Vince Cable
Main Page: Vince Cable (Liberal Democrat - Twickenham)Department Debates - View all Vince Cable's debates with the Cabinet Office
(10 years, 3 months ago)
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Mr Robin Walker (Worcester) (Con)
3. What recent assessment he has made of the competitiveness of the UK as a place to do business.
The Secretary of State for Business, Innovation and Skills (Vince Cable)
Last week, the World Economic Forum released its annual assessment of international competitiveness. The UK rose in the rankings to ninth place, and in relation to the responsibilities of my Department, to fourth place for labour markets and to second in the world for technological readiness and innovation. This is further evidence that our economic policies are delivering a more competitive economy. We are delivering on our commitment to make Britain the best place in the world to start and grow a business.
Mr Walker
I am grateful to the Secretary of State for that answer. I congratulate him and the Department on that progress. This Government have put making the UK the best place in the world to start a business right at the heart of that strategy, and businesses in Worcester are embracing that challenge. Does my right hon. Friend agree that it is a huge achievement that, since 2010, about 2,800 new businesses have been started in Worcester?
Vince Cable
And not only in Worcester. Indeed, one of the most rapidly growing programmes, operating through the British business bank, is the start-up loans scheme. My hon. Friend may be aware that approximately 19,000 start-up loans have now been made, with a value of over £100 million.
Mr Dennis Skinner (Bolsover) (Lab)
One business that is not growing—the Business Secretary knows that as well as me, because we met him a few weeks ago to talk about its demise—is the deep-mine coal industry. There are only three pits left now. Does he really want to preside over the demise of the last deep-mine coal pits in Britain? Two of them are in Yorkshire, and one is in Nottinghamshire. They are reaching the end of their lives, but they have reserves that should be exhausted. I have got a plan, and he knows about it. The Government should apply for state aid and get £70 million, which is only a tiny proportion of the £700 million that this Government took from the National Union of Mineworkers pension fund in February. That is all we need in order for those three pits—Hatfield, Thoresby and Kellingley—to be able to exhaust their reserves. Those are the conditions in Europe. Why does he not apply for the money, instead of being led by the Tories surrounding him, who are determined to see the end of the pits in Britain?
Vince Cable
The hon. Gentleman is right that we had a very good and constructive meeting with him and his colleagues on the future of the remaining deep-mine pits. He will be aware, because I think we explained this, that the state aid issue is much more difficult than he—
Vince Cable
I fear it is. I think that the hon. Gentleman will also recall that most of the deep-mine pits closed under the previous Government. However, we indicated that we were willing to advance a loan to make the closure of the pits a lot less brutal than it otherwise would be.
David T. C. Davies (Monmouth) (Con)
RBS has today recognised the competitiveness of the UK, or at least the southern part of the UK—the bits that are run by the coalition Government. Does my right hon. Friend agree that if RBS wants to domicile itself in the southern part of the United Kingdom, it should bring its jobs with it and not expect us to underwrite any mistakes that it may make in future?
Vince Cable
As it happens, I met the chief executive of RBS a couple of days ago. It is making good progress on sorting out the problems with its balance sheet and returning to normal business lending. I have been pointing out for quite a long time that the position of RBS in an independent Scotland would be very difficult, since its balance sheet is 10 times the size of the Scottish economy. It could hardly operate within Scotland as an independent country.
Andrew Miller (Ellesmere Port and Neston) (Lab)
Under the seventh framework programme, our universities were incredibly successful at accessing money, but our SMEs were not. Under Horizon 2020—the next programme —what steps will Her Majesty’s Government take to improve the lot of SMEs? Secondly, will the Secretary of State confirm that universities such as Edinburgh, which were hugely successful under framework 7, will not be successful if the vote goes the wrong way next week?
Vince Cable
On the hon. Gentleman’s latter point, he is right that Scottish institutions benefit disproportionately from UK research because of the excellence of their work and that they would no longer be guaranteed access to UK funding streams in an independent Scotland, although I hope they would maintain their excellence. We will certainly try to ensure that SMEs are taken properly into account in the competition for European funding. His point is a good one.
