Oral Answers to Questions

Debate between Bill Esterson and Anna Soubry

Tuesday 3rd May 2016 Commons Chamber

[Anna Soubry]

My hon. Friend makes a good point. There will always be good, full support for this digital movement. The other thing that is of concern to some small businesses is access to superfast broadband, because there is no point in doing this unless a business has it. Many small businesses are reticent to get up to speed—if I can put it that way—but I am confident that, with the excellent work of my hon. Friend the Minister for Culture and the Digital Economy, we are making huge progress and ensuring that all businesses have access to superfast broadband.

[Bill Esterson (Sefton Central) (Lab)]

The Minister has singularly failed to explain how the change will help businesses. I do not know whether she has ever produced a set of business accounts, but the Financial Secretary to the Treasury told MPs in a Westminster Hall debate in January that it would require a

“a summary of income and expenses.”—[Official Report, 25 January 2016; Vol. 605, c. 36WH.]

As every businessperson knows, that can be done only by putting together the full detail each quarter. Whether the Minister calls it reporting, filing or updating, her claim that the change represents a reduction in red tape is laughable. It is a major increase in bureaucracy, administration and costs, especially for those businesses without digital access. The Government should go away and think again.

[Anna Soubry]

I am one of those who actually had a real job or two before coming to this place. I can therefore assure the hon. Gentleman that, as a self-employed barrister, I absolutely did have to provide accounts each week, but I do not claim to have run a business of more than just myself and maybe one other. The most important thing is that these are not quarterly returns. The hon. Gentleman really should understand what is proposed. It is actually a good way of ensuring that small businesses always keep up to date with how their business is going. The change will enable businesses to do their annual returns considerably better.

Pubs Code and the Adjudicator

Debate between Bill Esterson and Anna Soubry

Thursday 14th April 2016 Westminster Hall

[Bill Esterson]

I am not sure what the ethics of such a proposal would be, so I shall move on, but I would be happy to share a pint with my hon. Friend in that week.

There is real consumer appetite for quality, locally-produced real ale. The monopoly on beer sales for pub companies and the breweries they own really does not reflect what consumers want to buy. The landlords of pubs in my constituency, including the Corner Post, Stamps and the Freshfield, are seeing booming custom and will back me up because they are serving some of the beer that I mentioned from the breweries that have recently started up. We have heard many stories, not only today but over the years, about how pub tenants have been ruined or promises of investment have not materialised because of the actions of the pub-owning companies. That is why it is so important that we get this absolutely right.

Market rent-only is only an option. If the pub companies and brewers run a robust and positive business model, they have nothing to fear from the alternative. If pub companies feel that they are giving tied tenants the best option, they should be willing to put the options for their tenants on the table and convince them that beer ties are a sensible business decision.

We await the publication of the pubs code. When she responds, I hope the Minister will tell us when it is going to be published. It needs to be published soon, so that the industry has the time to analyse it properly and to address the weaknesses we have heard described today—I will come to some of those later—before it goes live on 1 June. Suspicion has often been raised about how the code has been handled and we need to see the final version to allay those concerns. Let us remember that it took an amendment tabled by the hon. Member for Leeds North West for the market rent-only option to be included in the Small Business, Enterprise and Employment Act 2015. That amendment received wide, cross-party support. To their credit, the Government accepted the will of MPs and peers and made the commitment to include market rent-only options and parallel rent assessment to go alongside them.

Parallel rent assessment matters because it offers a side-by-side comparison, so that pub tenants can determine whether to remain tied or to go free of tie. Pub tenants need parallel rent assessment so that they can make an informed decision, so having market rent-only without parallel rent assessment simply made no sense. That is why there was so much concern when the initial consultation that was published in autumn 2015 appeared to exclude parallel rent assessment. But, after a lot of fuss, including during exchanges with the Minister on the Floor of the House at BIS questions, the mistakes in the consultation were rectified. The Minister deserves some credit for her response on that occasion.

What a great pity, then, that doubts still remain about the effectiveness of the pubs code so close to its implementation. The Government say that the market rent-only options will be offered to landlords at rent review or lease renewal. They also say that the trigger will be the rent review or lease renewal itself, rather than, as seemed likely at one point, only in the event of an increase in rent. However, there are two interpretations as far as tied tenants are concerned. One is that the effective date for rent review is the date of implementation; the other is that it is the date on which the notice is issued and when the review process starts, which is six months earlier.

The market rent-only option will be enforceable only from 1 June this year. Only rent reviews or lease renewals made after that date will entitle a tied tenant to a market rent-only option. When she responds, will the Minister clarify whether renewal notices issued before 1 June will allow pub companies to avoid offering the market rent-only option, even when the reviews are agreed after 1 June?

Then there is the pubs code itself and the concerns raised by the British Pub Confederation and others. The draft code appears to allow pub companies to force tenants to surrender a long lease for a much shorter one in exchange for the market rent-only option. The problem with that is that a tenant who takes a short lease will face uncertainty about what will happen at the end of it. Running a business of any kind requires certainty, and when the building itself is so crucial to the business—in fact, in this case the building is the business—not knowing whether a lease will be renewed dramatically reduces the attractiveness of market rent-only. This approach certainly appears to be the very opposite of creating the level playing field that I think we are all trying to achieve.

The draft code also suggests a waiver of the right to the market rent-only option for prospective new tenants, so pub companies could decide to let pubs only to tenants who waive their rights. Our concern about the loopholes that have been discussed today is that the combined effect of the two proposals in the draft code could mean business as usual for the pub companies, because tenants who want the market rent-only option will not have their tenancies renewed, while only those who accept the tie will be allowed to take on leases. Will the Minister clear this up and say whether those provisions will be included and whether the loopholes will be removed from the final version of the code? If they are not, pub tenants might start to think that the pubs code is not actually going to change very much at all.

All that brings me to the appointment of the Pubs Code Adjudicator. Like other Members, I think the hon. Member for Peterborough (Mr Jackson) made an excellent speech. I agree with pretty much everything he said. He made the points that, for a free market to operate effectively, it needs to be a fair market—I agree wholeheartedly with that—and that unless the code is drafted correctly, it will be unworkable. He also talked about conflicts of interest, which I will come to shortly.

In a number of our exchanges, not least when my hon. Friend the Member for West Bromwich West (Mr Bailey) was on his feet, the point was raised about whether the newly appointed adjudicator, Mr Newby, had been involved in the drafting. I think the Minister was trying to clear that up. Mr Newby may well have been involved in setting up his office, which of course is entirely proper; the problem is that the Business Secretary’s letter to the British Pub Confederation says that

“he shared his professional insights”

when the draft pubs code was discussed with him. I do not know whether that counts as setting up his office or as helping to draft the pubs code, but there seems to be some blurring between where setting up an office ends and helping to draft a code begins. In the end, I am not sure we are much further forward on what his role has been so far.

On the point about conflicts of interest, the Fair Pint campaign’s submission to the Small Business, Enterprise and Employment Bill Committee was clear: do not appoint a surveyor to the post. Any surveyor with experience of the field will have potential conflicts of interest. They will have acted for the big pub-owning companies and will not be seen to be impartial in arbitrating as the adjudicator between pub companies and tenants.

[Anna Soubry]

My right hon. Friend the Secretary of State for the Department for Business, Innovation and Skills said in his letter:

“I can confirm that Mr Newby has not been involved in the drafting of any part of the Pubs Code. My officials met Mr Newby after his appointment to provide him with a high level briefing on Part 4 of the Act and some areas of the draft Pubs Code in order to familiarise him with the key aspects ahead of him taking up this important role. During the course of this briefing there was a discussion of some technical aspects of the MRO arbitration process—for example, the length of time it takes to appoint an independent expert—where he shared his professional insights.”

Does the hon. Gentleman agree that that is a correct reading of the full paragraph, which, I would suggest, he slightly misquoted?

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[Bill Esterson]

I used the end of the quotation, which states that

“he shared his professional insights.”

I think it goes further than what the Minister said earlier about the work he carried out, because to me, if he is being asked to provide feedback on the code in a professional manner, that is very close to sounding like he is being involved in drafting the code.

[Anna Soubry]

To remind the hon. Gentleman:

“Mr Newby has not been involved in the drafting of any part of the Pubs Code…During the course of this briefing there was a discussion of some technical aspects of the MRO arbitration process—for example, the length of time it takes to appoint an independent expert—where he shared his professional insights.”

[Bill Esterson]

It seems to me that if he is sharing his professional insights, he is giving observations and helping to draft the code. We can split hairs over this all afternoon, but I am sure others will draw their own conclusions about what his involvement has been in preparing for his office.

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[Anna Soubry]

I am very grateful to my hon. Friend for his wise words. I take objection to the idea that the civil servants, in the most difficult of circumstances—they really are up against the clock—have not acted with total integrity. They have done a great job. I think that we sometimes forget that civil servants are professionals and human beings. With few exceptions, they serve us extremely well and do a good job.

Make no mistake: I do not have any complaints about the rigour of this place’s questioning and probing, and I am grateful to my hon. Friend for his comments. I hope he knows that I always act with complete integrity and would weigh up all the matters in favour of and against the appointment of anyone to ensure that we get the right person. I do not know whether Mr Newby is a lovely person, but I do know that he brings the requisite skills, ability and experience, and I am confident that he will act with integrity and do a good and fair job.

As I made clear on 10 March, Mr Newby is an excellent candidate. He was appointed in accordance with the code of practice for ministerial appointments to public bodies. As I did then, I take exception to any allegation that I or, indeed, anyone else has acted improperly or with complicity, and I have no doubt that he has all the necessary skills and experience of the pubs trade.

[Bill Esterson]

Will the Minister give way?

[Christian Matheson]

Will the Minister give way?

[Anna Soubry]

I will in a minute. There has been a very positive response to the appointment of Paul Newby as the Pubs Code Adjudicator. I am grateful for the briefing supplied by the House of Commons Library and the comments on 16 March from the Royal Institution of Chartered Surveyors, which we have heard a lot about and heard some quotes from. Its statement regarding the appointment of Paul Newby as Pubs Code Adjudicator went as follows:

“By the very nature of the role, the adjudicator’s office will need someone with past experience in this field of valuation and Paul’s professional history has seen him represent both pubcos and tenants at various junctures in his career. As Paul Newby will no longer continue in his role with Fleurets, there should not be a risk of this posing a conflict of interest in his execution of his new post.

An RICS spokesman has said: ‘Chartered Surveyors are expected to demonstrate the highest professional standards and act within the RICS Code of Conduct at all times. We have no reason to believe that Paul Newby is failing to meet these standards. On the evidence that we have seen to date, this does not appear to be an issue of conflict.’”

[Bill Esterson]

Will the Minister give way?

--- Later in debate ---

[Anna Soubry]

I shall continue.

[Bill Esterson]

rose—

[Anna Soubry]

Does the hon. Member for Sefton Central (Bill Esterson) want to intervene? Let me say a few words and then I will take an intervention.

As the Pubs Code Adjudicator, Mr Newby has a duty to set out arrangements to deal with any specific conflicts of interest. He will do so in the normal way and, as part of that, he will publish a register of interests. Contrary to the British Pub Confederation’s campaign, he has a wealth of experience on rents, rent reviews, lease renewals and landlord and tenant issues. It was that experience that I found particularly attractive in his CV and then when I met and interviewed him, as I did all three of the final candidates.

Mr Newby has also been involved in dispute resolution in those areas as an expert witness, arbitrator and independent expert for many years. In one case he represented a tenant who had significantly overpaid rent to a large pub company. That required sustained effort by Mr Newby to recover the overpaid rent. That is just an example of his work for tenants, certainly not of being in the pocket of large pub companies.

We have had reference to my former profession as a barrister. I do not want to fall out with the hon. Member for Leeds North West, but I do not think he quite remembered what was said. I was trying to make a point about professionals. The hon. Gentleman for—I have forgotten his constituency in Scotland; that is very rude of me.

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[Anna Soubry]

I have some very good news for hon. Members, but if the hon. Gentleman wants to intervene, I will give way.

[Bill Esterson]

I thank the Minister for answering the question about when the regulations will be laid, but it would have been extremely helpful to have them in advance of the debate, so that we could discuss them today. Earlier, she said at least twice that serious allegations had been made about her having a conflict of interest in Mr Newby’s appointment. Will she say who made those allegations and what they have been? Using parliamentary privilege, she can name the person right here and now.

Pubs Code Adjudicator

Debate between Bill Esterson and Anna Soubry

Thursday 10th March 2016 Commons Chamber

[Anna Soubry]

Yes. Paul Newby’s primary job, of course, is to implement the pubs code and make sure it is complied with. When people invoke the pubs code, his job will be to act as a fair arbitrator, and I have no doubt that he has all the necessary skills and experience of the pub trade. As I have said, he has experience of representing both pub companies and tenants, so he sees things from both sides; he has all the skills, and his appointment was made with great care and total propriety.

[Bill Esterson (Sefton Central) (Lab)]

The way the Minister announced the appointment yesterday—as part of the shambolic proceedings on the Enterprise Bill and Sunday trading—did not exactly inspire confidence. She announced it in an intervention—of all things—on Third Reading, after the Secretary of State could have mentioned it in his Third Reading speech. If nobody had mentioned the pubs code on Third Reading, the announcement would not have been made even then.

Turning to Paul Newby’s appointment as the first adjudicator, I certainly look forward to meeting him and to raising the concerns raised by the hon. Member for Leeds North West (Greg Mulholland) and, more importantly, by pub tenants about the relationship between Mr Newby’s employers and the large pub-owning businesses. I do not think that the tenants will be at all reassured by what the Minister has said. The challenge for Mr Newby will be in ensuring a level playing field between tenants and pubcos. How does she think that he can do that, given the concerns that have been raised by tenants?

There is a very real danger that someone who has acted for Punch Taverns, Enterprise Inns and Marston’s will be seen as continuing to act on their behalf, and the Minister must be aware of this very real concern, as she sits there, chuntering as usual. She will also be aware of concerns among tenant groups that the adjudicator should not be a chartered surveyor. Will she pursue concerns about the attitude of the Royal Institution of Chartered Surveyors about parallel rent assessments?

Labour raised concerns about the pubs code in the Lords and in Committee here, so will the Minister raise those concerns with the adjudicator about pubcos offering shorter leases to make it impractical for tenants to take up the market rent only option? Will she ensure an effective date of 1 June for tenants who wish to take up the MRO, rather than allowing a potential delay of six months—another of the asks of pub tenants?

The shambolic approach to the initial consultation on the pubs code undermined pub tenants’ trust, which is back on track after concerns were raised by pub tenants organisations—

Enterprise Bill [ Lords ] (Eighth sitting)

Debate between Bill Esterson and Anna Soubry

Thursday 25th February 2016 Public Bill Committees

[Bill Esterson]

The Minister certainly claims that she understands market forces; she does so often.

I have mentioned before that this could be described as a domino clause, because those local authorities that do not implement it may well be influenced by what goes on in neighbouring authorities that do implement it. I guess that is a form of market forces. Perhaps it is the forces between neighbouring local authorities around the country that will, in the end, force everybody to comply and to relax Sunday trading rules for all.

Sadly, the Government’s consultation is an advocacy document for devolving Sunday trading rules. The Government have ducked and dived, parried all the evidence that has been presented to them, and blindly focused on what they want to hear, as they have only quoted selectively from the consultation. We can assume that that is the case, because of the 7,000 responses to the consultation received by the Government, they have focused their analysis on just three groups: large and medium-sized businesses; business representative bodies; and local councils. In other words, they are focusing on the people who stand to gain the most.

