Budget: Saving for Retirement
Debate between Lord Flight and Baroness Neville-Rolfe(7 years, 2 months ago)
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Baroness Neville-Rolfe
I certainly do not take such a gloomy view of the products. The NS&I investment bond, which we started on, gives a rate of 2.2% for three years. That is significantly higher than the market average of 1.38%. Savers know that they can trust products offered by NS&I. Obviously, rates of return on savings products have come down and that has to be reflected, but the £7 billion of additional government financing will be at a cost of £295 million compared to borrowing through gilts.
Lord Flight (Con)
My Lords, while ISAs have their place, does the Minister not agree that pension schemes are the more attractive—and, tax-wise, the more generous—vehicles for people to save for their retirement? Does she also agree that many people have perhaps been mistaken in cashing in their pensions and incurring tax liabilities, when it would have been better for them to leave them to accrue for the ultimate stage of retirement?
Baroness Neville-Rolfe
I agree with my noble friend. The Government are at pains to make sure that our communications draw attention to the value of pensions on automatic enrolment, because of course the employer makes a contribution as well as the employee, and this has been a very important reform. However, ISAs, which now have an allowance of £20,000 from next month, and the lifetime ISA, which is particularly helpful to younger people and the self-employed, also have a place. We want to encourage people to save and I am glad that we are doing so.
Cultural Property (Armed Conflicts) Bill [HL]
Debate between Lord Flight and Baroness Neville-Rolfe
Lord Flight (Con)
My Lords, I am curious to know what the minimum value envisaged is in the amendment from the noble Earl, Lord Clancarty. It seems to me that unless those minimums are fairly substantial—maybe a million but certainly in the hundreds of thousands—then it would make a complete shambles of the antique and flea market industry. People can know one generation of owner but they are never going to know the previous generation of owner. Therefore, a passport can operate only where it is clearly an item of substantial value and has had that value for some time.
Baroness Neville-Rolfe
My Lords, I would like to start by addressing Amendment 18. I thank the noble Earl, Lord Clancarty, for the work that he does in this House as an advocate on behalf of the creative industries. Aided by his background as an artist and a writer, he provides a voice in the House for a community that contributes an awful lot to our cultural fabric.
I believe that auctioneers and traders have an important role to play in providing information about the history and background of the items that they sell. That allows the UK’s lawful—I hope—and vibrant marketplace for arts and antiquities to flourish and grow, as many have said.
I have some concerns about the amendment that the noble Earl has tabled with support from the noble Baronesses, Lady Bonham-Carter and Lady Northover, the noble Lord, Lord Redesdale, and my noble friend Lord Renfrew. Perhaps I can explain why.
First, I continue to believe that it is appropriate to allow the art and antiquities trade to regulate itself. The established trade associations possess codes of ethics by which they expect their members to abide, and we expect the associations to strictly enforce those codes. The codes require that members undertake not to purchase, sell or offer any item of property that they know has been stolen, illegally exported or illegally excavated. Furthermore, we believe that the Dealing in Cultural Objects (Offences) Act 2003, along with the new offence that we are creating, provides a sufficient incentive for legitimate dealers to ensure that they do their due diligence and pass on relevant information concerning the provenance of an object.
The lack of prosecutions—although there has been one—does not mean that the Act has had no effect. It has had a successful deterrent effect, as was rightly noted by my noble friend Lord Inglewood.
I am determined to minimise costly bureaucracy for businesses unless there is a strong case for it being necessary. To my mind, this amendment would be disproportionate, considering that there are, and have been since 1956, very few occupied territories around the world. Thus the number of objects unlawfully exported from such territories is likely to be very low. Given the extremely limited scope of cultural objects that would be classed as unlawfully exported from occupied territory, a measure requiring the provision of detailed information with regard specifically to whether any item of cultural property for sale in the UK has been unlawfully exported from an occupied territory would not be proportionate. To have a statutory passport for items, as some have said, seems like a big burden. It could also, of course, further disadvantage London as a centre for the art and antiquities trade—that would be a perverse effect.
