Oral Answers to Questions

Vince Cable Excerpts

Thursday 20th November 2014 Commons Chamber

[John Stevenson (Carlisle) (Con)]

1. What steps he is taking to support the manufacturing sector.

[The Secretary of State for Business, Innovation and Skills (Vince Cable)]

Our industrial strategy sets the long-term direction needed to give manufacturers confidence to invest and compete internationally. We are encouraging technology commercialisation, exports, investment, improving skills, and building UK supply chains. I am sure my hon. Friend will join me in congratulating Cumbria local enterprise partnership, which has been awarded £5 million under regional growth fund round 3 to support specialist manufacturers.

[John Stevenson]

A flourishing sawmill on the edge of Carlisle employs 120 people. Those in the timber industry are concerned that they are not included in the proposed relief scheme for the indirect cost of renewables, despite being accepted as an energy-intensive industry under the climate change agreement. That could give a competitive advantage to imported timber. Will the Minister look at the industry’s case and report back to me?

[Vince Cable]

I will certainly look at that—indeed, we already are. The hon. Gentleman will be aware of the more general issue of energy-intensive industries, and we have sought to achieve relief through compensation under the European Union emissions trading system and the carbon price floor. We have recently consulted on how to extend that relief in respect of renewable obligations and the feed-in tariff. That consultation has just ended and will incorporate industries depending on their energy intensity and trading capacity. We will announce the results shortly.

[Mr Frank Roy (Motherwell and Wishaw) (Lab)]

The steel industry is vital to manufacturing in the United Kingdom. Will the Secretary of State take the opportunity to tell the House exactly what has been happening with Tata Steel’s proposed sale of its long products division?

[Vince Cable]

Members across the House are concerned about the future of the long products division in Tata Steel. As the hon. Gentleman may know, I have had discussions with Cyrus Mistry in India, chief executive of Tata, and I recently met Mr Klesch, who has an interest in taking on that business. We are in close touch with Members across the House on the progress of those discussions, and I will report back when developments arise.

[Mark Pritchard (The Wrekin) (Con)]

While the Secretary of State is right and the Government have set out a national industrial strategy, will he put on record his praise for the job creators, innovators, and entrepreneurs in Shropshire who have created more than 1,000 jobs in the last year in agri-engineering, food manufacturing, car parts manufacturing, and the manufacturing that is being brought back from Europe and put into Shropshire?

[Vince Cable]

The hon. Gentleman describes a powerful trend. I am delighted that it is operating in his constituency and I congratulate the firms concerned. He refers to the process of onshoring production that had gone overseas, and I believe that around one in 10 British manufacturers are now considering that process. I have recently come back from India where I met a company called Amtek that is bringing car supply chain and production back to the UK—it may even be in the hon. Gentleman’s county.

[Mr Iain Wright (Hartlepool) (Lab)]

My hon. Friend the Member for Motherwell and Wishaw (Mr Roy) has already mentioned the importance of the UK steel industry, which underpins much of our manufacturing industry. Is the Secretary of State also aware of cheap imported steel being dumped into domestic markets, failing British standards and raising question marks about quality, traceability and reliability? Reinforcing steel used in the UK is certified under the CARES scheme. Is he confident that that scheme is working as well as it could be? What steps is he taking to ensure that such steel is tested, compliant with British standards, traceable and safe?

[Vince Cable]

That issue has been brought to my attention by British producers and it is a legitimate question. I am in the middle of an inquiry into whether the testing process operates effectively and takes proper account of different standards as between UK producers and those overseas. We have no ideological view on anti-dumping. It is a matter of proof and fact and operates through the European process, as the hon. Gentleman knows.

[Robert Halfon (Harlow) (Con)]

2. What recent support he has provided to small businesses.

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[Heidi Alexander (Lewisham East) (Lab)]

3. What estimate he has made of the contribution net trade will make to GDP over the next four years.

[The Secretary of State for Business, Innovation and Skills (Vince Cable)]

In March, the Office for Budget Responsibility expected net trade to make a roughly neutral contribution to growth until 2018. However, since GDP data methodology has recently been revised we will not have a fully updated view until December, with the OBR’s new forecast.

[Heidi Alexander]

Recent statistics from the Office for National Statistics show that the UK’s trade deficit has risen to £2.8 billion in September, up from £1.8 billion in the previous month. In the light of that, will the Secretary of State confirm that since the Government’s direct loan facility was launched a year ago to help businesses to export, only one firm has benefited from such support since it was announced?

