Exports: Government Support

Lord Hunt of Chesterton Excerpts

Thursday 29th January 2015 Lords Chamber

[Lord Hunt of Chesterton (Lab)]

My Lords, I welcome this debate, introduced by the noble Baroness, Lady Wheatcroft, who was a distinguished editor of Wall Street Journal Europe. It is an innovative if rather right-wing paper, but it kindly published some of my articles on environmental policy.

I liked the noble Baroness’s remarks, but they reminded me slightly of a rather irate Minister in this Government at some meeting getting more and more heated and saying, “Well, the UK just should be the corner shop of the world”. My vision is that it should be somewhat bigger. A bit of corner shopping is all very well, as the noble Baroness, Lady Wheatcroft, said, but there are some big issues. We should also remember her remark about the Prime Minister going to Asia. As noble Lords will recall, when the Prime Minister went to China the word “Boeing” was above his head as he came down the steps of the aircraft. He should have gone in an Airbus, like all the leaders of Europe do.

I declare my interests as a director of a small, high-tech company. I had a much bigger role as head of the Met Office.

For the UK to increase its exports, which is vital for the economy, it requires collaboration between the Government, business and everyone who provides services to foreign customers, whether they are in the UK or abroad. The first job of government is not to make it more difficult for UK organisations to contribute to visible and invisible exports. A simple point that this Government have forgotten, of which Indian universities reminded the Prime Minister when he visited India, and as the noble Baroness, Lady Wheatcroft, just emphasised, is that enabling foreign students to come to the UK is a very important invisible export. It is also important for them to be able to work in the UK. I am glad that there are now schemes for that to happen, but they are not widely known. When one goes around the world and meets students, they say that they will not come to the UK to study because it is so difficult to get a job afterwards.

The Government’s second own goal that I would like to point out was in the Daily Telegraph—not my usual reading—in “Business Club”, which is even less so. It had an interesting online article yesterday on the uncertainty about the UK leaving the EU, which is damaging invisible and visible exports. The article says that that is making it more difficult for UK businesses to get contracts in Europe. This uncertainty also inhibits some inward manufacturing investment and is driving some businesses abroad.

What is extraordinary about this threat to leave Europe is that UK business and government will be much less able to influence the EU’s setting of technical standards of saleable products. I read the New York Times from time to time; these EU standards are regarded as the world standards and affect business the world over. If the UK is not to be in the EU but be like Switzerland or Norway, it would simply have to receive the standards that are set by committees and other countries in Europe. Doubtless helping UK business would not be first in their mind.

The UK science and technology sector has developed standards from its great experience. I have worked with EU institutions; they help European business. In future, the UK will be less able to have this influence. In the 1980s I helped set up a European network called Ercoftac—a rather funny name—to enable universities and industries to work in the aerospace and automobile sector. The way we have managed to get standards, data and test cases for industry is the envy of the world. Of course, we will still be able to participate if we leave the EU, but the way that this kind of network will be able to work with British industry will be diminished.

The previous Labour Government and this Government have introduced, through BIS, some new, greater support for science and technology, which contributes to UK exports. I endorse many of the remarks made by the noble Baroness, Lady Wheatcroft, on that. For example, last week I learned about the Satellite Applications Catapult, which provides extraordinary business opportunities. It is not just about business; being effective in business enables the provision of more information about health and well-being for communities around the world. We are talking about using business as an efficient method of providing services.

The difficulty facing the building up of UK exports is that many of the major world-leading high-tech companies are no longer here in the UK. This is something that happened over 20 or 30 years, but it was gratifying that one of our major high-tech companies, AstraZeneca, was not taken over by the United States company Pfizer. In fact, one might note that, despite the City of London gagging at the possibility of more M&A scavenging, that company is here thanks to our continental colleagues who are on the board of that company. As a result of those takeovers, large companies from Germany, the United States and Japan are operating in the UK, but their R&D is often done abroad. This has had an effect on UK employees. For example, there are fewer engineers in some big electrical companies in the UK than in their home countries.

This Government have done better than the Labour Government in improving manufacturing industry. That is to be welcomed. This has led to substantial imports, such as offshore wind and nuclear plant; we did not have this capacity before. The question is whether UK manufacturers can build themselves up so as to reduce the UK’s sizeable and growing balance of payments deficit. I look forward to hearing from the Minister on this point.

