Economy: Productivity

Lord Harrison Excerpts

Monday 5th September 2016 Lords Chamber

Asked by

[Lord Harrison]

To ask Her Majesty’s Government what plans they have to improve the United Kingdom’s productivity.

[The Commercial Secretary to the Treasury (Lord O'Neill of Gatley) (Con)]

My Lords, UK productivity performance remains a fundamental challenge. The Government set out their approach to tackling the issue in their productivity plan, Fixing the Foundations. The Government have since introduced further measures that will help productivity growth—for example, the apprenticeship levy, proceeding with investments in UK infrastructure such as High Speed 2 and the biggest investment in road and rail for a generation.

[Lord Harrison (Lab)]

My Lords, given the Prime Minister’s welcome focus on our poor and parlous situation in regard to productivity in this country—we stand some 18 percentage points below the average of our rivals in the G7—what is the purpose of, and how will competitiveness and productivity be generated by, our leaving the single market within the context of Brexit?

[Lord O'Neill of Gatley]

My Lords, the decision to leave the EU was the result of a democratic question put to the people of this country—it was the result of that choice. What that means for the future of UK productivity remains to be determined. As I am sure many Members of the House are aware, in the past couple of weeks in particular there has been a somewhat surprising upbeat tone to some of our economic data. Among other things, this raises the possibility that productivity has not slipped any further or as much as many people may have thought.

Economy: Productivity

Lord Harrison Excerpts

Wednesday 16th March 2016 Lords Chamber

Asked by

[Lord Harrison]

To ask Her Majesty’s Government what assessment they have made of the United Kingdom’s productivity in relation to that of other European Union and G20 states.

[The Commercial Secretary to the Treasury (Lord O'Neill of Gatley) (Con)]

My Lords, UK productivity levels hover around the middle of the park in relation to the G20 and the EU28. We face a significant, ongoing and long-standing productivity gap with the most productive nations of the world, such as the United States. The Government have of course recognised that and, within the overall fiscal framework, are working to remedy the problems and fulfil the challenge they set themselves in last summer’s productivity plan, Fixing the Foundations.

[Lord Harrison (Lab)]

My Lords, given that UK productivity is, by 29%, worse than French or German productivity and that in the vital area of financial services, according to the Office for National Statistics, we have deteriorated badly over the past six years, is there any prospect that this Government might redouble some of their own productivity? For instance, in the area of infrastructural services—rail, road and air— decisions might be made more quickly and effectively to provide the basis for improved productivity. Finally, in order to help smaller firms, which need help, will the Minister turn his attention to the HMRC decision to break off the valuation check service this March?

[Lord O'Neill of Gatley]

My Lords, the noble Lord asked a number of questions and I shall plump for the middle one. I assume that many Members of the House have not had a chance to digest the details of today’s Budget, but I am very pleased to say that we are accelerating our infrastructure plans, on which there is already quite impressive independent evidence. I could highlight a number of things that have been announced today. One that is very dear to my heart is that we are accelerating—compared with before, and taking on board the full recommendations of the independent National Infrastructure Commission—so-called HS3. In particular, the target is for the train journey time from Leeds to Manchester to drop to 30 minutes.

Economy: Balance of Payments and Industrial Productivity

Lord Harrison Excerpts

Thursday 10th December 2015 Lords Chamber

Asked by

[Lord Harrison]

To ask Her Majesty’s Government what steps they will take to improve the United Kingdom’s current balance of payments and industrial productivity levels.

[The Commercial Secretary to the Treasury (Lord O’Neill of Gatley) (Con)]

My Lords, this Government are committed to boosting productivity and enabling our trade performance. Our productivity plan, Fixing the Foundations, is designed to ensure that we remain a dynamic, open and enterprising economy. It includes steps to improve our export support, which we built on at the spending review. This action, together with our commitment to eliminate the budget deficit, reduces the potential risks to our economic security associated with our external position.

[Lord Harrison (Lab)]

My Lords, the trade deficit of the United Kingdom is as big as the Bay of Biscay. Manufacturing is once again in decline because of the failure to invest such that it is blocking the march of the makers, as proposed by the Chancellor. British productivity is failing to produce because of underinvestment in people and parts. Is not John Longworth of the British Chambers of Commerce right to criticise the Chancellor’s unbalanced economy? Would it not be helpful in our negotiations with the European Union, when highlighting competitiveness, if competitiveness started at home?