Secondly, I would like to touch on the human rights issue, which has not been given particular prominence. We are concerned that this amendment would infringe Article 8 of the European Convention on Human Rights because the collection and retention of the names and addresses of all previous owners would interfere with the right to respect for private and family life, home and correspondence. That cannot, in our opinion, be justified as necessary for achieving the aim of protecting cultural objects.
I turn finally to one of the amendment’s more specific points, which was obliquely referred to by my noble friend Lord Flight, who joined the debate. Monetary value is not an appropriate way of determining whether an object should be covered or not. Such objects may have a significant historical or emotional value for the communities from which they were removed, but not necessarily a high monetary value. That deals with our reservations about Amendment 18.
Apprenticeships
Debate between Lord Flight and Baroness Neville-Rolfe(8 years, 1 month ago)
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Baroness Neville-Rolfe
The latest Apprenticeships Evaluation survey found that nine in 10 of recent completers of apprenticeships were either in part-time or full-time employment after finishing their apprenticeships, so we are seeing people getting into the labour force. The reason that I love apprenticeships is that they give a portfolio or skillset which you can take elsewhere. That allows people the opportunity to move around. The whole point about the changes in apprenticeships is to make the employers lead. If they decide what is needed, it ensures that people stay in the workforce—and often with the employers that they first started with.
Lord Flight (Con)
May I draw the Minister’s attention to the contribution made by the Baker-Dearing university technical colleges? They are teaching both vocational skills and standard O-levels and A-levels. This enables the people attending and coming out of them to do much higher-quality apprenticeships, in the spirit of the noble Lord’s Question.
Baroness Neville-Rolfe
My noble friend is completely right. These colleges are extremely useful. Of course we need to upskill and uptool for the changing economy that we have.
Business: Advice Services
Debate between Lord Flight and Baroness Neville-Rolfe
Baroness Neville-Rolfe
I am delighted that the noble Lord mentioned LEPs because, of course, LEPs bring together chambers of commerce, business interests and local authorities. The growth hubs that I mentioned are indeed part of that LEP network, which already has 31 hubs and will have 39 by next April.
Lord Flight (Con)
My Lords, does the Minister agree that the Government’s Enterprise Investment Scheme has been a tremendous help to small businesses in providing risk equity capital? Is she aware that the requirements forced on the UK by the EU Competition Commissioner, in order to meet the state aid requirements, are going to severely reduce the likely flows of risk equity money to SMEs under the EIS?
Enterprise Bill [HL]
Debate between Lord Flight and Baroness Neville-Rolfe(8 years, 6 months ago)
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Baroness Neville-Rolfe
My Lords, I am grateful to my noble friend Lord Flight for his comments and for the work done by the absent noble Earl, Lord Kinnoull. I am very grateful to my noble friend Lady Noakes for injecting realism into our discussion this evening. I agree that Clauses 20 and 21 are very important and overdue, and should improve London’s reputation, as the noble Lord, Lord Lea of Crondall, said.
The Government and the Law Commissions that first developed the clauses have been keen to find a solution which would satisfy all stakeholders, allowing the London market to support the provisions. I am grateful to the market for its continued efforts. The latest amendments proposed by industry stakeholders relate to the complex legal areas of limitation periods and legal privilege.
I will deal first with Amendment 61, but I should say at this point that the Government have more sympathy for Amendment 62, which I will come to. The starting position in both areas is that the default rules should apply unless there is a very strong justification for making special exceptions for particular circumstances.
Amendment 61 seeks to answer some insurers’ concerns that they will be forced to disclose legal advice they received in relation to the underlying insurance claim if they seek to show they had reasonable grounds for disputing that claim. Whether an insurer has reasonable grounds to dispute an insurance claim is an objective question, based on the substance of the grounds themselves rather than whether the insurer has received legal advice in relation to them. The insurer can establish these grounds without waiving privilege by setting out the grounds for dispute in its pleadings or by relying on the content of its correspondence with the policyholder.
