Trade and Investment

Lord Leigh of Hurley Excerpts

Monday 15th June 2015 Lords Chamber

[Lord Leigh of Hurley (Con)]

My Lords, I welcome the chance to speak in this debate today and, in doing so, refer your Lordships to my registered business interests, which include advising companies on direct investment from overseas.

I join the congratulations to my noble friend Lord Maude of Horsham. He and I first worked together in 1995, when I served on the tax group sub-committee of the DTI Deregulation Task Force. Sadly the Deregulation Task Force was abolished by Labour in 1997. We then worked together when he was chairman of the Conservative Party—a post it has not abolished—and thereafter I watched in admiration his work in the Cabinet Office, where he saved the taxpayer not just millions or billions but tens of billions of pounds. The country is lucky that he has chosen to dedicate the next stage of his career to public service, following, as has been said, in his father’s footsteps. He will be a great asset to the House.

I want to talk about how we should be building on our legacy and to answer the oft asked question: what should Britain’s place be in this world? At least one part of the answer is: as an open trading nation, exporting the world over and attracting investors into the UK. We have history. In 1596, when Captain Benjamin Wood set sail, it was the first attempt by Britain to find trade routes to China, a land thought to contain untold riches and wonder. He was, I am sorry to report, never heard from again. Fortunately, his successors fared better and, in 1637, a Captain Weddell landed in Canton and our trade relationship with China began in earnest. As many will know, we enjoyed similar successes elsewhere in the globe and became the world’s pre-eminent trading nation, a capital of a newly globalised world.

Coming to the present day, we should start by showcasing the incredible story unfolding in foreign direct investment. While much emphasis is often placed on the importance of exports, we also need to encourage FDI. This should not be criticised as “selling off the family silver” but rather the reverse. In FDI we have consolidated our leading position and, once again, remain the number one country in Europe, as the Minister told us. This is a position we have held for four years in a row and we are second in the world to the United States.

The UKTI 2013-14 report shows there were 1,773 individual projects with UKTI involvement, and the majority of these took place. We look forward to the Minister’s report next month on the years 2014 to 2015. These projects have helped to create and safeguard 111,000 jobs. These are not just any old jobs but future-facing jobs, with 37,000 of them coming from an advanced manufacturing base.

The investment is coming from all over the world, too, and not only the obvious places. As the noble Lord, Lord Bilimoria, has pointed out, it is coming from growing markets such as India. We all continue to hope that the rest of the European economy will soon be as fast growing as ours.

There are many reasons why our economy is growing like it is and these reasons resonate with overseas investors. Chinese investment into the UK is growing at an astonishing 85% per annum. I was privileged to be part of the largest trade mission to China, assembled during the previous Parliament, in which the Prime Minister conceived the programme Partnership for Growth. That trade mission was full of SME businessmen and women seeking to do business in China. So, while the EU will always be a key trading market for the UK, we are leaving nothing to chance in the rest of the world—hence the mission to China, which is already bearing fruit. Exports to China have doubled in the past five years.

Whereas generally exports are improving, there is still more to do. The trade deficit has been mentioned. This is significantly down as an average of GDP to less than 2%, as opposed to 2.5% under the last Labour Government. However, I am sure the Minister will agree that there is often too much focus on the headline number. The latest figures for the most recent month, April, which have just been published, show that the UK deficit was £1.2 billion. In fact, looking behind those numbers, it comprises an £8.6 billion deficit on goods and a surplus of £7.4 billion on services, which is a dramatic difference—well done the services sector, including of course, the legal services championed by the noble Lord, Lord Clement-Jones.

Turning to my industry, the financial services industry, I note that in his 2013 Budget, the Chancellor announced the establishment of the Financial Services Trade and Investment Board, now headed by Sue Langley, and this and other UKTI initiatives are clearly having an effect. But perhaps my noble friend can explain how much of UKTI’s resources will, hereon in under his watch, go directly to exporters rather than to internal initiatives. I am aware of the medium-sized initiative, the MSI, but remain concerned that in the UK only one in seven medium-sized businesses export outside the EU, whereas in Italy one in three medium-sized businesses export outside the EU. We are behind the curve in respect of SMEs.