Using a very small sample from the 7,000 responses, the Government found what was undoubtedly for them the palatable figure of 76% of respondents supporting devolution in order to make their case, but there was only 76% support among those three groups. The Government have ignored, and not published, the figures that show the concern among small business owners, high streets, shop workers, families and family groups, and, indeed, faith groups. The people who will be affected the most by the change are being completely ignored in this process.

Since the beginning of the year, the Department for Business, Innovation and Skills has published five consultation responses, all of which have included a breakdown of respondents and analysis of their position, and how many responses in total are in favour of a proposal and how many responses in total are opposed to it. That has happened on a range of issues. However, that has not occurred for the consultation on Sunday trading reform. Why is that? It is because the Government know that their proposals are not backed by the majority of the public and the majority of stakeholders.

In making their case for Sunday trading reform, the Government have also used evidence that is laughably out of date to support their case. I will focus on three key pieces of evidence that the Government have used to make their case and to deal with the question that my hon. Friend the Member for Newcastle upon Tyne North asked earlier, in order to outline why the Government are misguided.

The first is Swedish sales data. The BIS press release announcing the Government response to the consultation of last August proudly stated that a change in Sunday trading resulted in a 5% increase in turnover in Sweden. In order to get that figure and find that 5% increase, the Government went all the way back to Sweden in 1972, when ABBA were formed. I am sure that somebody will be able to think of a suitable ABBA song to describe the appropriateness or otherwise of the way the Government have used that data. [Interruption.] I feel an intervention is coming.

[The Minister for Small Business, Industry and Enterprise (Anna Soubry)]

Dancing Queen?

[Bill Esterson]

Speak for yourself. The Government did that to find a 5% increase in turnover from changes to Sunday trading laws.

Sweden in 1972 is clearly not the same as the United Kingdom in 2016. The Government also fail to mention the wider impact after Sunday trading reform in Sweden. For example, small stores were decimated, with their market share dropping from 70% to 19%. That is an almost complete collapse in the sector.

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[Alan Brown (Kilmarnock and Loudoun) (SNP)]

It is a pleasure to serve under your chairmanship, Sir David, in this last sitting.

My thoughts are broadly in line with those of the hon. Member for Sefton Central. As we know, this Bill introduces the small business commissioner, which obviously has cross-party support. Amendments have been tabled that we thought might give the office of the small business commissioner more teeth, to allow it to work more efficiently on behalf of those it will represent. Obviously the amendments have not been accepted today, but hopefully the Government will consider that in future.

In thinking about the office of the small business commissioner, it certainly makes sense to think about the office of the Groceries Code Adjudicator. Given that this is a wide-ranging Bill anyway, it makes sense to use it as an opportunity to review the powers and purpose of the GCA and to learn from its short history.

When the GCA was created in 2013, my SNP colleagues gave their support at that time, but my hon. Friend the Member for Banff and Buchan (Dr Whiteford) urged the Government to give the GCA enough power to address two key issues that she raised then. First, she highlighted the underlying problems caused by the concentration of power in the grocery supply chain due to the dominance of a handful of large supermarkets. We are well aware of the recent issue of Tesco breaking the code of practice and abusing its market position to prioritise its cash flow and finances over those of their suppliers. It was often excessively late with its payments. Tesco did that, but what was the outcome of the case? Yes, Tesco was named and shamed, which was good—the matter has been highlighted and Tesco has said it will not do it again—but the GCA, Christine Tacon, was unable to impose a fine, because she was only given the power to impose fines in 2015, two years after the establishment of her office.

The second issue that my hon. Friend highlighted was about sustainable food production and the ability of non-direct suppliers to supermarkets to make complaints that the GCA can investigate and follow through on. Recently we have seen evidence that this issue is rearing its head again, with the dairy farmers and the price they receive for milk. A stronger GCA may have been able to intervene and take greater action in support of the farmers or those at the end of a supply chain, who we need to survive in order to get the end product, provide local employment and have a greener product as a result of a smaller carbon footprint. Also, my hon. Friend the Member for Berwickshire, Roxburgh and Selkirk (Calum Kerr) has called for the GCA to have greater powers over labelling, to make the supply chain from source to product much clearer.

Overall, the position of the GCA is welcome, but there are still imperfections. The new clause could allow some of them to be smoothed out. I support the new clause and certainly agree with the principle behind it.

[Anna Soubry]

It is obviously a pleasure, Sir David, to serve under your chairmanship in our final sitting.

In short, the Government are already committed to reviewing the GCA after next month. That commitment is in the Groceries Code Adjudicator Act 2013, so this very review is going to happen; it is in statute. Yes, we are looking at the terms of reference. We are preparing them to make sure they include all the things we want the review to look at, so we are looking at consideration of the remit and the powers of the GCA being part of that review.

The review will cover the period up to 31 March, so we will begin the public consultation shortly after that date, as part of the review, providing an opportunity for everyone to input their views. As I say, it is all there already in the 2013 Act. The new clause is just not necessary, because all these points are covered already.

[Bill Esterson]

I am grateful to the hon. Member for Kilmarnock and Loudoun for his reminder of some of the issues, challenges and experiences of those who have sought help from the GCA in the last two years, and of the need for greater support and resource for the office of the GCA.

The reason for the new clause was to draw the parallels between the adjudicator and the commissioner. I acknowledged in my opening remarks that the review was already taking place, but it is important to have debates such as this to get the Minister on the record, as we have done a few times in Committee, and she has now made clear what will happen.

Enterprise Bill [ Lords ] (Seventh sitting)

Debate between Bill Esterson and Anna Soubry

Thursday 25th February 2016 Public Bill Committees

[Anna Soubry]

We need to remind ourselves, of course, that the Government have been clear that ending six-figure payments should apply to all public sector organisations, with few exceptions. Of course, it is the taxpayer who picks up the cost of exit payments and employees who have specialist skills should not automatically be exempt.

I was a little troubled by the contribution from the hon. Member for Wakefield, and not because I disagreed with her for one moment about the dreadful accident the day before yesterday at Didcot and the subsequent fatalities. It is undoubtedly the case that many people do dangerous jobs. I am reminded, of course, of all those who work in the fire and rescue service; we often forget that the fire brigades provide the rescue service as well. They do incredibly dangerous work, not only when they are fighting fires but when they are rescuing people. Although it is extremely rare, if it ever happens, that we make firefighters redundant, nevertheless they are also included in this new provision. I do not think that the fact that someone does a dangerous job should in some way exempt them.

The list of exempt organisations will be set out in the regulations, not in the Bill itself, and of course they will need the approval of both Houses of Parliament. The guidance accompanying the regulations will set down the criteria that Ministers, or those who have been delegated the responsibility, must consider in decisions to relax the cap. In other words, there are exemptions that can be made, but they will be determined in a list that, as I say, will require the approval of both Houses.

Regulations relaxing the cap can apply to individual cases and to groups of individuals, to cater for cases where Ministers may wish to consider organisational cases for relaxing the cap. So there is already a mechanism in place for organisations to be considered for exemption. Therefore, the amendment is unnecessary.

The regulations implementing the cap will be in force from October 2016 at the very earliest. However, as I think I have explained—it has certainly been explained in correspondence, but now I will make it very clear again—Magnox employees who are in the current redundancy programme and due to exit by September 2016 will not—repeat, will not—be caught by the cap, and the cap will not affect the core terms of the pension scheme available to Nuclear Decommissioning Authority staff, in other words Magnox employees, such as the retirement age or the basis on which their pensions accrual rate is set.

The hon. Member for Cardiff West used a particular example, of course, from somebody who had quite properly written in, which is absolutely the right thing to do. In relation to that point, I will say that I have indeed had meetings with MPs. I have not met the unions, not because I have any difficulty in meeting unions, but only because—unfortunately—my diary is pretty hectic.

However, I particularly made the point when I met the MPs, and I have made it clear to the unions by way of a letter, that people should please use their MPs to make full representations to me. As we all know, in this place Members can lobby a Minister in a corridor, or anywhere we bump into each other. That is the quickest and easiest way, but it is not a slight on the unions. I have specifically said to Members of Parliament, “Get back to them, and tell them about our meeting. Use your good self to communicate through.”

[Bill Esterson (Sefton Central) (Lab)]

Will the Minister give way?

[Anna Soubry]

In just a moment. I have drifted off, and I want to come back to my point on Magnox pensions. These are employer-funded costs that form part of the exit payment, and the cap does not affect the core terms of the pensions. That is important, and everyone is beholden to ensure that employees get the facts, not the myths or the spin. The cap does not affect the core terms of their pensions, such as accrual rates and normal pension age. I hope that might be of some assistance.

Enterprise Bill [ Lords ] (Sixth sitting)

Debate between Bill Esterson and Anna Soubry

Tuesday 23rd February 2016 Public Bill Committees

[Anna Soubry]

I am glad that we all agree. To make it absolutely clear, new clause 5 will replace clause 33. I hope all Members of the Committee will vote in favour of these amendments. I know it sounds strange to vote against clause 33, but the new clause will replace it and all that will happen is that we will honour the full intention of the other place by making sure that their amendment is better written and any loose bits are tied up. We want anybody who is listening to this to know and understand that the full weight of what the other place put into the Bill will stay in the Bill—it is just that we have tidied it all up. We are all as one.

[Bill Esterson]

Briefly, I hope that the Minister’s confidence is justified that this does what she says it does and that it achieves what was agreed by Parliament in the previous Session, what was in the Small Business, Enterprise and Employment Act 2015 and the essence of what the Baroness said in March and what was agreed in the Lords. I hope for her sake that that is all true and that it really will deliver for pub tenants. I take those assurances away. We have got to this point; it has not been the Government’s finest hour—I think the Minister acknowledges that—and with those remarks we will support what the Government are doing.

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[Bill Esterson]

I do not intend to detain the Committee on this section except to say that the Minister’s explanatory statement makes very clear where we stand: that this is intended to clarify the effect of the Lords amendment. With that assurance, as I said in my closing remarks on the previous provision, assuming that all is going to go ahead and that this will be brought back later to be voted on, the sector is happy as things stand.

We have finally got where we need to get to on the pubs code. I am sure there will be a decent degree of scrutiny of the implementation of the code, the role of the adjudicator and how the pub tenants’ relationship with pub companies operates in the future. With those comments, I am happy to go along with what the Minister is proposing.

[Anna Soubry]

I have nothing to add; I think I have made everything clear.

Enterprise Bill [ Lords ] (Fifth sitting)

Debate between Bill Esterson and Anna Soubry

Tuesday 23rd February 2016 Public Bill Committees

[Anna Soubry]

If I may, I will speak specifically to the clause. If we were to stray into discussion of the successes—there have been many—of the Government’s programme to roll out superfast broadband and generally improve access for individuals at home and businesses in a digital age, we could be here for the rest of the morning. We do not mind debating such things, but this is neither the time nor the place to do so; a number of hon. Members, particularly on the Government Benches, might want to make all sorts of contributions to that debate based on their experience and that of their constituents.

We know that there are concerns and that much more needs to be done and will be done. Clause 28 is essentially one of the pieces of the jigsaw. The Industrial Development Act 1982, to which I have referred, is now more than 30 years old, and some parts need updating.

[Bill Esterson (Sefton Central) (Lab)]

The Minister wants to keep us on the clause, but it is actually very wide-ranging. On line 22, proposed new section 13A, “Improvement of electronic communications networks and services etc”, says:

“This section applies if it appears to the Secretary of State that adequate provision has not been made for an area in respect of electronic communications facilities.”

My hon. Friend the Member for Cardiff West gave an example, and I have numerous cases in my constituency, as do the Minister’s hon. Friends. If not now, when we will address some of those concerns? When will the Secretary of State take the powers given to him in the clause to improve broadband, whether for trade in this country or for the important international trade on which we rely to close the trade deficit and improve prosperity overall?

[Anna Soubry]

Sorry, Sir David; I was enjoying an interesting piece of information from my hon. Friend the Minister for Housing and Planning. He was telling me, by way of giving an example of the progress that this Government are making on addressing the problem—I am waiting for him to give me a nod before I use these words—that a deal has been struck with the Home Builders Federation that from now on, all new homes will include access to broadband. That is excellent news.

I think that some of us had begun to create the argument that there is nothing to prevent local authorities from making it a condition of granting planning permission, especially to new business estates, that proper access should be included to superfast broadband, mobile phones or whatever it may be. Even if they cannot make it a condition of planning permission—we all know how these things work and the sorts of discussion that developers have with local authorities—those things should absolutely be there. There is a growing feeling that in this modern age, digital technology, superfast broadband and what I call full-fat mobile phone technology should be treated as a fourth utility. If we are making some movement towards that—my hon. Friend the Minister for Housing and Planning might be able to update us—it would be a commendable move.

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[Anna Soubry]

But we are not going to be stuck on this clause all day. This clause is technical and will enable financial assistance to be granted to improve electronic communication networks and services. The power will not and should not be used to displace investment by industry.

Communications infrastructure investment, as we know, continues to grow. I am happy to put it on the record that I have not enjoyed the best of experiences with BT. I was due to meet BT representatives one day, and on that very day BT decided to disconnect my constituency telephone. You couldn’t make it up.

[Bill Esterson]

Surely a coincidence!

[Anna Soubry]

I hope so. It was not because IPSA had failed to pay my bill; it was because my team had, quite reasonably, asked BT to improve the internet connection, which many of us know is not always the finest. For some reason—BT still has not explained why—in the attempt to improve my internet connection, it disconnected all the phones. Even more bizarrely, although it had taken about five seconds to disconnect them, it took about three days to reconnect them.

Anyway, you see how we drift, Sir David. However, my dear friends at BT are investing £3 billion in deploying fibre broadband. Virgin is investing £3 billion to extend its network footprint from 13 million to 17 million homes by 2020. We know that we must do more, but those are the huge advances being made. Investment by non-major operators such as UK Broadband, Gigaclear, CityFibre and Hyperoptic also plays a valuable role.

The clause is effectively a backstop. It gives Government the option to provide targeted support where it is most needed. That is why I hope that all hon. Members will not hesitate to support it.

Enterprise Bill [ Lords ] (Third sitting)

Debate between Bill Esterson and Anna Soubry

Thursday 11th February 2016 Public Bill Committees

[Bill Esterson]

Of course, that has nothing to do with why I said any of that.

Like the amendments we moved on Tuesday, amendment 55 would preserve anonymity for a complainant. The amendment would introduce the threat of naming and shaming large companies that rely on the unwillingness of their suppliers to come forward as a means of paying their suppliers late. The need for naming and shaming was raised by the Minister’s colleague, the hon. Member for Huntingdon (Mr Djanogly), on Second Reading:

“On the complaints side, the SBC can demand and order little. For example, the commissioner will not be able to order the production of documents from a company that has been complained about. Given the lack of hard powers for the SBC, the question is how effective they will be. I think that a big part of the answer will be the SBC’s ability to name and shame.”—[Official Report, 2 February 2016; Vol. 605, c. 829-30.]

The Minister accepted that on Tuesday. The hon. Member for Huntingdon went on to ask the Minister to explain how the legislation, as it stands, will allow for naming and shaming, and I repeat that request.

The amendment, originally moved in the other place, would introduce a stark solution: that every complaint will be published. I trust that the Minister appreciates that this is a probing amendment, our intention being to continue exploring the idea of how exactly the presence of the small business commissioner will encourage good payment practice when phone calls to chief executives and signposting to small businesses do not achieve the intended result. How will it happen without publishing every unresolved complaint? When direct approaches have not worked, what will be the small business commissioner’s role in making that difference in improving late payment practice in individual and general cases?

The comments made by Lord Stoneham when he moved the amendment in the other place are worth considering:

“we are again seeking more effective powers and oomph for the Small Business Commissioner. We are assuming that if the complaints scheme is entered into, there will be a period before the initial approach is made for some sort of opportunity for conciliation. Indeed, I would have thought that most issues should be encouraged towards resolution before going into any kind of formal complaints scheme or procedure.”