Legal privilege is an important protection for parties, particularly during ongoing litigation. But the existing rules concerning waiver of legal privilege already balance the competing interests in the question of when legal advice should become disclosable. This amendment threatens to put policyholders at a disadvantage, which is not justified by a corresponding need on the part of insurers.
We have read the further legal opinion, which my noble friend Lord Flight kindly sent to me today. However, legal privilege is a complex topic which has been developed over the years by the courts and should not be changed in a specific context without very good reason. While I note all the work that has been done, the Government, like my noble friend Lady Noakes and the noble Baroness, Lady Hayter, are not convinced that such good reasons exist here. I therefore ask my noble friend to withdraw Amendment 61.
The Government have “some sympathy”, to pick up the wording quoted by the noble Baroness, Lady Hayter, with Amendment 62, which relates to limitation. Some insurers have argued that the vast number of claims they deal with on a daily basis means that they need to know when they have satisfied all their liabilities in respect of a certain claim. I agree that it does not seem unreasonable to expect a policyholder to bring a late payment claim within a year of being paid the substantive insurance claim or the final payment under it.
It appears that Amendment 62 would increase certainty for insurers without materially prejudicing policyholders. It might even have the effect of encouraging insurers to make that final payment, to commence the one-year period for any subsequent late payment claim and bring the matter to a close. If that were the case, it would, of course, be a benefit to policyholders.
To that end, I believe that the amendment at least deserves further consideration. I agree that the policy intention behind it might represent an improvement to the late payment clause, which could be in the interests of both policyholder and insurer. In the light of this debate, I would like to explore the details of this possibility further and to discuss it with all interested parties. In the circumstances, I hope my noble friend will not move Amendment 62.
Lord Flight
My Lords, I thank the Minister for her professional and courteous reply. I am grateful that the Government are willing to further consider the issues raised in Amendment 62. With regard to Amendment 61, I say simply that I hope the relevant individuals will read the Edelman opinion. The bottom line is that if Clause 20 goes through as it is, it opens the door to vexatious litigation. But I thank the Government for their response and beg leave to withdraw the amendment.
Small Business, Enterprise and Employment Bill
Debate between Lord Flight and Baroness Neville-Rolfe(9 years, 2 months ago)
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The Parliamentary Under-Secretary of State, Department for Business, Innovation and Skills (Baroness Neville-Rolfe) (Con)
My Lords, these amendments relate to Clauses 122 and 123 which remove the requirement for face-to-face meetings in insolvency proceedings.
I am grateful to the noble Lord, Lord Stevenson, and my noble friends Lord Flight and Lord Leigh for their questions about when face-to-face meetings should be held and the position of small creditors. I have also met R3, the trade body representing insolvency practitioners, as I promised to do in Committee, and am grateful to it for the valuable insight that it provided.
After further consideration, the Government intend to expand the thresholds so that a face-to-face meeting may be requested by 10% of the total number of creditors or contributories, as well as 10% by the value of their claims, which was, of course, the Government’s original proposal. This would mean that on average three or four creditors could trigger a meeting in a liquidation case. Moreover, to account for the larger insolvency cases with lots of small creditors, a further threshold of an absolute number of 10 or more creditors or contributories—a third 10—has also been introduced.
I thank the Delegated Powers and Regulatory Reform Committee for its recommendations on this part of the Bill. We have listened to its concerns and moved the various thresholds to the face of the Bill so that they will appear in the Insolvency Act as amended. Any changes to these thresholds will also now be subject to the affirmative resolution procedure.
Before I sit down, I should like to comment on another insolvency issue raised in Committee by my noble friend Lord Flight. This was the temporary exemption from the scope of the no-win no-fee reforms in Part 2 of the Legal Aid, Sentencing and Punishment of Offenders Act 2012 for insolvency officeholders to bring civil proceedings. The Government have listened to the concerns raised in this House and elsewhere. As a result, we announced on 26 February that we would defer commencing the no-win no-fee reforms for proceedings brought by insolvency officeholders beyond April 2015.
I am most grateful for the input of noble Lords on all sides of the House and I hope they will agree that we have found a sensible solution on all these issues. I beg to move.