The UK’s reputation as an economic powerhouse has been steadily restored over the last five years. Businesses are investing here, helping to create more jobs and in turn opening up new markets for export. Brand Britain is as strong as it has ever been, respected by consumers and businesses the world over. As my noble friend Lord Risby has pointed out, one reason for this is the transformation of the Foreign Office, mainly under William Hague, which has become a pro-business, helpful resource to the UK economy, dramatically better than its previous indifferent approach to something that it regarded as mere trade. In the last Parliament, we also saw much-needed stability in the corporation tax road map—a clear sign to businesses and investors of the direction in which the Government want to take the economy.

I would, though, make just one point, and that is on the role of the FCA, which is relevant to trade and exports. Sometimes, through its overzealous enforcement of its own rules, and sometimes its opacity and inefficiency when it comes to approval, firms that want to find overseas investors, even where FCA-regulated business is only a tiny part of their revenues, require FCA approval. I have seen with my own eyes businesses with turnovers of £30 million or £40 million, which happen through their websites to offer customers consumer credit—or opportunities to buy goods under a consumer credit licence, which may be for as little as £10,000—have to apply to the FCA for approval, which can take at least a month and frequently six weeks. It is, of course, important that firms operating here are properly regulated, but we need to consider a more streamlined approach and perhaps a de minimis level to better enable more foreign direct investment, not just in financial services but in trading companies.

On the core subject of this debate, I am worried that the idea that trade deals are somehow bad for the countries involved is gaining credence. This is of course pure economic illiteracy, but look at President Obama in the US being potentially denied his trade promotion authority, which would allow him to fast-track agreements, or the trade unions here in the UK criticising the Transatlantic Trade and Investment Partnership. This would in fact boost growth and create jobs, not just here but right across Europe—and heaven knows the eurozone needs all the help it can get as our biggest single export market continues to flail, hurting our exports. Trade deals ultimately make the world a richer place by breaking down artificial barriers that only increase inefficiency and waste. It is incumbent on us who understand the benefits for the UK to do a better job of explaining how this is the case, because I certainly believe that the more agreements we can make with key trading partners, the better off the whole of the UK will be.

I will point to just one example, South Korea. Since the agreement was signed, exports to South Korea have doubled—up 50% excluding oil—and we now have a substantial trade surplus with South Korea. We need more trade deals and I am sure that we will learn of some soon from my noble friend. Those who oppose such deals are hurting the UK and we need to drown them out with the simple truth that they are good for the whole of Britain. I am sure that my noble friend, with his huge experience of government, will want to ensure that the proper message is delivered to the public about the importance of trade.

I commend the last Government, in particular my noble friend Lord Livingston and UKTI, for continuing to bang the drum for the UK to bring in that inward investment we need and boost our exports to reduce the trade deficit still further. That, combined with more trade promotion and agreements with key partners across the globe, will ensure that the UK continues to lead the world out of crisis and into more prosperous times. The world is very keen to do business with us. It likes our products and services, our rule of law, our quality of product and our efficiencies, and it likes our business-like approach.

The new business-friendly Government, whether in or out of the EU, will give confidence to many that this is the time to come here to the UK for business. Our future is enshrined in our past. Just as we sent ships into uncharted waters in search of new markets 400 years ago, I look forward to hearing how my noble friend will chart the course for us. I am delighted that we are proverbially doing so again.

Palestine

Lord Leigh of Hurley Excerpts

Monday 1st June 2015 Lords Chamber

[Baroness Anelay of St Johns]

My Lords, I always take great care to look at Amnesty’s reports; I admire the work that it does. The position of this Government is clear: torture is wrong and any death penalty, however it occurs and by whomever it is carried out, is wrong. Priorities for the FCO are to ensure that torture is prevented and that the death penalty is abolished throughout the world. I shall continue on that work myself.