He was making the argument for mediation’s being a direct part of the small business commissioner’s remit, as we discussed on Tuesday. He continued:

“To encourage that process and to provide an incentive to settle matters quickly and informally, some pressure should be applied. Once we have entered into the formal complaints scheme or procedure, a report would then be published and the respondent would be named.

The respondent may fear that they would attract unwanted publicity if matters were published in this way, but if the respondent has no concerns that they have done anything wrong and there is nothing they need to put right, they should have no anxiety about this, and that could be another way of applying pressure to get something resolved.”

Or, as Lord O’Neill of Clackmannan said rather more bluntly:

“It offers to put teeth into the legislation, and I think it is useful for us to get a greater degree of accountability—a bit of an edge…the softly-softly approach is okay, but it should be, ‘Walk quietly, but carry a big stick’.”—[Official Report, House of Lords, 28 October 2015; Vol. 765, c. GC207-GC208.]

I think it was President Wilson in the early part of the last century who said that, but it is no less effective when quoted by Lord O’Neill. Where is the “big stick” in the small business commissioner’s role?

[The Minister for Small Business, Industry and Enterprise (Anna Soubry)]

It is a pleasure to serve under your chairmanship, Sir David. I cannot comment on what happened earlier in the day. No doubt you said some wise words—but that is just me being a creep.

The hon. Member for Sefton Central is right to table the amendment. I do not want him to press it to a vote, but he is right to probe the matter; it raises important points. First, the primary function of the small business commissioner is to address the problem of late payments and, secondly, their success will depend largely on their own abilities. It will depend on their having credibility with big businesses—so that those will be in fear of not responding to a phone call, taking action or engaging; and on their having the respect of the small business community, which will know that that person is its champion.

The next question is what the commissioner can do to achieve what we all want, which is a change in the culture of late payments. Having discretion, rather than leading to a “softly, softly” approach, can be an extremely powerful tool—more powerful than an arbitrary “They will publish.” The discretion to publish is the key tool, because the commissioner needs to consider the appropriateness of publishing a report and naming a respondent, in the light of the particular facts of each case. Having discretion preserves their independence. To put things in crude terms, the commissioner can say to someone: “Look, it’s very simple. Either you sort this complaint out in favour of the small business, or I will remind you of my powers, in my annual report, to publish your name.” I think that discretion will be hugely important.

There is something else. A complaint based on a very particular circumstance may have no wider public interest application. It may be a valid complaint but it may not need to go into the public domain, because that serves no wider interest. It may be resolved immediately and not warrant the resource and time required to publish it in a full report. It can be simply and swiftly sorted out.

The commissioner’s power to choose not to publish a report is a key incentive for businesses to work constructively with the commissioner. We do not want to lose the drive for cultural change that I have mentioned. We also have evidence that a discretionary approach works. The Australian small business commissioner, of whom we have heard much, exercises his power to name respondents in exceptional circumstances. He uses influence, authority and the threat of reputational damage to resolve cases successfully.

The commissioner will, as I have said, act impartially towards both parties, and be independent of Government, but both parties must have confidence in his or her approach, and many of our stakeholders have said that the level of transparency I am outlining would be effective in changing payment practices in individual cases, and more broadly.

I hope that that reassures the hon. Gentleman. We have considered the issue carefully and we think that discretion is the stronger way to get what we all want.

[Bill Esterson]

As ever, it is very important for us to be as accurate as we can in our comments. I should make a correction to what I said when I was testing the Committee on American history: as I am sure everyone knew, it was of course Teddy Roosevelt who made the comment about walking softly and carrying a big stick. I thank my hon. Friend the Member for Cardiff West for his prompting on that point.

I take on board the Minister’s comments about credibility, the fear of not responding, and the commissioner’s ability to ensure that a chief executive will take the phone call and that the matters will be addressed down the chain. The amendment is about situations where that does not happen. Taken as a package, I think it is in the category of areas where, as the office develops, we may need to come back and consider again how the commissioner is able to work, and whether, if things are not going well enough, such an approach is needed.

I mentioned mediation and its effectiveness in avoiding the need for punitive action, including naming and shaming, which could be quite difficult. Naming and shaming is one of those areas where it could cause problems for the ongoing business relationship between a small business and its customers. Ideally, we want not to be in the position where there have to be reports about individual cases of late payment. However, if we get to the point where this is a voluntary approach in the reports that the commissioner publishes, then I hope that the commissioner and the Minister will think again at that stage. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 6 ordered to stand part of the Bill.

Clause 7

Scheme regulations

[Bill Esterson]

I beg to move amendment 56, in clause 7, page 7, line 24, leave out paragraph (vii)

This amendment would remove from regulations the power to dismiss a complaint which the Commissioner considers has previously been considered under the complaints scheme or by another complaints-handling body, ombudsman or regulator.

The amendment would remove from regulations the power to dismiss a complaint that the commissioner considers has previously been considered under the complaints scheme or by another complaints handling body, ombudsman or regulator. It is about the nature of the complaints that the commissioner will deal with.

On Tuesday, by means of a number of groups of amendments, we discussed our concerns about narrowness of remit, given how the small business commissioner’s office is set up. We believe that, to do the job properly, the commissioner needs to have much more flexibility about the issues that they investigate. Amendment 56 would remove from regulations the power to dismiss a complaint that has previously been considered by another organisation. The logic is fairly simple. We hope that the small business commissioner will offer a markedly different function from existing regulators and ombudsmen. What would be the point of creating the office if that were not the case?

It does not seem right automatically to discount complaints just because they have been looked at by another complaints handling body. It may be that the complaint process took too long under the other body or that the ombudsman found that it fell outside their scope. The amendment would allow the small business commissioner to consider something that it had not been possible properly and fully, in the opinion of the commissioner, to consider elsewhere, even if, as far as the other body or ombudsman was concerned, it had been considered. We are concerned that, under the current Bill, some complaints could fall through the gaps.

The Minister has talked a number of times about the need for flexibility for the commissioner. That is the reason that she has given for opposing or asking us to withdraw a number of our amendments, which would have laid out the small business commissioner’s functions in greater detail and widened the remit considerably. We are now asking for that flexibility. If a complaint comes to the small business commissioner, let them decide whether they will investigate it, instead of there being a prescriptive approach that may tie the commissioner’s hands over an issue that they might like to run with. Amendment 56 would allow them to be the arbiter of whether another complaints handling body has given the matter sufficient consideration.

[Anna Soubry]

The scheme regulations, as outlined in clause 7, will set out details of how and when complaints should be raised with the commissioner. They may also, among other things, set out factors or circumstances in which the commissioner can refuse to consider a complaint; the circumstances can change.

The Bill does not prevent the commissioner from reconsidering a complaint that has been raised somewhere else, but it enables them to refuse a complaint when that is appropriate. In other words, it comes back to the power to trust the commissioner to exercise discretion according to the particular circumstances of a complaint. I think that is absolutely right, because it is not prescriptive. It vests power with the commissioner and it trusts the small business commissioner to do the right thing depending on the particular circumstances.

--- Later in debate ---

[Bill Esterson]

Amendments 58 and 59 relate to the issue of the commissioner’s annual report. We ask for the report to include complaints made by Government Departments, which is consistent with other points we have made in earlier amendments. We also ask that the commissioner, rather than the Secretary of State, reports directly to Parliament. We have called for the remit of the small business commissioner’s work to be widened in a number of ways, but the inclusion of the public sector is one of the most important elements of our request, hence amendment 58.

The importance of including complaints made by Government Departments boils down to the expectation of what small businesses want and expect from the small business commissioner. Small businesses that face the problem of late payments do so in the public sector and in the private sector, and it is only right that the annual reports reflect where the complaints come from and who the sources of the late payments are. The issue of late payments is one of the most crippling faced by small businesses. It seems to us and to small business organisations that have commented on the provisions that it is arbitrary to narrow down and attack only one part of the problem by considering only the private sector—and the larger element of the private sector, at that.

The amendment reflects the crossover between Government Departments and big business when it comes to late payments. Government Departments sign the prompt payment code. They are expected to pay their suppliers in good time; the target is to pay within five working days and that is a good standard. However, only 18 of the Government’s 33 biggest suppliers, all of which are major businesses, are signatories of the code. That means that 15 major suppliers are not signed up to the prompt payment code. As a result, it is quite likely that smaller suppliers in the supply chain—particularly of those 15 that have not signed up to the code—are victims of late payments in a contract that, ultimately, comes from the Government. That includes the issue of the construction sector and cash retention, which we discussed on Tuesday.

The situation is complicated further still with contracts of the size we are considering. We talk about the 33 largest suppliers to the Government, but there is often a chain of a number of suppliers. Of the 18 suppliers that are signed up to the code, how many of their suppliers are signed up to that same code? There are relatively large businesses, which may also be late payers, in the middle of supply chains, and in a supply chain of three, four or five companies, the smallest firms at the end of the chain are often the ones that bear the brunt.

The amendment is important because it is not just a case of saying that the small business commissioner should be able to report on the complaints of small businesses against Government Departments. The point is that some of the biggest contracts that a small business gets in the private sector can be part of a chain that leads back to Government Departments, and we want the commissioner to be able to name and shame chronic late payers in the annual report. I know that the Minister agrees with my point about naming and shaming.

We also want the small business commissioner to offer something of a strategic approach—an overview of problems that run through major supply chains—in the annual reports. The fact is that supply chains are often a muddle of private and public sectors, and big business and Government Departments. A line of investigation might not start with a complaint against the public authority, but it might implicate the public authority as part of the chain. Will the Minister clarify whether that will be in the scope of the small business commissioner? I have raised that point with her before and I am not entirely sure that I have had a clear answer. Perhaps she will address that either now or at the end.

[Anna Soubry]

At the end.

[Bill Esterson]

We want the small business commissioner to follow an investigation to wherever it leads. If it leads to the shortcomings of Government Departments’ enforcement of the prompt payment code, their slip-ups on paper-based invoices that lead them to be late payers, their dealings with a company that is a major late payer and is benefiting somewhere down the supply chain from taxpayers’ money, we want to know about it in the annual report. Covering those complaints in the small business commissioner’s annual report would say as much about how we view the small business commissioner as it would about what we want the report to include.

Amendment 58 is a statement of intent that we would give the small business commissioner a certain standing. It would send a message to more than 5 million businesses that when they have a complaint, they will have someone to communicate it to. Crucially, that person will have the authority to take the complaint all the way to Government and to Parliament, hence amendment 59.

There are two very different models on offer that provide examples to follow: the Australian small business commissioner and the American Small Business Administration. What they have in common is that they provide a vehicle for the concerns of small businesses to reach the very highest level. The Australian small business commissioner reports directly to the Australian Parliament and can submit special reports directly to Parliament whenever they feel it appropriate. What we are asking for is much simpler, because it is an annual report to Parliament. It seems that the Australians appreciate, more than this Government, the concern that reporting just will not happen if the small business commissioner is toothless. Under the provisions of the Bill, the commissioner will be toothless because there is nowhere for them to take their findings, and the reliance—or, as we discussed on Tuesday, dependence—on the Secretary of State gives rise to concerns that reporting will just not happen.

The American Small Business Administration works strategically across government and ensures the views of small businesses and entrepreneurs are better heard in policy making. It gives small businesses a voice in government. The Small Business Administration reviews congressional legislation and conducts nationwide studies on the impact of regulation on small businesses. It is able to testify on behalf of small businesses when legislation is being debated.

We have to ensure that the small business commissioner is able to include in their report those points that make a difference to policy making and to small businesses. Whether this is through a nationwide survey that challenges supply chains ranging across the public and private sector; through a trend in small business complaints the small business commissioner has spotted over the year; or through their first-hand expertise on the concerns of small businesses that the small business commissioner wants to lay before policy makers; we have to give them the authority and opportunity to present the information that small businesses need us to see. Without giving the small business commissioner that authority in their annual reports, we are in danger of giving small businesses nothing more than a sympathetic ear.

[Anna Soubry]

I begin by drawing the Committee’s attention to my previous comments when we debated the remit of the small business commissioner and why I urged the Committee not to agree with the hon. Gentleman’s amendments to increase their remit to include public authorities.

I advanced that argument for a number of reasons, notably because the legislation is about small business and its relationship with larger businesses and because there are many other ways that small businesses can raise a complaint against the public sector. We do not want to duplicate much of that very good work. It is also important to remember that in March last year the Government restated our long-standing commitment to pay 80% of undisputed invoices in five days, with the remainder being paid within 30 days. Central Government are now required to report on that on the infamous gov.uk website.

Perhaps even more importantly—I hope this addresses specifically the very good point the hon. Gentleman makes about whether or not the good policy of payment is being trickled all the way down through the supply chain—the Public Contracts Regulations 2015 require 90-day payment terms to be passed down what we call public sector supply chains. That is what the regulations state. We all know that they must now bear fruit so that that becomes the absolute standard practice.

I tread carefully, because I am going to mention something that may cause a small titter among members of the Committee: the mystery shopper scheme—[Interruption] Exactly. It has unfortunate title, because it does not fully explain what it does. The important thing is what it does and it does that very well. It takes up these sorts of issues in the supply chain and makes sure that the regulations are being put into practice.

I urge the Committee not to support the hon. Gentleman’s amendment on the annual report and complaints against the public sector for all the reasons that I have given before—[Interruption] Sorry, I just can’t read that. I have been helpfully passed something about the mystery shopper; somebody’s writing is worse than mine and that is quite something. It says that if the ultimate customer is a Government Department or public sector, then the mystery shopper applies at the end of the chain. I’m not sure I understand that, but I’m sure it is terribly important. We will get some clarity on that when I next rise.

[Bill Esterson]

May I intervene?

[Anna Soubry]

Of course; it might help me to understand this note.

--- Later in debate ---

[Anna Soubry]

As ever, my excellent Parliamentary Private Secretary knows more than I do. When the public sector is at the end of the chain it matters not, because if it is a question of going business to business in the rest of the supply chain, of course the small business commissioner will be able to act on any complaint about any of the relationships between businesses in that supply chain. That is the most important. Then when government becomes involved we have the mystery shopper scheme; but in any event we have all the other places to take complaints, such as the ombudsman, as was previously outlined.

Finally, I do not think that there is a need for the commissioner to lay the annual report. The Secretary of State must lay the annual report before Parliament unaltered; the commissioner’s doing it would make no difference at all. It would not increase their independence, so the amendment is what lawyers would call otiose. It is not necessary, because I am confident—I hope others agree—that the Bill delivers as we want it to.

[Bill Esterson]

The more the Minister says the words “mystery” and “shopper” together, the more I think her listeners suspend belief in the effectiveness of the scheme. As I think I said on Tuesday, I am familiar with mystery shopper schemes in the private sector and they can be effective, but the idea is not inspiring confidence.

[Anna Soubry]

I think we agree that the title may not be the best one, but that does not matter; it is a question of whether the job gets done. The evidence is clear: the scheme works extremely well.

[Bill Esterson]

I hear what the Minister says. I am afraid that, to anyone listening to our deliberations, the way hon. Members have laughed several times at the description would suggest that confidence may be lacking in whether the scheme will be as effective as it needs to be. There might be work to be done there.

The point about the supply chain is that if only 18 out of 33 major suppliers are signed up to the prompt payment code, and the Government are unable to make that 33 out of 33, and if Departments do not make sure that late payment is not a problem throughout the supply chain, something will have to change. Given that we are setting up an office called the small business commissioner, and that often it is small businesses that are the victims of late payment in the relevant situations, we need the commissioner to be able to consider public sector involvement all through the chain. The Minister said, as we discussed on Tuesday, that complaints are being dealt with elsewhere in a number of ways, but it is clear that that is not happening sufficiently well at the moment, and that a lot more work is needed.

