UK Trade and Investment

Lord Cope of Berkeley Excerpts

Tuesday 9th October 2012 Grand Committee

[Lord Cope of Berkeley]

My Lords, I am delighted that this debate is taking place. I thank the noble Baroness, Lady Liddell, for instituting and promoting it. The timing, however it has come about, means that its chimes well with our work in the Select Committee on small and medium-sized enterprises and exports, which I have the honour to chair. Our remit is rather wider than this debate. We are concerned with all the Government’s work to support SMEs in exporting. We are interested not only in UKTI, on which this debate has focused—which is fair enough; I am not criticising it—but on UK export finance and the Government’s role in deregulation, tariff negotiations, tax issues, procurement policy and so on.

The Government can help through diplomacy over tariffs and other restrictions on trade, as well as by their purchasing policies, and by Ministers actively promoting trade, as the Minister does so energetically around the world. I hope that I am correct in saying that the promotion is for SMEs as well as for large businesses such as those mentioned by the noble Baroness.

Commentators write about the difficulty of exporting manufactured goods, for instance to India, because labour there is cheaper. They do not often mention that there is usually a 30% to 40% tariff barrier to be overcome. The same is true in Brazil with many goods. That is also a great part of the difficulty that the Government can help with by their energetic diplomacy to try to get free trade.

Our committee published a call for evidence before the recess and received a large volume of responses from organisations, companies and individuals, including academics working in the field. We and our staff are busy going through them—as the noble Lord, Lord Haskel, who is a fellow member of the committee, will confirm. We have also started taking oral evidence. We are in the middle of a series of visits to different parts of the country to meet SMEs of every size and kind, and next month we plan to visit Brussels and Germany.

Visiting companies and organisations in the recess, and looking through the evidence as it came in, I was struck again by the variety among SMEs. It is something we must always remember when we talk about them. Variety is one of the essential facts about SMEs. They come in all sizes, and very different dynamics drive them. They are in all kinds of business. We are very conscious that they are in every sector. We will not be able to ignore the food sector, for example, because the noble Lord, Lord Haskins, is on the committee and he will see to that. Nor can we ignore the creative sector because we have the noble Lord, Lord Grade, as well.

If successful SMEs have one characteristic in common, it is above all that they are problem solvers. They do not let difficulties stop them. If they do not have a can-do attitude, they simply do not succeed. That does not mean that government in its various forms cannot make life easier for them, if only by getting out of the way. Positive help by Government for SMEs has existed for a very long time—since before I was small firms Minister in the Government of the noble Baroness, Lady Thatcher, 25 years ago. These days, of course, much of it is channelled through UKTI, but it also comes from local enterprise partnerships, chambers of commerce and so on. I will not comment directly today on the work of UKTI, as we are in the middle of our evidence taking and deliberation, but we are interested in, for example, whether the criticism made by the noble Baroness—that UKTI is too big business-oriented—is valid.

Nor do I want to comment today on the role of UK export finance with respect to SMEs, which is developing once more after a period in which it was not. I look to my noble friend the Minister for reassurance that his colleagues in government take SME exports as seriously as I know he does. I hope that he will also set out what UKTI is doing to reinvigorate its pitch to SMEs. As far as I can see, too few of them know of the help that they can get from UKTI, either directly or sometimes indirectly, channelled through other organisations, such as the ones that I have mentioned.

We have to recognise that many SMEs either cannot be helped by the Government or do not want to be helped by the Government or anyone else. After all, as far as many of them are concerned, the whole point is to do their own thing. In some cases, people are trying to do something differently from what they did when they worked in large firms and so on. Nevertheless, others want reassurance that it is all possible—it is possible to create a business and to export to difficult countries around the world. The fact is that it is possible. We have already come across some remarkable stories of SMEs doing business and exporting. Britain needs SMEs to flourish and particularly to export. We need to stimulate more potential entrepreneurs and to try to help them when they want to export. UKTI has a very important job looking after the interests of the entrepreneurs, the people who work for them, their customers and, of course, the UK itself.