Entrepreneurship Opportunities
Debate between Baroness Wilcox and Lord Sugar
Baroness Wilcox
The Government recognise the need to help young people to access the finance that they need to start up their own businesses and to be entrepreneurs. As I just said, next week we will be launching the £10 million start-up loans scheme which is specifically aimed at 18 to 24 year-olds. My colleague the Minister for Business and Enterprise in the other place, Mark Prisk, met Sir Richard Branson last week, and the issue of start-up loans was raised during those discussions. So it looks as though I have missed my chance to fly to the moon with Richard Branson but he is a wonderful role model, and more courage to him.
Lord Sugar
My Lords, is the noble Baroness aware that many young people considering taking the leap of leaving employment and starting their own business are hesitant to do so for what I consider to be the least of their troubles? They are hesitant because, for example, they are worried about how to register for VAT, how they will be able to pay their taxes and how they will pay national insurance. However, as I said, this is the least of their problems. Can the Minister consider an initiative whereby HMRC publicises in some way how easy it is to start up in business and perhaps publishes some kind of crib sheet which says that it is easy to get going?
Baroness Wilcox
I thank the noble Lord for that question. It is a very sensible idea. We have many things under way but I think that this is a new way of thinking in that direction. It is what we expect from the noble Lord, and I would love to think that one day we could get him to sign up as one of our enterprise champions.
Businesses: Regional Growth Fund
Debate between Baroness Wilcox and Lord Sugar
Lord Sugar
My Lords, my question for the Minister is not the one that she was anticipating. She will recall that in my short stint at BIS as an adviser to the Government, I concentrated on the business link centres. At the end of that period, I concluded that they were, frankly, a waste of money. I was told that they cost £250 million per year. Will the Minister give us an update on the status of the business link centres and indicate whether she has come to the same conclusion? Will the money that was given to the business link centres be deployed somewhere else?
Baroness Wilcox
I was not prepared to answer a question on that, but I will of course send an answer to the noble Lord. I would like to reassure him that I think that he would approve of the system that we are using here. It is working. The bids have already levered in £2.5 billion of private sector funding. Maybe he would like to follow carefully how we are proceeding with this sum—and maybe even support us in some ways.
Apprenticeships: Network Rail
Debate between Baroness Wilcox and Lord Sugar
Lord Sugar
If we bundle all these into some form of initiative for providing work for the young and those who are out of work, what is the net reduction in initiatives that has resulted from their cuts?
Baroness Wilcox
My Lords, the number of new apprentices in this past year is 279,000 of whom quite a few are very young. As the noble Lord knows, we have a very special pay arrangement which was set up by his Government to ensure that we attract youngsters. I am so delighted that the noble Lord, Lord Sugar, has asked a question because it has given me the opportunity to say once again how marvellous his programme is for attracting apprentices into business, but that the aggressive tone he uses on the programme might not be attracting people into nursing and the quieter causes that we still so very much need in this country, including the youngsters to whom he is referring.
Consumer Credit
Debate between Baroness Wilcox and Lord Sugar(13 years, 3 months ago)
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Baroness Wilcox
This Government, like the previous Government, are constantly trying to find ways to help people get the best possible information to make sure that the decisions they make lead to debts that they can fulfil. It is very difficult. This is why another review is taking place. We are looking yet again to see what we can do so that people do not have to go to loan sharks. However, I am worried about putting a cap on any of the very, very high interest rate products. At least we know that when people get into trouble they can come to us for help. Countries such as Germany and France capped at 25 per cent years ago. The problem is that there is no access for the very poorest people who need to borrow. It is important that they have access to some facility.
Lord Sugar
My Lords, the noble Baroness and I have spoken about this subject once before across the Floor and I reiterate my question about the misleading advertising by credit card companies and loan organisations. It is about time that the Advertising Standards Authority imposed strict regulations about the prominence of warnings in respect of interest payable in those adverts so that they are approximately the same size as the headlines trying to lure the consumers in. Will the Minister, once and for all, take this matter up with the Advertising Standards Authority?