In discussion of the amendments on the annual report, the Minister said we should not restrict the small business commissioner by insisting they could not do something in that case. I think that is a fair representation of what she said. She is now saying, with reference to the present group of amendments, as she did on Tuesday on a similar set of amendments, that the commissioner cannot investigate the public sector. Following the logic of what she said about the previous group, the commissioner should really investigate the public sector.

[Anna Soubry]

I thought we had established that we do not want to extend the remit of the small business commissioner. We want him or her to concentrate specifically on late payment between small businesses and larger businesses. We do not want to go into the public sector because we take the view that the existing schemes that are available—the ombudsman and all the others that I have described—are beginning absolutely to tackle that job.

As a Minister, one works with all the different commissioners and people such as the Groceries Code Adjudicator and there is never anything to preclude the small business commissioner from being able to raise any matter at any time—on the contrary, I would expect him or her to have that sort of relationship with any Minister in my role. I hope that gives the hon. Gentleman some satisfaction that if there were a feeling that things were not working in any other field, they would be able to raise that with the Minister. That was a bit long; I am sorry, Sir David.

[Bill Esterson]

I am glad that the Minister made such a long intervention. We are going to talk about the relationship with Government Departments when we discuss my next amendment. The problem is that we do not accept that there should be this restriction because of the relationship between the public sector and business and the way that the supply chains operate. The Government do not agree. We have a profound disagreement on this point. We base our evidence on what goes on elsewhere in the world—in Australia and America—with very successful systems, which very much have a wider remit that ensures the commissioner, or the Small Business Administration in the case of America, can investigate and report on the activities, operations and behaviours of the public sector in the way it deals with its suppliers, as well as the private sector.

Fundamentally, it is important to consider the private and the public sectors when thinking about how an economy operates and how contracts and payments are made. The Government are resisting this point, and we may well come back to it once the commissioner is up and running. We tested the Committee’s opinion on the inclusion of the public sector earlier and I do not feel the need to test it again. I think we know what the Committee as a whole thinks of this. With those remarks, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 9 ordered to stand part of the Bill.

Clause 10

Review of Commissioner’s performance

[Bill Esterson]

I beg to move amendment 60, in clause 10, page 9, line 26, at end insert—

‘(7) The Commissioner may assist the Government, including its agencies, to develop legislation, procedures and administration that provide alternative ways in which small businesses can comply with the requirements of the legislation, procedures and administration.’

This amendment would allow the Small Business Commissioner to assist other parts of Government, including the Secretary of State to develop procedures and processes.

The Minister just started to talk about relationships with Ministers, and this amendment is about the small business commissioner working with all parts of Government—including, but not limited to, the Secretary of State for Business, Innovation and Skills—to ensure that Government, their agencies, and all connected with the Government can be included in understanding what comes from the commissioner as a result of their relationship with small business when it comes to legislation and administration.

The amendment aims to help small business, and to help Government get their relationship with and the requirements of small business right as far as possible. It is drawn from a fundamental part of what the US Small Business Administration does. In addition to the signposting functions, which are very much a part of the Small Business Administration’s functions that the Government have chosen to adopt, the United States has a whole department devoted to giving small businesses a voice in government.

The US Small Business Administration’s Office of Advocacy advances the views of small businesses before Congress, the White House, the federal agencies, the federal courts and state policy makers. It has a three-pronged approach. First, it provides a nationwide source of small business statistics, making it the point of reference for policy makers on the impact that Government regulation and legislation are having in the small business community —on its most pressing concerns—and up-to-date frontline feedback on the challenges it faces from one year to the next.

Secondly, having a base in the federal Government gives it a permanent, independent voice with which to channel concerns to the highest level of government. Thirdly, as the watchdog for the Regulatory Flexibility Act, it is in a position to link its research and advocacy with an effective mechanism to bring small business concerns into the regulatory process. It has a finger on the pulse of small business concerns and a seat at the table for regulation and policy making. This is what we are trying to achieve with amendment 60.

By looking at the example of the US Small Business Administration, we see that the measure is entirely possible and can be used to great effect. Amendment 60 simply makes sure that when we set up the small business commissioner here, we will give them a clear mechanism to work strategically across Government to ensure the voices of small businesses and entrepreneurs are better heard in policy making.

Before last year’s general election, Labour said we would create a UK version of the US Small Business Administration, which would concentrate all business support and policy in one organisation. At the Federation of Small Businesses conference at the start of 2015, the then shadow Secretary of State for Business, Innovation and Skills, my hon. Friend the Member for Streatham (Mr Umunna) said,

“So Britain can grow its way out of the cost of living crisis and build a balanced recovery built to last, we need to do all we can to help our small businesses grow, create new jobs and meet their aspirations. We need government to be a better servant—and customer—of our small businesses and to make sure that entrepreneurs’ voices are heard at the top table. A UK Small Business Administration is necessary to realising this ambition. Based on the best examples from around the world, a UK Small Business Administration would create a step change in the opportunities for small businesses from government procurement and improve the quality of support available, operating along a proper British Investment Bank and a network of regional banks to ensure that start-ups and established firms can access the finance they need”.

Amendment 60 joins up the complaints from small businesses that the commissioner will receive and makes sure that this is factored into the implementation and development of regulations and Government policies. We have worded this carefully. We are not talking about making sure that the small business commissioner only has a seat at the table with the Department sponsoring them—they already have that, by definition. We do not doubt that he or she will have an open line of communication with the Business Secretary and his or her team.

If we are to effect real change, the commissioner needs a seat at the table right across Government Departments. Whether they come from the Cabinet Office, the Treasury, the Department for Communities and Local Government or any other Department, policy making and regulations have a tangible impact on small businesses. Amendment 60 will make sure that the small business commissioner is a part of this process, not confined to one Department. It seeks to ensure all the benefits to small business, jobs and the wider economy that we should all have in mind as we seek to develop this legislation and create the office of the small business commissioner.

[Anna Soubry]

The Bill already includes an absolute duty on the commissioner to prepare and publish an annual report, which must include any recommendations on how matters he or she has encountered might be addressed. That provides the very mechanism for the commissioner to raise suggestions from his or her experience. I very much want the small business commissioner to keep their firm focus and all their attention on the issue of late payment and the relationship between bigger businesses and small businesses.

--- Later in debate ---

[Bill Esterson]

We now move away from discussing the creation of the small business commissioner to consider some of the wider aspects of the Bill. This group of amendments looks at the impact target. I will start with amendments 62 and 64.

The Government used to publish a twice-yearly statement of regulations. It might have been a bit of a blunt instrument because the relative impact of these regulations can vary enormously. However, it was a simple mechanism to ensure that the Government were publishing a tally of new regulations that had come into force during the reporting period. Lord Stevenson of Balmacara noted in Grand Committee that publication of the statements had stopped since the general election, and he asked Baroness Neville-Rolfe to find out why. I cannot see an answer to that question anywhere in Hansard; I apologise if I have missed it. Can the Minister tell me why the biannual statements stopped?

Amendments 62 and 64 deal with two important points on regulation that are too often overlooked: honesty and accountability. Amendment 62 suggests having a warts-and-all tally of regulations in the business impact target. It specifically calls for both a nominal component to give an update on the number of regulations, and a monetary component that tots up the total cost to businesses of the regulations. Amendment 64 ensures that, when we publish the reports, there is a chain of accountability so that everybody knows who has approved a new regulation and who is responsible for it.

The reason for amendment 62 is simple. While the Government have not been providing the reports, the Regulatory Policy Committee has. The committee found that, of 13 recent assessments, 10 showed increases in the overall cost of regulation. The Minister will tell us later that the Government have reduced the cost of regulation by some astronomical amount; she will probably cite a figure of £10 billion.

[Anna Soubry]

Absolutely!

[Bill Esterson]

The Regulatory Policy Committee seems to be pointing at something slightly different. For some reason, the 10 increases in the overall cost of regulation that the Committee found were not reflected in Government statements on regulatory savings. Why that happened is an interesting question.

It also emerged that many Government regulations—just under half—were considered to be out of scope by the Government. Therefore, when the Minister no doubt gives the figure of £10 billion in a few minutes’ time, one must wonder what the true figure might be. The regulations increased the costs to business, but they are important for Government and I agree that they should be important. However, they were not reflected in the Government’s in-scope or out-of-scope scenarios. Many regulations come from the European Union, the mention of which will cause Government Members to start to—

--- Later in debate ---

[Anna Soubry]

Thank you, Sir David. Actually, as a woman of a certain age I find it makes a great change. I was so worried about the hon. Member for Wakefield that this must go on the record: she was so cold that she had the hood of her jacket up. As I am mentioning her, may I congratulate her—she is now putting her snow mittens on—on her election yesterday? We all wish her well in her new role, which I am sure she will, unfortunately, play extremely effectively.

I must take issue with the hon. Member for Sefton Central about the previous Government’s achievement, which was great, in making huge savings to the costs of businesses across the piece, by way of reducing regulation. Our policy of one in, two out, was particularly successful, and I am helpfully reminded that in 2015 the World Bank rated the United Kingdom sixth out of 189 economies as a place to do business because of the reduction in regulation. Of course, this country was the first to adopt one in, two out. We have done incredibly well and our global competitiveness has increased as we begin to deregulate and untangle the abundance of red tape that often strangled business.

It was a pleasure in the previous Government, at a very low level, to take part in some of the great work that is often done behind the scenes, led by an excellent team of civil servants to whom I pay huge tribute. There is one in particular whom I often describe as the guru of deregulation. She has the most brilliant and incisive brain for untangling red tape—looking at where we overly regulate and at how we can do things better. It is now an even greater pleasure in this role to be right at the core of that work. It is often done very quietly but the benefits to business are huge. We have set ourselves another target to achieve savings of another £10 billion in the next five years. It will be difficult and I do not try to pretend otherwise, but that is one of the things addressed in this part of the Bill.

On amendment 61, we will focus the business impact target on the things that the Government can control. Gold-plating will therefore continue to be included. The burden of the legislation and directives that come from the European Union are better tackled at source. I strongly take the view that the package delivered by President Tusk delivers reforms in economic governance, competitiveness, sovereignty, benefits and the movement of labour that are exactly along the lines that we want to see in the future of the European Union.

I want to stay in the European Union, although I want reform. A wind of change is blowing. My Prime Minister has caught that wind and he is turning it into a gale. This movement to deregulate, to reduce the regulation on business and to change the way we do things in the European Union will gather momentum and pace, and those reforms will come to full fruition. The Government will continue to report administratively on the impact of all significant European Union regulation and have that impact independently validated. That is the point: all the work we do is independently validated.

[Bill Esterson]

The Minister’s support for staying in a reformed European Union is no surprise; I have heard her say that before. I completely agree, but I mentioned making the most of European Union regulations and learning from what goes on in other countries so that we can benefit from them and so that they do not become onerous or a cost to business. Does she take that point on board? What more does she think she and her fellow Ministers should be doing to ensure that regulations from the European Union are not onerous and can be more beneficial? Can we learn from the way other countries apply them?

[Anna Soubry]

Yes, we always want to learn from what other member states do, but gold-plating was a valid criticism—particularly, I could say, under the 13 years of Labour Government, but that would be a cheap political point that I would not want to make. In all seriousness, this nation did gold-plate things. One of the great tasks that has been performed and completed in the past five years—and which continues to be addressed—is whether we continue to gold-plate. We make it clear to all Government Ministers, Departments and so on that they should not gold-plate, but it is work that we continue to do. If we can learn from other member states in the European Union as to how to ensure we do not do that, so much the better. To finish on amendment 61, affirmative statutory instruments are already captured under the Small Business, Enterprise and Employment Act 2015.

Amendments 62 and 63 would limit the options of future Administrations in determining their target and would give an unusual amount of power to an unelected verification body. It is the Government who should determine the nature of the target, how it is measured and by what methodology. We are consulting the Regulatory Policy Committee about the methodology for this Parliament and will publish it soon.

I respectfully suggest that amendment 64 duplicates existing administrative requirements to publish impact assessments in the name of the responsible Minister alongside related legislation. In my new role, although it feels as though I have been there for some time, I have seen that the work on deregulation—in terms of the detail into which we all go and the aspiration and targets placed upon Departments—is quite outstanding. The demand is effectively set by a desire to achieve financial targets. None of us really like targets, but, goodness me, they are a fabulous driver for all of us to look at the existing regulation and anything new coming in to ensure that business is not over-regulated, invariably at huge cost to it.

Finally, the hon. Gentleman asked about the statement on new regulation. It has been replaced by an annual report under the business impact target that will be published this June and annually thereafter. That is the better way forward. Though interesting points were raised that, as ever, were listened to, I urge hon. Members not to support the amendment on the basis of all I have said.

[Bill Esterson]

It is really important to say that we agree on not having unnecessary regulations; I take on board the Minister’s point about that. I gently say to her, however, that small businesses are extremely concerned about some recently proposed additional regulation, not least the introduction of quarterly filing or additional reporting of tax information and the feared potential implications for extra bureaucracy. We have discussed that issue elsewhere. I do not know whether you would welcome a discussion on that now, Sir David, but such proposals cause concern. The Minister needs to be aware that there is a sense the Government need to think a few things through more carefully.

The point that the Regulatory Policy Committee was making was that by not including just under half of regulations, the Government are not counting them and are not showing that the gold-plating the Minister speaks of is not still happening. It leaves the sense that the Government are embarrassed by the fact that they have not done more to remove what she described as gold-plating or to learn from how some of our friends in the European Union have managed to apply EU regulations in a more cost-effective way, or done enough to reduce the cost of regulation from the European Union. That is why we agree with the Regulatory Policy Committee that such things should be within scope.

Enterprise Bill [ Lords ] (Fourth sitting)

Debate between Bill Esterson and Anna Soubry

Thursday 11th February 2016 Public Bill Committees

[Bill Esterson (Sefton Central) (Lab)]

Welcome back, Ms Buck. This is the first time that my hon. Friend the Member for Wakefield has spoken in the Committee since her success yesterday and I add my congratulations on her appointment as the new Chair of the Select Committee on Environmental Audit.

As my hon. Friend has said, the Labour party is pro-business, but we are not pro-business as usual and it is important that we challenge unacceptable business practice and exploitative practice. We support good regulation but at the same time we must ensure that unhelpful or damaging regulations are addressed. My hon. Friend cited excellent examples of good regulations that show how such reporting should be done. She also explained that we must take a longer-term view when we consider the environment or other aspects of life. The short-term, balance-sheet effects of regulation are not enough. Whether a regulation, an action or a change in the rules has an effect on a business or an economy in a matter of weeks, months or a year or so is very different from its longer-term impact, whether on the economy or, indeed, the environment. We should be trying to achieve the level playing field that has been a central theme of our deliberations on the Bill so far, and that level playing field should apply to business, consumers and the wider public. The costs of regulation to business can be apparently significant, but savings can be made elsewhere. My hon. Friend the Member for Wakefield has given many examples of exactly that, but I will give a few others as well.

When the minimum wage legislation came in during the early part of the Labour Government, there was criticism that the regulations would produce a big cost to business and to the economy; that they would cost jobs. That turned out to be scaremongering and untrue. There was in fact a benefit, not just to the workers who saw big increases in pay and protection of their terms and conditions, but to the wider economy. People were in a position to spend more money in the economy, which had benefits for business and the wider economy. There was also a benefit in the protections that were given to those businesses that had always been good employers and paid decent wages.