[Vince Cable]

The hon. Lady is horribly out of date; dozens of companies are now benefiting from that new suite of credit facilities, which is one of a range of activities we are putting in place to support British exporters. When we entered office, about 27,000 companies were helped by UK Trade & Investment, but that is now up to 50,000, and the impact is already being felt in the big emerging markets, such as China and India, where there is very rapid export growth.

[Ian Swales (Redcar) (LD)]

The Investment Management Association told me last week that Asian investors were increasingly looking to mainland Europe because of the uncertainty over the UK’s membership of the European single market. What effect will this uncertainty have on the Secretary of State’s trade forecasts?

[Vince Cable]

My hon. Friend is right to stress the importance of inward investment to job growth in the UK. Indeed, many manufacturers and banks in the City of London have made it clear that the expectation of being able to export to the European single market is fundamental to their decision to locate here.

[Ian Austin (Dudley North) (Lab)]

Will the Secretary of State welcome the contribution that will be made to trade by the Ladder for the Black Country, a brilliant apprenticeship scheme established by the Vine Trust and the Express and Star, which is working with hundreds of businesses to provide thousands of apprenticeships and give young people the jobs and skills they need to develop careers? Is this not exactly the sort of scheme that should be copied nation-wide?

[Vince Cable]

On the basis of that quick précis, it sounds as if it is. As the hon. Gentleman knows, we have seen a rapid expansion of apprenticeships, which we are very proud of, as they are fundamental to meeting the demand for skills, particularly higher skills. I would be interested to hear more about his local programme and to see what we can do to help.

[Andrew Jones (Harrogate and Knaresborough) (Con)]

Will the Secretary of State join me in welcoming the recent news that record amounts of British food and drink are now being exported—something that I was doing before I came to this place—and that great British food is now available in more than 150 countries?

[Vince Cable]

Yes, it is often forgotten when we talk about manufacturers that the food and drinks sector is the largest by a considerable measure. It is a considerable success and we are supporting it, not just through the work of UKTI, but through our work on agri-tech industries, innovation and the skills strategy.

[Ian Murray (Edinburgh South) (Lab)]

The Government promised an export-led recovery, but as my hon. Friend the Member for Lewisham East (Heidi Alexander) mentioned, the trade gap is widening and exports are going backwards. Why, then, have the Government, mid-year, slashed the budget for the trade show access programme that helps small businesses new to exporting or new to markets to gain access to international trade shows? I have had sight of a private letter from the trade association, the Sponsors Alliance, to the Prime Minister asking him to reverse this dreadful decision. Will the Secretary of State support this plea from small businesses and not slash the funding they desperately need to support their exporting activities?

[Vince Cable]

First, there is no question of the budget being slashed; it has been substantially increased, and the question is how much it should have been increased by. I am aware of the concerns of trade associations, however, and have met them and discussed the matter with them, and we are endeavouring to ensure they have the maximum support.

[Mr Speaker]

I call Mr Chris Ruane. He is not here; therefore, the grouping with Question 12 falls, and questioner 12 will have to come in at that point.

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[Philip Davies (Shipley) (Con)]

10. What his policy is on representation of people from ethnic minorities in boardrooms.

[The Secretary of State for Business, Innovation and Skills (Vince Cable)]

We believe that it is in the best interests of business to tap into the widest talent pool, resulting in a diverse and representative business leadership. I have therefore asked Trevor Phillips to start a new private sector-led campaign that will seek to address the lack of ethnic diversity in boardrooms. The purpose of the campaign will be to achieve success similar to our work on addressing gender diversity in boardrooms.

[Philip Davies]

Some people, like me, believe that all appointments should be made on merit. Some believe in political correctness, and think that merit is unimportant and that boardrooms should represent the population at large. The Secretary of State seems to be in a league of his own as a politically correct champion who believes neither in merit nor in representation; instead, he believes that ethnic minorities should be over-represented in the boardroom. Will he explain why that is the case and why he, as a Government Minister, will not give out the message that jobs should be given on merit alone, irrespective of people’s race, religion or any other factor?

[Vince Cable]

I am delighted to see the hon. Gentleman in his place. I thought he might have been in Rochester today, waiting to defect. On his question, I certainly do believe in merit; I do not believe in quotas. I know that he has written 19 letters to Mr Trevor Phillips on the subject of race and political correctness, which leads me to believe that he might have a problem with the concept of racial equality.