Queen’s Speech

Lord Harrison Excerpts

Thursday 4th June 2015 Lords Chamber

[Lord Harrison (Lab)]

My Lords, like many others on this side of the House, I am less than transported by the Government’s proposed Bills for the forthcoming Session. However, I welcome the noble Lord, Lord O’Neill, not only as a man of the north but for his interests in strengthening transport links to not only the north and beyond but across to the east and the west. There are many successful large cities and big towns in the north. If that is true of the north, I hope he agrees—I believe he does—that it is also true of other areas throughout the United Kingdom and that there has been a failure to develop the east-west links which are so vital. One colleague would talk about the south-west and others would talk about the A14, for instance.

However, the noble Lord omitted to talk about the Airports Commission and the forthcoming decision that will have to be made. I encourage him not to proceed into the pusillanimity that David Cameron has exhibited by kicking this issue into the next Parliament. We need decisions. The airports need to be part of an integrated transport response to the changing and growing needs of our economy. Perhaps in his reply the Minister will mention more about regional airports and what the Government intend to do there.

Like others, I shall talk principally about small businesses and access to finance. Next Thursday, the noble Baroness, Lady Neville-Rolfe, and I will have a debate on the question of late payment of commercial debt. I warn her that it is no longer satisfactory to invoke the Prompt Payment Code as a way of solving that problem, which has been with us for far too long. I remind her that some two years ago, at the behest of the German ambassador in London, I attended a meeting with the German business bank on the eve of our setting up of the British Business Bank. However, I am at a loss to explain what is happening in the UK and what our bank has been doing. The British Business Bank was finally set up, as I understand it, in November 2014. Why so late? There was an explanation about waiting for the European Commission, but I do not understand why that did not apply to the German business bank. Why has there been so little help for manufacturing? The Minister, Matthew Hancock, agreed that only 13% of the moneys so far lent had been to manufacturing. That is another theme highlighted by the noble Lord, Lord Broers.

In addition, the Commons, in its report of 10 February, talked about the British Business Bank and said that,

“support is too complicated for business to understand or too poorly communicated for businesses to be aware of”.

It concluded that businesses seeking support find,

“a complex and unclear offer … from the Government”.

Will we do something about that? In that same report, there are concerns about the Green Investment Bank. It is a bank inhibited by a lack of borrowing powers. What do the Government propose to do about freeing up the Green Investment Bank?

During the spring, I had the pleasure of attending the World Bank and IMF parliamentary conference in Washington and of meeting Christine Lagarde. She and others are proposing a symposium or conference in Paris on climate change. What UK initiatives are we producing at that important meeting? What are we doing to fulfil the aim by our Prime Minister to be the greenest Administration ever?

The leitmotif of the noble Lord, Lord O’Neill, was productivity. He talked about the problems of being the second-poorest in terms of productivity in the G7 and being 17% behind—in deficit—compared to other countries. Even France, which is often invoked in UK political circles as a nutcase when it comes to the economy, clearly is more productive than we are. I ask the Minister to take on board the memorable formulation by my noble friend Lord Haskel that we need to replace the age of austerity with an age of productivity. We must clothe ourselves in the habit of productivity. In order to tackle productivity, the noble Lord, Lord O’Neill, suggests that we must do more in education. I suggest that we have a chaotic education system which leaves out higher education, as the noble Lord, Lord Broers, pointed out.

We need to improve infrastructure. We have become pothole Britain. A Roman legion marching in Britain today would be subject to turned ankles and shattered shins. The noble Lord, Lord Horam, pointed out how the lack of housing is incapacitating our ability to revive the economy. Even the Telegraph yesterday had a report about how the City is snared in London from bringing in new customers and operators because of the lack of housing. The noble Lord, Lord O’Neill, boasts of coining the expression “BRICs”, but we need more bricks and mortar, and a bit more housing, to provide for peoples locally. I ask that local councils stop being attacked. They are often loaded with more and more work to do, and responsibilities, while being deprived of the money that is so important.

I conclude in agreeing with others who have spoken on the European question, to which we will return in time. I hope that we make a proper decision at the end of all this debate and that the noble Lord, Lord O’Neill, will join us in ensuring that we have a European future.