The same, of course, is true today when we debate the challenge of the exploitative use of zero-hours contracts. Sports Direct is an employer that is often cited. There is grave concern at the way zero-hours contracts are used in that business for people whose only or main employment is with that business. That does not just make life very difficult and precarious for the individual; the competitors of Sports Direct or similar businesses where the zero-hours culture is a concern face pressures that are unacceptable, unfair and damaging both to business and to the wider economy.

There are many examples of how regulation can be a force for good. It can be a way of improving the wider environment and economy. It can help business, even though at first glance it may appear not to do so. As we seek to create a fairer society and a fairer and more successful economy, these matters are very important and we rightly have the opportunity to debate them. My hon. Friend was right to table the amendments. They do the job of highlighting the concern and the challenge. She has highlighted the long-term environmental and economic benefits of ensuring that we measure and evaluate regulation—the immediate impact and apparent negative effects, but also the longer-term, beneficial effects. In many cases, what may appear to have a financial cost in the short term has a much greater financial and environmental benefit in the long term. I am therefore pleased that my hon. Friend has tabled the amendments and I am happy to support them.

[The Minister for Small Business, Industry and Enterprise (Anna Soubry)]

We must remember that clause 15 is specifically for this purpose—to require regulators subject to the regulators’ code to report annually on the effect that the code has had and to obtain the views of business on that effect. That is what the clause is all about. Our approach does not preclude consideration of broader public interests when regulators report. As I have said, the key purpose is to address the impact on business, but that does not preclude all the other matters that the hon. Member for Wakefield has raised.

Regarding Ofgem, Ofcom, the rail regulator and Ofwat, clause 17 provides a way forward to include them in the regulators’ code. That clause will remove the exemption, but not of itself bring them into scope; that can be done only following consultation and through secondary legislation. Those are important points to make when looking at the aim of the clause.

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[Bill Esterson]

I am glad I got that right. However, it is patently clear that the UK must face up to a serious problem, which includes the way in which anti-money laundering rules are regulated. New clause 19 seeks to ensure that small businesses are supported as much as possible in complying with anti-money laundering rules. For the vast majority of small businesses, anti-money laundering rules are another bewildering set of regulations. While the UK is facing up to these problems, the least we can do in this legislation is to make it as straightforward as possible for small businesses to understand and comply with those regulations.

Let me turn to amendment 66. When we discussed amendment 62, we called for a nominal and monetary tally of regulations to be included in the Government’s business impact target. I acknowledged at the time that, although important for the sake of transparency about the impact of regulations, focusing solely on umbrella financial costs to small businesses was something of a blunt instrument. Amendment 66 therefore goes a step further. Our intention is to address the challenge that policy makers face in assessing the broader impact of regulations on the economy and, indeed, society more broadly.

The burden and benefits of regulation are rarely distributed equitably. The point is that simply talking in terms of the overall financial burden on businesses and couching one-in, two-out or other savings targets in those terms overlooks the different circumstances of the more than 5 million small businesses in the UK. What benefits one may burden another. A regulation that plays to a small business in Manchester or London might make life harder for a rural start-up, or it might have a disproportionate impact on a small business that exports to the EU, and so on.

Current assessments disproportionately measure the direct impacts of new policies. Indirect impacts are harder to quantify, but that does not mean that we should pretend they do not exist. Longer-term impacts are even harder to measure, because the impacts spiral out from the business itself to include the knock-on impact on the wider economy, but that is exactly why it is important to factor them in. Amendment 66 adds that magic ingredient, productivity, into the mix for consideration during assessment. Indeed, much recent debate in the Treasury and Department for Business, Innovation and Skills circles has been about how to improve the UK’s productivity. When we consider productivity and not just cost, we radically change the nature of impact assessments. Instead of monitoring what goes in—that is, the immediate financial impact on small companies—we monitor what comes out: the impact of the regulation on how businesses operate, how they grow and whether they can take on more staff, and, ultimately, the impact on GDP.

Adding productivity takes the blunt instrument of the assessments as they stand and adds a far more nuanced approach. It is an approach that more accurately reflects the complexities of the small business landscape and an approach that ends the strange idea that regulations can somehow be considered in isolation—that they can exist in a vacuum outside the wider economy.

[Anna Soubry]

The regulators code requires regulators to take account of the needs of small businesses and to tailor their regulatory approach accordingly. The Bill’s new reporting requirement requires regulators to be transparent about the effect that these considerations have had on those they regulate, including small businesses. This will be even more explicit when we develop reporting guidance for regulators. The growth duty will require regulators to consider economic growth fully when regulating, and productivity is part of that.

--- Later in debate ---

[Bill Esterson]

I was hoping for something more from the Minister, but we will not have more time in Committee.

[Anna Soubry]

We will.

[Bill Esterson]

We have been given more time on Report, unless the Minister is giving us another day in Committee, and he tables such a proposal when we come back next Monday week. That would be unusual because we have to finish, according to what has been passed in Parliament, two weeks today at five o’clock.

--- Later in debate ---

[Anna Soubry]

So come on, Mr Esterson, let’s get on with it.

[Bill Esterson]

Says the Minister, sitting there, chuntering, as she does.

[Anna Soubry]

As usual.

[Bill Esterson]

Indeed. Honesty from the Minister—I like that.

I would have more sympathy with the Minister for Housing and Planning if the proposals had been made a little earlier than the evening before the Committee started, but there we are.

--- Later in debate ---

[Bill Esterson]

I am as much in the dark as my hon. Friend the Member for Newcastle upon Tyne North on this matter, as I am on so much that the Government do. Perhaps the reasons will emerge when we debate—

[Anna Soubry]

If we ever get there.

[Bill Esterson]

The Minister is in fine form today—when we get to that point, eventually, in two weeks’ time. That question can sit and await answer from the relevant Minister when we deal with the new schedule. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 15 ordered to stand part of the Bill.

Clauses 16 to 18 ordered to stand part of the Bill.

Clause 19

Extending the primary authority scheme under RESA 2008

[Anna Soubry]

I beg to move amendment 1, in clause 19, page 17, line 40, leave out “Welsh ministerial” and insert “devolved Welsh”.

This amendment, amendments 3, 4, 6, 7 and 9 and subsections (1) and (2) of the new clause inserted by amendment NC2 replace references in the Regulatory Enforcement and Sanctions Act 2008, and in the amendments made by the Bill to that Act, to a Welsh ministerial matter with references to a devolved Welsh matter. Subsection (4) of the new clause inserted by amendment NC2 defines a “devolved Welsh matter” so that, in addition to Welsh ministerial matters, it also covers matters within the legislative competence of the National Assembly for Wales.

--- Later in debate ---

[Anna Soubry]

Yes. They have been tabled at the request of the Welsh Government and therefore, I am sure that the hon. Gentleman—[Interruption.] He is putting his thumb up, and rightly so. They are technical, but they have been done at the request of the Welsh Government and I am sure that they are absolutely right to make that request, which is why we hope this is uncontentious.

[Bill Esterson]

The assurance the Minister gave about the Welsh Government’s request was certainly what we needed. It is a shame that Ministers do not accept requests from us in here when we try to amend things, but we live in hope.

[Anna Soubry]

I do not have anything to say to that. It would be a first if we all agreed on everything—actually, there are times when we agree, and that is wonderful. It would seem that this is such an occasion.

Amendment 1 agreed to.

--- Later in debate ---

[Bill Esterson]

The clause will extend the primary authority scheme, which was introduced by the Labour Government in 2009. It provides greater regulatory consistency and certainty to businesses that operate in local authority areas by creating a statutory partnership between multi-site businesses and a primary authority. The primary authority acts as a co-ordinator of other local authority enforcement activity in relation to that business. The initial roll-out of the primary authority scheme saw a good uptake and support from business, professional bodies and local authorities. It is a splendid example of regulation working well in practice and benefiting business, the wider community and the wider economy, thanks to the previous Labour Government—we can all agree with that.

The primary authority scheme improves levels of compliance with regulations at a local level by providing small business with information about regulations and reducing the financial burden of compliance with them. It is an excellent model; it extends a friendly hand to businesses and regulators. It was created in response to problems caused by inconsistencies in regulatory interpretation between different local authorities, which led to a real challenge for businesses operating across a number of local authorities’ areas. The primary authority scheme overcame that challenge and confusion and gave businesses greater confidence to expand beyond the boundaries of their local authority.

When the primary authority scheme was created, the OECD said that it was a “potentially far-reaching innovation”. It is regulation done well. It finds a balance between business and regulators, works with businesses to ensure compliance is as easy and affordable as possible, and offers councils the flexibility to account for local circumstances where there are discrepancies between their use of regulations and that of neighbouring councils.

We broadly agree with the extension of the primary authority scheme set out in clause 19, but I do not want the Minister to think that she enjoys our unqualified support. A helping hand to small businesses in the spirit of pragmatism and flexibility is good, but let us not take it out of context. In fact, we must bear in mind the context throughout our debates, particularly when we discuss the small business commissioner. The entire Bill is an example of the Government giving with one hand and taking away more with the other. The primary authority scheme will help small businesses to access affordable regulatory compliance, but on every other front they face an onslaught and a whittling away of the Government support they need to get started and contribute to the local economy.

Let me give some examples. The Government axed the Business Growth Service, the Manufacturing Advisory Service and the growth accelerator programme. The growth accelerator programme alone assisted more than 18,000 businesses. A great deal of the £100 million in finance that it helped small and medium-sized enterprises to raise went into helping local businesses in their very earliest stages. The Government converted Innovate UK grants into loans and took up to 58% of the budgets from the very local authorities that the clause tries to help businesses work with—the 58% is from Liverpool, my neighbouring authority.

The Government give a fair impression of wanting to make life easier for businesses with the extension of the primary authorities scheme, but although we support the scheme we are acutely aware that it pales into insignificance in the face of the sheer scale of the withdrawal of support for small businesses in recent years. If the Government wanted to help businesses, they would not have completely shut down the long-term dividends to the economy of many of the discontinued schemes that were already beginning to deliver, including the ability of local authorities to help through economic development, which is disappearing due to the scale of cuts. The change has been made for the sake of scraping together the short-term cuts that the Chancellor wants to achieve his political aims, which has not helped local businesses or local economies.

[Anna Soubry]

Of course, as has been identified by the hon. Gentleman, the clause extends and improves the hugely successful primary authority scheme. I pay tribute to the last Labour Government for creating the scheme. Some will say that it is one of the few things that they actually did that was of any benefit to anybody, but that would be cheap.

Enterprise Bill [ Lords ] (Second sitting)

Debate between Bill Esterson and Anna Soubry

Tuesday 9th February 2016 Public Bill Committees

[Anna Soubry]

Some might say I was being slightly patronised there, Ms Buck, but I am sure that that was not the hon. Gentleman’s intention. There will be a review, which will report in March, from which a series of recommendations will go out for public consultation. I am very keen that we reform the retention system in the construction industry. If anyone wants me to repeat that, I will say it yet again, because I have said it not only in this Committee, but in the Westminster Hall debate last month: it needs reforming and we need to get on with it. I could make the point that some people were in government for 13 years and did not deal with the problem, but that would be churlish of me and I would not do such a thing. Nevertheless, the point I am making is that there is an adjudication system to help those companies that suffer.

I have also conceded that I am told on very good authority that, for reasons that we know and understand, the existing system is not working as we would like it to. In any event, I think it is out of date and unfair and it needs sorting out. I would be delighted to be the Minister who sorts it out once and for all, so that we have a modern, fair system that protects those who need to take care of all the snags and things that come to light after a build has been completed and, at the same time, ensures that the money is there so that they can make good any defects. There is a way to sort it out. It might not be what is proposed in the amendment—there might be a better way to do it—but those are exactly the things that the review will explore.

Amendment 38 specifically says that the new small business commissioner would consider complaints relating to access to finance, not complaints about whether or not small businesses have knowledge about the various schemes. One of my predecessor’s achievements was bring together as many of the Government’s schemes as possible through one portal: the British Business Bank. If someone wants access to finance, they can go to their bank or to their accountant and ask for advice, or they can seek the advice of the Federation of Small Businesses. Equally, they can google it, and one of the results will be the British Business Bank, which gives all the details of all the various schemes, not only those operated by the Government—start-up loans being an extremely good example—but also advice on peer-to-peer lending, the angel schemes, crowdfunding and so on. We are beginning to see a real change in the amount of information available, especially from that one-stop-shop, the British Business Bank, so that small businesses know where to go if they are looking for finance.

The amendment, though, is about small businesses’ complaints about their access to finance. With respect, the Financial Ombudsman Service already deals specifically with such complaints. Were we to extend the role of the small business commissioner, all we would be doing is duplicating an existing system that everyone seems to accept is working well. As I said earlier, we learned from the consultation that the one thing no one wants is the duplication of services.

The Financial Ombudsman Service is working well, and it has respect. Small businesses can go there to make their complaints; Members may well have referred their constituents. We already have exactly the device required. I argue strongly that expanding the remit of the small business commissioner would not be appropriate when it comes to finance, because we already have a very good system. Small businesses are within the remit of the Financial Ombudsman Service if they have a turnover of less than €2 million and fewer than 10 employees. So it is there for the microbusinesses.

The Financial Conduct Authority is currently consulting on whether even more small businesses should be given access to the FOS. The FOS analyses the complaints it receives from microbusinesses and reports on them every year. It also publishes occasional stand-alone reports, such as, in August 2015, “Micro-enterprises and financial services—a review of complaints”, which had the express purpose of highlighting areas of good practice and promoting change where it is needed. Access to finance for businesses is also regularly considered by Select Committees.

With respect, I really believe that the amendment would represent an unnecessary extension of the remit of the small business commissioner. Again, we must make it very clear that the primary function of the small business commissioner is to address the big problem that all small businesses complain about, which is late payment. That is where I want his or her focus and resources to be.

I turn to other matters. I think I have dealt with cash retentions in the construction industry, but I want to deal with the other amendment, which deals with the enterprise investment scheme and the seed enterprise investment scheme. Details are already published, with guidance and information, on gov.uk. We in BIS support and complement this work with promotional activity. Again, with respect, I really do not think the amendment is necessary, because what it wants to achieve is already being done.

I think that is it, unless there is anything else I need to add. I ask for the amendment on cash retentions to be withdrawn because I honestly think we are going to make huge progress very quickly and we are all on the same page. I respectfully suggest that the other amendment is just not needed: we do not need to extend the remit of the small business commissioner in this way, because others are doing the job very well for small businesses.

[Bill Esterson]

Let us deal with access to finance and the EIS and seed schemes. The Minister needs to read the whole of amendment 38 to consider where it is going. If the word “complaints” were replaced by the word “representations”, it might be easier to follow. The point is for the commissioner to make recommendations to Government about improving access to finance; that is the intention behind the amendment, as I thought I had explained. That is also in the explanatory statement that came with the amendment, but I will not pursue the point by pushing it to a vote.

When the Minister says that late payment is the priority, I understand that. Clearly, one has to start somewhere and that is what the Government want to do. However, as I said in my opening remarks, the second issue—it is a very big second issue—is access to finance. It is really important that we get to grips with that as well. Please understand the importance of the amendment and what it is driving at.

The Minister commented on the schemes and their advertisement on the gov.uk website. I understand that. The point I made earlier was that not enough businesses are finding them. That is why if the small business commissioner has a signposting role, he or she should use it as much as possible. Perhaps the Minister will take that away and consider it.

[Anna Soubry]

We want the small business commissioner to have his or her own website, and I want there to be portals—the hon. Gentleman understands these things—so somebody can click on something that says “access” and go through to the various information. That is terribly common on so many websites, so I want there to be that sort of access. The hon. Gentleman makes a very good point, and we agree that one-stop shops are the way to get information about a lot of this work out there.