[Lord Leigh of Hurley (Con)]

Does my noble friend the Minister agree that this Question is the same as the Motion to Take Note in the name of the noble Lord, Lord Steel of Aikwood, from a couple of months ago and that, since that time, Hamas has taken no steps to enter into any negotiations and has kept to its principle of refusing to recognise the right of Israel to exist? Does she further agree that the biggest tragedy in the Middle East is that more than 100,000 people have been slaughtered there, 75,000 of them in Syria, and that this deserves our urgent attention?

[Baroness Anelay of St Johns]

My Lords, the Middle East process also requires our urgent attention and we shall not divert our eyes from that. It is of great regret that Hamas persists in its activity of attacking Israel, most recently in the past week or so by setting off rockets towards Israel. It is clear that there has to be leadership by the Palestinian Authority to return its Administration to Gaza and ensure that there can be steps towards negotiations for a two-state solution.

Israel: Elections

Lord Leigh of Hurley Excerpts

Wednesday 25th March 2015 Lords Chamber

[Baroness Anelay of St Johns]

My Lords, I am sure these matters will continue to be discussed within the United Nations. In particular, of course, we are still awaiting the opportunity to see what the commission of inquiry into Israel produces in its report. We are disappointed that Israel did not allow the commission access to specific places. As to EU co-operation, currently discussions are going ahead in the EU about what further sanctions might be required if progress on the peace initiative is not made.

[Lord Leigh of Hurley (Con)]

My Lords, on the subject of UN involvement in the Middle East, does my noble friend share the concerns expressed by the UN political affairs chief, Jeffrey Feltman? He has cited evidence of Hamas testing missiles and attempting to smuggle in materials that could be used for missile production. Does she share my concerns that Hamas might be preparing for another conflict against civilians?

[Baroness Anelay of St Johns]

My Lords, we have assessed that Hamas is seeking to rebuild infrastructure, including the tunnel network in Gaza, and we are indeed deeply concerned about the reports to which my noble friend has referred of militant groups rearming. Hamas faces a fundamental decision about whether it is prepared to accept the quartet principles and join in with the efforts for peace or whether it will continue to use violence and terror, with all the terrible consequences for the people of Gaza. Hamas needs to make that choice.

Exports: Government Support

Lord Leigh of Hurley Excerpts

Thursday 29th January 2015 Lords Chamber

[Lord Leigh of Hurley (Con)]

My Lords, I thank my noble friend Lady Wheatcroft for instigating this debate. She is of course a well known commentator for the Wall Street Journal, an excellent publication, and business editor of the Times. I refer noble Lords to my various interests as declared in the register of interests.

Since new year’s eve 1600, when the East India Company received its Royal Charter from Queen Elizabeth I, Britain has been a nation of exporters. At our zenith, Britain was responsible for half of all the world’s trade. Since then, of course, we have had globalisation and the entry of a few competitors, so I would not see a return to those dizzy heights as a viable target. However, we can still aspire to see Britain’s goods and services exported the world over. We are, after all, an island nation, necessarily open and outward-looking.

It is not just for soft power and prestige that exports matter, though; they are of course vital for economic growth. With government spending rightly curtailed by the nightmarish inheritance that was the state of our public finances in 2010, and uncertain consumers paying down debt or increasing savings, exports have been and remain a key driver of growth in our successful economy. It is worth noting that in 2014 the UK had the fastest rate of growth of any major economy, thanks to the sterling work of the Government and the long-term economic plan.

I am pleased that the Government have recognised the importance of exports, with strong leadership matched by concrete measures to support business. As my noble friend Lady Wheatcroft has said, the Government have set very bold targets of doubling UK exports to £1 trillion a year and getting 100,000 more UK companies exporting in that time. To achieve this, the Government must support businesses looking to access markets abroad by offering guidance, with networking opportunities at trade shows and other events, and of course with direct financial support. I join my noble friends Lord Risby and Lord Lang of Monkton in recognising the work done by the Foreign Office to make overseas trade a specific part of its mandate. As well as our ambassadorial consular services, businesses operating abroad will find unprecedented support awaiting them from our embassies and UKTI offices.

