Cable quizzed

• [Feb 17] Jason McCartney (Colne Valley, Conservative): WHAT steps he is taking to encourage entrepreneurship.

Vincent Cable (Secretary of State, Business, Innovation and Skills; Twickenham, Liberal Democrat): The Government have actively encouraged enterprise, including doubling the amount of small business rate relief for one year, launching the new enterprise allowance, and initiating a new programme in universities, Enterprising Academics. With support and practical input from my entrepreneurs group, I am developing further measures to support entrepreneurship around employment regulation and start-ups.

1118)

[24887]

Jason McCartney (Colne Valley, Conservative): I thank the Secretary of State for that answer. I welcome, as do my constituents, the new enterprise allowance-in fact, my constituents have been asking me about that for the long-term unemployed. A recent graduate from Slaithwaite also asked me whether we might extend the scheme to recent graduates, to take advantage of their skills, especially if they have studied business or engineering.

1119)

Vincent Cable: That is an excellent suggestion, which we will pursue. As the hon. Gentleman knows, the new enterprise allowance is being trialled in Liverpool, and will give people who would otherwise face long periods of unemployment the opportunity to start their own businesses with financial support, mentoring and access to loans. It is a very good scheme, which I want to encourage and expand.

1119)

[10534

Barry Sheerman (Huddersfield, Labour): How will the Secretary of State respond to the wonderful report on creative clusters in our country launched yesterday by National Endowment for Science, Technology and the Arts? The report shows again that 6% of new businesses create 50% of new jobs, but that most of the clusters are in London and the south-east. As he is stripping the capacity to do anything about that in Yorkshire, which is performing at a low level, what will he do about it?

1119)

Vincent Cable: As it happens, under the growth review that Ministers are conducting, yesterday we reviewed the creative industry sector to which the hon. Gentleman refers. The sector has serious problems of access to finance, because of lack of tangible security, and issues around copyright protection. We are pursuing both those issues, and if we can crack them, it will help creative industries across the country.

Simon Hughes (Bermondsey and Old Southwark, Liberal Democrat): What recent progress he has made in his discussions with representatives of the banking industry on increasing levels of lending to small and medium-sized enterprises.

1119)

[24909]

Mark Spencer (Sherwood, Conservative): What recent progress he has made in his discussions with representatives of the banking industry on increasing levels of lending to small and medium-sized enterprises.

1119)

Vincent Cable: As announced last week in the House by the Chancellor, the UK's five major banks have stated a capacity and willingness to lend £190 billion of new credit to business in 2011. That includes £76 billion of new lending to SMEs, which is a 15% increase on the amount lent in 2010. If demand exceeds that, the banks will lend more.

1119)

[10298

Simon Hughes (Bermondsey and Old Southwark, Liberal Democrat): I warmly welcome my right hon. Friend's work and the Government's announcement. To have maximum transparency, will Ministers negotiate with the banks for the figures on lending to small and medium-sized businesses to be published by principal local authority area on a regular basis, so that we can see exactly what is happening throughout the country?

1119)

Vincent Cable: The figures will be independently monitored by the Bank of England and published quarterly. My right hon. Friend makes a helpful suggestion, and I will examine whether the figures can be disaggregated in that way.

1120)

[24909]

Mark Spencer (Sherwood, Conservative): Will the Secretary of State assure me that he will take no lessons on the banking system from the shadow Chancellor, who designed the system that failed us so badly, and who did nothing to encourage transparency and control bonuses? Will he ensure that banks start to lend to small businesses?

1120)

Vincent Cable: Indeed. In not only the agreement but our wider policy, we have advanced considerably on the position a year ago. We inherited a banking system that had collapsed, in part because of failures of regulation. We have introduced much more effective and higher levels of tax on the banks, because of the profits on their balance sheets. We have introduced greater transparency, which will add to legislation. Through the banking commission, we have set up a process of fundamental structural reform.