Lord Flight (Con)
My Lords, I thank the Minister for listening to the various concerns in this territory and for the government amendments. I am aware that the insolvency industry is comfortable with the legislation as it now stands. It understandably has the view that it hopes creditor meetings will not disappear as they can be extremely useful. However, a most satisfactory compromise has been achieved, for which I thank the Minister.
Small Business, Enterprise and Employment Bill
Debate between Lord Flight and Baroness Neville-Rolfe
Baroness Neville-Rolfe
My Lords, we hope that the directive will be agreed in Brussels in the next few months. It is a directive, so there will be a two-year commencement, as normal. In the mean time we will bring in—and, I hope, road test and make a great success of—the register that we plan. If the detail of the directive requires some change either to the Bill—or, more likely, I suspect, from my experience of European directives, to regulations made under Section 122—that will be laid before the House in the usual way. I take comfort from the fact that that important bit of transparency legislation is going through in Brussels, and one would hope to see it on the statute book as soon as possible. That is the situation.
Lord Flight
My Lords, I suggest that what will happen is that the EU directive will come forth and we will be heavily gold-plated on its requirement. It is pretty clear that its requirement is for a register, but one available only for legitimate purposes.
I know that I have no chance of persuading the Government at this stage to fall in line with the EU and honour the privacy of private companies. What right is there for a snooping journalist to go around finding out what wealth someone has through the introduction of the register and looking up information about their private affairs? I find it quite unacceptable that that should be done, just like that, when it adds absolutely nothing to the task of unearthing fiscal and terrorist crime.
I have tried throughout to persuade the Government that it would be more sensible to limit access essentially to those tasked with finding crime, so there is little point in pushing the amendment further. I beg leave to withdraw the amendment.
Small Business, Enterprise and Employment Bill
Debate between Lord Flight and Baroness Neville-Rolfe(9 years, 4 months ago)
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Lord Flight
My Lords, the Government’s aim in Schedules 9 and 10 is to create a more efficient process for the Government’s official receiver to be appointed trustee of a banker’s estate—I mean a bankrupt’s estate; it might be a bankrupt banker. This would mirror the provisions for compulsory liquidation and therefore seem logical but the changes set out in Schedule 10 go further and remove the requirement for the official receiver to tell creditors whether or not they can hold a meeting to appoint a trustee. This means that creditors will not be informed that they have an up-front opportunity to appoint an alternative trustee, should they wish to do so, because there will be no process in place to inform them. The schedule would see a dramatic reduction in creditors’ power to influence insolvency proceedings and I fear that this could lead to a reduction in trust and confidence in the UK’s insolvency regime.
My Amendment 61WA—I mis-referred earlier on but Amendment 61VA also relates to this point—seeks to provide that the official receiver becomes a trustee on making the bankruptcy orders, and to omit the existing provisions which require the official receiver to decide whether to hold a creditors’ meeting to appoint a trustee and to notify the creditors if he decides not to do so. I take the view that three creditors or the proposed threshold of 10% by value of the creditors should be sufficient to requisition the qualifying decision-making process.
In addition, there is no provision in the Bill requiring the official receiver in each and every bankruptcy case to inform creditors of their rights to appoint an insolvency practitioner as trustee or for the mechanism to do so. This lack of provision disenfranchises creditors and surely flies in the face of increasing creditor engagement. Amendments 61WA and 61VA are intended to address these points.
Baroness Neville-Rolfe
My Lords, I thank the noble Lord and my noble friend for these amendments. I hope that I have understood their thinking correctly.
I will start by talking about Clause 118, which Amendment 61ZB seeks to amend. The clause removes the need for trustees to seek sanction before exercising certain statutory powers. That is a cost-saving measure, which arises, as I have already said, from the Red Tape Challenge; it receives considerable support externally and helps to achieve efficiency, as my noble friend Lord Flight explained.