Unlike previous Administrations, this Government are proud of the exploits of our business leaders, which are so important. This Government are willing to put them front and centre of our soft-power diplomacy. I have therefore been very pleased to see many British leaders accompany the Prime Minister on his trips abroad, which have been mentioned by both my noble friend Lord Cope and the noble Lord, Lord Hunt of Chesterton. In fact I was on that delegation to China, if that is the one that was being referred to—we did not go to Hong Kong—and I believe that the noble Lord, Lord Hunt, is correct that it was not an Airbus but a Boeing. I inquired as to the choice of transport, particularly the carrier, which was not British Airways, and was told that a tender had been put out and the most cost-effective plane had been selected in order to minimise the cost to UK taxpayers.

[Lord Hunt of Chesterton]

Is this a defence or an attack?

[Lord Leigh of Hurley]

I confess that one of the benefits of the delegation, as the noble Lord, Lord Cope, said, was that nearly all the delegates there were SMEs. Fortunately, it was not an Airbus, because a Boeing has the advantage, particularly on the carrier we were travelling with, of a bar in the centre of the plane. It was a memorable trip, as my noble friend Lord Livingston will recall, if only because virtually all the SMEs on the plane that had signed contracts while we were out there pushed themselves towards the bar in the middle of the flight, to the point where the pilot put on the seatbelt sign, even though there was no turbulence whatever, to get them all back again.

These delegations have a number of important missions, including helping medium-sized businesses that lack the brand value and network of their larger cousins but have growth potential if they can globalise their operations. The Prime Minister’s personal commitment, as my noble friend Lord Risby has said, must be welcomed. It is worth commenting that he has visited 19 out of 20 of the G20 countries—Argentina, understandably, is on hold—and we have seen significant increases in the budget of UKTI, even at a time when many UK government departments have understandably had to cut back. Indeed, the recent spending review at the department for business for 2015-16 established a baseline increase of £70 million a year, with a view to assisting 500 new medium-sized businesses annually. These measures show the priority status that exporters have been afforded under this Government. Whereas the previous Prime Minister led the world in accumulating the biggest budget deficit of any leading economy and discouraging business activity with higher rates of corporation tax, this Government have made the UK a leader in attracting global investment.

I see this in my personal and professional life, acting for SMEs in the UK. There has been a huge pick-up of interest from overseas, particularly from China. This approach is paying dividends in extending the reach of UK companies from domestic or European to truly global. For example, it is relatively easy and straightforward to export to Ireland: it is close and we speak the same language. The real challenge—but also the gain—is in trying to export to the BRIC countries and other emerging economies. In 2008, at £19 billion, the UK exported more than twice as much to Ireland as it did to China. Pleasingly, in the last quarter of 2013, for the first time ever, exports to China finally overtook those to Ireland. The Prime Minister said that he wanted more exports to the BRIC countries and UK business has responded.

This does not mean that the EU is not a very important market: of course it is. For example, it remains very important in my field of activity, financial services. Many international finance companies, from banks to funds to traders, set up in London to access the EU, but it is not perfect. Our success in truly globalising our export market should encourage us to demand some reform in Europe. This means completing the single market in all services. I commend our own commissioner, my noble friend Lord Hill, in his endeavours to deliver a capital markets union. This will help further with the export of UK financial services throughout Europe and bolster our competitive position in this field.

Despite the many advantages referred to of our membership of the EU, we must ensure that British exporters to the EU are not disadvantaged by EU regulation. I am thinking of the vote by the European Parliament Committee on the Internal Market and Consumer Protection to recognise further “EU safety tested” markings. These are yet another burden for manufacturing, particularly European manufacturing. Parochially, I know of one manufacturer who manufactured his product in full compliance with the relevant European standards—which in his case was EN1888—only to discover, when he tried to export his product to France, that the French unilaterally sought to apply their own particular safety standard, which was called an LNE. In the face of that protectionism in the French market, it was essentially impossible for him to export his product to France, despite complying with the EU regulation.