--- Later in debate ---

[Bill Esterson]

I thank my hon. Friend. The Government’s proposed small business commissioner is likely, according to the Government’s own predictions, to help just 500 small businesses a year. The commissioner will serve as a signposting service to mediation services that already exist and have failed to deal with the crippling problem of late payment in the past. In fact, it was the Minister’s colleague, the hon. Member for Huntingdon (Mr Djanogly), who said on Second Reading:

“On capacity, the new £1.1 million SBC website should handle 390,000 disputes from 70,000 businesses, yet the SBC will deal with only 500 complaints a year. That gives rise to the question of what will happen with the rest of the disputes and what the real impact of the proposal will be. Could the site cope with the workload of significant numbers qualifying for assistance? That remains unclear.”—[Official Report, 2 February 2016; Vol. 605, c. 828.]

That is just the website, which the Minister mentioned. The small business commissioner will employ only a handful of staff, and there is nothing in the Bill to say that they will be legal, financial or even business experts.

We have to be honest when we look at the definitions laid out in the clause. The aspiration to support small business is lofty and laudable, but it prompts a question: without the legal clout of the Australian small business commissioner or the wide-ranging agreement with the US Small Business Administration, and without anything like the budget or staff numbers of either of them, how many such companies is the legislation actually likely to help?

[Anna Soubry]

I will keep this as short as I can, because I do not think that there will be a vote on the clause.

I agree with a large part of what the hon. Gentleman says. The clause defines small businesses that may access the commissioner’s functions as those with a headcount of fewer than 50 people. Financial thresholds may also be applied under secondary legislation—for example, if it transpires that there are businesses with relatively few employees, but high financial worth. They might be excluded from the commissioner’s scope, because our emphasis is small business.

I think Lord Mendelsohn talked about the “asymmetry of power”; the measure is about small businesses, especially very small businesses—the actual definition for small business is 250 employees, but we are taking that down to 50 and fewer, because those businesses simply do not have the sort of power that other, bigger businesses have. We want to redress that and to change the balance.

Perhaps the small business commissioner will not at the moment deliver as we all want them to deliver, but it is a terrifically good beginning to have someone in situ specifically looking after the needs of small businesses, concentrating on the primary role—I will be boring by repeating this—of tackling the problem of late payment, because that is the big issue that troubles the majority of small businesses. The commissioner will be their champion.

I hope to be—I like to think I am—the champion of small businesses, and that is why I was appointed. I do not know whether there has been a small business Minister before and, although I do other things as well—I seem to do everything—the emphasis is on small business. I actually sit in Cabinet because the Prime Minister wanted a Minister with responsibility for small businesses at the Cabinet table—unfortunately, he could not find one, so he got me. No! To be serious, that is why the role was created.

I am so proud that we will have the small business commissioner as the small business champion, especially for late payment. I do not think that there will be any dispute about the clause.

Question put and agreed to.

Clause 2 accordingly ordered to stand part of the Bill.

Clause 3

General advice and information

[Bill Esterson]

I beg to move amendment 40, in clause 3, page 3, line 10, at end insert—

“(d) tax rates, allowances and thresholds of relevance to small business owners.”

This amendment would extend the general information and advice that may be published by the Commissioner to include tax rates, allowances and thresholds of relevance to small businesses.

--- Later in debate ---

[Anna Soubry]

Hear, hear!

[Bill Esterson]

I thought the Minister might say that. However, we have included it precisely because it does not seem to happen every time. After the introduction of the Groceries Code Adjudicator, both the GCA herself and commentators found that the take-up of her services by suppliers was hampered by the fact that not enough people knew about her and the services she provides. It is a simple issue of communication, or good marketing, but it takes more people than the postholder himself or herself to ensure that an awareness that they exist and an understanding of what they do reaches more than 5 million small businesses.

On a whole host of issues that we will come to later in another new clause, it seems that the Government are going to great lengths not to learn important lessons from the introduction of the Groceries Code Adjudicator. This is a simple one: make sure people know that the office exists and use the local authorities as an ideal vehicle for raising that awareness. Raising awareness is not done straight from the small business commissioner and it is not currently done from the Groceries Code Adjudicator to the many people they are trying to help. That would not be possible, given that, under the small business commissioner, we are talking about reaching more than 5 million companies. By equipping local authorities with the understanding of the post, they need to triage small local businesses into signposting the small business commissioner where appropriate, and in that way we can make light work of spreading the news. The website on its own will not do it. Local authorities will also no doubt appreciate that, not least because it will plug the gap left by so many of the Government’s cuts to councils and to national schemes designed to give advice to small businesses.

[Anna Soubry]

In resisting the amendments I will put the following arguments. The commissioner will give small businesses general advice and information that would be helpful for their dealings with larger businesses. I have given one such example as portals through websites. Many of us as Members of this place have our own websites, so we are more than familiar with how best to talk to constituents and provide them with information. We know that there are ways to do it that never existed before, but that will be for the commissioner to decide. I respectfully suggest that we do not need to write all this stuff down in legislation. We can allow him or her to use the abilities that they will undoubtedly have to ensure they provide the services and the general advice and information that they believe will best suit small businesses.

The commissioner will also direct to relevant bodies and sources of assistance, as I described. Our consultation showed that there is widespread support for that function, and that small businesses—I think the hon. Gentleman will agree—do not always know about the services available to them. The commissioner will address those information gaps. For example, I have no doubt that some small businesses will contact the small business commissioner with a complaint about a utility company. The small business commissioner will ensure that their complaints go to the right place, such as Ofgem or Ofcom. We all know small businesses that have huge problems accessing superfast broadband or have difficulties with their landline, BT and so on. The commissioner can give them direct access at the click of a mouse or a button to Ofcom. I have already talked about the financial services ombudsman, which is another way of helping small businesses to resolve problems and disputes.

The commissioner will not cover specific issues such as taxation, because such information and advice is already available. Nobody wants duplication. I am confident that good advice is available, so why would we double it up and confuse people further? The commissioner’s information will be sensibly integrated with other sources of business advice—as I said, access to finance is a very good example. The commissioner will decide what advice and information will assist small businesses. It can already include his or her own schemes and remedies.

I agree that awareness of the commissioner is crucial. However, he or she will be best placed to decide how to promote their services. I will absolutely trust whoever is appointed, because part of the skill set I expect them to have is the knowledge of how to get out there and ensure that everybody knows about them.

I recognise that the payday loans market has caused serious problems for consumers, but, with respect, I do not think it should be in the Bill because we took the action that was needed to address it in the previous Parliament. The Financial Conduct Authority’s more stringent regulatory regime is already having an effect on the payday loan market. It found that the volume of payday loans fell by 35% in the first six months of regulation, even before a cost cap was introduced last year.

The commissioner’s power to make recommendations about the information that the Secretary of State gives simply allows for different ways of providing information. The commissioner already has the power to publish and provide information.

New clause 14 is a good example of bad legislation. We do not need legislation to tell people to talk to one another. While the hon. Gentleman was talking about it, I wrote down off the top of my head what local authorities can and should do—many are already doing these things—to support small businesses. They should ensure that they have good, sensible business rates; create the right environment; free businesses from unnecessary regulation and undue checks; support high streets with imaginative parking by, for example, providing access for wheelchairs and buggies; ensure their local plans, core strategies and planning matters are small business-friendly; and support the high streets and all of the wonderful small businesses that we have in our constituencies. Finally—as I said, this is just off the top of my head—they should ask whether planning applications include access to superfast broadband. Good digital technology must be at the heart of their planning decisions and everything they do as local authorities.

I respectfully suggest that that sort of legislation is not needed. Local authorities, with few exceptions, know how best to work with small businesses, but it is not their job to give them advice. It is their job to create the right environment in which they can thrive and grow. That is why I urge everybody to reject the amendments.

[Bill Esterson]

The Minister talked about constituents contacting us via our websites. I have constituents who contact me via my website, too. I have an electorate of something like 68,000. [Interruption.] That is quite a small electorate, but not all 68,000 contact me via my website.

[Anna Soubry]

I am sorry; I did not say that they contact me via my website, but I understand how websites work and how they can disseminate information and enable people to access the information they need by way of portals. Obviously, an MP’s website does not have many portals, but we are all familiar with how websites operate in a modern world so that people can get the information that they need. That is all I am saying.

[Bill Esterson]

We can also measure how many people are looking at a website. I do not have the technical know-how to do that, but some do. I know that 68,000 people do not visit my website or anything similar to that, and 250,000—the borough’s voting population—do not visit Sefton Council’s website, either. I do not think that websites are therefore anywhere near the answer to providing access to the small business commissioner.

The Minister talked about new clause 14, which is not about getting local authorities to work on how they access business, much as I want them to do all the things that she talked about. I do not disagree with that, but that is not what the new clause is about. It is actually about ensuring that local authorities know that the small business commissioner exists and what he or she does so that they can work together to improve life for small businesses. It is a shame that she did not grasp that.

On tax, in my experience most small businesses want to pay tax; they just want to ensure that they pay the right tax. Whether that is true of some rather larger businesses, we can all speculate from time to time. To pay the right tax, however, businesses sometimes do not find that the advice from HMRC is what they need. In the Lords, we heard an example of a business attending a seminar organised by HMRC so that it could get its tax right and when, having followed HMRC’s advice, it approached HMRC to say what it thought it should be doing, HMRC disagreed and said:

“We are not bound by our own advice”.—[Official Report, House of Lords, 26 October 2015; Vol. 765, c. GC137.]

That was something of a shock to the company, which had invested all that time and effort in dealing with its tax affairs in an attempt to pay the right level of tax. That is why it is important that the small business commissioner is involved in helping businesses to understand tax rates and to pay the right tax so that they are not dependent on HMRC, which does not always act as we might reasonably expect. As that was a probing amendment, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

--- Later in debate ---

[Anna Soubry]

We can talk about powers, which will come up later in the Bill, but we are talking about remit. It is not the remit, in my view, of small business commissioners to offer services that are already available. They can point people in the right direction, but Members must be under no illusion about what the commissioner’s role will be. If someone comes to the small business commissioner with a case that is within scope and says, “Will you mediate?” the commissioner will say, “No, I’m not going to mediate. You go off to mediation, but if you’ve got a complaint about bad practice relating to late payment, come back to me. I’ll deal with it.”

The services are there. Let us concentrate on what the commissioner’s role is. The role is to tackle late payment and to change the culture, so that we do not have so many small businesses that are not paid in time or have unfair conditions put on them in terms of when they are paid. That is why I urge hon. Members not to support the amendment. It is not the direction of travel. Mediation services are already out there, and it is the job of the commissioner to direct people to existing services.

[Bill Esterson]

Well, we will find out in time whether that works. The reason for quoting the Australian example is that both parties have to accept that mediation will have consequences. I think I am right in saying—the Minister will correct me if I am wrong—that if a party refuses to engage in mediation, there may be penalties if matters end up in court. That is an interesting approach.

[Anna Soubry]

If someone has a legal dispute and therefore issues proceedings, they will be pointed—there is no debate about it—to mediation. If they are a belligerent party and refuse to use mediation, when they come to court and lose, they will take the heavy toll of costs accordingly. At the moment, all the courts point people in the direction of mediation, and it is a very belligerent party that does not go down the mediation route. In fact, it may be almost impossible in the English system for a case to get into a county court or the High Court unless it has gone through mediation or some judge has determined that the case needs to go before it because mediation is not the correct route. In other words, we have a good system that is working.

[Bill Esterson]

That is interesting, but we come back to the huge problem of late payment that we are still grappling with after all these attempts. The Minister mentioned the number of pieces of legislation that have attempted to help with that.

The Minister has mentioned a number of times, including on this matter, her concern about not duplicating. If we have things that are not working, we need to consider new approaches; that is at the heart of the creation of the small business commissioner. However, it is about making the commissioner as effective as possible. That is why we have looked at mediation in the way we have. The amendment does not make the power compulsory, but it gives the commissioner the opportunity to be one of the services available.

While I do not dispute what Members on both sides of the Committee have said—that plenty of mediation services are available—if the system was working well, businesses would be finding those mediation services and using them. Something is not quite right, because it sounds like that is not happening. The constituents who have come to me have certainly not been taking advantage of such services; they have been suffering in silence when it comes to challenging those who owe them money.

I agree with the Minister; we need to change the culture. I have no doubt about that, but the question is how best to do it. This probing amendment was about doing just that. We absolutely need to raise awareness of the services that exist. If that is not sufficient in time, I hope that she and the Secretary of State—she may by then be the Secretary of State—will decide to give the small business commissioner those additional powers. Perhaps then we will have made further progress in helping to achieve the outcomes we want in reducing the level of late payments. As she quite rightly says, ideally we want it to stop being the problem that it is now. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 3 ordered to stand part of the Bill.

Clause 4

The SBC complaints scheme

[Alan Brown]

I echo what has been said. The amendment seems to be a logical extension. Earlier we supported the extension to public bodies, which I thought would strengthen the Bill, and I think this amendment would too. Fellow SMEs should be protected as well. There should not be a loophole. We do not want to get to a stage where there is an argument about what constitutes an SME. All businesses should be treated equally, and this simple amendment would allow that opportunity.

[Anna Soubry]

This is why we have done it in this way. As we see from the clause, the commissioner will handle complaints by small business suppliers about payment-related issues with larger businesses—that is, any medium-sized or large business. The intention of all this legislation is to help small firms where they suffer from the imbalance in bargaining power. I have referred to the words of the noble Lord Mendelsohn about asymmetry. We know that smaller firms, by virtue of their smallness—especially microbusinesses—are at a disadvantage, especially against medium and larger companies. We believe that that is where the real problem is, and that is what we particularly want the small business commissioner to address.

That is not to say that if a small business is in dispute with another small business, it will not have access to all the sorts of dispute mechanism that we have heard about, but we do not believe that is where the real problem is, or the real imbalance of power. That is why we have specified businesses of fewer than 50 employees. They are disadvantaged by their size against medium and larger companies. We know that such businesses often feel unable to challenge contract terms proposed by larger businesses, as I think we have all agreed and mentioned, because it could breach or damage existing or potential commercial relationships with those companies.

Smaller businesses may not have the time, money or expertise to take a legal challenge, which is another consideration. However, as we know, sometimes it is because they are simply frightened that if they take any form of legal action—even something like mediation—it will completely thwart the future commercial relationship between them. They are in a much weaker position by virtue of their size, so that is where we are putting all the emphasis. Their big problem is medium and larger businesses. That is why I resist the amendment.

[Bill Esterson]

The Minister rightly makes the point about the imbalance in bargaining power, but I repeat that 70% of trade is with other small businesses and that when a larger firm is behind the problem due to delays elsewhere in the supply chain, there does not seem to be a mechanism for addressing that. Perhaps she can take that away, if she is resisting our attempts to include small businesses: how can we deal with problems in the supply chain that come ultimately from a large or medium-sized business? With those comments, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

--- Later in debate ---

[Bill Esterson]

We move to the topic of unfair treatment or unfair contracts and how they are or might be dealt with by the small business commissioner, starting with amendments 48 and 54. The issue is similar to some of the problems faced by consumers that were dealt with in the Consumer Rights Bill—is it an Act now?

[Anna Soubry]

I don’t know.

[Bill Esterson]

I look for inspiration, and I am sure that we will get it. [Interruption.]

[Anna Soubry]

Yes, says the Whip. Whips are always right.

[Bill Esterson]

Thank you. Whips always know.

I think that there was an agreement in Committee on that Bill, which is now an Act, that microbusinesses have a lot in common with consumers, and that there is merit in considering them in the same way when they are purchasing goods and services, and certainly those that are not their core business. Examples include a hairdresser, who would buy shampoo or scissors as part of the business, whereas an individual would perhaps buy such things from Boots. When the hairdresser was buying coffee or a kettle for staff, however, it would perhaps be reasonable for them to be treated as a consumer. One-off business-to-business purchases made by a small business, such as somebody who is self-employed, should attract the same protection as would be afforded to consumers.

