as are all of us in the Chamber. In the last debate on community energy, the former science Minister, the hon. Member for Derby North (Amanda Solloway), outlined the Government’s agreement with the broad intentions of the Local Electricity Bill, which was very welcome.

Those who support the Local Electricity Bill accept that it can be improved. We want to work constructively with the Minister and his Department to improve it, so today I will address some of the Government’s concerns. I will take each concern as outlined by the Government in turn.

First, the Government have said that there is already a right to local supply through existing rights and flexibilities, but we have heard why that system probably does not work; Ferrari analysis springs to mind. The existing rights and flexibilities simply do not address the problems faced by local suppliers. The huge potential for more community energy generation is not being realised. Community energy has seen no significant growth in the last six years, standing at a mere 278 MW of electricity generation capacity. No existing community energy group in the UK is licensed to sell its electricity directly to local customers.

Licence Lite, the scheme set up in 2009 to award geographically-based energy supply licences, has resulted in only three such licences being granted since the scheme was established. The key flaw in Licence Lite is the need for local renewable generators to partner with a willing licensed energy utility.

Secondly, the Government say that changing the rules risks distortion in the energy system. The energy markets and the energy system are the result of the rules that govern them. These rules are much as they were when they were introduced for the 1990 privatisation. They might have made sense at that time, but now that there is such huge potential for distributed smaller-scale renewable generation they are now outdated.

Thirdly, the Government say that changing the rules risks increased costs for consumers. The evidence shows the opposite. In 2020, community energy organisations spent nearly £900,000 on energy efficiency upgrades, helping over 45,000 people to reduce their energy bills. A twentyfold increase could be achieved from community energy schemes by 2030.

Fourthly, the Government say that changing the rules risks further unintended consequences. However, they have not really outlined what those unintended consequences are, so I hope that the Minister can say what he thinks they might be. Those of us who support the Bill want to work together with the Government, as I have said.

I draw the Minister’s attention to a recent report from the UK Energy Research Centre, to which academics from Imperial College London have made a significant contribution. It is a very important report, and it identified five different business models that could work together to ensure a thriving community energy sector. It is clear not just about the important role that collaboration between communities and the private sector has to play in community energy but about what the Government must do to support community energy solutions.

The report also says that the Government should set clear and sustained targets for growing the community energy sector, and introduce policies and regulations that allow space for small actors, which we have heard about. That must go hand in hand with sufficient investment in energy efficiency retrofitting, an area where the Government do not have a very good record.

I have three questions for the Minister today. I have sent them to him in advance, so I hope that he has had time to prepare his response to them. My first question is simple: will he commit to including the Local Electricity Bill in future energy legislation? Secondly, he said in recent letters to Members of this House that the Local Electricity Bill risks creating distortions in the energy system and having other unintended consequences—apart from the increased cost, which I have addressed. Can he outline what these distortions and consequences are, because knowing them will allow me and other supporters of the Bill to work on improving it?

Finally, I wrote to the Minister earlier this month, together with the hon. Members for Wantage, for Waveney, for Ceredigion, as well as the hon. Member for Glasgow North (Patrick Grady) and the right hon. Member for Leeds Central, asking him to meet us. We are keen to work constructively with the Government. Will he agree to that meeting? There is a great deal of cross-party support for the Bill, as we can all see in this room. We have an opportunity to do something significant on our path to the net zero transition, building the public consensus we need. Otherwise, we might face significant delays to deliver the necessary changes. Community energy is not just nice to have and it is not just a cherry on the top of a sustainable economy cake; it should be at the heart of what we do to get to net zero.

Oral Answers to Questions

Stephen Hammond Excerpts

Tuesday 6th July 2021 Commons Chamber

[The Minister for Business, Energy and Clean Growth (Anne-Marie Trevelyan)]

The hon. Lady will know that I have sent my reply in to the BEIS Committee, but I also had a very constructive meeting with a number of the trustees just a few weeks ago and we have agreed to continue. I have left them with some questions that they must go to talk to the rest of the trustees about, and my door continues to be open for them to bring back propositions if they want to continue to discuss this.

