Amendment of the Law
Debate between Brian Binley and Iain Wright(9 years, 2 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Mr Wright
As the shadow Chancellor says, the only way is up. We have just won two games on the trot, which is unusual for us. We are only four points away from the next team up, so we have everything to play for.
My hon. Friend the Member for Oldham East and Saddleworth (Debbie Abrahams) told us that this Government’s tax and benefit changes mean that families are on average £1,127 a year worse off. She has been a fantastic champion of the NHS, and she mentioned how A and E and the rest of the NHS is at breaking point. She said that Oldham never had a food bank until 2012, which is very similar to my experience in Hartlepool and to the experience elsewhere around the country. I particularly pay tribute to her for being a champion in tackling late payments to contractors, which can be a blight on small businesses trying to pay their way in the economy.
Several hon. Members who spoke are leaving the House voluntarily; I imagine that several others will leave involuntarily. I pay tribute to the hon. Members for Dudley South (Chris Kelly) and for North Warwickshire (Dan Byles). I am genuinely sorry that they have decided not to stand again, but I look forward to welcoming the excellent Natasha Millward to the House, and to Mike O’Brien coming back. I also pay tribute to the right hon. Member for Mid Dorset and North Poole (Annette Brooke), who has been a fantastic champion for park homes, on which we have worked closely together.
I want to single out the hon. Member for Northampton South (Mr Binley), who has just walked into the Chamber. I consider him a real friend to me and to business in this country, as he is very knowledgeable. Before he leaves this place, I hope that we can have a pint and celebrate the great work that he has done, and the great work he will continue to do.
Mr Wright
It’s a date—and perhaps I can bring along the hon. Gentleman’s successor in his seat, Kevin McKeever.
The hon. Member for North Dorset (Mr Walter) made a weak joke, frankly, about how the Leader of the Opposition’s kitchen must be a butler’s pantry. That was particularly welcome from the hon. Gentleman, who I know has serious and relevant credentials for talking about the experiences of ordinary working families in this country. As an alumnus of Warminster boarding school, a former international banker and a freeman of the City of London, his comments were very relevant.
The Chancellor should have focused on the country’s long-term prosperity and competitiveness, using the Budget to do more to strengthen productivity, investment and trade, yet that did not happen. Today’s Financial Times stated:
“This was a Budget that offered little to business”.
It was revealing that the Chancellor did not once utter the word “productivity” in his statement, but tackling the productivity gap is the single biggest means by which Britain can improve competitiveness, raise living standards for all and ensure that the deficit is brought down. UK output per hour has fallen to 17% below the rest of the G7, the largest gap since 1991. It takes British workers until the end of Friday to produce what a German or American worker has produced by Thursday. The OBR reports that actual growth in productivity per hour has again been weaker than expected, with a fall in the final quarter of 2014. It states that productivity growth
“remains the most important and uncertain judgement in our forecast”.
Failing to act on productivity during the next Parliament will make the difference between the austerity well into the future that the Conservatives will provide and the better plan for business and rising living standards that Labour is preparing. We need to restore the link between economic growth and higher living standards for all. To do that, our economy needs more high-skill, high-pay jobs in the high-productivity sectors in which Britain has an advantage. That will require a proper, co-ordinated and focused industrial strategy, but Ernst and Young said yesterday that the Chancellor’s “scatter-gun approach” to UK industry will not help to deliver a proper industrial strategy, or to achieve the 300,000 additional jobs that a sector-focused strategy could produce.
Higher productivity would be boosted by higher investment, but spending on infrastructure has fallen by a third under this Government. The Red Book shows that there will be a planned reduction in capital spending over the five years to 2019-20. The OBR has said that business investment fell by 1.4% in the last quarter of 2014, following a fall of 1.2% in the third quarter. The failure of the Chancellor to announce future plans for the annual investment allowance disappointed business, has increased uncertainty and delay, and almost certainly postponed investment in new equipment and jobs.
Why did the Government not set up an independent national infrastructure commission to stop long-term decisions about the performance of our economy being kicked into the long grass? Why did the Chancellor not announce a boost to the investment in low-carbon technologies? Why did he not ensure that Britain is a world leader in green technology? The Business Secretary mentioned in passing, almost in embarrassment, changes to the green investment bank. Will the Economic Secretary put a little more meat on the bones of that proposal? The Chancellor put in place measures that will increase the demand for homes, but there was nothing to help the construction industry and the supply of new homes—things that are vital for the future of this country. Why did he not introduce a long-term innovation strategy for science and research, with a stable and secure funding framework, to improve the UK’s record on R and D?