1120)

[24949]

Stella Creasy (Walthamstow, Labour): On Government action to encourage lending, we see this week that, thanks to lack of regulation, Dollar Financial intends to open another 800 money shops in this country this year alone. Will the Secretary of State clarify whether such legal loan sharking is the lending that he wants to encourage?

1120)

Vincent Cable: There is a consultation process going on at the moment led by my colleague, the Under-Secretary, my hon. Friend Mr Davey, and we shall respond to it shortly. Clearly, it is essential that we have lending in deprived communities, with social enterprise and credit unions, and we are working to expand those areas.

1120)

[12005]

Gordon Banks (Ochil and South Perthshire, Labour): Last week, the man chosen by the Secretary of State to lead his business advisory group and to be his very own sounding board resigned because of the Government's deal with the banks. Can the Secretary of State tell the House whether he agrees with his noble Friend Lord Oakeshott that the Government have gone soft on the banks, that the Merlin lending deal does not live up to the coalition agreement and that the Government negotiators were arrogant, incompetent and

"couldn't negotiate their way out of a paper bag."?

Does the right hon. Gentleman agree that Lord Oakeshott has taken over his former mantle as the Lib Dem voice of decency on the banks and, as The Independent says:

"Is Lord Oakeshott the new Vince Cable?"

1120)

Vincent Cable: I do indeed agree with my friend Lord Oakeshott on many issues, including what he says about banking, but on this issue I think he is wrong. May I suggest that a more authoritative view comes from the business organisations whose members will benefit from lending? For example, the CBI-often quoted these days from the Opposition Benches:

"It's good news that banks have agreed to lend more to businesses, and there will be more transparency in this area."

The FSB says that "we welcome the intention to lend more to small businesses." They are the people who are benefiting.

Chris Kelly (Dudley South, Conservative): What criteria he used to determine appointments to the independent advisory panel for the regional growth fund.

1122)

Vincent Cable: The selection of panel members was rooted in ensuring that the independent advisory panel is mixed, with a good spread of expertise from around the country, bringing together representatives from major businesses, small and medium-sized enterprises, entrepreneurs, academia and civil society. All members of the panel act in an individual capacity under the chairmanship of Lord Heseltine.

1122)

[24838]

Chris Kelly (Dudley South, Conservative): I thank the Secretary of State for that answer, but can he explain why a representative of the New Economics Foundation has been appointed to the panel? That organisation has attacked the merits of economic growth and argued that Burma, Saudi Arabia and Haiti show Sweden, the United States and the United Kingdom that achieving long, happy lives without overstretching the planet's resources is possible. Might it not have been better to appoint someone to oversee the regional growth fund from an organisation that supports growth?

1122)

Vincent Cable: The organisation is there to support growth. The suggestion that my hon. Friend mentions seems seriously dotty, but I have seen other work from the New Economics Foundation, focusing on local communities, which is very good. I can assure him that the advisory panel's work will be overseen by Lord Heseltine and Sir Ian Wrigglesworth, neither of whom could be said to be shirking on matters of business and entrepreneurship.

1122)

[10619

Joan Walley (Stoke-on-Trent North, Labour): Given that the Government have said that they will be the greenest Government ever, can the Secretary of State give an assurance that panel members will include people with expertise on sustainable development and environmental protection, so that there can be a balance with growth and environmental concerns?

1122)

Vincent Cable: In a way, that is what the New Economics Foundation is there for.

David Ward (Bradford East, Liberal Democrat): What his Department's strategy for employment growth is for areas that have a high proportion of public sector employment.

1126)

Vincent Cable: The Government's overriding economic policy objective is to bring about strong, balanced and sustainable growth. The growth review will support private sector growth, providing jobs to people released from the public sector. The regional growth fund will focus on providing financial support to areas with weak private sectors, and we will announce the first allocation of funds shortly.

1127)

[24946]

David Ward (Bradford East, Liberal Democrat): I thank the Secretary of State for that answer. If the Department for Business, Innovation and Skills is the Department of growth, then the Department for Communities and Local Government must be the Department for cuts. If we treat communities-or individuals-who are unequal as equal, we reinforce inequality. I welcome many of the measures that have been announced, but they are national measures. Are any special measures in place for communities that suffered from the front-loading of the cuts as a result of the local government settlement?