[Stephen Hammond (Wimbledon) (Con)]

If his Department will publish its net zero strategy before the 2021 summer recess.

[The Minister for Business, Energy and Clean Growth (Anne-Marie Trevelyan)]

We will publish our comprehensive net zero strategy ahead of COP26. It will set out the Government’s vision and how we will meet our ambitious goals as we transition to net zero emissions by 2050.

[Stephen Hammond [V]]

I thank my right hon. Friend for her response. She will know that many infrastructure institutions, including the Institution of Civil Engineers, have called on the Government to deliver a system-wide plan for transitioning the UK infrastructure. Will she confirm that when she publishes the strategy in the autumn—I take that from her response—it will provide the policy certainty for infrastructure and the supply chain so that there is investment and we can ensure that the necessary initiatives are put in place to enable the Government’s aim of net zero to be achieved?

Corporate Insolvency and Governance Bill

Stephen Hammond Excerpts

2nd reading & 2nd reading: House of Commons
Wednesday 3rd June 2020 Commons Chamber

[Stephen Hammond (Wimbledon) (Con)]

It is a great pleasure to follow the shadow Secretary of State. During this crisis, many of us have experienced groundhog day, and we have certainly just experienced it now; looking at the right hon. Gentleman at the Dispatch Box took me back to a period before 2015.

I warmly welcome the Bill. As the shadow Secretary of State said, the Secretary of State is right to set this legislation in the context of an extraordinarily impressive set of business measures—regardless of any tinkering around the edges that is needed—that the Government have put in place to tackle the covid crisis. We are right to recognise that in normal circumstances the Bill probably would have been split into two phases. Some of the changes that it contains are permanent, and have been debated and consulted on certainly since 2016, but maybe earlier. Other changes are rightly temporary, as they are urgent measures to address the challenges faced by many in the corporate sector who would not necessarily normally be experiencing such problems with insolvency. The flexibility is therefore clearly right.

As I have said, the Bill sets out a number of permanent and temporary concepts and provisions. I will spend a little bit of time reflecting on one or two of the permanent ones, before finishing with a particular temporary issue that affects my constituency. The Bill outlines the concept of moratorium, and it is quite clear what that is. It gives the challenged business a 20-day opportunity to consider a rescue plan. That can be extended for a further 20 days if the directors ask for it, and can, as I understand it, be extended for a whole year should the creditor or the court consent. The purpose of that is clearly obvious, and all that makes a huge amount of sense. During that period the directors retain control of the company and no legal action can be taken against it without a court decision.

However, the process is overseen by a monitor, a point on which I want to raise a few issues that I hope my Front-Bench colleagues will consider or at least address later. First, my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake) has already raised with the Secretary of State the potential conflict of interest to do with whether the monitor is sanctioned by an independent regulatory body or is just a normal insolvency practitioner that could be taking work from one group of companies with one hand and, with the other, working against that in looking at insolvency. I hope my right hon. Friends on the Front Bench will carefully consider the point about regulation and bring something back quickly.

The second point concerns the criteria that the monitor has to use for the moratorium, the time it could take to assess whether the definition is met, and whether the criteria are too tightly drawn or could be met more quickly if they were more easily drawn. I recognise the need for the monitor to make a suitable statement about the moratorium. The current threshold is whether

“in the…monitor’s view, it is likely that a moratorium…would result in the rescue of the company”.

However, the monitor has a relatively short period in which to make that assessment. In normal circumstances there would be a huge amount of due diligence done on trading, future trading, inspection of management accounts, general financial arrangements and debt arrangements. Not only does that normally take longer than 20 days; it is potentially a costly process to undertake. Particularly given the spirit of what we are trying to do in the Bill, will Ministers consider whether it might be more effective to look at the definition of the criteria and approve a slightly lower threshold for what constitutes a company that could be rescued? That might be as simple as saying that “it is likely” that the moratorium could result in the rescue of the company, as opposed to saying that “it must”. That would be of considerable help in rescuing companies.

[Kevin Hollinrake]

I agree with my hon. Friend and support his point. I think the provision to which he is referring is proposed new section A6(1)(e) in the Insolvency Act 1986, which contains the wording:

“in the…monitor’s view, it is likely that a moratorium for the company would result in the rescue of the company as a going concern.”