Baroness Wilcox
If the Advertising Standards Authority was answering instead of me, it would say that it is complying with everything it should be doing. However, the question the noble Lord, Lord Sugar, asks demonstrates that there is continuing concern about this. I will of course take this on board and reflect again upon what the noble Lord has said and see if there is anything I can do to help things along.
Businesses: Contracts and Payments
Debate between Baroness Wilcox and Lord Sugar(13 years, 6 months ago)
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Baroness Wilcox
My Lords, I am a bit of an expert on Sir Philip Green’s report because I have read it now. His report says nothing specific about government payment terms. In interviews, he says that the norm in most departments is to pay suppliers in five days, compared with the standard 30-day-payment period for most private sector transactions and the 45 days demanded by some bigger companies like his own. If the Government demanded a minimum of 30 days of credit from suppliers, they would save hundreds of millions of pounds in financing costs. That is what he has said in conversation but his report actually says nothing at all about it.
Lord Sugar
Will the noble Lord, Lord Strathclyde, consider issuing vuvuzelas to his Benches? They would make a much better noise. In the document recently published by BIS, Backing Small Businesses, I have read many of the claims which the Minister has stated today about 80 per cent of invoices being paid in five days, prime contractors paying their subcontractors within 30 days, and 15 per cent of business being dished out by Government to small businesses. That is a restatement of what the previous Chancellor said in the Budget of 25 March this year. Do the Government have any of their own ideas of what they are going to do to back small businesses instead of restating policies that have already been implemented?
Baroness Wilcox
My Lords, the noble Lord, Lord Sugar, knows what a fan I am of his, so I will always try and please him. I am delighted to know that the previous regime did such work in this area and we intend to do good work to build on that. I hope he will give me time to get that all under way.
Loan Companies: Interest Rates
Debate between Baroness Wilcox and Lord Sugar
Baroness Wilcox
My Lords, many of us have seen on television these advertisements by payday loan and instant loan companies offering loans at what seem to be huge rates of interest, running into thousands of per cent. This is a complicated market. The APRs may not be the most suitable method for measuring the cost of these products. For example, borrowing £100 for five days from a company attracts an APR of 3,253 per cent, as the noble Baroness said. That sounds an enormous amount, but in fact the borrower will pay a total of £111—just £11 for borrowing £100—which is less alarming than the APR might suggest. However, that said, we are always looking for ways to try to make credit and lending available to people at all levels in our society. I know that the previous Government and the Government before them struggled with whether to cap lending or let it run free. It has always been the policy of the previous Government, the Conservative Government before them and consumer groups that at least if people have access to some form of credit, they are not being forced on to the black market and loan sharks.
Lord Sugar
My Lords, does the noble Baroness agree that this type of advertising for these loans is rather misleading and that the Government should step in to regulate the content of the adverts, insisting that a significant proportion of them—on TV and in newspapers—is allocated to spelling out what consumers are letting themselves in for? I pre-empt the noble Baroness’s answer by saying that this is not a matter for the Advertising Standards Authority or the trading standards people. Can we also consider a 30-day cooling-off period when the consumer can change their mind at no penalty to them?
Baroness Wilcox
My Lords, I thank the noble Lord for that question and for actually giving part of the answer. The line to take on this is that advertisements for high-cost credit, such as those for instant loans, should carry a wealth warning. We are looking at that interesting idea. The Office of Fair Trading has just made a report which we will be looking at to find a way forward on all of this. This issue affects all of us and it does not matter which side of this House we are on. We all understand the idea that people have to have access to some form of lending and credit, but I can quite understand that seeing these advertisements on the television has upset an awful lot of people, who think that it sounds far too easy. We are and will be looking at ways to see if we can make clearer the information that the general public get, in a language that they can understand.