Of course, even the most successful countries import technology. It should be obvious that the UK needs to do that because we provide 8% of the world’s science, while 92% is abroad. I am pleased to see that BIS is now following the practice, well established in the United States, of employing staff to import commercial innovations. In the past I have been critical of the fact that there was no strong element of technical work on that area within BIS, but I believe that it is growing. For example, there was an advertising session at the London Olympics to bring foreign companies from abroad to demonstrate what they were doing. An Italian environmental company using social media came and we hope that it will be working in the UK.

Many small UK businesses complain about the lack of support that they receive from the UK Government, compared with that provided to competitor businesses by foreign Governments. Some British businessmen are quite demoralised by the unfairness of this competition. In principle, everybody should play cricket and follow the level playing field approach of the UK. However, this is not the case. Despite its propaganda about free and open competition, the United States is one of worst offenders in the way in which it restricts the import of foreign software and spends vast sums on technological support at its embassies. I have seen this in Beijing and in other countries. They are overtly using their technical knowledge to advise and support American consultancies and technologies.

Other European countries use their financial assistance to developing countries to promote their own basic exports. There is an article in a newspaper today about how this is happening through World Bank programmes. One hopes that high-tech companies in the UK may benefit from the Newton programme, introduced by the Prime Minister when he went to China. This should make some contribution, although I suspect that it is more about science and technology than about business.

Many business commentators have noted that one of the most effective ways in which the UK Government can help business is via the Government’s whole or partial ownership of exporting organisations. This started, of course, with Rolls-Royce. The Government rescued it from bankruptcy back in the glorious days of Ted Heath. It obtained City funding but the Government retained their golden share, so Rolls-Royce is still here. If that had not happened, one wonders whether it would still be here.

Recently, we have read ominous remarks in the newspapers about Rolls-Royce. Although it has been remarkably successful with its aerospace engines selling to about half the global wide jet market, typically, the moment there is the whiff of a problem, the City pages slaver at the possibility of more M&A scavengers breaking it up. I hope that the Minister will clarify the position. Rolls-Royce is still a top, world company and should have all the support that the Government can provide.

Many government agencies were set up as quasi-commercial organisations. It began under the Wilson Labour Government and continued strongly with the Thatcher Government. Such organisations have worked at the highest technological and commercial level and have greatly helped UK exports. As the noble Baroness, Lady Wheatcroft, said, more could be done to support British companies in overseas markets. The underfunded National Health Service is another example.

[Baroness Williams of Trafford (Con)]

My Lords, this is a time-limited debate. Speeches are limited to nine minutes. When the clock says nine, it means that noble Lords are into their 10th minute. Therefore, when the clock says 10, they are into their 11th minute. I would remind noble Lords to give the Minister sufficient time to respond.

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[Lord Leigh of Hurley (Con)]

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

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

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

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

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

[Lord Hunt of Chesterton]

Is this a defence or an attack?

[Lord Leigh of Hurley]

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

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

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

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

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

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

UN: Technical Agencies

Lord Hunt of Chesterton Excerpts

Thursday 20th March 2014 Grand Committee

Asked by

[Lord Hunt of Chesterton]

To ask Her Majesty’s Government what are the key objectives of United Kingdom delegations attending United Nations technical agencies in 2014; and whether they will report back to Parliament after the meetings.

[Lord Hunt of Chesterton (Lab)]

My Lords, United Nations agencies are responsible to national Governments, who are their members and funders. These organisations with specialised purposes, from health to meteorology to communications, were formed even before the League of Nations and United Nations were. In the United Kingdom, the Foreign and Commonwealth Office has an overall brief to ensure that the delegations to these agencies from various UK government departments and their semi-independent agencies represent UK interests effectively. Despite the strong and effective participation of the UK in these agencies, there is general concern that their profile in Whitehall and Westminster is not as high as it should be. It is obviously much lower than that of foreign affairs and international crises.