Simply changing “would” to “could” would resolve the issues.

[Stephen Hammond]

My hon. Friend drafts the amendment for me. I absolutely agree, and I hope those on the Front Bench will too. That would seriously help with what we are trying to do at this stage.

The permanent measures are designed to allow as many companies as possible to be rescued and to continue trading, but these companies will be creditors of others. In that regard, we must also look at the Bill’s potentially perverse impacts. I have a constituency case, Ms Ravindran, a constituent who runs a design business. It is a small company that is owed £36,000 by an individual, and at least 10 other creditors are owed up to £200,000 in total by that particular individual and company. She is rightly concerned that the Bill will give undue protection to one rather than the other. The issue is that it will be clear to those intending to use the provisions of the Bill to protect themselves, and to enable themselves to trade through and be rescued or restructured, that they should not be undertaking activities. I would like the Minister’s reassurance that the companies seeking to be rescued will not be able to take early advantage of things such as directors loans to take money out of a business that is then likely to apply for a moratorium and thereby impact others who are debtors of that company.

There is also a potential problem that I hope the Minister will be able to reassure me about later. Under the current drafting, ongoing trading costs and scheduled debt repayments that occur during the moratorium do get paid. Those that do not get paid become a super-priority, but nothing prior to that gets paid. The concern is that the potential suppliers to a company in the moratorium period may try to game that period. They may well see a company in difficulty and decide that it is easier to put the payments due to them in the moratorium period, so that they get super priority, not in the normal supply. I suggest to the Minister that the way around that is to have a look again at whether there could be some tweaking of the definition and to consider that the Bill be amended so that only the interest and charges incurred during the moratorium, rather than the scheduled debt repayment, becomes the super priority. That would take away the incentive to game the system.

There is clearly an understanding about why changes are proposed in the Bill to the termination of supply contracts. We all know that currently a supplier could use contractual terms to cease supply. Therefore, ensuring that a company that has entered into a moratorium or a restructuring procedure, as defined by the Bill, is not forced to rely on the usual contractual terms is clearly right, but there are some other circumstances. Again, have we thought clearly enough about the protection to the supplier? My right hon. Friend the Secretary of State rightly talked about some of the protections that are there, but it is clear that the non-payment of those debts to the supplier could put that supplier into insolvency as well, because it may not be able to get the protection from the court fast enough.

I think that the definition of what constitutes hardship to the small or medium-sized supplier or the company in the rescue package might clearly present some—I was going to use the phrase “wriggle room”—legal possibilities that should not be contemplated. Beyond the definition of hardship, should there not at least be a legal obligation in the restructuring plan that requires a supplier’s status to be given legal protection? I think that is quite important, and it inevitably means some reconsideration of the named cross-class clampdown proposals as well.

A lot has been said about the supplier and making sure that it continues to supply, and, hopefully, the company getting those supplies is then rescued. Again, however, in some circumstances not every company entering the restructuring procedures will actually be rescued. It simply will not happen. What happens then? As I understand it, the supplier is given the super priority status, but—and this leads into another point I want to make in a moment—will Her Majesty’s Revenue and Customs, or indeed other financial providers, want to be given super super priority status over and above that of the supplier? The provisions to ensure the continuity of supply are welcome, but I ask my hon. Friend on the Front Bench to reflect on whether he can reassure us about the protections to the suppliers.

That leads directly to my next point, which is that the Bill reintroduces the concept of making HMRC a preferential creditor. I am very concerned that all the good work that my right hon. Friend the Secretary of State is doing in this Bill could be unwound by doing that. It could have a really negative impact on business rescuing and lending across the UK.

Do not take my word for it: R3, the industry insolvency practitioner, directly makes that point. It goes against a policy, which has encouraged lending to small businesses, that has been in place for some 18 years.

[Kevin Hollinrake]

That is a very important point. I think the legislation is covered under clause 95 of the Finance Bill, which makes HMRC a preferred creditor once again. The real concern is not just that lenders will be less willing to lend on that basis—that is a concern because you go above lenders with a floating charge—but that HMRC may be less willing to show forbearance to businesses that are seeking protection and time to get through these problems.