Small Businesses: Finance

Lord Harrison Excerpts

Wednesday 25th February 2015 Lords Chamber

Asked by

[Lord Harrison]

To ask Her Majesty’s Government what steps they have taken in the past year to increase access to finance for small businesses.

[Lord Newby (LD)]

My Lords, it was announced in the Autumn Statement that the Government are providing further funding to two British Business Bank schemes, the enterprise capital funds and enterprise finance guarantee schemes. Additionally, the Funding for Lending scheme will be extended and focused on lending to SMEs, and furthermore, the Small Business, Enterprise and Employment Bill ensures that SMEs which are rejected for finance by banks are referred to alternative finance providers and that those providers have access to the credit data they need.

[Lord Harrison (Lab)]

My Lords, according to the Federation of Small Businesses, credit availability and affordability has declined in the past quarter and indeed the Government’s own Funding for Lending scheme has sputtered and spluttered into reverse over the past two years. Will the Government take heed of Keith Morgan, the leader of the British Business Bank, who has said that there are market failures which need to be addressed if our small businesses are to grow and to provide jobs for the future?

[Lord Newby]

That is why we have created the British Business Bank specifically to deal with these market failures. The bank aims to unlock £10 billion of new finance by 2017-18. On lending to small businesses, the noble Lord should be aware that gross lending has grown by 25% in the past year and by 41% over the past two years.

Bank of England

Lord Harrison Excerpts

Thursday 30th October 2014 Lords Chamber

Asked by

[Lord Harrison]

To ask Her Majesty’s Government whether they will rename the central bank of the United Kingdom, “The Bank of England and of the United Kingdom”.

[Lord Newby (LD)]

My Lords, having begun life in 1694 as a commercial bank, the Bank of England predates the formation of the United Kingdom itself. Of course, the Bank’s role is not limited to England and it acts as the central bank for the whole of the UK. However, to change its name would represent a break from over 300 years’ worth of history and the prestige which it carries as a global brand.

[Lord Harrison (Lab)]

My Lords, given the particular saliency of the currency issue in the recent Scottish referendum, would it not be a wise, inexpensive and inclusive act to extend the title of Britain’s central bank to the “Bank of England and of the United Kingdom”, thereby properly recognising the reach and relevance to all four nations of the United Kingdom of our own central bank?

[Lord Newby]

A notable feature of the referendum campaign was that Alex Salmond was desperately keen to keep the comfort blanket of the Bank of England. As far as I am aware, he never suggested that its name should change.

Euro Area Crisis Update (EUC Report)

Lord Harrison Excerpts

Wednesday 23rd July 2014 Lords Chamber

[Lord Boswell of Aynho]

To ask Her Majesty’s Government what is their response to the Report of the European Union Committee on the Euro area crisis: an update (11th Report, Session 2013–14, HL Paper 163).

[Lord Harrison (Lab)]

My Lords, on behalf of my noble friend Lord Boswell of Aynho, and at his request, I beg leave to ask Her Majesty’s Government what is their response to the report of the European Union Committee on the Euro area crisis: an update. I thank my colleagues behind the scenes—namely, Stuart Stoner, our indefatigable clerk, Sarah Yusuf, Rose Crabtree and Katie Kochmann—who all helped and contributed over the years to these important deliberations.

I am delighted to speak to this short debate on the Euro area crisis: an update. This work was undertaken by the Economic and Financial Affairs Sub-Committee, which I chair. The report brings together four short update inquiries undertaken since the European Union Committee’s previous February 2012 report on the crisis. The most recent update was undertaken in February and March 2014. We heard from a stellar line-up of witnesses, including: Senator Mario Monti, former Prime Minister of Italy and a former Commissioner; likewise Erkki Liikanen, a former Commissioner, now the governor of the Bank of Finland and author, of course, of the Liikanen report on the European Union banking structural reform; Sir Jon Cunliffe, erstwhile UK ambassador to the European Union and now deputy governor for financial stability at the Bank of England; as well as a panel of economic experts, which included the Mayor of London’s chief economic adviser, Gerard Lyons.