The requirement for sanction was originally designed to protect creditors from an unregulated insolvency profession, preventing officeholders from taking steps that could have a negative impact on the bankruptcy estate such as continuing to trade a bankrupt’s business, which you have to look back in time to imagine. Now, of course, we have a much more highly regulated insolvency practitioner profession. Failure to act in the interests of creditors is a regulatory matter, and it would be for the trustee’s regulatory body to take appropriate disciplinary action.
The amendment would make an exception for cases where there is a creditors’ committee and the trustee wished to appoint the bankrupt to assist in dealing with certain tasks. This sometimes happens where the bankrupt is involved in a particularly unusual trade or there is some urgency to the matter and the trustee cannot find someone to perform vital tasks.
Let us take the case of a bankrupt and a remote farm—which is close to my own personal experience many years ago—perhaps in winter when weather conditions are challenging. That may mean a quick decision is required to instruct the bankrupt to continue to feed the animals or to engage a vet to look after sick animals, and so on. The requirement for sanction where there is a creditors’ committee would add unnecessary delay and cost.
A further reason for resisting the amendment is consistency. If accepted, trustees would be able to exercise all other powers without permission except this one, and then only where there is a creditors’ committee. That might add unnecessary complexity to the insolvency framework.
Amendment 61ADG would have the effect of removing a part of Schedule 10, which updates the section of the Insolvency Act 1986 which itself dealt with the process of interim receivership. Noble Lords will be aware that an interim receiver is appointed to protect assets where a bankruptcy petition has been presented and there is a real risk that assets could be lost before the petition is heard.
While the official receiver is acting as interim receiver, he or she is protected from liability where they dispose of an asset which subsequently turns out not to be part of the person’s estate, provided that when they did it they had good reason to believe that it was. Schedule 10 makes amendments to extend that protection to insolvency practitioners when they are appointed to that role. Amendment 61ADG would act to remove the protection for insolvency practitioners while leaving it in place for official receivers. I suspect that that was not the intention of the amendment.
Amendment 61WA would introduce a requirement into the Insolvency Act for the official receiver to notify creditors how they may go about removing and replacing them as trustee. I am grateful for the noble Lord’s probing amendment to government Amendment 61W, which my noble friend Lord Popat will introduce later on in this debate. However, I will just say that it is intended that these matters will be dealt with by guidance to official receivers, and I do not agree that we should introduce new regulation when we are trying to cut red tape. I hope that that explanation is helpful, and that on that basis the noble Lord will withdraw his amendment.
Small Business, Enterprise and Employment Bill
Debate between Lord Flight and Baroness Neville-Rolfe
Lord Leigh of Hurley
That is the point. Shadow directors can be significant shareholders who have chosen not to sit on the board—in particular, a lender who has become active in the affairs of a business—or simply someone in whose interests and according to whose instructions the directors act, without the person actually being a director. The Bill seeks to clarify the rules governing shadow directors so that people do not deliberately assume that status in order to avoid a lighter touch corporate governance regime. Indeed, the definition of shadow director is not changed by the Bill, only the extent to which they should enjoy the same duties as directors.
At present, the duties of directors apply to shadow directors to the extent permitted by common law rules and equitable principles. These are set out in Section 170 to 177 of the Companies Act and offer up a code of conduct. Clause 86(3) would enable the Secretary of State to make regulations to apply any duties of directors to such shadow directors. The Bill makes provision for the duties of directors to apply to shadow directors,
“where … they are capable of so applying”,
as my noble friend said. This wording, quite apart from adding certainty, will do the opposite and leave the courts little discretion to allow them to apply said duties in a proportionate manner. This wording, “capable of so applying”, amounts to some sort of blanket application of duties from one to the other since it is difficult to conceive of a situation where the duty would be incapable of applying.
Of particular interest is the duty to avoid conflicts of interest. It is not often possible to prevent a conflict from arising, and therefore the prima facie duty to avoid conflicts is typically addressed by having some mechanics: for example, one frequently sees a director excusing himself from any meetings considering such matters which might present a conflict and thus being prevented from voting. The Companies Act specifically considers these mechanisms but, of course, it will not be possible to apply them to shadow directors, who may not seek to be shadow directors and may not even be aware that they are. This could result in an automatic breach of the duty by entirely innocent shadow directors, so I would argue that more flexibility is required.