--- Later in debate ---

[Stephen Hammond]

I thank my hon. Friend. The House will be pleased to know that it will not need to listen to the next couple of minutes of my speech on the basis that he has just made exactly the point I wanted to make about the floating charge in particular. They are the normal financiers to those sorts of businesses. If they find themselves displaced in the ranking of credit priority, they are less likely to lend and that will have an impact. It was introduced in 2002 and has seen an extraordinary expansion of lending via those floating charge providers. It would seem odd that we are, in one place, trying to do one thing in one piece of Government legislation, and potentially undermining the impact of this very welcome Bill in another. I hope the Minister will, with his formidable powers of persuasion, speak to the Treasury about this matter.

[Edward Miliband]

I have a long list.

[Stephen Hammond]

The shadow Secretary of State says that he has long list. I am sure we all have, but I have only one point today, which is this particular issue. I ask the Minister to have a conversation with the Treasury about whether that measure, which it may or may not want to do, needs to be brought in now, because I think it will impact this Bill.

Finally, I want to talk about one of the temporary changes that directly affects my constituency. I welcome the flexibility that is being allowed to charities and bodies to move their annual general meetings or to hold them digitally. That is extremely sensible, but it does not cover all bodies. It does not cover charities set up under an Act of Parliament, or charities that are not CIOs—charitable incorporated organisations.

The wonderful Wimbledon and Putney Commons is such a body. It was set up in 1871 by an Act of this place and it has, in its constitution, a requirement that it meets in person, that all levy payers are instructed of the date of the annual meeting and that it must happen by the end of June. The measures in the Bill would undoubtedly help the conservators who run the common. The trouble is that it does not apply to them. May I therefore make a particular plea to the Minister to say in his winding-up speech either that the Bill will include all charities rather than just those set up under CIOs, or that all bodies set up by an Act of Parliament are included, such as the Wimbledon and Putney conservators—Wimbledon and Putney Commons. [Interruption.] I said conservators. For those who want a history lesson, I made that slip in my maiden speech, but I am not making it now. If that is not possible, I ask that there be a definitive statement that the Charity Commission specifically allows some temporary flexibility to those bodies. With that entreaty on behalf of Wimbledon Common, I thank you Mr Deputy Speaker.

--- Later in debate ---

[Drew Hendry]

I agree and I am willing to concede that some people have indeed been helped. I said that the scheme was introduced with the best of intentions, but the fact is that there are far too many people running businesses who have tried to access this scheme but could not do so. We have heard examples, and I could give dozens more from people who have contacted me. I guarantee that just about everybody—if not everybody—in the Chamber has had similar contact from people who have been unable to access the scheme. The fact is that it is not working as it was intended to. It is not getting through to the people who really need it, notwithstanding those who have been able to access it.

My party, the Scottish National party, also backs calls by the Institute of Directors for the Government to use the scheme to provide firms with overdrafts during this crisis. For firms still unable to access finance, it is high time—indeed, it is overdue—for direct grants and/or equity investments to be offered instead.

The final problem is public and business confidence. We are at stage four in the covid crisis at the moment. There has been a relaxation of measures for people to get out and about and do things and for businesses to start up, but that confidence evaporates if we have to go back to the restrictions and businesses are not able to do that. That will pile on the pressure for the businesses that we are trying to assist today.

I was struck by what was said by the hon. Member for Wimbledon—I hope I get this right—about one of the problems being the protection of one thing at the expense of another. That is a really good comment, because overall confidence and compliance for people and businesses will face further threat. All measures that are introduced by a Government who are, unfortunately, defined by double standards are likely to run into difficulties. This UK Government, these measures and those on public health are all being undermined by the failure to deal with the Dominic Cummings saga. No matter how much the Prime Minister bloviates, this matter has not gone away. My inbox and, I am sure, those of many others, were still full this weekend of messages from people looking for that to be addressed. I know that it is not a party thing, because I have seen the tweets and messages from people representing constituencies and parties around the House—they have all had the same messages. This matter—the principle of different rules applying—has not gone away or failed to register. We might take the comment of the hon. Member for Wimbledon and say that the protection of one at the expense of all others applies here. Observance of the rules is critical to the success—[Interruption.]