The United Nations Association, the voluntary body that supports the UN in the UK, works hard to raise the profile of UN bodies. These agencies have a vital role for key aspects of all countries of the world, both developed and developing; for example on health warnings, food safety, communications, aviation, weather forecasting and intellectual property. Sometimes Ministers attend the meetings of the UN agencies but fewer do from the UK than from other countries. I recall my noble kinsman Lady Bottomley attending the WHO meetings when she was Minister of Health, while Mr Meacher at Defra was an assiduous attendee of meetings at UNEP, the United Nations Environment Programme.

My first point is that the agencies need reviewing from time to time, in the light of urgent issues, but while the UN and national Governments always look at efficiency in these reviews, they seem reluctant to look at the fundamentals of their operation and the budgets allocated in relation to the urgency of the problem. I am pleased that the UK contribution to UN agencies is not dependent on its policies or particular decisions; nor is it subject to lobbying by commercial or political organisations, as US contributions are. My noble friend Lord Rea will talk about the WHO; yesterday I learnt that there are threats to the WHO from the United States about its policy that sugar levels should be dropped to the equivalent of one glass of Coca-Cola per day.

Water resources are currently critical but the United Nations programmes—for example in UNESCO and the World Meteorological Organisation, which is also responsible for hydrology—have very small budgets. In the case of the World Meteorological Organisation, it is less than 5% of the total while 95% is for meteorology. Although availability of water is one of the key objectives of DfID, this is a surprising situation. Sometimes new agencies are needed, as happened in the 1980s when the United Nations Environment Programme was initiated. UNEP did a good job on the ozone hole but it is not being directed in an effective way by member countries to co-ordinate and publicise the national, regional and global problems associated with atmospheric and marine pollution. That is of course very topical at the moment, particularly in Asia. Marine pollution is in fact to some extent a responsibility of the International Maritime Organisation, based across the river here in London, but it plays a limited role. Is Defra considering stronger co-ordination by UNEP in this general area of pollution, since UNEP is probably the UN body with the biggest responsibility?

My next point is that the United Nations bodies are generally open in their communications. They are not secret; all their minutes are published before and afterwards and the communications between the members are open. However, it is very important that the recent exposure of certain Governments spying on the confidential communications of diplomats from other Governments and non-governmental organisations does not lead to a loss of trust between countries and agencies working in the UN.

I tabled a Parliamentary Question and was told, more or less, “We’re not going to answer that question because we do not talk about those things”. The fact is that they exist and this is a real issue. I hope that the Minister, in replying, will provide something more than I got in response to my PQ.

My next point is that the Government review agencies, but in doing that they should also consider the benefits to the UK: for example, in dealing with flooding, where other countries have developed useful approaches and, in some cases, have better research facilities. The Food and Agriculture Organisation studies of GMOs in agriculture are surely important. The recent reviews by United Nations bodies of the UK’s health and housing are very useful, although they were very controversial and the Government were not very happy with them. That is the kind of UN activity that is really impacting on us in the UK, which we therefore need to consider in reviewing those agencies.

One way to ensure improved benefits to the UK from our membership of the UN is to involve UK stakeholders, in which I include parliamentarians, to a greater extent in UN agencies; for example, through regular pre-meetings, report-back meetings and wider participation of UK delegations as observers. I am president of an NGO, ACOPS. We have observer status at the International Maritime Organisation and the London dumping convention, and we can provide some expertise. For example, there are now regular consultations between the Met Office and certain parts of the private sector, which are very welcome.

However, generally, the United States is stronger in that respect and positively ruthless in using its delegations to promote US technology. They have told me that they will vote or not vote because they were told by their industry to vote for this or not vote for that. That is highly directed to promoting US technology and US business. The Chancellor was calling yesterday in his speech for the UK to have higher exports. Perhaps he might talk to the Foreign Office UN department to see whether it could be of some help in that direction. At the executive level, there are now excellent relations between some UN agencies and NGOs, of which GLOBE is an example on issues connected with climate and the environment.

My third main point is that the United Nations as a whole has broad targets. I believe that the millennium development goals were a tremendous step forward for the whole UN movement, understood at the level of the sustainability commission in New York and the General Assembly. That brought together lots of activities. There have also been the broad goals of reducing carbon emissions. I believe that there could be more specific targets for agencies or groups of agencies—for example, I just mentioned pollution. Those targets could be openly discussed by parliaments as stakeholders and progress or regress towards achieving them should be openly reviewed.