Mark Pawsey (Rugby) (Con)
A recent report showed that reshoring is increasing across the economy. That happens when UK companies source more of their products from the UK. It is estimated that over the next 10 years that could create 200,000 jobs and boost output by up to £12 billion. Does the Secretary of State agree that that is an effective demonstration of the increasing competitiveness of the UK economy?
Vince Cable
It is. Indeed, reshoring is happening in somewhat surprising areas. I had a meeting only yesterday with representatives of the British textile industry, which almost disappeared years ago. A significant amount of reshoring is taking place because companies want to be close to the market and regard the business environment as attractive. The same is happening in the aerospace supply chain and elsewhere. We are doing what we can to support that through the regional growth fund and other Government schemes.
Mr David Hanson (Delyn) (Lab)
Does the Secretary of State accept that companies such as Airbus, which is close to my constituency and which employs thousands of people, are successful and competitive because they work with German, French and Spanish colleagues to produce world-class planes? Does he agree that it is therefore essential that we remain part of a Europe-wide Union to ensure that we remain competitive?
Vince Cable
The right hon. Gentleman is absolutely right. The Airbus factory in north Wales is an extraordinarily impressive part of British manufacturing. Most of us who have been there have been overwhelmed by the quality of its work. He is right that it is a European company and that it could not operate on any other basis than as a European network. Another key factor in its success has been the industrial strategy and the support that it receives through the aerospace growth partnership.
Jim Shannon (Strangford) (DUP)
Northern Ireland is becoming a vital part of the United Kingdom’s business, trade and investment sector. It is showing clearly what it can do within the United Kingdom. Last week, Magellan Aerospace announced a £6-million investment and 47 new jobs in my constituency. Alongside that, there has been a £6.8 million investment in an advanced engineering and competitiveness centre for Northern Ireland, based in Belfast. Will the Secretary of State, in conjunction with the Northern Ireland Assembly and the Minister of Enterprise, Trade and Investment, Arlene Foster, develop innovative solutions in the advanced engineering sector, which are crucial to competitiveness and the growth of the British aerospace industry?
Vince Cable
Indeed, we will. I have had good discussions with Northern Ireland colleagues about the very successful advanced manufacturing sector. Bombardier has an expanding presence in Belfast, as the hon. Gentleman will know, and there are other parts of the aerospace supply chain that we are keen to develop in Northern Ireland.
Mr Chuka Umunna (Streatham) (Lab)
Before I ask my question, I am sure that on the anniversary of 9/11 the whole House will want to remember those who lost their lives, including British citizens, on that terrible day 13 years ago. Our thoughts, best wishes and prayers go out to their families and friends.
Scotland’s vibrant financial services sector is important to the UK’s competitiveness, and more particularly to Scotland’s competitiveness in the global marketplace. RBS has been mentioned, and no doubt the Secretary of State will also have heard Lloyds bank and Clydesdale bank say that they will relocate their headquarters to London in the event of separation. The vote next week is, of course, for the Scottish people, but does that not illustrate the lorry load of uncertainty for jobs, competitiveness and growth in Scotland that will come with the break-up of one of the most successful unions the world has ever seen?
Vince Cable
I absolutely agree with the hon. Gentleman and he makes the point well. In addition to the lists of institutions he has just given, Standard Life in the insurance sector has made it clear that it could not remain in Scotland were it to be an independent country. That relates to the need for large financial institutions to have a regulator, and in some cases a lender of last resort. A country the size of an independent Scotland would not be able to support those institutions. The hon. Gentleman is absolutely right in his approach.