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

11. What steps he is taking to ensure that the UK’s system of skills training is relevant to the changing structure of work.

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[Andrew Stephenson (Pendle) (Con)]

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

[The Secretary of State for Business, Innovation and Skills (Vince Cable)]

My Department plays a key role in supporting the rebalancing of the economy through business to deliver growth while increasing skills and learning.

[Andrew Stephenson]

The town of Barnoldswick in my constituency won a great British high street award in November, and the town of Colne, where shop vacancies have more than halved in the past two years, has been branded “the capital of cool” by Tourism Lancashire. What recent support has my right hon. Friend’s Department provided to small business to help them to continue to grow and thrive?

[Vince Cable]

I congratulate my hon. Friend on the active role he plays in supporting his local commercial community. As the Minister for Business and Enterprise, my right hon. Friend the Member for West Suffolk (Matthew Hancock), described a few moments ago, we are actively involved in supporting small business through the start-up loan scheme, through credit flows to the business bank and by creating a deregulatory and favourable tax environment.

[Mr Chuka Umunna (Streatham) (Lab)]

It is essential that we give our towns, cities and regions the tools to be the masters of their own economic destinies to drive jobs and growth. The Secretary of State has said that he established local enterprise partnerships to help achieve that, and the LEP network was set up to support them and take forward their shared programme. Will he update us on their progress?

[Vince Cable]

Enormous progress has been made by the local enterprise partnerships since they replaced the regional development agencies, which, by common consent, were remote and wasteful. The most significant recent development was the growth deals, which all the LEPs now have and which have been enhanced by the specific programmes that have been developed for Manchester, Sheffield, Leeds and other centres.

[Mr Umunna]

I am sorry, but the Secretary of State simply does not appear to know what is happening on a supposedly key part of the Government’s programme. I have here a letter from the chair of the LEP network. He says that the network will close in two weeks and that the CEO has resigned because there is no support to do the job. He says that the network is

“seriously under resourced for such a critical role at such an important time”

and that it is

“now officially overwhelmed and preparing to throw in the towel.”

Four years ago, the Secretary of State said that the regional policy was Maoist and chaotic. Does this not demonstrate that very little has changed?

[Vince Cable]

It demonstrates nothing of the kind. The LEP network is working exceedingly well. LEPs are voluntary organisations; some are outstanding and innovative and others struggle, as this one has done. It is much better that we have a regional network that is business-led and is related to the geography of the area, which was manifestly not the case with the regional development agencies.

[Martin Horwood (Cheltenham) (LD)]

T2. Does the Secretary of State share my concern that the family brand name Weetabix is closing its packet printers Vibixa in my constituency, with inevitable consequences for more than 100 employees and their families, after the company was denied the sales force that could have widened its customer base? Does he agree that when a profitable company closes a profitable subsidiary, it should offer the best possible redundancy terms to its employees, some of whom have served Weetabix for more than 35 years, and not something barely above the statutory minimum?

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[Andrew Griffiths (Burton) (Con)]

T6. The decision of this House on Wednesday to vote to scrap the pub tie caused £350 million to be wiped off the share price of pub companies yesterday, and it continues to fall today. That of Punch Taverns in my constituency fell by 17% in one day. Jobs and businesses are at risk. What discussions is the Department having with those companies and what help is the Secretary of State offering? If he is not offering help, why not?

[Vince Cable]

As the hon. Gentleman knows, Parliament has spoken and we respect its views on the subject. All I would say is that the Federation of Small Businesses commissioned a study that pointed in a very different direction from the one he is describing. Of course, there has been extensive consultation with all the different parties on this issue.

[Sheila Gilmore (Edinburgh East) (Lab)]

T7. The Secretary of State has frequently said that he wants fairness for people on zero-hours contracts. Will he now, even at this stage, reconsider the amendments he opposed in this House this week, which would have given greater protection to people on zero-hours contracts, including care workers?

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[Tom Blenkinsop (Middlesbrough South and East Cleveland) (Lab)]

Yesterday the Prime Minister had a meeting with north-east Lincolnshire Members of Parliament about the Scunthorpe steelworks site and the wider Tata long products divisional issue. As chair of the all-party parliamentary group for steel, I twice asked to attend that meeting and was twice refused. Will the Secretary of State please talk to the Prime Minister to see whether the APPG for steel can have a conversation with him so that the industrial divisional issue is not missed just because of the geography of Scunthorpe?