We need London to act as the trading capital of the BRICs and increase our exports to these fast-growing nations still further. With the help of the world’s leading financial services industry, I am confident that we can do so. Closer to home, we need the UK to continue to lead Europe out of its comparative economic malaise and into competitiveness through increased trade. Initiatives such as TTIP—the much hoped for trade agreement between the EU and the US—will be vital in achieving this. I believe that the UK will continue to act as a broker between the US and the EU in facilitating that. I therefore commend my noble friend Lady Wheatcroft for staging this debate today to highlight the importance of exports to the UK economy.

Middle East and North Africa

Lord Leigh of Hurley Excerpts

Thursday 30th October 2014 Lords Chamber

[Lord Leigh of Hurley (Con)]

My Lords, I thank my noble friend Lord Risby for instigating this debate. Although it refers to the current situation in the Middle East, I am not surprised that Israel has attracted a disproportionate amount of interest. I can think of no other country that attracts so much attention in this House. I can also think of no other country that it is so completely misunderstood. I declare my interest now as a member of the Conservative Friends of Israel, and I suppose I ought to declare my interest as being Jewish. I do not regard myself as part of a lobby. I regard being open, saying what you have on your mind and being principled as something that we are in this House to do, and to suggest otherwise—that we are part of a lobby—is a slur.

Israel is unique in the Middle East. It embodies those values which we in the United Kingdom hold so dear: freedom, democracy, equality and human rights. It stands alone in the region as a true functioning democracy. Israel has a proud history of ensuring that all its citizens enjoy protected freedoms and human rights. Israel’s universal suffrage and democratic political environment has, as a result, produced a strong civil society. Israel is ranked as the only “free” country in the Middle East and north Africa by the independent organisation, Freedom House, which measures these things.

Israel is comprised of people who practise a variety of faiths and no faith, and all enjoy full rights to do so without fear of persecution or unequal treatment under the law, unlike nearly every other country in the Middle East. Notably, Israel is one of the very few places in the Middle East where Christians are not endangered but are flourishing. Since Israel’s foundation in 1948, its Christian communities have expanded by more than 1,000%. Father Gabriel Nadaf, a Nazareth priest, told the United Nations Human Rights Council only a few days ago:

“Christians comprised 20% of the population of the Middle East … Today they comprise only 4% … Christians in the Middle East are marginalised; their rights denied, their property stolen, their honour violated, their men killed, and their children displaced”.

He went on to say that,

“there’s only one safe place where Christians are not persecuted. One place where they are protected, enjoying freedom of worship and expression, living in peace and not subjected to killing and genocide. It is Israel, the country I live in. The Jewish state is the only safe place where the Christians of the Holy Land live in safety”.

This comes at a time when Christians and other religious minorities in neighbouring countries are contending with state-sponsored repression and the brutality of terrorist organisations such as the reprehensible ISIS. Moreover, as my noble friend Lord Palmer said, Jewish people have, over the years, been forcibly expelled from all the Arab countries where they lived peaceably and happily for many centuries. In a region so tragically blighted by totalitarianism and religious fundamentalism, Israel’s remarkable democratic success story deserves far greater credit. The story is the same for women, homosexuals and the press. Uniquely, Israel protects the freedoms of them all.

All this is not to say that Israel is perfect. No country is. My noble friend Lady Warsi will be pleased to learn I, too, have deep reservations about the Israeli Government’s current plan for settlements. Recent announcements by the Israeli Government on settlements are concerning. The announcement in August to appropriate 1,000 acres of land in the Gush Etzion area of the West Bank just south of Jerusalem rightly elicited a strong response from the international community. Likewise, this week’s news that plans are advancing to construct 1,000 housing units in east Jerusalem is unfortunate. While settlements are unhelpful to the ongoing peace process, it is wrong to suggest that they are an insurmountable obstacle. They are one of the main final status issues to be resolved in direct peace talks.

Additionally, much of the construction takes place in existing settlement blocs along the so-called green line. It is a long-established principle that those settlements along the green line will be retained by Israel as part of a final peace agreement, with the Palestinians compensated by equivalent land swaps. Israel, driven by the policy of “land for peace”, has a track record of removing settlements to help give momentum to peace. Its unilateral withdrawal from Gaza in 2005 was a major gesture. It now stands as a genuine opportunity missed by the Palestinians to develop Gaza into what could have been a prosperous territory.