Mr Barry Sheerman (Huddersfield) (Lab/Co-op)
4. What steps his Department is taking to increase the number of highly skilled workers.
Andrew Jones (Harrogate and Knaresborough) (Con)
5. What support he is providing to pubs.
The Secretary of State for Business, Innovation and Skills (Vince Cable)
The Government have introduced a number of measures to support pubs, including ending the beer duty escalator and cutting beer duty. We are supporting pub tenants through the introduction of a statutory code of practice to govern the relationship between pub-owning companies and their tied tenants, with an independent adjudicator to enforce the code. The measures will be introduced through the Small Business, Enterprise and Employment Bill.
Andrew Jones
I thank my right hon. Friend for that reply. Pubs are often the hubs of their communities, but in Harrogate and Knaresborough we have had a spate of local pubs being converted into supermarkets. Will my right hon. Friend work across Government, particularly with the Department for Communities and Local Government, to see what more can be done further to support pubs, and keep them open and at the heart of local communities?
Vince Cable
My hon. Friend is right, and I believe that his constituency houses the Pub is The Hub voluntary organisation that plays an extremely important role in that respect. I think it receives significant funding from my colleagues in the Department for Communities and Local Government and the Plunkett Foundation, and I encourage my hon. Friend to support that organisation in its work.
Sir Bob Russell (Colchester) (LD)
I endorse the question that has just been put, so will the Minister look across the Government—if we can have joined-up Government—at possibly reducing the rateable value on traditional community local public houses, which face a lot of competition from binge-drinking premises and supermarkets?
Vince Cable
The issue of rateable valuation will arise in the revaluation, when it occurs, but my hon. Friend will be aware that pubs have benefited significantly in the autumn statement from the package on business rates, which is worth £1 billion. A third of all pubs have now benefited from the £1,000 discount given to low-value property.
Toby Perkins (Chesterfield) (Lab)
The Opposition very much welcome the news that the Government are bringing forward a new pubs code in the small business Bill—we would, because we have asked for it on three occasions, and the Secretary of State has voted against it. He will know that there is concern that the appeals mechanism gives tenants the opportunity to have a “Here’s what you could’ve won” review of their appeal without any right to question it. There is also a sense that the small, family-owned brewers are being brought into a problem that they did not make. What representations has he had on the Bill, and can he give us any assurances that it will satisfy people who are worried about our pubs, so that we do not have to keep returning to the issue, and so that the industry has certainty on what the future in the next Parliament will look like?
Vince Cable
We have no wish to create problems for the small, family-owned pubs, which are an extremely important part of the industry. The hon. Gentleman will be aware that one cornerstone of the proposals is the free-of-tie rent assessment, which does not apply to pubs with smallholdings. Small, family-owned pubs are already subject to the voluntary code. In a sense, it would be right for tied pubs of all kinds to be given some protection.
Mr Rob Wilson (Reading East) (Con)
6. What steps his Department is taking to encourage investment in science.
Diana Johnson (Kingston upon Hull North) (Lab)
7. What steps the Government are taking to ensure the value of the minimum wage keeps pace with inflation and encourage firms to pay a living wage.
The Secretary of State for Business, Innovation and Skills (Vince Cable)
Since 2010, the national minimum wage has increased faster than average earnings. From 1 October, the adult rate will rise above inflation to £6.50, giving more than 1 million workers the biggest cash increase in their take-home pay since 2008. Last year, I asked the Low Pay Commission to look at the conditions needed for faster increases. It concluded that we are in a new phase of year on year, faster real increases in the national minimum wage.
Diana Johnson
Since 2010 there have been only three prosecutions for breaches of the national minimum wage law. If the Secretary of State agrees, as I think he will, that more needs to be done to enforce the minimum wage, why in January did Liberal Democrat Members vote down Labour’s proposals for tougher enforcement, including additional powers for local authorities to take enforcement action?
Vince Cable
Both sides of the coalition will be introducing and supporting tougher enforcement measures in the small business Bill. The hon. Lady will already know that, adding to the enforcement regime we inherited, we have introduced not just the naming and shaming procedure but the prospect of significantly tougher penalties and much larger fines.