Throughout his time in office, the Chancellor has made much of an export-led recovery. He said yesterday:
“Out of the red and into the black—Britain is back paying its way in the world today.”—[Official Report, 18 March 2015; Vol. 594, c. 770.]
He sounded less like Shakespeare and more like an episode of “Bullseye”. What he said was simply untrue. He will not achieve his objective of doubling exports by 2020. He is certainly not going to win Bully’s special prize of the keys to No. 10. I can hear the voice of Jim Bowen talking to the Chancellor: “Look at what you could’ve won.”
The OBR said yesterday:
“The current account deficit remains wide by historical standards.”
In the third quarter of 2014, the deficit was at 6% of GDP, which it said was
“the second largest quarterly deficit in National Accounts data stretching back to 1955.”
The contribution to GDP growth that is made by Britain selling things around the world is falling. Page 108 of the Red Book shows that in every one of the six years from 2014 to 2019, the percentage growth in imports of goods and services will exceed that in exports of goods and services. Our trade position is forecast to worsen in every single year. The Chancellor has failed to produce an export-led recovery.
In a very complacent and out-of-touch speech that was soaked in hubris and arrogance, the Chancellor said that people have never had it so good. After five years, he has failed. He has failed on debt, he has failed on deficit reduction and he has failed working families, who are on average £1,600 a year worse off. The Budget has shown what a further five years of Conservative rule would inflict on this country: a sharp acceleration in the cuts to public spending; a rollercoaster approach to managing the public finances; threats to our NHS and other valued aspects of British life; uncertainty for business that will lead to reduced investment; and, ultimately, poorer living standards for all. The British people will deliver their verdict on this Government in 48 days’ time. They deserve a better plan for Britain’s future, and that can be achieved only with a Labour Government.
Enterprise and Regulatory Reform Bill
Debate between Brian Binley and Iain Wright
Mr Iain Wright (Hartlepool) (Lab)
This has been an important if somewhat curtailed debate. In the time we have had, 21 hon. Members from all parties made considered and high-quality speeches, with the exception of Lib Dem Back Benchers and Scottish National party Members, who made no speeches, high quality or otherwise.
Since the Secretary of State rose at 5.44 pm to open the debate, 1,368 new companies have been registered in Russia, the country with the largest and fastest-growing number of business start-ups anywhere on earth; 21,394 passenger cars have been manufactured in China; 975 patents have been filed in the US; 338 people have enrolled on engineering degrees in India; and 60,000 iPhones and 20,250 iPads have been manufactured and sold around the world. Any enterprise Bill that the House considers must tackle on behalf of British business that unprecedented level of intense international competition.
That is an urgent task because, as we have heard, we are slipping down the league tables of global competitiveness. As my hon. Friend the Member for Streatham (Mr Umunna) said in his excellent opening speech, according to the World Bank’s global survey of doing business, when the Government took office, Britain was fourth in the world in terms of the ease of doing business; it is now seventh. Across the different categories, our competitiveness is slipping alarmingly. On the ease of starting a business, we have slipped from 16th to 19th; on dealing with construction permits, we have slipped from 16th to 22nd; and on registering property, we have slipped from 23rd to 35th. We are now ranked 60th in the world on companies gaining access to electricity, behind the likes of Chile, Belize, Costa Rica, Guatemala and Iraq.
The task is made even more urgent because the Government’s policies have pushed the British economy into reverse and into recession. As my hon. Friend rightly said, when the Government took office, the British economy was growing. Since the spending review, it has shrunk by 0.4%. We are now in a double-dip recession made in Downing street. Fifty businesses are going under each and every single day.
The Chancellor may wish to blame the weather, even though this country has seen weather before. He may wish to blame, as he did at the weekend, high oil prices, even though oil was trading in London this morning at a 17-month low and the price of Brent crude is 25% of its March peak. He may wish to blame the jubilee, or the eurozone, which he may claim is killing Britain’s prospects for growth, but even now Tory MPs are wising up to the fact that he is looking for excuses or alibis. They are questioning the political genius and economic competence of the man who gave them the pasty tax and raised taxes for pensioners while providing tax cuts for multi-millionaires. It is not business that should stop whinging and work harder, as the Foreign Secretary suggests, it is the part-time Chancellor.