Of course, targets require data, which remains a great weakness of the UN system and, indeed, the international system. UN bodies could urge countries to be more systematic in gathering data and more open with them. For example, sometimes even the most basic data are not available in some countries, such as whether there is or is not a sewage plant in the capital city of an African country. In the case in point, the answer was no. A study in another African country showed that several organisations are collecting very useful environmental and health data which are not well co-ordinated. The study, in collaboration with those organisations, recommended the use of data centres. The whole world would benefit from that. DfID does not seem to understand or support that view very strongly.

In closing, which goals and targets should be emphasised and publicised? They should relate to recent crises. One of the greatest crises at the moment is the Syrian and, earlier, Iraq conflict. Surely we should be thinking more about technical methods of identifying combatants and their weapons, as happened last year with the question of gases. We must consider how we can provide improved humanitarian aid. Those are technical and organisational questions and we should have targets for them.

The Bangladesh factory collapse last year led to the deaths of many hundreds of people. There should now be improved targets for the International Labour Organisation on factory health and safety. After the floods in Europe and Pakistan and the droughts in California, the water programmes need more technical focus and bigger budgets, as I have already mentioned. We could also have targets to help co-ordinate international and regional programmes for pollution episodes.

We could have improved warnings and assistance before, during and after natural and artificial disasters. The United Nations organisation for disasters, the ISDR, co-ordinates but with more funds it could have more ambitious targets. For example, should we not have a target that, say, 30 years from now we should finally be able to detect earthquakes? There is a good deal of research going on—big objectives are appropriate. A meeting in Parliament this morning showed the need for FAO studies of future food and fish stocks, and how they are in danger from exploitation, pollution and climate change, to be more widely understood by world leaders. We need some clarity in this area.

I look forward to the Minister’s response to the issues raised. I declare my interest as a former permanent representative for the UK at the World Meteorological Organisation, when I was head of the Met Office; president of an NGO; and vice-chair of GLOBE, working with UN agencies.

United Kingdom: Future Demographic Trends

Lord Hunt of Chesterton Excerpts

Thursday 14th March 2013 Lords Chamber

[Lord Hunt of Chesterton]

My Lords, I should also like to speak in the gap, having given notice. This is an important debate and we should thank the noble Lord, Lord Hodgson, for one of the few debates that really addresses the future of the United Kingdom. That certainly happens occasionally.

My point is about technology and electronic contributions, on which the noble Baroness, Lady Greengross, touched. They are extraordinarily important for enabling elderly people whose capacities may begin to decline to understand and to assist them with health, communication, transportation, learning and so on. I have seen examples where this works brilliantly. A friend recently died and, if there had been the information and communication, that need not have happened.

As has just been said, this now provides a technological and industrial opportunity. This interesting report refers to the financial aspect. There is a lot of money in the elderly sector of society. If people could be encouraged to invest in the new methods and technologies and not just in housing, that would provide a boost to our technology and industry. We go from the industrial revolution to the gerontological revolution. Harold Wilson talked about the “white heat of technology”; we will have the white hair of the new technological revolution.

Annexe 17 of the report has an interesting point on the role of the royal college providing completely new designs and ideas. It will be an extraordinary opportunity for quite new ideas and for business. That rather positive note is something that we should think about.

Older People: Their Place and Contribution in Society

Lord Hunt of Chesterton Excerpts

Friday 14th December 2012 Lords Chamber

[Lord Hunt of Chesterton]

I, too, congratulate the most reverend Primate on this Motion and on his inspiring speech. He included an economic insight into the important contribution of the elderly, but we shall perhaps have more of these economic archiepiscopal insights with his successor.

As a former city councillor in Cambridge, under the stern mayoral discipline of the noble Baroness, Lady Trumpington, it was a pleasure to hear her powerful words again. It was certainly my experience as a city councillor visiting retirement homes to see the loneliness and sadness that we have been thinking about in this debate. During one such visit, during an election campaign, I was asked about my policy on euthanasia. I hummed and hawed and said that it was not quite the role of Cambridge City Council to deal with that. The lady asking the question said that she would prefer to be off by lunchtime; she was a precise Cambridge mathematician who was actually a founder member of the Euthanasia Society, along with the Shaws and the Webbs. This is the sort of challenge that the noble and right reverend Lord, Lord Harries, spoke about.