This is why the amendment offers up an alternative wording, which says that duties will apply,
“to the extent it is reasonable, just and equitable for any such general duty to apply”—
it certainly sounds reasonable to me—and caters for examples such as conflicts of interest. It still allows for the Secretary of State to make an intervention, as well as giving the courts the requisite discretion, but it will prevent the inherent unfairness in the situation that I have just described.
Baroness Neville-Rolfe
My Lords, in responding to Amendment 51, I thank my noble friends Lord Flight and Lord Leigh. Like my noble friend Lord Leigh, I have been a director in the past, but never a shadow director. It may be helpful if I set out how directors’ general duties currently apply to shadow directors and how Clause 86 will improve this position.
The current provision in Section 170(5) of the Companies Act 2006 states that the directors’ general duties apply to shadow directors to the extent that the,
“common law rules or equitable principles so apply”.
This makes it confusing for anyone who may be acting as a shadow director to know whether any duties apply to them and the extent to which those duties apply. Clause 86 clarifies that the same standards of behaviour are expected of shadow directors as of appointed directors, wherever possible.
I am sympathetic to the intention behind this amendment that shadow directors should not be put in a disadvantaged position compared to appointed directors. The Government recognise that there may be circumstances where the directors’ general duties may not be capable of applying to shadow directors in the same way as appointed directors. One example could arise in the context of the duty to avoid conflicts of interest, as set out in Section 175 of the Companies Act 2006. In principle, we would expect any director to avoid a conflict of interest wherever possible. However, Section 175 of the Companies Act also recognises that there are cases in which a director should be able to act in cases of conflict. It therefore allows for authorisation by the company for a director to continue acting on a matter where they have a known conflict in certain circumstances. A shadow director may not be able to seek authorisation in this way.
Clause 86 does not introduce a blanket application of the duties to shadow directors. A shadow director will be able to rely on Clause 86 to demonstrate that, in their circumstances, a duty or part of a duty is incapable of applying to them. Officials have discussed this with the British Private Equity & Venture Capital Association, and in light of the points that have been made, I now wish to consider the issue more fully and reflect on whether there is a need to adapt the way the general duties of directors apply to shadow directors so that they do not find themselves in a worse position than directors. This would be achieved by using the power already included in Clause 86(3). I will write to noble Lords before Report to give an update on my conclusions. I hope that my noble friends are reassured by this explanation and that, on this basis, my noble friend Lord Flight will withdraw his amendment.
Lord Flight
I thank the Minister for what she has said and beg leave to withdraw the amendment.
Baroness Neville-Rolfe
My Lords, I am grateful to my noble friend for so graciously moving his amendment and to the noble Lord, Lord Mendelsohn, for his remarks. The confirmation statement in Clause 89 is a replacement for our friend the annual return to Companies House. It will contain important information about the company, in particular about the register of people with significant control, which we have just been debating.
Amendment 54B would increase the criminal penalties we provide for not filing a confirmation statement at Companies House. It is important that penalties should be sufficient to deter and sanction those who do not provide Companies House with a confirmation statement. However, I do not believe that increasing the penalty is necessary in this case, which I think is what the noble Lord may be seeking. Enforcement activity by Companies House is focused on ensuring that information is delivered to it and put on the public register in a timely way. Companies House sends reminders to the company in good time before the company is due to file the current annual return. If a company fails to deliver information, the first aim of Companies House is to seek compliance. In the event of continued non-compliance, Companies House prosecutes the company and its directors. Last year, Companies House prosecuted almost 2,000 companies for failing to file the annual return. This approach to enforcement works. Compliance rates for the annual return are currently running at 98%.