The Bill could have addressed such failures. It has been trailed in the media as the flagship piece of legislation to make enterprise, growth and competitiveness this Administration’s principal policy. It is hardly that. Instead it is a mishmash, an ad hoc rag-bag of measures, as my hon. Friend the Member for West Bromwich West (Mr Bailey), the Chair of the Business, Innovation and Skills Committee, and my hon. Friend the Member for Great Grimsby (Austin Mitchell) said. It reflects a Government who, after only two years in office, have run out of ideas. There is no strategic thread, no compelling vision and nothing that will provide real help for British enterprise, as my hon. Friend the Member for Glasgow North East (Mr Bain) eloquently pointed out in a powerful contribution.
The Bill’s span is wide. For example, clause 50 concerns heritage planning legislation and clause 51 deals with the Equality and Human Rights Commission. Incidentally, my hon. Friends the Members for Ayr, Carrick and Cumnock (Sandra Osborne) and for Stretford and Urmston (Kate Green) made powerful speeches about that clause. I absolutely agree with them, and we will oppose the measure firmly in Committee. There is also clause 56, which deals with copyright. That wide span does not really show an Administration confident in their approach and clear about their aims for the British economy. Instead, it exposes a situation in which Ministers are desperately trailing around Whitehall asking for off-the-shelf proposals to pad out a supposedly flagship Bill. British business deserves better.
Businesses are crying out for a productive partnership with Government. They want to work together on a long-term vision for the British economy in the next few decades and put in place a powerful industrial strategy to allow Britain to thrive. However, there is nothing of substance in the Bill that will allow such a strategy to materialise.
Several hon. Members, such as my hon. Friends the Members for Glasgow North East, for West Bromwich West and for Swansea West (Geraint Davies), mentioned the Bill’s provision for the establishment of the green investment bank. We support the principles of such a bank. Indeed, it was under the previous Labour Government that the decision to establish one was taken. However, this Government’s two-year delay and dither has meant that the UK is slipping ever further behind our global competitors in investment in green growth. We have fallen from third in the world for investment in clean technology when Labour left power to seventh in the world today.
Even though I can see the point that investment rose last year, Pew Research has stated that that was largely because
“investors rushed to initiate projects before policy reforms go into effect that could curtail incentives”—
reforms such as the botched feed-in tariff. From a position in which we could have taken a first-mover premium in the new global manufacturing sector, the Government are losing this country our competitive advantage. Earlier this year the chief executive of Vestas, the world’s largest wind turbine maker, said that his company was postponing investment in the UK, stating:
“The most important issue that our customers have is a long-term policy framework that is required to put in these investments, which are huge.”
However, he said that
“we have not had reassurance from the government.”
As we have heard, the situation has been made worse by the fact that the Government continue to cause uncertainty and delay as a result of the Treasury’s refusal to allow the green investment bank to borrow until 2016 at the earliest. The hon. Members for Lancaster and Fleetwood (Eric Ollerenshaw) and for Stroud (Neil Carmichael)—I do not see the latter in his place—raised that issue. A bank that does not borrow cannot be called a bank, as my right hon. Friend the Member for Wentworth and Dearne (John Healey) and my hon. Friend the Member for Stoke-on-Trent North (Joan Walley) said in powerful interventions. Investment and leverage from the private sector now, while the economy is in a double-dip recession, could help us get into recovery and out of this mess. As my hon. Friend the Member for Foyle (Mark Durkan) said, there is a risk that the green investment bank will not be as active a driver in economic recovery as it should.
A large number of hon. Members, certainly on the Labour Benches, rightly mentioned their concerns about the proposed changes to employment legislation. My hon. Friend the Member for Bolton West (Julie Hilling), for example, brought to bear her considerable experience in the matter. My hon. Friend the Member for Blaydon (Mr Anderson) said that the proposals were based on bias, “Back to the Future”, opinion, anecdote and prejudice. My hon. Friend the Member for North Ayrshire and Arran (Katy Clark) mentioned whistleblowing, and we will certainly be raising and looking closely at that in Committee.
The hon. Member for Stourbridge (Margot James) said that in her opinion health and safety legislation is a burden. I do not know whether she commemorates workers’ memorial day every 28 April, but the people who have been injured and the families who have lost loved ones will not think that health and safety legislation is a burden.