1127)

Vincent Cable: I know that my hon. Friend has worked extremely hard for the community he represents, which is a deprived area with relatively high unemployment. We would hope that specific tailored measures will come from the Leeds city region local enterprise partnership, which covers that area. The funding announcement on the regional growth fund is imminent, and it is often forgotten that, as a result of our negotiations with the banks, the business growth fund has an additional £2.5 billion, which will support private sector development across the country, including in my hon. Friend's area.

Topical Questions - Departmental Responsibilities

Business, Innovation and Skills

House of Commons debates, 17 February 2011, 10:30 am

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[24900]

Simon Kirby (Brighton, Kemptown, Conservative): If he will make a statement on his departmental responsibilities.

1128)

Vincent Cable: My Department has a key role in supporting business to deliver growth, rebalancing the economy, bringing enterprise, manufacturing, training, learning and research closer together, and in the process creating a stronger, fairer British economy.

1128)

[24900]

Simon Kirby (Brighton, Kemptown, Conservative): Given its proximity to London and its highly skilled work force, does the Secretary of State agree that Brighton is a great place to do business? Will he consider relocating some of his staff and office use to this most excellent city?

1128)

[11172]

Mark Prisk (Minister of State (Business and Enterprise), Business, Innovation and Skills; Hertford and Stortford, Conservative): My hon. Friend is right. Brighton has tremendous economic advantages. We will, of course, as a Government and as a Department, consider those for our own purposes.

1128)

[24927]

Mary Glindon (North Tyneside, Labour): Workers at Longbenton Foods in North Tyneside have been locked out of their frozen food factory this week and have been asked to take enforced holiday by the owners. More than two years ago the Labour Government stepped in to help the factory with grants when a fire closed it, and thus saved the jobs for the work force. As we try to ascertain what the current problems are, can the Minister assure me that, like his Labour predecessors, he will make a commitment to give any support he can to all those concerned in trying to ensure that those crucial jobs are maintained in my constituency?

1128)

[11172]

Mark Prisk (Minister of State (Business and Enterprise), Business, Innovation and Skills; Hertford and Stortford, Conservative): These are always difficult times for people in the situation the hon. Lady describes. Would she do me the courtesy of providing me with the information? My Department will look at it. She knows that money is tight, for reasons that we are all aware of, but I want to make sure that I understand the facts, then I will give her an answer.

1128)

[24859]

Nick de Bois (Enfield North, Conservative): Does my right hon. Friend agree that tackling vexatious employment claims and introducing more flexibility for employers will encourage the growth of jobs and a sustainable economy?

1129)

Vincent Cable: The response that the Under-Secretary of State, my hon. Friend Mr Davey, gave to Mark Pawsey a few moments ago answers the question. The consultation process is under way. We want to deal with the problem that Nick de Bois raises, which is a big one, in two ways-first, by increasing the period of employment from one to two years before claims can be made, and, secondly, by insisting that all disputes that go to tribunals should go through a conciliation stage first.

1129)

[13814]

Naomi Long (Belfast East, Alliance)

As the Secretary of State is considering banking reform, may I ask him what discussions he has had both with the Northern Ireland Executive and with the Irish Government regarding the impact that the National Asset Management Agency is having on the banking sector in Northern Ireland?

1129)

Vincent Cable: I have not had any specific discussions of the kind that the hon. Lady suggests, but it would probably be appropriate for the Chancellor to do so. Clearly, there is an important Irish dimension because of the way in which British banks are heavily exposed to Irish banks.

1129)

[24796]

Helen Grant (Maidstone and The Weald, Conservative): What plans does the Secretary of State have to promote gender balance in business, and what is his view on imposed quotas?

1129)

Vincent Cable: The Government are not in favour of imposed quotas, but the detailed proposals will shortly come forward. As the hon. Lady knows, a report is close to fruition and will be announced in a few days. It will advance the issue of greater women representation on boards, which has been shamefully low for many years.

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