--- Later in debate ---

[Anna Soubry]

I shall now deal with new clause 7, which is really not necessary given the package of legislative and non-legislative measures we have taken to tackle late payment. I shall give some examples.

We plan to make regulations this year to require large companies to report six-monthly on payment practices and policies. That information will be available for public scrutiny. We have strengthened the prompt payment code to enforce a maximum 60-day payment term for all signatories from this year. Public sector buyers are required to have 30-day payment terms in contracts and throughout their supply chains, as we discussed this morning. We have to sharpen that up—we have to be better—but it is there. From 2017, public sector buyers must also publish annually their liability to debt interest payments. Central Government will publish quarterly on liability to debt interest from April 2016, and we will monitor the effectiveness of the measures.

There has been a little jollity—if one can be jolly about the mystery shopper service—but, in all seriousness, I have been absolutely convinced by that service because I have seen the evidence of the work it does. I might not be happy with the name, but it does investigate poor payment performance by public sector bodies and in their supply chains, and it is having an effect and making a difference.

Stakeholders—that dreadful word, but they are important people who have an interest—tell us that they want more public exposure of the payment practices of larger companies, and I agree with them. Bans on certain practices would be easy to sidestep and substitute with others. However, as we all know, publicity—casting a spotlight—is one of the best disinfectants against bad practice. That is the way forward. Were we to go down the sort of legislative route suggested by the new clause, it would become all too easy to sidestep and get around, so we would not make the advances that we need to make. For those reasons, I urge the hon. Gentleman to withdraw the clause or, if he pushes it to a vote, I urge the Committee not to support it.

[Bill Esterson]

I am still intrigued about the mystery shopper—at some point we may find out.

[Anna Soubry]

It is going to be a running joke.

[Bill Esterson]

The Minister is making a joke of it. I am intrigued to discover what it is finding and what is happening with its findings. I hope that we might hear that at some point. We do not need to hear today, but I would be very interested. I do agree that mystery shoppers can be very important in improving the quality of service and operation in a number of organisations.

I accept the Minister’s assurances on new clause 7, but, again, when the commissioner has been up and running for a while, it might be good for them to look at some of the payment-terms issues in the new clause and how well things such as the prompt payment code are bedding in—that is, is it as effective as we want it to be? That might be something useful that the commissioner could do in future to make a real difference.

Before the Division, the Minister talked about whether the commissioner should take unfair contract terms to court. She said that a quasi-judicial role would be inappropriate. Take the example of somebody in an imbalanced business relationship being offered a three-month payment term on an invoice, knowing full well that it is unfair and completely wrong, but, given their dependence on that contract and business relationship, feeling they have no choice but to go ahead with it. At a later date—this is what the amendment is getting at—there might be an opportunity for them to get some kind of redress. That would be the sort of issue in which the commissioner might intervene. The amendment suggests the commissioner might recommend to the court that the term was inappropriate, rather than take a quasi-judicial role. Nevertheless, I take the Minister’s points and, as the amendments were intended to be probing, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

--- Later in debate ---

[Anna Soubry]

I do not disagree at all. That is why a flexible approach rather than an overly prescribed legislative approach is what I seek, and I am told that our model reflects the small business commissioner model in Australia. If as the hon. Lady describes the small business commissioner receives a flood of anonymous complaints and—even better—some have substance to them, it is difficult to believe that the commissioner would not grab that and take it forward. However, this is about accepting and understanding the difficulty of anonymity for the person against whom the charge or complaint is made, because they cannot take part in the investigation without some more detail to answer the charge. The small business commissioner must act and be seen to act in a way that is fair to both parties.

That is why the Bill does not prohibit anonymous complaints from being made. In legislation we are making the dangers of anonymity clear and ensuring that it is fair, but not for small businesses alone. We might be biased in favour of small businesses, but when looking at complaints the commissioner must be absolutely fair to both parties.

[Bill Esterson]

I think the point was well made by my hon. Friend the Member for Wakefield and by the Minister that if a pattern of anonymous complaints emerges, that is absolutely something the commissioner may act on. Having carefully reread amendments 46 and 49, I accept that they might potentially be read in that way—that was the intention—but I am satisfied by what the Minister says and having it on the record is extremely helpful. Amendment 51 deals with confidentiality and I agree that in an individual case it might be difficult for the commissioner to act if complainants did not give information to the commissioner. Granted they might want to give it confidentially, but those are two separate matters and I am satisfied by what the Minister said. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 4 ordered to stand part of the Bill.

Clause 5

Enquiry into, consideration and determination of complaints

--- Later in debate ---

[Bill Esterson]

All three amendments are drawn from what happens in Australia. The Australian small business commissioner is a great success and we have discussed that in some detail, so it would be as well for the Government to consider what happens in Australia.

Legal powers to demand information relevant to an investigation form a crucial part of what the Australian commissioner does—note that that includes the public as well as the private sector. That is an important reminder that as the office of the small business commissioner in this country develops, the opportunity to continue to learn from the very best practices in the world remains available. The amendments are probing ones designed to allow the Government to do just that. We have discussed such matters previously, so I need say no more. I will wait to hear the Minister’s response.

[Anna Soubry]

It is really important that the commissioner wins the trust of small and large businesses. We need to ensure that we do not take an overly heavy-handed approach at the outset.

The commissioner will seek to change the culture of payment. The best way to do that is to take an approach that balances disincentives to encourage larger businesses to behave reasonably towards smaller businesses with support for those smaller businesses, so that they may become more savvy contractors. To do that, the commissioner needs to build trust.

The commissioner may publish a report about the inquiry, consideration and determination of a complaint, or any of those aspects. This could include reporting on whether or not a party provided information and should be sufficient to obtain engagement on all sides. In other words, it uses the huge power of naming and shaming. Compelling the production of information—I do not like that as an idea—from the parties or third parties will get us into an awful quasi-judicial situation and bring an adversarial flavour to the process, and it will invite legal argument and therefore delay. That is why I resist that.

The key issue from consultation responses on alternative dispute resolution is the need to raise awareness of what it is and what it can achieve. The commissioner will do that, as we have described. Adverse costs inferences can already be drawn by the courts, as I described in my previous comments, in the event of an unreasonable refusal to participate in mediation. I think we have got the balance right. I am grateful for the probing nature of the amendments, and I hope that what I have said will satisfy the hon. Gentleman. We have made it very clear that if things need to come back in some way after the commission has been set up—if it is not working—we are always here to listen, but we want this person to work for the benefit of small businesses in relation to late payment.

Enterprise Bill [ Lords ] (First sitting)

Debate between Bill Esterson and Anna Soubry

Tuesday 9th February 2016 Public Bill Committees

[The Minister for Small Business, Industry and Enterprise (Anna Soubry)]

indicated assent.

[Bill Esterson]

I am pleased that the Minister is confirming that from a sedentary position.

If the small business commissioner is to be as effective as possible on late payments, we need someone who can work not on the basis of a press release or the exhortations of Members of whichever House but constructively with businesses, learning the right lessons and creating the right solutions. That means not being an appointee of the Secretary of State, doing the Secretary of State’s bidding or wondering whether the Secretary of State will intervene with the potential for abolition.

It is important to note that the Institute of Directors has been forthright in its support of the amendments. The institute represents many directors, owners and operators of small businesses, so I suggest that it is worth listening to what it has to say:

“Together, these amendments would give the Small Business Commissioner a stronger footing from which to be a champion for small business. We fear that the possibility of abolition by the Secretary of State could potentially negatively impact the ability of the Small Business Commissioner to challenge that same Secretary of State. We hope for and anticipate a positive working relationship between the Commissioner and the Secretary of State”.

--- Later in debate ---

[Bill Esterson]

I thank the hon. Lady for her intervention, with which I agree. We will deal with that point in more detail in the next set of amendments, although it does have an impact on the appointment and dismissal process, as she rightly points out.

We want the commissioner to be effective. We want him or her to be able to help with late payments and to look at what other functions might make good additions as the office evolves, and that includes the point made by the hon. Lady.

The Federation of Small Businesses, the Institute of Directors and the British Chambers of Commerce often offer good advice, legal services and access to discounted business products such as insurance, and they are also good at helping businesses with disputes, but they are member organisations. Not every small business has a lawyer or accountant who is able to offer the full range of services. Many small businesses will need the office of the commissioner—just as an advice service was available under the previous Labour Government for businesses that had nowhere else to go—to provide advice, support, encouragement and dispute resolution directly, rather than just signposting elsewhere.

If the Minister expects the small business commissioner to signpost to those excellent organisations, she will need to ensure they can cope, because they might face a deluge of additional work. They have raised that concern with me, and no doubt also with the Minister. She will need to ensure that every business that approaches the small business commissioner wants to go to a membership organisation, where, of course, they will have to pay a fee—because I suspect that the Institute of Directors, the Federation of Small Businesses and the chambers of commerce will continue to charge for their services, as will solicitors, accountants and other professionals, if that is what the intention is when it comes to signposting. The small business commissioner will therefore also need to be in a position to develop his or her own capacity to help with disputes, whether related to late payment or not, to consider developing an advice and support function, and to look at areas such as procurement in the supply chain.

The ability to explore the options as the office develops will be restricted if the small business commissioner is, in reality, restricted by his or her relationship with the Department for Business, Innovation and Skills. We want the small business commissioner to have the chance to be as effective as possible, and an important part of developing that effectiveness will be the way in which the small business commissioner is set up and his ability to operate as independently as possible. Otherwise, the question will remain whether the small business commissioner has the teeth to deliver for business and do the job of enabling enterprise to flourish.

The amendments to make the small business commissioner a Crown appointment are based on the legislation that set up the office of the Information Commissioner. The Information Commissioner is a public body, sponsored by a Department—the Ministry of Justice. In the case of the small business commissioner, we propose that BIS would sponsor the small business commissioner, so that he would not simply be part of the Department, answerable only to the Secretary of State. The Information Commissioner reports directly to Parliament. The office cannot be abolished by the Secretary of State; the individual office holder cannot be removed by the Secretary of State. The office’s decisions are supervised by the courts, not the Department. That is the level of independence afforded by a Crown appointment, and that is what is needed for the small business commissioner to be as effective as possible and to deliver for small businesses and enterprise.

The Australian model, for example, is not an appointment by a Minister; it is an appointment by the Governor-General, the Queen’s representative. That is the direct equivalent of what we are proposing. Three significant steps in the right direction were taken in the other place on this matter. The first was the designation of the small business commissioner as a corporation sole. The second was the amendment to have the small business commissioner appoint his own staff. The third was the new requirements on the Secretary of State to consult on any proposal to abolish the role. That is certainly a sign that we are moving in the right direction. It is a heartening indication that there is a shared sense that the small business commissioner needs to be free to act in the interest of small business. [Interruption.] I am fascinated to know what the Minister thinks is interesting, having heard what she has just said—she is very welcome to intervene and tell me. She is going to wait until her response.

Late payments and unfair payment terms are a long- term problem and they call for a long-term solution, with a role that is absolutely protected from the outset. These amendments to strengthen the independence of the small business commissioner offer that protection. The current commitment to establishing the role—the commitment to championing the interests of small businesses—is laudable. By strengthening the independence of the small business commissioner, our amendment would capture that commitment and change the conditions of appointment, removal and abolition of the post, which, as they stand, may leave the small business commissioner vulnerable in future.

That is a level of protection that remains even if the small business commissioner’s role sets him on a collision course with the Government of the day, as happened with the Information Commissioner over NHS IT programmes and the citizen information project. The Information Commissioner disagreed with the Government and did so publicly. We need that protection for the role of the small business commissioner—a clear statement in the legislation that says, “This post is here to stay and it will stand independent of Government, no matter the political priorities or budget constraints of the day.”

Establishing the small business commissioner as a corporation sole is a step in the right direction, but a corporation sole is more about the continuity of the post. It allows the post to pass without interval from one office holder to the next. It lays powers and legal status with the office, not the office holder, securing a level of continuity as the post passes from one person to the next. It gives the office holder some guarantee of independence, but the level of independence needed for the small business commissioner is not guaranteed purely by virtue of a designation of corporation sole.

Removing the ability of the Secretary of State to abolish the role is the key. If the small business commissioner is not appointed by, cannot be removed by and cannot be abolished by the Secretary of State, then he really achieves independence. This is the distinction between a corporation sole and a Crown appointment, and that is why our amendments are so important.

[Anna Soubry]

It is a pleasure to serve under your chairmanship, Sir David. I hope that I am right in this, but I would like somebody to check: I note that 50% of the members of this Committee are men, which means that membership is half men and half women. I do not know whether that is a first, but it certainly must be for a business Bill going through this House. It is a welcome development. Too often, in my experience, the highest levels of businesses tend to be dominated by men. I just thought I would say that.

--- Later in debate ---

[Anna Soubry]

I absolutely will. A Crown appointment is made on the advice of Ministers. Effectively, we get exactly the same process, but with a different stamp on it. This will be a public appointment that will go through the usual procedures. It will be advertised. As for the idea that this is going to be somebody from the cocktail and canapés circuit, forgive me, but those days have long gone. That is certainly not the way that I operate or that my Secretary of State operates. We take considerable care to make sure we get the right person in place. I actually take a little exception to the idea that I go to cocktail and canapé parties to select someone. I personally make a great effort to ensure that we have people who represent the diversity in our society. I am quite robust in my views, as I am rather anti-establishment, and I will bend over backwards to ensure that we get the right person in place. I am confident that when we advertise this job, a large number of people will come forward with exactly the sort of qualities we need.

The amendments made by the Government in the other place have already increased the independence of the commissioner by giving him or her a separate legal identity as a corporation sole. As we know, the commissioner can appoint staff and receive public funding. Those are the key hallmarks of an independent body. Nothing stands to be gained in practice from the suggested amendments, which would only add considerable delay and complication to getting the commissioner up and running. It is normal practice for the Secretary of State to be able to terminate public appointments. The Secretary of State cannot dismiss a commissioner at will, but only if the individual is unable, unwilling or unfit to perform their functions.

It is good that we are having this debate so that we can give people the confidence in what we hope to achieve and in the mechanisms by which we will make the appointment to get what we all want—an independent small business commissioner who will be utterly focused on looking at late payments, free from any form of interference or abuse of office. The commissioner will have an independent spirit but will come from the right background, so that they have the confidence, most importantly, of small businesses to be their champion in solving the problem of late payments.

[Bill Esterson]

Thank you, Sir David. I apologise for omitting your title earlier. I thank the Minister for her brief response, but I do not think that she has really answered the questions we posed. I am glad that there is broad agreement about the value to the economy of small businesses, and I reiterate that our approach to part 1 of the Bill is about trying to strengthen the post as much as possible so that businesses and the wider economy really can benefit from it. I understand why the post has been set up to look at late payments, rather than at some of the wider issues, as the problem of late payments has existed for more years than many of us will remember. I understand why the Government have gone down that route, although it is a shame that the commissioner has not been set up to draw on some of the successful experiences as well as the remits of the arrangements in America and Australia.

The Minister said that the commissioner would not—I am not sure whether she said “could not”, so I will assume that she said “would not”—be abolished at will. However, the role can be abolished by affirmative resolution of both Houses and, in Parliament, that is pretty close when one party has an overall majority in the Commons. It is unlikely that the Lords would object. I take on board the point that if it were proved that the commissioner was not up to the job, the commissioner would be removed, but there is a difference between that and abolishing the post.