[Stephen Hammond]

The hon. Gentleman has taken a bit of latitude with what I said. I was pointing out that this was beneficial, but that we needed to consider the interests of the other and therefore their protection. He is corrupting, or misusing, my words, shall I say.

[Mr Deputy Speaker (Mr Nigel Evans)]

Order. I think we might be straying a bit further afield from what we are supposed to be debating this afternoon.

Budget Resolutions

Stephen Hammond Excerpts

Wednesday 31st October 2018 Commons Chamber

[Stephen Hammond (Wimbledon) (Con)]

It is a pleasure to follow the hon. Member for Coventry South (Mr Cunningham) and to make a short contribution to the debate. I was very lucky to attend one of the best state secondary schools in the country. I was taught by inspirational teachers, and I remember two in particular today. My history teacher said, “Remember that there are myths and rewriting of history.” As I listen to Labour Front Benchers today, I note that their economic history is certainly being rewritten.

I was also reminded of my English teacher, who taught us that the great Shakespearean themes are appearance and reality. For many, the appearance of Wimbledon is that it is a leafy suburb where we play a bit of tennis and not much else happens, but the reality is rather different. Like so many places up and down the country, there will be rejoicing on the high streets of Wimbledon Park, Raynes Park and Motspur Park at the news on business rates. High streets and local high streets are at the heart of our community, whether people live in a suburb such as Wimbledon, a smaller town or a rural area, and this is to be welcomed.

[Faisal Rashid]

Will the hon. Gentleman join me in welcoming the Chancellor’s decision to use the Budget to show his support for Labour’s plan for Government by taking on board our long-standing policy to take action to support ailing high streets?

--- Later in debate ---

[Stephen Hammond]

The Labour party had 13 years to enact support for the high streets; this Government and this Chancellor are doing it. Therefore, I will concentrate on what is happening here and now and not on something that will not happen. Labour has not been elected to Government.

The reality of Wimbledon is also that we are a high-performing, small, high-tech, entrepreneurial, start-up suburb, and there is much in this Budget that will be extraordinarily helpful to those firms. The annual increase in the investment allowance will undoubtedly start to provide the certainty and encouragement that businesses need. The commitment to reviewing the taxation of intangible fixed assets and the reduction in the capital allowances special rate are going to start to stimulate the investment that this economy needs, has seen and will continue to see.

Many high-tech businesses are mobile. This means that for many, the choice of where people are located is not just between Wimbledon and anywhere in the UK, but between the UK and anywhere else in the world. A Budget that supports digital infrastructure and high-tech companies is to be welcomed. If a modern industrial strategy is to mean anything, it needs to mean that we support the industries of the future as well as the industries of the past. This is what the Budget does.

It is equally invaluable that we have high-quality infrastructure, whether physical or virtual, and measures in the Budget show the Government’s ambition. The extension of the national productivity investment fund provides the bedrock for those improvements to 2023-24. That is combined with extra funding for broadband, the transforming cities fund and the industrial strategy fund, in which there is £100 million for Made Smarter. That is going to transform hugely manufacturing in digital technologies. I am delighted that that has happened, and I was fortunate recently to visit Print City at Manchester Metropolitan University. This will be one of the industries of the future.

The industrial strategy, however, is not just about physical infrastructure; it clearly has to be about building a workforce who are skilled to face that challenge. The Turing scholarships speak to that need, but we also need an economy that has skills for everyone, if we want everyone to benefit from it. Government Front Benchers will know that the revival of apprenticeships since 2010 has been a life-changing opportunity for so many. During Colleges Week two weeks ago, I was fortunate, like many, to visit young people at Merton College who want to participate in IT apprenticeships. Measures to extend incentives for apprenticeships, and to stimulate the opportunities for small companies to play a huge part—particularly those in the small, high-tech entrepreneurial sector, such as those that I mentioned in Wimbledon—and to take more people on and provide them with a quality life experience will transform the opportunities for many.