Her Majesty’s Government can be proud of their record in supporting Israel and standing by the basic principle that a country has the right to protect itself against rocket attacks on its civilians which have led, and may still lead, to many civilian casualties. Peace talks earlier this year were thrown into disarray when President Abbas violated an agreement to abstain from unilateral action, even after Israel agreed to follow the next steps outlined by Kerry.

A lasting two-state solution requires a negotiated final peace agreement. Unlike Gaza, Israel’s historic peace agreements with Egypt and Jordan are testament to what can be achieved by direct negotiations. Unilateral actions and grandstanding by the Palestinian Authority simply drive a wedge between the two parties and make a peace agreement less likely. Even worse, perhaps, grandstanding in the UK and Europe by otherwise respectable politicians for short-term domestic political objectives is really regrettable.

Fatah’s unity Government with Hamas should sound alarm bells. Hamas, it must not be forgotten, is an internationally recognised terror organisation that displays some of the ghastly characteristics of ISIS. I am amazed that so many fail to see the similarities between ISIS, Hamas and Hezbollah in terms of their tactics, operations and, even more so, their funding. No peace agreement will be able to guarantee peace in the medium to long term if a generation of Palestinians is growing up indoctrinated to hate Israel and Jews. Sadly, evidence of EU-funded schoolbooks encouraging such hatred has been discovered, which is very depressing and worrying.

In summary, Israel can be described only as a force for good in a region experiencing great transformative turmoil. The UK benefits from its relationship with Israel. UK trade with Israel continues to grow inexorably to more than £2.5 billion. I am sure that my noble friend the Minister will join me in hoping that one day in the near future, Israel can be at peace with a viable and successful state of Palestine, and able to share its borders with newly invigorated and genuinely democratic Arab states.

Gaza

Lord Leigh of Hurley Excerpts

Monday 14th July 2014 Lords Chamber

[Baroness Warsi]

The noble Lord is probably referring to what I said in response to my noble friend—that Israel is a liberal democracy and we therefore hold it to account against liberal democratic standards. There is no doubt that Israel would like to be held accountable against liberal democratic standards because those are the values that it upholds and stands for. It would be wrong for us to try to compare the conduct of Israel as a liberal democratic state with that of a potentially designated terrorist organisation.

[Lord Leigh of Hurley (Con)]

Does my noble friend not agree that the tragedy of Gaza is that, following the Israeli withdrawal from Gaza in 2005, there was a golden opportunity to give Israel the confidence that she could subsequently withdraw from the West Bank but, instead, Hamas took over from Fatah? Rather than building infrastructure and creating a tolerant society, Hamas acquired and fired some 11,000 rockets from 2005, mainly, as my noble friend Lord Pannick said, from densely populated civilian areas, which led to terrible human tragedy. Because they were fired from densely populated human centres, the inevitable action, which had to be taken, led to those terrible deaths, whether they were of Israelis or Palestinians. I do not think it is meaningful to compare one with another; any death in that area is a tragedy. Does the Minister not agree that international pressure on Iran is now needed to stop it supplying these rockets and to stop it supplying funding to the terrorist organisation that Hamas now is?

[Baroness Warsi]

My noble friend makes an important point. This is a matter that has border connotations. The discussion that we are currently having with Iran about its nuclear ambitions and its wish to be part of the international family will also involve discussions with it in relation to its support for terrorist organisations.

Businesses: Small and Medium-Sized Enterprises

Lord Leigh of Hurley Excerpts

Tuesday 6th May 2014 Lords Chamber

[Lord Leigh of Hurley (Con)]

My Lords, I too thank my noble friend Lord Cope for initiating this welcome debate. The report by the Select Committee was published before I was introduced to the House. Accordingly, I have had the advantage of looking at it from the outside. As a relative new boy, it is sometimes easier to make observations. I have observed that the House has had relatively few debates and questions on the area of finance and enterprise. As the noble Lord, Lord Cotter, has just said, nothing can be more important to the well-being of our country than a flourishing economy from which everything else is generated.