Margot James (Stourbridge) (Con)
My right hon. Friend will know of the previous Government’s poor record on enforcing the minimum wage. Is he confident that with his new proposals we will dramatically improve on that poor record?
Vince Cable
We will, and an administrative measure that will help that process is an increase in Her Majesty’s Revenue and Customs’ enforcement budget. As my hon. Friend will know, the first stage in the process is to insist that the enforcement authorities address deficiencies in the minimum wage. She is right also to emphasise that the enforcement regime we inherited was a rather weak one.
Oliver Colvile (Plymouth, Sutton and Devonport) (Con)
9. What steps he is taking to increase access to higher education.
Mr Rob Wilson (Reading East) (Con)
T1. If he will make a statement on his departmental responsibilities.
The Secretary of State for Business, Innovation and Skills (Vince Cable)
Let me begin by paying tribute to three former ministerial colleagues who have left the Department. Appropriate cross-party tributes have already been paid to the right hon. Member for Havant (Mr Willetts), but as I worked with him very closely for four and a half years, I can say that he was a superb colleague who has left a major and constructive legacy. I also pay tribute to the right hon. Member for Sevenoaks (Michael Fallon), who is now the Defence Secretary, and to my noble Friend Viscount Younger of Leckie.
I welcome a series of new colleagues. The new Minister for Universities, Science and Cities is the right hon. Member for Tunbridge Wells (Greg Clark). The new Minister for Culture and the Digital Economy, the hon. Member for Wantage (Mr Vaizey), will be responsible for digital industries and related activities. The Under-Secretary of State for Business, Innovation and Skills, the hon. Member for Mid Norfolk (George Freeman), will be responsible for life sciences, and Baroness Neville-Rolfe is the new Minister responsible for intellectual property.
My Department plays a key role in supporting the rebalancing of the economy through business to deliver growth while increasing skills and learning.
Vince Cable
My Department published some detailed analysis, which I think enjoyed wide consensus. It was objective in relation to the potentially damaging effects not just on business and the British single market, but on research in the United Kingdom. As I said earlier, Scottish university institutions have attracted a disproportionate share of finance for the very good reason that they do excellent research, but that arrangement clearly could not be guaranteed in an independent Scotland.
Mr Chuka Umunna (Streatham) (Lab)
Sir David Barnes, former chief executive officer of AstraZeneca, told us that while companies should manage their tax affairs efficiently, it should not have been the driving force for Pfizer’s proposed takeover of AstraZeneca because it was
“a narrow basis on which to build an enduring and constructive business partnership.”
Does the Business Secretary agree with that general principle in respect of the takeover of important British companies?
Vince Cable
Yes, I do agree with that, and I made that very clear at the time. I think that the response of the Government, as well as of the shareholders of AstraZeneca, was a factor in persuading Pfizer not to pursue that bid.
Mr Umunna
The tax avoidance mechanism—tax inversion—that Pfizer sought to use through that takeover has been one of the main driving forces behind this year’s surge in cross-border deals. However, this week US Treasury Secretary Jack Lew said the Obama Administration would crack down on inversions pending further action by Congress. Does the Business Secretary share my concern that if we see takeovers of British firms being primarily driven by the desire to avoid US tax, there is a real risk of a large flight of capital back to the US when the threatened crackdown comes, leaving important UK companies high and dry?
Vince Cable
Again, I agree with the hon. Gentleman’s basic proposition. As it happens, much of the alarm that was raised some months ago about large American companies taking over British companies or British-based companies on the back of those tax provisions have proved wholly unfounded. He is quite right that takeovers, although they are generally beneficial to the UK economy, should not be driven by artificial short-term tax considerations.
Mark Pawsey (Rugby) (Con)
T3. Businesses in Rugby tell me that the changes this Government have made to the employment tribunal system have encouraged them to expand and take on more staff, and the growth in employment demonstrates that. Does the Secretary of State share my concern that Labour’s proposals to scrap our reforms would mean a return to the bad old days when companies were discouraged from taking on that extra person through fear of getting tied up in a weak or vexatious tribunal claim?