The hon. Member for Bury St Edmunds (Mr Ruffley) cited two cases from his constituency, in the retail sector of all sectors. He said that the biggest burden facing the retail sector was not the lack of demand, the lack of consumer confidence or the rise in VAT imposed by this Government, but unfair dismissal. The idea that business growth is being held back by burdensome employment regulation is simply absurd.
I would say to the hon. Member for Northampton South (Mr Binley)—I have a lot of affection for him and know that he has long decades of experience in business—that, as my hon. Friend the Member for Streatham said, only 6% of businesses said that regulation was the main barrier to growth, with nearly half saying that the biggest obstacle to business success was the dire state of the economy.
Mr Binley
Does the Opposition spokesman, for whom I have equal affection, recognise that those people would have placed it at the very top of the list if the previous Labour Government had not created so many economic problems that of course other matters came before it? None the less, most people named it as one of the problems.
Mr Wright
The hon. Gentleman is a wily old bird and he knows that the economy is in recession not because of the UK employment regime or because there is somehow a need to make it easier to fire workers at will, but because, as my hon. Friend the Member for Great Grimsby said, the Government have choked off demand by cutting spending too fast and raising taxes such as VAT too far. As my hon. Friend the Member for Bolton West pointed out, removing the rights of workers will only have the impact of increasing job insecurity, thereby damaging work force morale, productivity and confidence precisely at the time when we need to see more confidence flowing through the economy.
The Government have repeatedly and pointedly failed to rule out the prospect of Beecroft’s recommendations being brought forward as amendments to the Bill. The Secretary of State was somewhat vague on that matter. After penetrating interventions from my hon. Friend the shadow Secretary of State and my hon. Friend the Member for Stretford and Urmston, the Secretary of State said that as far as he was aware—although it is his Bill—he did not see any prospect of that occurring. I hope that the Minister will make the Government’s position crystal clear on the implementation of the Beecroft recommendations during the Bill’s passage through Parliament. I hope he will confirm that none of Beecroft’s recommendations will be in amendments tabled to the Bill and that he will work with us in Committee to ensure that any such amendments from Back Benchers will be rejected. I know that the hon. Member for Bedford (Richard Fuller) wants to table such an amendment and I look forward to working with him—or against him—in Committee.
Hon. Members also raised the proposals on directors’ remuneration in part 6. We have made it clear that although we are generally supportive of what the Government are doing, the proposals do not go nearly far enough. We need greater accountability and transparency, and the recent shareholder spring, which involved many companies, suggests that investors believe that, too.
Reports in the weekend media suggested that the Government will not empower shareholders with an annual binding vote on remuneration for executives, requiring it instead only every three years. Previously, the Secretary of State has rightly stated that an annual binding vote would provide investors with a powerful tool to hold executives to account, particularly as regards failure. He pledged that again today, which is very welcome. We intend to press forward in Committee with amendments to this part of the Bill to ensure that the matter is dealt with comprehensively and fairly and that all the recommendations of the High Pay Commission are implemented, including those that workers sit on remuneration committees.
Parts 3 and 4 will establish the competition and markets authority; the purpose is to improve the speed, quality and robustness of decision making. We Labour Members are keen to ensure that the competition regime in this country is the best in the world, so that innovation and imagination are rewarded; in that respect, I agree with the hon. Member for Bexleyheath and Crayford (Mr Evennett). When the Government came to power, the UK’s competitive environment was seen as one of the best in the world—third behind only the US and Germany—so it is of concern that on this Government’s watch, the Global Competition Review has downgraded the status of the Office of Fair Trading, following what it termed the OFT’s “dismal” enforcement on cartels. In Committee, we will scrutinise closely and challenge the Government’s proposals to ensure that our competition regime remains best in class.
The Government had a great opportunity in this Bill to deal with the consequences of their failed economic policies. The Bill was a chance to put in place legislative measures to enhance this country’s economic competitive position, and to set in train policy certainty for investors, which would allow them to invest for the long term. The Bill could have helped our companies to improve their productivity and decarbonise the economy, while allowing British firms to benefit from the green industrial revolution, which is happening now—not in 2016. It could have made a firm statement in law that failures and poor performance at the top of business would not be tolerated or rewarded with excessive pay, and it could have safeguarded consumers from powerful vested interests. The Bill has made some progress on that, but not nearly enough. It is a missed opportunity. It is a rag-bag that exposes the Government’s lack of a compelling vision and fails to help British business to compete in the global economy of today and tomorrow. On that basis, I commend the reasoned amendment to the House.