However, there are a couple of elements that I hope Government Front Benchers will consider in this Budget. Everyone supports extending choice and opportunity for tertiary education. Despite what my right hon. Friend the Member for Haltemprice and Howden (Mr Davis) said, I believe that student loans have facilitated a huge extension of the numbers of people going to university, but can it really be fair to charge an interest rate of 6.1%? It could become a disincentive, notwithstanding the fact that many loans are not paid back, and I urge the Minister to discuss with the Chancellor whether it can be justified. It would send a huge statement to young people going to university.

No one will quibble either with the Chancellor’s claim that everybody should pay the tax they owe, but HMRC’s application of IR35 rules is often retrospective, unresponsive and unfair. Under modern working arrangements, contractors are often working and employed for longer than they used to be. I understand the need for the rules, but there is an issue with the certainty and consistency of their application. I hope that Ministers and HMRC will reconsider whether it is fair.

As the Chancellor and others have acknowledged, risks lie ahead. The OBR’s growth forecast today is 1 percentage point lower than it was in 2015. There can be no other explanation than the uncertainty surrounding Brexit. If we had continued with the level of growth projected in 2015, not only could we have undertaken the largest fiscal loosening in a generation, providing vital investment for public services, but fiscal Phil could have met his fiscal objectives and balanced the books.

I urge the Minister to bear it in mind that no deal means no transition, uncertainty for British business and trade on worse terms. It is crucial, as the OBR has said, that we see no further disruption from Brexit and get a negotiated settlement that allows British business to prosper and the benefits of the Budget to come through for everyone.

Oral Answers to Questions

Stephen Hammond Excerpts

Tuesday 13th March 2018 Commons Chamber

[Andrew Griffiths]

The hon. Lady must have missed the intention behind what the Government were doing with the Matthew Taylor report. Not only are we committed to continuing the existing employment rights and protections, but we are going further and faster than anyone else—further and faster than our European colleagues—to give gig workers and others in vulnerable conditions, such as agency workers, greater protections than ever before. We are not just talking about it; we are protecting those workers.

[Stephen Hammond (Wimbledon) (Con)]

12. What steps he is taking to support growth in the small business sector.

[Mr Speaker]

I call the Minister.

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Andrew Griffiths)]

Apologies, Mr Speaker. I was congratulating myself too much!

The Government-owned British Business Bank provides £4 billion to support more than 60,000 UK small and medium-sized enterprises. We plan to unlock more than £20 billion of investment in innovative and high-potential businesses, including a new £2.5 billion investment fund with the British Business Bank. The Small Business Commissioner helps with payment issues, dispute resolution, and the sourcing of advice throughout the UK. Through the industrial strategy, we are continuing to invest in 38 growth hubs across England, as well as the business support helpline.

[Stephen Hammond]

Of course I join in the congratulations to the Minister, but he will know that one of the crucial requirements for the success of the small business sector is access to and understanding of finance, and there is considerable evidence that there is currently a knowledge gap in the market. What are the Government doing to address that?

[Andrew Griffiths]

My hon. Friend has hit the nail on the head. We are concerned by reports that businesses, particularly small businesses, are reticent about coming forward to access finance that could help them to invigorate and grow. That is why the British Business Bank produces “The business finance guide”, in partnership with the Institute of Chartered Accountants in England and Wales and industry bodies. The guide explains the different sources of finance that are available to smaller businesses, and is also published online. The British Business Bank will launch a new digital platform in the spring to raise awareness even further.

Oral Answers to Questions

Stephen Hammond Excerpts

Tuesday 12th December 2017 Commons Chamber

[Mr Speaker]

What an enticing prospect for the hon. Member for Monmouth.

[Stephen Hammond (Wimbledon) (Con)]

7. What steps he is taking to support growth in the small business sector.

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Margot James)]

Through the industrial strategy we will drive over £20 billion of investment in innovative and high growth businesses. We will increase the national productivity investment fund to £31 billion. We are working to ensure that small and medium-sized enterprises win more public sector contracts to enjoy the benefits of that investment.