The penalties in Parts 7 and 8 are designed to be consistent with the level and approach of existing Companies Act penalties. The penalty for failing to deliver a confirmation statement to Companies House is equivalent to the existing penalty for failing to deliver an annual return. The Government do not consider that there is a case to increase these penalties. Of course, we take the failure to file information at Companies House extremely seriously. It is important that people should be able to obtain up-to-date information about companies with which they may wish to do business. A continuing failure to deliver a confirmation statement could incur a daily default fine of £500. This would quickly add up to a significant amount. I understand concern that there should be sufficient incentives to ensure that information about people with significant control is put onto the public register. In practice, however, we judge a prison sentence to be highly unlikely to be proportionate to failing to deliver a confirmation statement, even were the law to permit the judiciary to impose such a penalty. It is, of course, important that people should have confidence in the public register. When necessary, enforcement includes the prosecution of criminal activity. Consequently, we consider that the sanctions set out Clause 89 are sufficient. I hope that explanation helps to clarify issues and that my noble friend feels able to withdraw his amendment.
Small Business, Enterprise and Employment Bill
Debate between Lord Flight and Baroness Neville-Rolfe(9 years, 4 months ago)
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Baroness Neville-Rolfe
I thank the noble Lord for his helpful intervention. Indeed, like him, I feel that we need greater awareness of the potential of GOV.UK and the internet for communicating with business, especially small business, in a much simpler and easier way. That is exactly Matthew Hancock’s intention. The plan is that this website, if it does not do so already, will cover all the sorts of things that you are talking about. Do have a look at it and if you feel there are other things that we should do, I am sure that we can. I am sorry about the parliamentary impropriety of referring to the noble Lord as “you”.
That brings me to a couple of final points. Just last month, which is a year since the publication of Small Business: GREAT Ambition, we announced that we had met a large commitment in that document by launching the Business Growth Service, joining up all of our support available for those businesses that have the right level of ambition, capability and capacity to improve and grow. So we are making progress with this overall and trying to bring together the offer for small business, which I feel is a theme that we will probably agree on in the course of this Committee.
The House can look forward next month to a report by my noble friend Lord Young of Graffham, the Prime Minister’s adviser on enterprise, who will produce his definitive paper on what impact the last five years of government work has had on small businesses in this country. I will ensure that interested Lords receive a copy.
Therefore, while I fully agree with the intention behind the amendments, I agree with my noble friend Lady Wheatcroft that we have enough reports. I do not believe that it is necessary to achieve the outcome that the noble Lord seeks in the way that he has proposed. I hope that he has found some reassurance from my lengthy explanation and is willing to withdraw the amendment.
Lord Flight (Con)
My Lords, I first declare an interest as chairman of the Enterprise Investment Scheme Association. This issue falls under the Treasury rather than the BIS, so it often gets ignored in terms of its crucial importance in raising equity capital for small businesses. Once you have the equity capital, you can gear up with borrowing. EIS, under Governments of both main parties, has raised more than £12 billion since it started; over the past three years, the amount raised has doubled in each of those years and is now well in excess of £2 billion for the current year. When the present Government came into power, one of the constructive things that they did was to go back to negotiate with the EU to widen the parameters of the EIS, which had been unhelpfully narrowed during the previous Labour Government. Equity finance for small business is almost more precious than debt finance, and there is a wider range of providers of debt finance now increasingly available. I want to register the point on a BIS Bill in a BIS debate today that the Treasury and the EIS is crucially important for small business.
Lord Flight
My Lords, I am not quite clear what the Minister was actually offering here, but I should stress that it is clearly completely inappropriate to treat companies with a turnover in excess of £25 million and more than 250 employees as large companies, which is what the Bill presently does. These small and medium-sized businesses are as much the victims of late payment as smaller companies. It is clear—and I trust that both sides of the Committee would agree—that the definition needs changing to an appropriate size, whether by using the R&D definition that fits reasonably well and on which Grant Thornton has done the research, or another definition. However, the SME definition is clearly inappropriate. I beg to move.
Baroness Neville-Rolfe
My Lords, I have already responded to my noble friend Lord Flight. This matter will be discussed again, not least under some later amendments. We have listened to what he said but, at this point, I would ask him to withdraw his amendment.