Vince Cable
Indeed, and the world competitiveness report acknowledged that Britain ranked number four in the world in overall attractiveness in labour markets. My hon. Friend is right that the reforms we have introduced are certainly one factor in that we have had a growth of 2 million in private sector jobs since May 2010. One factor that has not been noted, and certainly has not been noted by Opposition Members, is the very large number of cases now being dealt with by ACAS that would otherwise have gone through an expensive and frustrating legal procedure.
Diana Johnson (Kingston upon Hull North) (Lab)
T2. In asking my question, I want to make it clear that I want the Scots to remain our countrymen and women and not to become our competitors. The Government set up the UK Green Investment Bank in 2012 to boost investment in green technology and enterprise across the United Kingdom. With Hull and the Humber area emerging as a major UK centre for green energy and renewables, we would have extended a very warm welcome to having the bank in Hull. However, as we all know, its main headquarters is in Edinburgh, so can the Secretary of State just confirm that the UK Green Investment Bank can only be located within the United Kingdom?
Vince Cable
I think we all share the views that have been expressed across the House: that the United Kingdom is better together for a whole variety of reasons. The green investment bank is functioning very successfully with its current headquarters and operations. I think it has disbursed approaching £1 billion in a wide variety of projects from offshore wind to street lighting systems in Glasgow. It is a very successful initiative of this Government and I trust it will remain so.
Eric Ollerenshaw (Lancaster and Fleetwood) (Con)
T4. Given the importance of superfast broadband to businesses in both rural and urban communities, what is the Department doing about BT’s near-monopoly in contracts, which is leading to BT now missing out whole villages and even sections of Lancaster city in my constituency of Lancaster and Fleetwood?
Mr Barry Sheerman (Huddersfield) (Lab/Co-op)
May I say that I lament the moving of the right hon. Member for Havant (Mr Willetts)? One of the weaknesses of the parliamentary system is this stupid churn of Ministers, especially the good ones who should have been in the Cabinet and doing their job right through to the election.
May I push the Secretary of State on the subject of entrepreneurs? We need more of them in our country, along with more business start-ups. There are some very good tax incentives at the moment, so will he speak to the Chancellor about spreading the tax relief incentives out beyond the private sector? Let us give equal status to social investment and social enterprises. He will know that, at the moment, the cap is much lower.
Vince Cable
That has been an active subject of discussion with the Chief Secretary to the Treasury. Indeed, we have had a social enterprise day supporting worker-owned enterprises, and a consultation is taking place at the moment on how such activity can be facilitated through the tax system. I note the hon. Gentleman’s comment about the churn of Ministers. I should point out that I have been in my present job longer than anyone since someone called Peter Thorneycroft in the early 1950s.
Oliver Colvile (Plymouth, Sutton and Devonport) (Con)
T5. As my hon. Friend knows, Plymouth is the host of the Peninsula medical school. In the light of the Ashya King case, in which Ashya’s parents had to flee to another country to get treatment for him that was not available in the UK, what plans does he have to accelerate research into new drug and medical technology?
Joan Walley (Stoke-on-Trent North) (Lab)
From his talks with north Staffordshire MPs the Secretary of State knows the importance of the proposed European directive on origin marking. People need to be able to find out exactly where a plate has come from by turning it over, and the directive will be of great importance to the competitiveness of the ceramics sector and to public health standards. The next meeting of the working party on consumer protection and information will take place on either 16 September or 1 October. Will the Minister review his position before that meeting and abandon his opposition to this proposal? Will he also ensure that his officials are working on a full appraisal in order to enable the proposal to go forward?
Vince Cable
The hon. Lady and her colleagues from the ceramics industry constituencies have been very effective in pursuing this issue with me. When she last raised the matter with me, I reopened the question and we have been looking at it carefully. I will report back to her on where we will be positioned in relation to the latest discussions in the European Union.