From my experience as a scientist in academia and government, like other noble Lords I benefited hugely from the wisdom and insights of older colleagues in my career. The remarks of my noble kinswoman Lady Bottomley on her experience in business and the health services is certainly paralleled in the world of science. An old don in his 80s at Trinity, Samoilovich Besicovitch, asking me about my teaching load, helpfully commented that it had been much easier under the tsar. That is the kind of thing that you can learn about from older colleagues. Many universities maintain the civilised practice of entitling retired academics as emeritus, providing opportunities for them to talk and collaborate with students and fellow academics. That is very much a feature of the scene in China. I was at a conference last week, and it was remarkable to see quite young scientists questioning and collaborating strongly with scientists in their 80s from the Chinese Academy. In Japan, some of my colleagues have stepped down from responsible professorial positions to become lecturers at junior colleges. That kind of thing could perhaps be done more in the UK.

How can government and Parliament also benefit more from the contributions of the elderly and retired? I notice that there are no people of our age in the Box. This is particularly important as the Government keep reducing posts. The Government contribute to the pensions of former civil servants such as me who would like to contribute. When civil servants were more numerous, government departments and, indeed, society benefited greatly from their representation in all sorts of national and international organisations. Regrettably, the UK is now almost notorious for its absence of representation in many such bodies. Retired civil servants could do this job—occasionally, I have seen this being done—and could feed back information to Whitehall and make sure that the UK is represented, just for the price of the train fare and a cup of tea on the train. This kind of thing should be thought about as part of the Government’s policy on slimming down the Civil Service.

In this debate there has not been much discussion of the medical and technological contributions to the welfare of the elderly and the ways in which they can help people, particularly those who are elderly and disabled. At one end of the spectrum, the noble Lord, Lord Giddens, referred to athletic achievement. At the other end, as a colleague of Professor Stephen Hawking at Cambridge, I was fortunate to see how technology enabled him to talk, be understood and continue his remarkable scientific contribution. However, he had the benefit of the latest technology. When she replies to the debate, will the Minister say what is being done to achieve this vision?

The right reverend Prelate the Bishop of St Edmundsbury and Ipswich said that human beings were not machines. However, machines can help humans be human. That is a very important point. For example, we can use high technology to understand what whales are saying to each other through the funny little noises they make across the ocean, but we are not using this technology to understand what people who can make only rather funny noises are trying to say to each other. It is just a matter of science, but the science is not being applied. We should have computer programmes that analyse the sounds and gestures of disabled people and enable them to communicate and to be seen as people. If we look at this in a very positive way, we may even be able to make an intergenerational leap from the very oldest to the very youngest techie children who respect only communications that come through the ether. Communications made through sound or touching are very old-fashioned and utterly uninteresting to them. We may be able to make a great breakthrough in that regard.

Government research agendas have an appreciable content of work focused on matters connected with the elderly and on the associated science, technology and social science, but I believe that a stronger vision of where this is leading is needed. This is a tremendously human-oriented programme. I look forward to the Minister’s response to that question.

Antarctica: Centenary of Scott Expedition

Lord Hunt of Chesterton Excerpts

Thursday 18th October 2012 Lords Chamber

[Lord Hunt of Chesterton]

My Lords, I welcome this debate and declare my interest as a former member of a BAS advisory committee and a collaborator on scientific projects when I have been at the NERC-supported Centre for Polar Observation and Modelling at University College London.

Scott’s Terra Nova expedition leads us to extraordinary stories of bravery and selflessness, especially on the return trek, and has inspired generations. It also led to Shackleton’s expedition a year or so later. Remarkable literature has come out of those expeditions and extraordinary photography. Recently, Arctic research has also led to interesting music. When I was a governor of a primary school in Cambridge, one of the prospective candidates for head said that for 20 minutes every day he would read to the students from Scott. We thought that that was a bit over the top so he did not get the job, but we understand the sort of extraordinary affection there is for Scott’s writing.