[Vince Cable]

A meeting took place with the Prime Minister, me and several steel MPs yesterday. That shows that the Prime Minister, other members of the Government and I are happy to keep Members up to date on this issue. We will establish a link with the community unions so that they can be kept fully informed too.

[Philip Davies (Shipley) (Con)]

The Secretary of State said this morning that appointments should be made on merit, yet to an earlier audience he said that boardrooms should have 20% of people from ethnic minorities, which led Lord Bilimoria to say, “I think for Vince Cable to say 20% is the right target when the ethnic minority population is 14% is going too far.”

I know that the Secretary of State is a Liberal Democrat and therefore used to holding two different opinions at the same time, but may I try to pin him down to one? Does he believe in quotas in boardrooms or appointment on merit?

[Vince Cable]

I do not believe in quotas for ethnic minorities, women or any other group. I have never ever said anything about 20%. If he reads the correspondence from Trevor Phillips, he will acknowledge that I never endorsed that view. However, there is a problem, which I hope the hon. Gentleman acknowledges, that more than half of the boardrooms in the UK have no non-white representation whatever. Only one in 16 senior managers comes from our very talented ethnic minority groups, and they should be better represented.

[Bill Esterson (Sefton Central) (Lab)]

The Secretary of State mentioned earlier the importance of regional networks. I wonder whether he thinks the same when it comes to banks? Regional banks have the advantage of understanding their local community and economy and their customers. When banks are not lending to small businesses in my constituency and others around the country, are not regional banks the answer to the problem of getting the growth and support that small business needs?

[Vince Cable]

We warmly welcome challenger banks offering a service to small business. If they can be organised on a local and regional basis, so much the better. There is an organisation called Cambridge and Counties, which is performing this role in the east of England, and I know that Airdrie bank does so in Scotland. We would like to see many more. The liberalised process of licensing means that these things can come on stream rapidly when they are put forward.

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

Regrettably but inevitably, the pubcos trade association, the British Beer and Pub Association, is providing misleading information to the media and MPs about the London Economics report commissioned by BIS, including presenting figures for an immediate free-of-tie option for all tenants, which clause 2 is clearly not; it is gradual. The association’s presentation is therefore false. What assurances can I get from Ministers that they are aware of this, will scrutinise it and will ensure that civil servants also know that these misleading claims are just that?

[Vince Cable]

I congratulate my hon. Friend on the long and successful campaign that he has fought on this subject. I am inclined to let the matter rest, rather than continue a debate that he has won.

[Mr Mike Weir (Angus) (SNP)]

Yesterday Royal Mail said again that there was a danger to the universal service obligation from increased competition. That is very worrying, especially to people in rural areas. Will the Secretary of State press the regulator to take stronger action to look at the state of competition and take appropriate action to ensure that the USO is not put in danger?

[Vince Cable]

I do not press regulators on this or other issues. The simple truth is that the USO is embodied in law. It would have to be changed by both Houses of Parliament. Royal Mail was put in the private sector to enable it to compete, and although it was little observed at the time, for the first time in decades it has been able to raise hundreds of millions of pounds in the bond market to reinvest. There is a success story there.

[Andrew Jones (Harrogate and Knaresborough) (Con)]

The latest Office for National Statistics bulletin showed that manufacturing production had increased by 2.9% over the same time last year. These are encouraging figures. What more can I tell manufacturers in my constituency about further action that will be taken to support them?

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[Vince Cable]

I can give the hon. Gentleman exactly that assurance. We should listen to what he has to say. Of course, we are concerned that the British steel industry should succeed.

[Mr David Willetts (Havant) (Con)]

With the extraordinary technical achievement of the Rosetta landing last week and the announcement of crowdfunding for Lunar Mission One this week, will the Minister responsible for science take this opportunity to congratulate the British space community on its scientific excellence and its enterprise?

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[Heidi Alexander (Lewisham East) (Lab)]

In response to my earlier question, the Secretary of State boasted that a number of firms were already benefiting from the Government’s direct lending facility. Will he name the firms, in addition to Carillion, that have benefited to date?

[Vince Cable]

I cannot name the firms, but I am happy to write to the hon. Lady with the names. UK Export Finance, which she asked about, is now providing a substantial range of export finance facilities, which were not available before and are contributing substantially to export growth.