[Stephen Hammond]

My hon. Friend the Minister will know that many local authorities have reliefs, including small business relief, which they could use. Unfortunately, not all local authorities are using them. Will my hon. Friend say what the Government could do to encourage local authorities to use those reliefs so that all small businesses benefit?

[Margot James]

The Department for Communities and Local Government has issued clear advice to councils that will enable them to calculate the relief that is payable to businesses in the current year. I urge them to pay heed to that advice and implement it. My hon. Friend may be interested to know that Merton council has been allocated £459,000 of business rates discretionary relief in the current year.

Oral Answers to Questions

Stephen Hammond Excerpts

Tuesday 12th September 2017 Commons Chamber

[Claire Perry]

I am sure that the hon. Lady will welcome the fact that we have made available more than £2 billion to support innovation and research and development in the sector. If a company in her constituency has specific projects that it would like to bring forward, I would be delighted to meet her to consider them.

[Stephen Hammond (Wimbledon) (Con)]

T8. Now that it is autumn, many of our constituents are concerned about the cost of fuel and energy this winter. What can the Secretary of State say to reassure all our constituents that fuel and energy will be accessible for all this winter?

[Greg Clark]

We still have in this country some of the lower energy prices in Europe, but the major energy companies’ increases for those on the standard variable tariffs are clearly unacceptable. The issue has been identified by Ofgem, which needs to take action to correct it.

Industrial Strategy

Stephen Hammond Excerpts

Thursday 20th October 2016 Commons Chamber

[Stephen Hammond (Wimbledon) (Con)]

It is a pleasure to follow the Chair of the Select Committee, the hon. Member for Hartlepool (Mr Wright). For a long time, the words “industrial strategy” struck fear into the heart, and raised the hackles, of many on the right of the political spectrum. Those words called to mind the era of excessive government intervention and anti-market philosophy, with the Government picking winners—usually winners that were declining—deciding on nationally strategic industries, and pursuing anti-competitive practices and industrial relations policies that stifled competition.

[Kelvin Hopkins (Luton North) (Lab)]

When it comes to industry, the most interventionist Government in Europe is Germany. It is also the most successful economy in Europe.

[Stephen Hammond]

That very much depends on how we define intervention; we might come on to that later in the debate.

To meet the challenges of the 21st century, especially in post-Brexit Britain, industrial strategy should be about four things: the Government creating the ecosystem or the environment in which industry can succeed and in which national productivity—a huge challenge—can be increased; ensuring that our country has the skills that it needs; ensuring access to finance; and boosting and promoting industries of competitive and comparative advantage.

When we talk about the ecosystem or environment, we almost inevitably talk about infrastructure. One of the achievements of the previous Government was that even in a time when we had to pay down the deficit, infrastructure was reckoned to be the key factor for economic growth. Public sector support has, rightly, been provided for all sorts of developments over the past few years, most notably in transport, energy, housing and broadband communications. The National Infrastructure Commission, which made it possible to look across sectors and move away from the previous silo approach, has had a great impact.

As the hon. Member for Hartlepool pointed out, an urgent priority for the Government has to be a consideration of not only how we strategically assess, but how we deliver. That is partly about smart procurement and making the Government an intelligent client. Our inability over the years to specify design has meant that costs have inevitably increased, so the cost base and project management costs have been much higher than they would otherwise have been. The Treasury optimism bias or risk quotient, depending on what one calls it, has had to be increased throughout. By driving into the Infrastructure and Projects Authority some of the skills needed for the delivery of smart procurement, we will be able to reduce costs and make projects more attractive and fundable.

We need to get the private sector much more involved than it has been so far. If we travel anywhere else in the world, we will use roads and bridges that are privately owned and run, and the fact that they are privately owned and run does not make them any less useful. A commitment to infrastructure must be a cornerstone of any modern industrial strategy, so I gently say to the Minister that I hope he will push his colleagues for the appointment of a new Minister for infrastructure, preferably with some responsibility for industrial strategy, and preferably a Member of this House rather than the other place.

Our departure from the European Union will give us a couple of fortuitous possibilities in what some of us think will be a difficult time. The EU procurement rules are some of the most onerous and bureaucratic anywhere in the world. Getting rid of them from our procurement system will undoubtedly help small industry and the supply chain. State aid has been a way of thwarting, as well as supporting, a lot of investment, and we will no longer have to abide by all the state aid rules. I hope that the Minister will say later that he accepts that challenge.

