Amendment of the Law

Debate between Vince Cable and Seema Malhotra

Thursday 20th March 2014 Commons Chamber

[Vince Cable]

I find that many of my ideas have been incorporated in Government policy, and I am very pleased about the progress that we are making in that respect.

Of course, increased investment depends on business confidence. Because we are approaching the election season, a danger is posed by some of the comments being made by the Opposition. Sir George Cox, who used to be at the Institute of Directors and is now an adviser to the Opposition, suggested recently that the business-averse policies of the shadow Chancellor and his leader were doing serious damage not to their own credibility, but to confidence in the country. I would underline that. If we have policies that appear to commit future Governments to energy price freezes that prevent new energy investment, we are undermining investment. Of course it is not just the Opposition; the people who want to take Britain out of the European Union and want to take Scotland out of Britain are also undermining investment confidence. Political certainty requires at least literate policies from the Opposition, which in the area of price freezes certainly is not the case.

[Seema Malhotra (Feltham and Heston) (Lab/Co-op)]

I think the Secretary of State will know that that is not an accurate representation of what was said. May I ask him to comment on net lending particularly to small businesses, which is a concern? Why does he think that has continued to fall on his watch, and what is going to be done about it?

[Vince Cable]

Yes, there has been a continuing decline in net lending to small business. We think it is bottoming out, but it has happened and it is damaging. It is a consequence of the near-collapse of the banking system and the fact that some banks are now responding to much tougher regulation by being much more conservative in their lending. That is not true in all cases: Lloyds and Santander are increasing their net lending to small businesses, but many are not.

In response, the Government are establishing institutions, particularly the business bank, which are developing new flows and types of finance—internet-based lending, asset-based finance, invoice finance—in areas that hitherto were deficient, as well as supporting the establishment of new banks. About 20 new banks have been licensed over the last year, and that deals with the issue of bank competition that should have been dealt with when the last Government were in power and we had the Cruickshank report. That is now happening, however, and I therefore think we will begin to see the net lending trend becoming much more positive, but there is no underestimating the enormous damage that was done to the British economy as a result of the collapse of the banks, over which the last Government had responsibility for many years yet did absolutely nothing.

Oral Answers to Questions

Debate between Vince Cable and Seema Malhotra

Thursday 6th March 2014 Commons Chamber

[Vince Cable]

Yes, I had a very rewarding visit to my hon. Friend’s constituency and I think there were broader lessons. Much of the gloom about the economy that is being spread by the Opposition is not reflected in many manufacturing towns such as Burnley, which has an unemployment rate well below the national average and highly successful manufacturing companies, particularly in aerospace and the car supply chain. Many other towns and cities across the UK are now sharing that experience.

[Seema Malhotra (Feltham and Heston) (Lab/Co-op)]

The Secretary of State will be aware that business growth in the UK is dependent not just on exports but on investors. Recently I went on a visit to India and I discussed with businesses, including a Confederation of Indian Industry round table here, issues concerning UKTI. How successful does he believe UKTI is at creating investment opportunities for medium-sized businesses from abroad, particularly in our regions, so that we can see growth and investment partnerships?

[Vince Cable]

UKTI is now regarded as an excellent service for business. It has a dedicated unit devoted to high-value opportunities and big inward investment in the UK. I visited India recently and met a substantial number of Indian companies, both in the service sector, such as call centres, and in manufacturing, such as aerospace, that are targeting the UK to re-shore production here from India.

National Minimum Wage

Debate between Vince Cable and Seema Malhotra

Wednesday 15th January 2014 Commons Chamber

[Vince Cable]

I did not particularly wish to raise this, but I am being asked personally to explain why I did not vote. It had a lot to do with the fact that my late wife was terminally ill at the time and I was in the Royal Marsden hospital. That is why my voting record at the time was poor on that and other issues.

As it happens, my party supported the national minimum wage; nobody opposed it. I became the party’s spokesman shortly after the vote and I made it absolutely clear throughout that Parliament that we supported the principle of the national minimum wage. There was never any question about that.

Perfectly legitimate issues were raised about why there was no regional variation. There is a proper debate to be had about whether there should be a regional or a national minimum wage. As it happens, I endorsed the principle of the national minimum wage. However, there is a perfectly respectable argument for regional variation. As I understand it, the Labour party now promotes the living wage, at the heart of which is the idea that there should be regional differentials, with people in London being paid more and people in the west country or the north of England being paid relatively less. There is an argument for that. Why criticise people who have put forward that idea in good faith?

As for the Conservatives, although I do not always speak in their defence, I think that they should get credit for accepting that there is a good system that works and for deciding to support it. That is creditable. Although I and my party have supported the national minimum wage, there is a perfectly respectable intellectual and moral argument for not having a minimum wage. Countries that do not have a minimum wage include Sweden, Finland, Norway, Denmark and Austria. Those countries are all in the social democratic tradition, but have felt that it is too problematic. Germany, which has had either social democratic or national unity Governments for most of the post-war period, has adopted a national minimum wage only in the last few weeks. In those countries, where there are civilised values and a sense of solidarity, the costs and benefits of the minimum wage have been debated properly. Why should we criticise people in this country who wanted to have such a debate, but who have now come to a consensus that it is a good system and that we should make it work?

[Seema Malhotra]

Is the Secretary of State saying that Government Members and Conservative Members in particular support the national minimum wage for all businesses in all circumstances?