We took as our starting point a very simple question: was the euro area crisis over? The answer we received was that the crisis had undoubtedly eased. In particular, the existential crisis afflicting the euro had diminished, in no small part thanks to the European Central Bank president Mario Draghi’s authoritative commitment in 2012 to “do whatever it takes” to save the euro. There were other encouraging signs: the reduction in sovereign bond spreads; Ireland’s exit from its adjustment programme; the entry of Latvia into the single currency; the hint from Poland—not only in terms of its financial line-up but even from so venerable a colleague as Lech Walesa—that it also had aspirations to join the euro; the return to growth in many member states; and even a growing confidence in Greece, the epicentre of the crisis. I thank also the noble Lord, Lord Boswell, who presides over the European Union Committee. He and I were in Athens recently at a COSAC meeting to hear of a very good report that was given by Prime Minister Samaras.

Having said that, we found that fundamental weaknesses remained, including: the extremely high levels of unemployment, particularly youth unemployment; immense economic imbalances between core and periphery member states of the eurozone; anaemic growth; inhibited bank lending, particularly to small businesses; and perhaps incomplete and uncompleted structural reforms in a number of the member states. There was also an overstrong euro on the exchange rates. Perhaps most of all, there were growing fears of a damaging deflationary spiral. All of this fed into wider political tensions about the effect of the austerity on the lives of European Union citizens—tensions that the May 2014 European parliamentary elections in part illustrate.

Our conclusion was that, while the crisis may have abated, it would be wholly unwise to conclude that the storm had entirely passed. In particular, the economic fragility of many member states meant that the euro area remained vulnerable to future shocks. Events since the publication of our report have borne this judgment out. The recent crisis of the Portuguese Banco Espírito Santo led to nervous jitters spreading across the euro area periphery. Industrial production remains low and overall growth is running at only 0.2% a quarter. The recovery remains as ill balanced as ever, as Germany leaves other members of the single currency in its wake—although even with Germany more recently there has been some holding back in its traditional economic growth. Inflation is currently running at only 0.5%, as growth continues to bump along. The threat of a prolonged period of low inflation or even a deflationary spiral looms ever larger. The European Central Bank was applauded for its action in June of this year, when it announced that the deposit rate for banks would be cut from zero to minus 0.1%, alongside targeted long-term refinancing operations, and yet the jury is out as to whether these measures will have any tangible effect.

The euro area crisis has also had a prolonged impact on the EU institutions. The European Central Bank has emerged with well deserved credit for its handling of the crisis. Nevertheless, it faces significant challenges, not only from the deflationary effect but also over the handling of its comprehensive assessment of the banking system, including of course the so-called stress tests, the result of which will be announced in October. Reports last week suggested that banks would have two weeks to plug any gaps in balance sheets that the ECB uncovered. This process will test the robustness of the euro area’s recovery and future health as never before. Overall, we found that the crisis had seriously altered the institutional and decision-making structures of the European Union. Those representing the euro area, such as the European Central Bank and the euro group, have grown in importance. By contrast, the Commission’s powers and influence in determining the crisis response have perhaps diminished. I should remind colleagues that the new Commission President, Jean-Claude Juncker, was a former chair of the euro group, with all the implications that that has.

This trend has significant implications for the United Kingdom. Closer integration is vital if the single currency is to prosper. We therefore agree with the Chancellor that the UK must do all in its powers to support its EU partners on this path. Nevertheless, such moves towards integration leave the United Kingdom in an increasingly isolated position. Noble Lords will be aware that the EU institutions are in a state of flux. As I mentioned, the newly elected European Parliament is finding its feet, the new President of the Commission has been chosen and the shape of the new college of Commissioners will emerge over the coming weeks. In this context, the Government and the Bank of England must maintain and develop constructive relationships with the increasingly powerful euro area authorities. All parties should redouble their efforts to convince euro area colleagues of the benefits of having the City of London as the leading global financial centre for the European Union as a whole. If they can be convinced of the mutual benefits of prosperity for the euro area and the single market, then the UK and the City of London will have much to contribute and much to gain.

I look forward to the Minister’s response on the steps that the Government are taking to ensure that the UK and the euro area enjoy such mutually beneficial relationships in the months and years to come.