[Andrew Bingham (High Peak) (Con)]

I have an example in my constituency of state aid preventing development. That development would help companies, and if we can do so, they will grow and create jobs upon jobs. The current situation seems ludicrous and we would be well rid of it, in my view. Does my hon. Friend agree?

[Stephen Hammond]

There will be some real opportunities. We will have the chance to re-examine our regulatory regime and competition policy to ensure that the UK is at the forefront of not only oversight, but competition.

If the movement of labour is restricted, there will be an acute skills shortage in this country, so we urgently need to look at ways of curing that. The Government have been at the forefront of one of such initiative, namely specialist academies for major infrastructure projects that allow us to build some of the skills that we have lost, but we need to do more. The Crossrail tunnelling academy is a prime example, and several other major rail projects are establishing academies alongside their projects. We would do well to continue to push that forward.

The recent Institution of Civil Engineers “State of the Nation 2016: Devolution” report recommends the creation of regional pipelines for infrastructure to identify where opportunities exist so that industry and academic institutions can invest in the training required.

In the longer term, there are two things the Government should urgently study and consider. The first is giving 14 to 18-year-olds an understanding of the fact that academic skills are not the only requirement for success in life, and that other things should be set alongside such skills. Why not have a national vocational qualification, alongside GCSEs and A-levels, to attract people into engineering? Equally, it would be perfectly possible for the Government to set up outreach projects that go beyond the theoretical and teach the application of STEM subjects.

Secondly, on finance, I hope the Minister will take the opportunity of our being rid of the state aid rules to consider some of the possibilities open to us. Almost inevitably, sovereign debt is chosen as the way to fund projects, because the weighted average cost of capital is cheaper. However, many countries look at possibilities in the private sector, such as pension funds, venture capital and sovereign wealth funds. The UK still seems to be suspicious of such funding. We should encourage the UK pension industry and other industries to set up direct investment funds. Equally, with the new freedoms they will have, the Government should explore setting up regional infrastructure and industry bonds, or regional equity schemes. This could be the new popular capitalism—the Mayism of the new century, just as popular capitalism was the Thatcherism of the 1980s. That will mean that people can invest in their country and region, and invest in their country’s success.

[George Kerevan]

The Scottish Government have already set up a Scottish investment bank, managed by Scottish Enterprise, which has significantly increased equity investment in small businesses.

--- Later in debate ---

[Stephen Hammond]

I am delighted to hear that. I am sure that the Scottish Government will want to take the opportunity of raising a sovereign wealth bond as well.

[George Kerevan]

indicated assent.

[Stephen Hammond]

I see that the hon. Gentleman agrees. My point is that we could now do this regionally, probably by using local enterprise partnerships as a delivery mechanism.

With any infrastructure policy, there is the challenge of what the Government need to do to organise the machinery of government that will support it. The National Infrastructure Commission represents a great strategic advantage to this country. The Minister has already heard me talk about the need to ensure that the IPA delivers on making the Government a smart client. Equally, the Government should look at the machinery in place and then sweat that machinery to ensure industrial success. Many of the LEPs can play a role in helping with regional skills and financing.

Finally, many incubators have already been set up in universities, which is fabulous. My hon. Friend the Member for Warwick and Leamington (Chris White) mentioned the one in his constituency, and there are others around the country, such as the agri-corridor in East Anglia, and particularly those in Cambridge, Leeds and Manchester, and across the north. However, we now want accelerators, which are for the next stage up. Businesses that have been in an incubator and have received some support are sometimes left to drift, and that is where universities can play a big role by bringing forward accelerators to help those businesses to reach the next phase of growth. We have talked a lot about picking winners, and if I had not spoken for longer than my eight minutes, I would have said much more about that. The Government need to ensure that universities focus those accelerators on our areas of comparative advantage. I know that the Minister—wearing not only the business hat he has on this afternoon, but his universities hat—will make that point to them. I am grateful for the opportunity to have spoken in the debate.