I note that Amundsen has not been mentioned recently. He reached the Pole just in front of Scott. The Norwegian Prime Minister was there recently, but I do not believe that our Prime Minister has been there. Amundsen generously admitted that the Scott expedition contributed much more to science—notably geology and biology. One of the biologists, Dr Wilson, was on the last party. Meteorology was also mentioned. A former director of the Met Office, G C Simpson, was there studying air currents and introducing new instrumentation for solar radiation. The lasting contribution of the expedition was to show the importance scientifically of polar regions. The UK has taken a lead in this through research institutes and universities, BAS, NOC and, not to be forgotten, SAMS in Scotland. Their work is co-ordinated and funded by NERC. Also, extraordinary international co-operation is co-ordinated through the Antarctic Treaty and its scientific committee, SCAR, on which the directors of BAS have often sat.

Recognition of the impact on global science and technology of observations in the Antarctic come with four or five great developments. First, what impressed me in the 1960s was the work of Rachel Carson in her famous book Silent Spring and the fact that DDT was found in the seals and birds of the Antarctic, showing an extraordinary circulation around the world. Secondly, the observation of the polar regions from the moon in the 1960s was an extraordinary sight. We had our blue planet with white caps on either side. Thirdly, the importance of Antarctic weather began to be recognised in the 1970s and 1980s. Good measures of Antarctic weather from weather stations all around the Antarctic enabled us to make global weather predictions. BAS contributes to that, as do other countries such as Argentina and Australia.

Fourthly, in the 1980s the upper air currents swirling around the Antarctic were understood, so it was not a great surprise, at least to a fluid dynamicist, when Joe Farmer at BAS found that extraordinary cauldron of swirling flow, enabling chemistry to take place there, isolated from the rest of the world. The chemicals in this cauldron were chlorofluoride carbons from refrigerators and the reactions led to the damaging loss of ozone in the stratosphere. Subsequently that was verified by the US satellite measurements. The fifth global impact was the role of polar science using computational modelling to enable us to use the results of the ice cores and radar satellite measurements to look at climates and geology going back in time, and also to make predictions about the dangerous phenomena mentioned by the noble Baroness, Lady Worthington, in her report.

Looking forward, we should be thinking not only about research but of educational projects in and around the Antarctic. I am privileged to be involved in a project to reconstruct the wooden vessel of the “Beagle” based in Chile, which will enable students and university people to go round those southern waters. Indeed, the surveying of those waters off Cape Horn by FitzRoy are still used.

I have three quick points. The UK should establish a polar science centre for both the Arctic and the Antarctic which should be separate from but collaborative with NOC, as other noble Lords have mentioned. The international role of the NERC with regard to United Nations agencies and the UK Government, which is touched on in the report, needs to be reorganised. It should not, as suggested in the report, continue to be the responsibility only of the scientists and the centres. The NERC, of which I used to be a member, does not review the science advice given nationally and internationally by the NERC—or, at least, it used not to and I understand from recent directors of NERC that that has not been the case. My third point concerns the Antarctic Treaty and SCAR, which needs to extend its roles significantly to become responsible for public understanding and education about the Antarctic through international collaboration. That will be a long-term way of ensuring that the value of the Antarctic continues.

--- Later in debate ---

[The Senior Minister of State, Department for Communities and Local Government & Foreign and Commonwealth Office (Baroness Warsi)]

My Lords, this is an interesting moment in which to address the third debate in my new job but the first in this Chamber. Before I turn to the debate, I pay tribute to my noble friend Lord Howell, who is a hard act to follow, but I will try. As the noble Lord, Lord Gilbert, said, I am quickly learning that Members of this House invariably will always know more than me in almost every debate.

I am grateful for the opportunity to respond for the Government on this debate brought by my noble friend Lady Hooper on the centenary of Captain Scott’s death and Britain’s enduring scientific legacy and physical presence in Antarctica. I am proud to say that the Government share the strength of feeling in this House on the importance of Scott’s legacy and the great scientific and strategic value of Antarctica to the United Kingdom’s long-term interests. Recently, there has been speculation that possible changes to the British Antarctic Survey may result in a downgrading of British interest or capacity. I want specifically to reassure noble Lords that Ministers are absolutely committed to maintaining and developing a physical presence in Antarctica.

Let me start with a few words on Captain Scott and his brave team. Despite the tragedy of their final journey, their moving story is one of bravery, endurance and good fellowship, and, importantly, of their commitment to scientific discovery. The noble Baroness, Lady Warwick, eloquently narrated the poignant story, as did my noble friend Lady Sharples in relation to her personal connections to “Discovery” and “Endeavour”. It is those attributes that have been such a source of pride as we remember and celebrate this centenary year of Scott’s achievement.