Genuine Economic and Monetary Union (EUC Report)

Lord Harrison Excerpts

Wednesday 2nd July 2014 Grand Committee

Moved by

[Lord Harrison]

That the Grand Committee takes note of the Report of the European Union Committee on Genuine Economic and Monetary Union and the implications for the UK (8th Report, Session 2013–14, HL Paper 134).

[Lord Harrison (Lab)]

My Lords, I am delighted to introduce this EU Committee report, ‘Genuine Economic and Monetary Union’ and the Implications for the UK. What is genuine economic and monetary union? In June 2012, the IMF revealed that there was a nearly €40-billion hole in the balance sheets of the Spanish banks and the spectre of contagion threatened to overwhelm the eurozone as a whole. European Union leaders recognised that urgent action was needed.

The result was a report written by the outstanding and now departing President of the European Council, Herman Van Rompuy, entitled Towards a Genuine Economic and Monetary Union. It envisaged a stable and prosperous EMU based on four essential building blocks. The first was an integrated financial framework, otherwise known as banking union. The second was an integrated budgetary framework. The third was an integrated economic policy framework. The final building block was ensuring democratic legitimacy and accountability. On the basis of this report, the Council invited the President of the Council, the Commission, the Eurogroup and the European Central Bank to prepare a specific and time-bound road map for the achievement of genuine economic and monetary union. The final report was published in December 2012, complementing the Commission’s own November 2012 blueprint for a deep and genuine economic and monetary union.

The Sub-Committee on Economic and Financial Affairs, which I chair, heard evidence on these proposals over several months, including on visits to Brussels, Berlin and Frankfurt, where we visited the European Central Bank and the Bundesbank. Our report was published in February. We are grateful to Professor Iain Begg of the London School of Economics, who acted as specialist adviser to the inquiry. I am also eternally grateful to Stuart Stoner, our outstanding clerk, and to Rose Crabtree, policy adviser for the report but a poacher turned gamekeeper who is now working for the PRA.

Our committee found that banking union was the most urgent of the four genuine economic and monetary union pillars. It was vital to tackling the effects of the financial crisis, securing the long-term stability of the eurozone and repairing the damage to the single market in financial services. For our December 2012 report on banking union, we consulted Michel Barnier, the appropriate commissioner, and Herman Van Rompuy. The report was with Chancellor George Osborne at the December Council.

Indeed, significant progress towards banking union has been made. A single supervisory mechanism has been agreed and will become operational under the European Central Bank this November. A single resolution mechanism has been agreed but, regrettably, only a partial banking union is in prospect. For the third leg of banking union, the single deposit insurance mechanism was quickly dropped because of political pressure. What is more, the final agreement on the single resolution mechanism that was reached shortly after our report was published remains sub-optimal.

Our concerns about the SRM focus on two issues in particular. First, the resolution mechanism itself—the process by which a failing bank would be dealt with—remains highly complex. Key players, including the Commission, the Council, the European Central Bank and national authorities, will all have a role to play. Indeed, it has been reported that more than 100 individuals and organisations might need to be involved in a resolution decision. Yet anyone with experience of these issues knows that bank resolution needs to be a quick and decisive process with the confidence of markets, investors and consumers. It is not to be undermined. I ask the Minister whether it is really credible to save a failing bank over a short weekend, before the markets open on a Monday morning, while consulting more than 100 other people or institutions.

Secondly, we were deeply concerned about the limited funds available to rescue failing institutions. The compromise agreement reached in the spring—by frontloading the mutualisation of funds and allowing the single resolution fund to borrow on the financial markets—was a step in the right direction. That is all helpful in avoiding the need for the taxpayer to pick up the bill. Yet even at its full strength of €55 billion, we fear that the resolution fund would be underpowered and ill equipped to deal with the scale of bank failures witnessed in recent years. In the committee’s view, direct recapitalisation of banks by the European stability mechanism was vital to break the vicious circle linking bank and sovereign debt. Again, perhaps the Minister can give us his view.

We also found that the second and third building blocks of genuine economic and monetary union—the proposals for an integrated budgetary and economic policy framework—were politically unrealistic at present. German concerns over moral hazard and the assumption of liability without effective controls mean that debt mutualisation remained highly contentious. That was not to say that these issues were not unimportant. A system of substantial fiscal transfers by a central budget is a characteristic of most currency unions and some degree of debt mutualisation may be inevitable if the single currency is to prosper. In the mean time, we warned that the imposition of so-called austerity policies could aggravate the problems facing weaker economies.