Our success as a society stems from the ability of government to raise money from the domestic population and, essentially, other than mineral extraction, this relies on businesses growing, employing more people who pay taxes, generating revenue on which people pay VAT, generating profits and dividends on which tax is paid, and helping entrepreneurs to build businesses, which eventually leads to capital gains tax being paid. It is therefore vital that everything possible is done to help and encourage SMEs which, of course, are typically not multinational, but domestic. As they grow, they are more likely to pay taxes in this country than in other jurisdictions and employ more people in this country. In this context, I welcome the tremendous focus on business growth by a number of government departments. The Treasury has created an environment in which investment into the UK and UK business is proving to be extremely popular and attractive, which is something that I see regularly in my day job. The Department for Business, Innovation and Skills is helping business and young people to gain employment through apprenticeships and, as a result, according to a recent CBI survey, growth expectations among SME firms is the highest since 2003, with manufacturing growing at its highest rate.

There is a feeling in the country that the Government are providing a joined-up approach to promoting business, which has not been seen in the UK for many years. Undoubtedly, the recruitment of my noble friend Lord Livingston as Trade Minister was a real coup for the Government. Having someone with tremendous business expertise and experience leading UKTI sends a message to international business that the UK Government understand what needs to be done and are urgently seeking to promote our businesses. I saw UKTI action at first hand when I accompanied the Prime Minister and Ministers on the trade trip to China in December. However, despite my praise and admiration for UKTI, I have a number of observations and, I hope, helpful suggestions to make in three main areas.

The first is in many ways a function of our own success. There is a plethora of schemes available to SMEs to finance their growing businesses for export. In fact, last week I attempted to put myself in the shoes of such an SME businessman and visited the government website to seek help. As your Lordships may know, the new entry portal for all government help is www.gov.uk and on the very front page there is a link to business. Within two clicks I reached a page that enabled me to read about government-backed support and finance for my imaginary business. This in itself is incredibly impressive. However, unfortunately the clarity ended there. To my horror, the next page offered a choice of 791 different schemes to assist me. Equal prominence was given to the somewhat parochial Barking Enterprise Centre and the Crofting Counties Agricultural Grant Scheme in Elgin. While undoubtedly very worth while, they were given the same prominence as the perhaps more relevant export credit guarantee scheme. There is of course the opportunity to filter down your requirements, and I did then select finance for a business based in London with up to 250 employees in the service sector at the growth stage, and this managed to narrow the schemes down to 42, although surprisingly no filter was offered for people looking specifically for export finance. Accordingly, I would like to suggest providing a very early help button in the government website so that potential SME exporters can have short but direct conversations with experienced UKTI advisers about the route through the maze that is offered to them—because the help is actually there. I believe that this was included in Recommendations 11 and 12 of the Select Committee report, but I have not found any real evidence of their being implemented.

My second point relates to the excellent work being done by the Foreign Office to help SMEs export, and while not strictly on the point of finance for SMEs, it is part of the road to success. Many large UK corporates have consistently mentioned to me that they have noticed a dramatic change in the approach by the Foreign Office in parts of the world where they are seeking to do business. Perhaps it reflects a change in the role of diplomacy abroad, but more likely it reflects the commercial approach to life taken by the current Foreign Secretary to ensure that UK plc benefits from our existing foreign service facilities. Perhaps I may encourage my noble friend the Minister to publicise these enormous benefits that are of value to both the large corporates and SMEs. They are able to obtain advice from UKTI representatives in our embassies abroad and, of course, from Foreign Office personnel. It seems to have worked for large corporations and there is no reason why it should not work for SMEs.

Thirdly, and finally, is the issue of the relationship between the large retail banks and SMEs, which I believe needs further examination. It is a large topic so I will not take too much time here, but even last week the Treasury Select Committee heard that some of the banks really did not cover themselves in glory during the last recession, and there needs to be a realisation that they may not be the long-term answer for SME lending. I therefore welcome the initiatives that have been started to encourage new entrants to the market.