The Minister said that the small business commissioner needs to command the respect of large and small businesses alike. I completely agree but there is a concern among the representative organisations that the lack of independence that comes from being an effective part of the Department will make it difficult for the commissioner to command that respect, particularly the respect of the small business community. Large business is effective at lobbying and has effective relationships with the Government, and that is much harder for individual small businesses and for small businesses collectively.

--- Later in debate ---

[Anna Soubry]

I am grateful for my hon. and learned Friend’s very sensible contribution. She reminds us that this is not necessarily about Government. Public authorities are a huge sector in our society, and they rightly have different levels of accountability.

I remind hon. Members of Lord Mendelsohn’s words when this matter was debated in the other place:

“Of course, the origins of the Small Business Commissioner in Australia…came from very different circumstances and functions. In fact, late payment was never really part of the role. It still does not do that much.”—[Official Report, House of Lords, 26 October 2015; Vol. 756, c. GC116.]

We can learn from that experience, but we need to understand that it has different roots and seeks to tackle different problems. We can learn much from it about the qualities needed in the small business commissioner. We must ensure that he or she focuses on the real mischief, which is late payment between bigger and small businesses. We are determined to tackle that problem.

[Bill Esterson]

There has been a very interesting series of exchanges during the Minister’s remarks. She mentioned the Australian experience and quoted Lord Mendelsohn’s analysis of what happened. The Australian small business commissioner was set up not to resolve late payment, but to deal with a number of other matters, including advice, complaints, mediation and small business support. Mark Brennan, the Victorian small business commissioner, advised that this approach should not be used to go after late payments.

[Anna Soubry]

I am sorry, Sir David. I did not intend to intervene, but this is important. I spoke to that gentleman, and he gave the most outstanding advice about and support for the small business commissioner’s ability to deal with late payments. He advised me about the qualities that the commissioner needs to act as effectively as he did. It is important that I put that on the record.

[Bill Esterson]

Lord Mendelsohn had a long meeting with that commissioner and spoke to him a number of times. The clear sense we were given was that the success in Australia has been about other matters; actually, when it comes to late payment, there has not been a success. There has not been the progress on late payment and Australia is probably not the place to go to learn about action on late payment. That was the evidence that was taken and very clearly set out by Hansard in the Lords. That is, of course, one reason why we are tabling these amendments: they are about learning from the success that Mark Brennan has had and the advice he has been able to give on those matters.

The Minister talked about success. As my right hon. Friend the Member for Don Valley said in an intervention, we would expect BIS to pay every invoice on time—of course we would. It would be not just bizarre but quite disturbing if BIS did not have a very high success rate when it came to undisputed invoices being paid on time, but that does not take away from the fact that, right across those four Departments, a significant level of late payment still exists. The Federation of Small Businesses figures for 2012 show 27% in local government and 29% in national Government, and my hon. Friend the Member for Newcastle upon Tyne North cited a higher figure of 34%. There is still a phenomenally big problem of late payment in the public sector when it comes to small businesses.

The Minister cited the example of trying to support a construction firm involved with the NHS—I commend her for trying to solve the problem, as others of us have tried. She will have found it almost impossible, I suspect, to prevent the NHS trust from knowing the identity of that construction firm when she took that complaint to them. There is always the risk, as I said earlier, of a loss of business later on. That is one of the concerns expressed again and again by small businesses: that when they complain and put their heads above the parapet, they lose future business. It damages the business relationship irreparably. This is one reason why it is so important that there should be an independent opportunity. We will come to anonymity and confidentiality later.

A large number of small businesses are still involved. The Minister mentioned the point about prequalification questionnaires having been removed. I am sure that she speaks to businesses, as I do, who say they consider it a complete and utter waste of their time to even try to get business directly with the public sector. Their experiences and the experiences of associates, friends, business competitors and collaborators alike, has been of a lack of success in the past.

I do not think we have had an adequate response. I do not think we have dealt with the issues around the supply chain or with the problems around the scale of the problem of paper invoices for small businesses. We did not get an answer about how the mystery shopper scheme works; it is something of a mystery, the Minister seemed to say. I do not think she sounded confident in it herself.

[Anna Soubry]

I am; it works.

[Bill Esterson]

I would love to know what the remedy is when the scheme identifies a problem, but we did not hear about that; perhaps we will later. With those remarks, I would like to press the first amendment in the group and test the will of the Committee.

Question put, That the amendment be made.

Trade, Exports, Innovation and Productivity

Debate between Bill Esterson and Anna Soubry

Wednesday 13th January 2016 Commons Chamber

[Bill Esterson]

This is the first opportunity I have had to congratulate my hon. Friend and her colleagues from the steelmaking areas on the fine work they have done in representing, and attempting to save, the steel industry. I will talk about the steel industry in more detail later, but I completely agree with the point that she makes.

The Chancellor said he wants to double exports to £1 trillion by 2020. Office for National Statistics forecasts show that he is set to miss this by more than £350 billion—in other words, he will be 70% short of his target. In 2011 the Prime Minister said that he intended to increase the number of UK exporters by 100,000 by 2020, and in its annual business survey the ONS found that the number of UK exporters actually fell by 8,600 last year.

The risk to long-term growth and productivity of failing to increase exports is stark. Failure to boost exports means slower long-term growth, depressed wage growth and an even more depressed rise in living standards. As David Kern, chief economist at the British Chambers of Commerce, said last year,

“unless radical measures are taken to strengthen our export performance, our trade deficit will continue to be a threat to the country’s long-term economic performance”.

But just as serious is the threat posed by a Government divided over whether or not to pull the plug on UK businesses’ main trading partner. Trade with the EU was worth £227 billion to the UK economy last year. It is a lifeline for many businesses, and for many workers. The risk we face is from a Government that fail to unite in wanting to honour a partnership with those businesses and workers who rely on EU trade for their livelihood. Instead they are divided over whether to kick the legs out from under UK business, not least in respect of relationships that account for almost half of UK trade and which are especially important for many SMEs.

The problem of UK exports is compounded by our lagging productivity. ONS statistics show that, as of 2014, productivity as output per hour worked in the UK was 21% lower than the average for the rest of the G7 countries. According to the ONS last year,

“the absence of productivity growth in the seven years since 2007 is unprecedented in the post-war period.”

Productivity has been revised down next year, the year after and the year after that, and the gap between UK productivity and that of the rest of the G7 is now the widest since 1991.

A long-term strategy to boost productivity, trade and innovation is a partnership. That partnership cannot ignore the workforce; on the contrary, they can be one of our most powerful assets. A partnership between workers, businesses and Government to boost productivity is a long-term vision that requires a commitment to long-term investment from Government—one that stretches over many Parliaments and one that requires a large degree of political, as well as industrial, consensus.

If we truly want to boost the UK’s productivity, manufacturing is a good place to focus our attention for a number of reasons, not least because the productivity benefits of industry reach far beyond itself, to benefit growth, skills and productivity in the UK as a whole. Manufacturers improve efficiency at a pace and intensity that outstrip almost any other sector. In fact, they currently inject three times the amount of their output share of the economy into improving machinery. An EEF survey conducted in 2015 showed that 80% of its members intend to invest in machinery with the aim of increasing productivity. That technology, again, filters out. The investment and innovation of one manufacturer becomes a tool to boost productivity across a host of sectors and in the wider economy as a whole. Investment in processes and systems improves efficiency and accelerates the diffusion of technology.

Generating sustainable growth, raising skill levels, and dispersing opportunity to every corner of the country: prioritising manufacturing should be the cornerstone of a strategy for increasing productivity. But this Government’s track record shows that they either do not understand this or else they are simply not willing to do what is necessary to support the industry. As my hon. Friend the Member for Redcar (Anna Turley) said, the tragic situation that unfolded in the steel industry is a case in point. The UK steel industry ran a trade surplus in all but three of the last 17 years. Steel exports were worth £6 billion to the UK in 2014, not to mention the 20,000 families the industry supported. Serious challenges coalesced: a glut of global supply, energy costs, a strong pound. These were difficult challenges, but surmountable for a Government.

[Anna Soubry]

Does the hon. Gentleman accept that the fundamental problem was that the price of steel has almost halved and no Government can change that?

[Bill Esterson]

Of course the Minister is right that the price has halved, but other countries in the EU chose to intervene while we said we would not. I am afraid the Government’s record on this has been woeful.

[Anna Soubry]

Will the hon. Gentleman send me details of other EU Governments who have intervened to save their steel industries? If so, I will pass them on, because they must be in breach of the state aid rules.

[Bill Esterson]

We have debated this so many times. The Minister knows that some countries choose to operate the state aid rules far more beneficially than we do. It is about time the Government chose to do the same.

The industry needed the Government to play their role in what should have been a partnership. The situation demanded that the Government see the long-term strategic value of steel production and do what other EU Governments did: move swiftly to protect their industries. Instead, they have lacked a strategy and shown themselves unwilling to make strategic interventions to support the industry with practical steps well within their capabilities, such as tackling business rates through the supply chain, dealing with electricity costs and ensuring better procurement practice to favour British steel. They failed to step up to the plate as a partner of industry, and in doing so turned a temporary, toxic mix of challenges into a permanent gap in our industrial make-up.

We have to take that lesson seriously. UK productivity will continue to lag as long as Governments sit on the sidelines and wash their hands of responsibility for safeguarding key industries. The aspiration is one that everyone in the House will agree with: an economy with high-skilled, well-paid jobs in which businesses can grow, export and invest to boost productivity. Agreeing on the aim is one thing, but how we go about it is another. It requires a long-term partnership championing the workforce and business; investment, not cuts; an industrial strategy, not laissez-faire dogma; and an economy that creates wealth, instead of relying on consumer borrowing. We need a strategy in which workers, business and the Government work together for Britain. The Government’s role is not that of an observer but to make sure our exporters get the help they need; to take action to boost productivity; to tackle the skills emergency; to safeguard key industries; and to build the infrastructure that growing businesses need.

The Minister and the Government have failed on each point. They cannot deliver and they will not be an active part of that partnership because they do not believe in intervening. Their empty rhetoric will get our economy nowhere. Only a long-term industrial strategy will deliver the high-value economy we all want. We need a strategy of partnership that is both pro-business and pro-worker.

Small Business Saturday

Debate between Bill Esterson and Anna Soubry

Tuesday 1st December 2015 Westminster Hall

[Anna Soubry]

I completely endorse everything the hon. Gentleman says. We should not forget that some small businesses are sole traders, while many will employ just one or two people. However, they are a critical part of the supply chain. Indeed, we should not forget the support that accountants and solicitors give to larger companies.

One of the downsides of being a Minister is that I am constrained about speaking in glowing terms about my constituency. All of us love to come to this place and champion our constituents, and rightly so. If I may, I will indulge my businesses and constituents with what I shall do this Saturday in celebration of Small Business Saturday, which is supported by the Government—goodness me, we all know that this is not a party political issue.

I shall probably begin at Bardills, which is an excellent garden centre—we forget how many garden centres are important small businesses—where I will order my Christmas tree. Then I shall go into Kimberley, which is one of three excellent towns. I shall enjoy a cup of coffee in Rumbletums and probably some cake over at Madhatters. I will go to a flower shop—I will be in trouble, because I could go to a number of good flower shops in my constituency, but the one in Kimberley is particularly good. I can buy fruit and vegetables in yet another great small business that, like so many, is family-run. Fred Hallam Ltd in Beeston goes back many generations, and while such families are running businesses they are providing a real service to their communities. We should not forget that.

When I go to the great shops and small businesses in my constituency, I really notice the level of care they give to customers. They know their customers and look after them by making sure that whatever they want is available. Such businesses are particularly keen to ensure that they provide an excellent service to older customers.

I will go into Beeston. The town unfortunately suffered because of the tram works that blighted it, but it is on its way up. Now we have got the tram, and we look forward to more people coming into the town and other people who previously shopped there coming back.

My hon. Friend the Member for Oxford West and Abingdon (Nicola Blackwood) made a good point about the need for free parking. She talked about her own constituency, where there will be free parking this Saturday, and I am pleased that my borough council will have free parking throughout December. I have quite controversial views on parking, which we will not go into, but let me put it this way: the more towns that embrace free parking, the better. As I said, I shall go into Beeston and enjoy Fred Hallam Ltd—it has a fishmonger, which is rare.

[Bill Esterson]

To show the cross-party consensus on this issue, may I congratulate Sefton on providing free parking throughout December for the very purpose that the Minister describes?

[Anna Soubry]

I completely endorse that.

I will go to the deli and buy, if not fine cheese, some Blue Monkey beer called BG Sips, which I recommend to everyone. Microbreweries are another type of small business that employ people and contribute hugely to the local and national economy. Many are now stepping into exports, and the Government are keen to ensure that UK Trade & Investment looks at the benefits it can provide to small businesses.

No doubt I shall go into Relish, where I will have to have another bacon butty or some similar delight. That is another good example of a small business that is doing well. I shall finish in Stapleford, where I will go to an excellent small business that alters clothes—it has been going incredibly well and is now growing and leading the town team. No doubt, I will end up in Shabbylicious with yet another excuse to drink more tea or coffee and indulge in more cakes and mince pies.

I hope I have made a serious point. Small business are important to the economy, and the statistics show it. I want to finish on a hopefully positive note, which is about business rates: small businesses now pay less tax. We are supporting them by extending the doubling of small business rate relief in England to April 2017. More than 400,000 small businesses will pay no rates at all as a result of that welcome extension.

I know that all Members will be out there on Saturday celebrating Small Business Saturday. I am grateful to the Federation of Small Businesses, which brought the event to my constituency. I pay tribute to it, and to the Institute of Directors, the British Chambers of Commerce and everyone who supports this excellent initiative.

Question put and agreed to.

Oral Answers to Questions

Debate between Bill Esterson and Anna Soubry

Tuesday 10th November 2015 Commons Chamber

[Anna Soubry]

Shouting from a sedentary position does not help at all. The new style of politics has not quite reached the Liberal Democrat Benches. The noble Lords have made their concerns very clear to Baroness Neville-Rolfe, and as a result of my conversations with her, that particular proposal will go into the second part of the consultation.

[Bill Esterson (Sefton Central) (Lab)]

The Minister’s so-called consultation scrapped the promised parallel rent assessment, so I am pleased to hear that she has put that back in. Will she do the same with all the provisions that were offered by Baroness Neville-Rolfe in the other House on 28 January and make sure that the vast majority of pub tenants are offered a fair deal when it comes to the market rent-only option? If she does not, she will be acting in bad faith and she will have betrayed the trust of thousands of pub tenants up and down the country.

[Anna Soubry]

As I keep saying, it is a consultation so we will listen to everybody. It is important that we strike the balance fairly between both sides of the argument, and that we understand and accept that there has been a great deal of movement to the betterment of tenants over the past few years. We must recognise that. I know from my own constituency work that pub companies such as Punch and Greene King have hugely changed their views to the benefit of tenants, and that must be welcomed.

Oral Answers to Questions

Debate between Bill Esterson and Anna Soubry

Tuesday 30th June 2015 Commons Chamber

[Anna Soubry]

I think I should just say yes, Mr Speaker, but I would add that my right hon. Friend the Secretary of State was actually talking about all businesses, not just those here.

[Bill Esterson (Sefton Central) (Lab)]

I am sure that businesses will tell the Minister on Twitter what they told Ernst and Young, which is that the number of regulations has gone up, not down, under this Government. Is not the reality that this Government are all talk and no action when it comes to getting rid of regulations?

[Anna Soubry]

I am tempted to say, “The hon. Gentleman would know, wouldn’t he?” I am really surprised at his churlish attitude, and I absolutely do not agree with what he has been told. We know, because it was properly evaluated, that under the previous Administration we actually achieved £10 billion of savings for businesses by cutting red tape. The hon. Gentleman should welcome and praise that.