The fourth strand of genuine economic and monetary union—democratic accountability and legitimacy—is explored in the context of the recent report from the European Union Select Committee, chaired by the noble Lord, Lord Boswell of Aynho. On the role of national parliaments in the European Union, that report found that there was an asymmetry between the growing powers of institutions such as the Commission, the European Central Bank, the Eurogroup and the troika, and the ability of citizens to hold them to account for their actions. We found that a serious democratic deficit now exists, as the results of the recent European elections partly testify. While the European Parliament has a key role to play, we found that the principle of democratic accountability could be strengthened only if national parliaments also had an enhanced role and we were therefore extremely concerned at how little emphasis was placed on the role of national parliaments in the genuine and economic monetary union proposals. Incidentally, the ECB and the Eurogroup have clearly advanced as institutions within the European Union. I am pleased to say that our committee interviewed Dr Constâncio, vice-president of the ECB, in our investigation into the banking union report, and we recently visited the ECB and the Bundesbank.

Our report concluded by considering the implications of all this for the United Kingdom. The Government stressed that the United Kingdom’s role had not diminished and that it continued to play an integral role in the European Union, notwithstanding the fact that eurozone members are pursuing an increasingly integrationist agenda. However, the evidence to the committee heard in Brussels and Berlin tended to contradict that assertion. Responsibility for defending the UK interest lies not only, if principally, with the Government but with us as parliamentarians and, I might say, the City of London as the foremost European global financial centre. The European Union institutions have their own obligations to ensure that the United Kingdom’s concerns are not lightly dismissed, and noises off from Angela Merkel, Mark Rutte and Fredrik Reinfeldt hint that that might be recognised.

Our report concluded by observing that the eurozone remains on the road towards greater integration, and the implications of this for the United Kingdom are immense. A strong and prosperous eurozone is in the interests of all European Union members, as is a strong and engaged United Kingdom and a strong City of London. Achieving all those outcomes simultaneously will require close care and attention, together with good will, on all sides. When I talk of good will, the recent Juncker debacle did not help.

I point out that Mr Juncker was head of the Eurogroup—the group that together oversees the 18 members of the eurozone. One thing that I have tried to do as chair of this committee over the past four years is to support our Chancellor when he says that the welfare of the eurozone provides the opportunity for the United Kingdom’s economies to prosper. We have always been told by George Osborne that the European Union needs to integrate more closely and get on with the job of making sure that its members are working together. It is therefore incongruous to describe Mr Juncker as an integrationist when that is the very thing that we have asked the EU to do.

I also say to the Minister that, important though the position of the European Commission President is, others are important too. What plans do we have for the replacement of Herman Van Rompuy, who has played such a behind-the-scenes but effective role? What positions are we likely to get with Andrew Lansley, if he is indeed to be our United Kingdom Commissioner? Is there really any hope that we can get an economic role now that we are outside of the European Union? Cathy Ashton—my noble friend Lady Ashton—will possibly be replaced by Mr Sikorski, currently Foreign Minister of Poland. Although a former member of the Bullingdon Club at Oxford, he has said some choice things about the way that we, the British, have gone about these negotiations.

Sharon Bowles, whose praises must be sung as chair of the European Parliament committee on all these matters, is someone who we need here. She is coming before our committee on 22 July to give us help on, and her understanding of, the subject of our new report—financial structures within the European Union. However, we must be clear, too, about our reform of the European Union. That is unclear at the moment but so often is familiar to us. The single market was a creation of the European Union by a member of this House. Can we pursue that in financial regulation through the digital economy or services directive?

Finally, can we try a little harder to find friends other than “phoning a friend” with Angela Merkel? We need to spread much wider than that. We have already recognised the position of the United Kingdom, which is outside the euro, outside Schengen, outside the fiscal compact—I heard no one from the Government say that the Czech Republic is now a member of the fiscal compact, thereby isolating us even more—and, indeed, outside the very important European Semester.