Israel and Palestine

Lord Leigh of Hurley Excerpts

Tuesday 8th April 2014 Lords Chamber

[Baroness Warsi]

The noble Lord will be aware that this was the fourth tranche of the prisoner releases that were agreed last year. The first three have taken place; the fourth has been delayed. The noble Lord will be aware that there is a difference of opinion about how these matters are seen. Israel felt that these prisoner releases were directly linked to the peace talks. The Palestinians believed that they were directly linked to no further action at the UN. Clearly, the discussions that took place at that stage were vague. I take comfort from both parties having indicated that they are prepared to come back to the negotiating table because that is where progress will be made.

[Lord Leigh of Hurley (Con)]

My Lords, does the Minister agree that unilateral Palestinian action at the UN and other international organisations has been very counterproductive? Does she agree that it is surprising that the EU has not used further efforts to bring Mr Abbas back to the table, given the €5.6 billion in aid that has gone to the Palestinian Authority in the past 10 years?

[Baroness Warsi]

It is not the Government’s decision to be taking sides in this matter. There have been counterproductive actions on both sides. There are things that both sides agreed to that have not been delivered. That is why we are stressing, once again, that they need to get back to the negotiating table because that is the only place where a long, true settlement will be made.

Middle East Peace Settlement

Lord Leigh of Hurley Excerpts

Tuesday 14th January 2014 Lords Chamber

[Lord Leigh of Hurley (Con)]

My Lords, I draw your attention to my entry in the register of interests, which includes board membership of the Jerusalem Foundation, where I had the honour to serve for a short time with my noble friend Lord Weidenfeld.

Despite having only a few minutes allocated to me, it would seem appropriate to echo the words of my noble friend Lord Carrington and pass condolences to both the State of Israel and the family of the late Ariel Sharon. There is a lot we can learn from his life which, while controversial, nevertheless included taking some enormous steps to promote peace in the region, such as agreeing the road map and the withdrawal from Gaza, despite facing enormous pressures internally and externally. I hope that his passionate and determined pursuit of peace towards the end of his life will encourage others to follow his example.

This debate refers to a wider Middle East peace settlement and there is often a tendency in such debates to focus just on the Israel-Palestine conflict, which is not necessarily the main cause of regional instability. However, in my opinion, economic prosperity for all the parties in that region is one of the keys for peace. This debate is focusing on the efforts made by the EU, and quite rightly, as since 1994 the EU has provided more than €5.6 billion in assistance to the Palestinian people. The United Kingdom has been a very large contributor to this sum. Between 2008 and 2012 it was the third largest contributor of direct financial support after Holland and Sweden, with the United Kingdom’s contribution being about 10% of member states’ specific contributions.

Some of this direct funding has gone to support the rehabilitation of the private sector in Gaza, which must be very welcome. However, the recent European Court of Auditors’ Special Report No. 14, which was published in 2013, draws attention to some very worrying observations, such as that a “considerable number”, in its words, of civil servants in Gaza were being paid without going to work or providing any public service. Furthermore, it is now clear that a significant proportion of the Palestinian Authority’s budget, in part financed by the EU Pegase programme, is used to pay a salary to Palestinian prisoners in Israel, many of whom have been convicted of terrorist activities. This now runs at a rate of nearly £3 million per month and, perversely, the longer the sentence, the greater the salary. While Israel has commendably started to release prisoners, as the noble Lord, Lord Weidenfeld, said, the president of the Palestinian Authority has publicly called such convicted terrorists “heroes”. This does not bode well for changing the mood in the region towards peace. The EU would do well to heed the warnings by listening to the concerns in its own auditors’ report and further reflect on whether it should allow its—and our financial—support for Palestine to be used, in effect, for prisoner salaries.

The EU could do much more to promote peace in this area. Specifically, the funds would be much better used in following the example of the Portland Trust, based here in the UK, and using our resources further to promote Palestinian economic growth, which did in fact achieve an impressive 4.25% in 2013. It is by promoting the prosperity of the region that the EU will enhance the peace process.