[Vince Cable]

Yes, it is now the law. Of course we support enforcement of the law. I do not understand the question.

Oral Answers to Questions

Debate between Vince Cable and Seema Malhotra

Thursday 24th October 2013 Commons Chamber

[Vince Cable]

No; in fact, the offer was framed in such a way as to ensure that the shares were acquired predominantly by long-term institutional investors. A few hedge funds are involved and, indeed, some hedge funds take a long-term view.

[Seema Malhotra (Feltham and Heston) (Lab/Co-op)]

Many small businesses and consumers across the country rely on local delivery offices such as the one in Feltham to pick up parcels and important letters. Will the Secretary of State confirm that there is nothing to prevent Royal Mail from selling off its local properties across the country and moving them to out-of-town locations that will be far more difficult to reach?

[Vince Cable]

I think I know the sorting office that the hon. Lady is talking about, because it is the one that serves my constituency. It was rebuilt and re-equipped three years ago, I believe, so it is wildly improbable that the Royal Mail will now want to sell it.

--- Later in debate ---

[Seema Malhotra (Feltham and Heston) (Lab/Co-op)]

Last week, I attended the Hounslow enterprise showcase, organised by Dawn Edwards and Isabel King from the Real Business Club, which was run with the support of the local jobcentre and Hounslow chamber of commerce. I spoke to three women from my constituency who were looking for advice on how to start or grow their businesses. Does the Secretary of State think that we need to do more to support women-led businesses, particularly as research shows that the UK has a higher gender gap in entrepreneurship than many of the OECD countries?

[Vince Cable]

Yes, we acknowledge the importance of women in business. Indeed, one of the initiatives that we are leading involves ensuring that women are properly represented on the boards of our leading companies, thereby creating role models for people starting their own companies. I agree that there is a gender gap and I agree that we need to do a lot more about it.

Oral Answers to Questions

Debate between Vince Cable and Seema Malhotra

Thursday 13th June 2013 Commons Chamber

[Seema Malhotra (Feltham and Heston) (Lab/Co-op)]

A delegation from the Confederation of Indian Industry visited the UK this week. What is the Secretary of State doing to support economic partnerships between Britain and India, and how does he envisage their driving growth in the UK?

[Vince Cable]

The Confederation of Indian Industry was in the Department at the beginning of this week to make the case for the deepening of the relationship, and that is proceeding well. Unfortunately, we are starting from a low base, as Britain’s share in the Indian market is not as great as it could be. The one really big success story is Indian investment in the UK, which is growing rapidly. That includes our largest manufacturing company, Tata, which is highly successful and a very valuable corporate citizen. We are doing all we can to develop that relationship.

Industrial Strategy

Debate between Vince Cable and Seema Malhotra

Monday 10th September 2012 Commons Chamber

[Seema Malhotra (Feltham and Heston) (Lab/Co-op)]

The manufacturers’ organisation EEF has called for an industrial strategy after criticising the Government’s approach to growth so far as inconsistent, incoherent and unaccountable. It was not clear from the Secretary of State’s contribution whether tomorrow marks a step change in his industrial strategy or more of the same. Which is it?

[Vince Cable]

We are of course dealing with a gradual evolution of policy; business wants certainty and clarity, rather than sudden changes. I return to the point I made in response to the hon. Member for Streatham: we are starting from an inherited position on the manufacturing industry that was very weak after a long period of decline. Turning that around will not be easy.

Amendment of the Law

Debate between Vince Cable and Seema Malhotra

Thursday 22nd March 2012 Commons Chamber

[Vince Cable]

It is certainly true. My hon. Friend’s central point, which was made very effectively by the Labour Government when they were in office, is that in a highly mobile world, we have to take account of marginal rates of tax in comparable countries. The current top rate of marginal tax in Canada, Australia, France and Germany is around 45%, and that is the level to which we have moved.

[Seema Malhotra (Feltham and Heston) (Lab/Co-op)]

Does the Secretary of State acknowledge that business leaders, who will benefit from the tax cut, said yesterday that the priority should have been to cut taxes for those on low and middle incomes in order to stimulate consumer spending? Does he agree that that should have been the priority, rather than cutting the 50% rate?

[Vince Cable]

I do not know where the hon. Lady has been for the past 24 hours. The central feature of the Budget was a very large tax cut for exactly the group of people she describes, and it will have exactly the consequences that she describes.

Let me get back to the core issue, which exercises me and the shadow Chancellor. The basic economic strategy of the Government is to get back to a stable, sustainable form of economic growth. I want to address head-on his central criticism, which he has made many times. It can be summarised in the phrase “too much, too fast”. This Government have a deficit reduction programme that was developed following the autumn statement, and it involves removing the structural deficit over a period of six years.

The Darling plan, which the last Government set out, involved a deficit elimination programme of seven years. What I am not clear about, particularly in view of the stridency of the shadow Chancellor’s views, is: what is the Balls plan? Is it for seven years, eight, 10, 20 or never? What is the alternative speed of deficit reduction that the Opposition are urging on us?

We are acting, successfully, on good advice. A few weeks ago, the head of the International Monetary Fund, Christine Lagarde said:

“Those countries that have fiscal space, and that can slow down their fiscal consolidation efforts are very few, and I’m afraid Britain is not in that particular group.”

That is because of the sheer scale of the structural deficit that we inherited.