The constant theme of my committee over the four years that I have had the honour of chairing it is that the best way of ensuring that the United Kingdom’s voice is heard within the European Union is to keep close to our partners and close friends in the European Union. We need man-to-man marking when we are engaging with the other 27 friends. We need to be friends on Facebook with the other 27 and not for ever threatening withdrawal as an instrument of European Union policy—a kind of foreign policy of coitus interruptus. We need to make the case for the European Union and the United Kingdom’s role within it with passion, persuasion and precision. We need to succeed in the European Union not secede from it.

--- Later in debate ---

[Lord Harrison]

My Lords, with the passage of time all committee chairmen tend to fall into their anecdotage. However, before I tell my concluding anecdote, which I hope will sum up the tenor of the debate we have had, I will say that I will resist the opportunity to play footsie with the noble Lord, Lord Lamont, or indeed with the Minister who has replied. I will also resist the opportunity offered by the noble Lord, Lord Desai, to take some of my committee to the United States both for the purposes of literary examination and comparison with the regulatory structure there. To my noble friend Lord Liddle I say that despite all the quotations from the Book of Job I do not see myself as a man of constant sorrow; my job is to help the process of change with the committee that I have.

My anecdote is the following. Some 20 years ago I wrestled to the ground Pierre Moscovici, who was later to become the Finance Minister of the incoming French Government, for the purposes of leading the socialist group on the monetary sub-committee—I am very familiar with sub-committees. However, one dark afternoon in Brussels in the European Parliament we met Alexandre Lamfalussy, who was later to be president of the European Monetary Institute and the forerunner of Trichet, Duisenberg, Draghi and all the rest. I, in my pomp and circumstance, then wrote to the Wirral Globe, Cheshire Observer and Chester Chronicle that I had just elected Europe’s next bank manager. Some 20 years later, I think I was right, but no one was paying attention at the time other than my good local newspapers.

I tell that anecdote because the tenor of this debate has been that we have to be on our pins, toes and high heels to be able to speak with those who might be our friends and who might change things. I thought that view was best put by the noble Lord, Lord Kerr, when he talked about knowing the guy at the other end of the telephone. That is the job of UK Governments now and in the future for the purpose of defending UK interests. I say to the noble Lord, Lord Hamilton, that what united the committee across the political waves was the belief that that was and remains important, and that we will continue to pursue it in the future. I am happy to continue the seminar in the Peers’ guest room shortly afterwards, should any noble Lord need a glass of European wine, and I thank all noble Lords who have contributed.

Motion agreed.

Employment: Private Sector Jobs

Lord Harrison Excerpts

Thursday 30th January 2014 Lords Chamber

Asked by

[Lord Harrison]

To ask Her Majesty’s Government, in the light of the report by the Centre for Cities in respect of the proportion of private sector jobs created in London, what steps they are taking to rebalance the economy across the United Kingdom.

[Lord Newby (LD)]

My Lords, the Government are taking a number of steps to ensure that the recovery is balanced across the UK through local enterprise partnerships, enterprise zones, city deals and growth deals. The latest figures show an increase in private sector employment of 928,000 outside London over the past three years, compared to 307,000 in London over the same period, so nearly 80% of all private sector employment growth has come from outside London.

[Lord Harrison (Lab)]

My Lords, according to the recent report, most of the new jobs have come from London and the south-east. Does the Minister share my concern about that? Does he understand that concern against a background of declining exports, a parlous balance of payments situation and the matter of small businesses having access to finance in order to grow jobs still not having been resolved? How will we rebalance the economy and how and when will we know that the economy has indeed been rebalanced?

[Lord Newby]

My Lords, there are a number of measures but one of the key things is what is happening to employment and unemployment regionally. In the past quarter, unemployment fell more quickly in Scotland, Wales and four English regions than it did in London. There is big growth in a number of regions outside London, which is extremely welcome.

Economy

Lord Harrison Excerpts

Tuesday 28th January 2014 Lords Chamber

[Lord Newby]

My Lords, at the moment, when we are seeing the largest increase in business confidence for a number of decades, any statement by anybody from any party which has the effect of undermining that confidence is very much to be deprecated.

[Lord Harrison (Lab)]

Does the Minister share the concern of the British Chambers of Commerce that our lack of ability in linguistic skills has severely held us back from exporting as rigorously and productively as we might have done and thereby caused the severe balance of payments problem that this country has suffered from under the coalition Government?