Miss Anne McIntosh (Thirsk and Malton) (Con)
The Department announced the local growth fund recipient projects in July, and, for some bizarre reason, the A64 was left off the list. This has put a real question mark over the chances for rural economic growth across Ryedale and North Yorkshire. Will the Secretary of State review that decision at the earliest opportunity?
Mr Dennis Skinner (Bolsover) (Lab)
I wonder if the Secretary of State would care to amend the reply he gave to me about when the pits closed. Just for his information, between the end of the pit strike in 1985 and the onset of the Labour Government in 1997, 170 pits were closed, out of less than 200. Those are the figures. They cannot be denied, and if he checks the record he will see that I am speaking the truth. On a second issue, is it not stupid to be getting rid of 3,000 mining jobs in the three pits that I have referred to while at the same time importing more coal from Russia when there are supposed to be sanctions? Is there not a stench of hypocrisy here?
Vince Cable
The hon. Gentleman is, of course, right on the figures. When we came into office there were only three pits left and none of the 170 he mentioned had been reopened, although there was a long period of Labour government during which that could have happened if the economics had been as he describes them. We have been actively involved in the case of these three pits; we have no wish to see a sudden closure and mass redundancies, and we continue to talk to potential commercial parties about it.
Caroline Dinenage (Gosport) (Con)
Businesses in my region really welcome proposals in the Small Business, Enterprise and Employment Bill on prompt payment. However, £46 billion is currently owed to businesses in the UK—that is an increase of £10 billion on last year’s figure—so as the Bill goes forward will Ministers consider making the code even tougher and broadening it to more companies?
Vince Cable
The hon. Lady is right to say that, particularly given the overall problems with access to finance for small and medium-sized companies, the issue of late payment is crucial and that this is happening on a massive scale. We will, in the course of this Bill, be making it much more transparent how larger companies, in particular, make their payments—we will be helping small companies in that way. I am happy to look at how we can strengthen the code, and indeed we are talking to the Institute of Credit Management about how we can do that.
Barry Gardiner (Brent North) (Lab)
Two years ago, figures were released showing that the green economy, although representing only 6% of the wider economy, was responsible for 30% of the growth in the economy. Will the Secretary of State tell us the current figures and, in his new line-up, which Minister has been specifically appointed to be responsible for green economic growth?
Vince Cable
There is a green economy group operating through government. I serve on it, together with the Secretaries of State for Environment, Food and Rural Affairs and for Energy and Climate Change—I believe it has Treasury representation on it, too. We put enormous importance on having a green thread in policy and we have taken major initiatives in that respect, notably through renewable energy innovation, supply chain development and the establishment of the green investment bank.
Richard Graham (Gloucester) (Con)
The Secretary of State rightly highlighted the importance of re-shoring to revitalising our manufacturing and rebalancing our economy. Innovative companies such as Gloucestershire’s Future Advanced Manufacture Ltd discussed with aerospace customers how to manufacture locally parts previously made in the far east, and has done this with success. Does he think that there are more opportunities, with his Department leading, to discuss with the aerospace industry how the big contractors can look at their supply chains and consider re-shoring opportunities through small and medium-sized enterprises?
Vince Cable
The hon. Gentleman is right to say that the aerospace industry is one in which the British supply chain had been badly depleted over the years, and it is now being rebuilt. When I was last in India on a departmental trip I did visit an Indian aerospace company that was relocating to the UK, so this does happen. Through the aerospace growth partnership, which is a key element of the industrial strategy, re-shoring and building up the supply chain is a key element in the long-term planning of the sector.
Mr David Heath (Somerton and Frome) (LD)
May I ask the Secretary of State about the remuneration of university vice-chancellors, because the entry level appears to be about £160,000 a year? There are 127 vice-chancellors receiving more than £200,000 annually, 33 receiving more than £300,000 and four receiving more than £400,000. What is it about running a university that makes it so much more difficult and so much more remunerative than running the country?