The Foreign and Commonwealth Office is proud to have been able to support the organisation of the memorial service in St Paul’s Cathedral for Captain Scott and his colleagues in the presence of Her Royal Highness the Princess Royal. We have also marked the centenary in other ways. My right honourable friend the Prime Minister recorded a message that was broadcast to all those working in Antarctica. My right honourable friend the Foreign Secretary signed an agreement with his Norwegian counterpart to celebrate our shared polar history and increased co-operation on heritage and science issues. The Minister for the Polar Regions at the Foreign and Commonwealth Office hosted a reception for the descendants of the Scott expedition. On behalf of this House, I thank everyone in the Antarctic community who made the centenary such a success.

The centenary has been about remembering the bravery and sacrifices of Scott’s expedition and the truly world-class scientific legacy that endures to this day. Both the British Antarctic Survey and the Scott Polar Research Institute are world-leading centres of excellence, supporting the United Kingdom’s strong record on science, discovery and education about Antarctica. My noble friend Lord Avebury and the noble Lord, Lord Giddens, are right to raise the impact of the science of Antarctica on our understanding of climate change. It was the long-term monitoring of activities in Antarctica that allowed British scientists to discover the ozone hole in 1984. There is no doubt that the UK will continue to undertake world-class science in Antarctica.

We anticipate that in just a few weeks’ time the British Lake Ellsworth project will begin to drill down through three kilometres of ice to a freshwater lake that has been hidden for hundreds of thousands of years. That is possible only because of British scientists, British companies, British innovation and the British spirit of exploration. It is exactly the kind of endeavour that is the spirit of Scott. It is not too far-fetched to say that there is a golden thread of scientific excellence running directly from those first ambitious steps of Scott’s scientific work right through to projects such as Lake Ellsworth today. That thread is strong but it is not unbreakable, and we should not take it for granted. The noble Lords, Lord Oxburgh and Lord Hunt, raised important concerns. Both come to this debate with great expertise and experience. Let me assure this House that this Government recognise the thread of that science and its importance, and we will take all the steps necessary to preserve British supremacy in this field.

British scientists have the confidence and ability to operate in Antarctica because of the strong presence, experience and logistical skill of the British Antarctic Survey. In turn, the importance of the science that can be carried out in Antarctica justifies and reinforces the need to have the strongest possible presence and the widest reach. Let me assure noble Lords, and specifically concerns raised by my noble friend Lord Jenkin, that there is no doubt that Antarctica matters to the United Kingdom. British explorers were the first to venture there and we were the first to claim territory. We have maintained a permanent year-round presence in Antarctica since 1944 and we will continue to do so.

The British Antarctic Territory is the largest of the UK’s overseas territories and the Government place great importance on ensuring its security and good governance. British presence is maintained jointly by the British Antarctic Survey and the Royal Navy, whose ice patrol vessel, HMS “Protector”, plays a vital role in delivering our responsibilities.

Our national Antarctic programmes are proud to operate from the Falkland Islands, which is a vital gateway to both the British Antarctic Territory and South Georgia and the South Sandwich Islands. The Government understand the importance of maintaining close links between all British activities in the South Atlantic and visibly demonstrating our strongest possible long-term commitment to the region.

As Antarctica emerges from its long winter sleep and the 30 men and women of the British Antarctic Survey who have kept the lights burning there for the past six months prepare for their companions to rejoin them, it is fitting to thank them and to remember the hardships that Antarctic service still entails. The noble Lord, Lord Mitchell, is right to pay tribute to all those who work there. In particular, I take this opportunity to pay tribute to the 29 men and women who have died on active Antarctic service for Britain in the region over the past 60 years. Just as they are never forgotten by their family and friends, so they and their sacrifices are remembered by us.

This Government recognise and respect our international commitments to Antarctica, in particular to the Antarctic treaty, which the UK was instrumental in bringing into existence. For more than 50 years the Antarctic treaty has preserved Antarctica for peace and science. It is arguably one of the world’s most successful international agreements. Antarctica is the only continent never to have seen conflict and the UK will strive to ensure that this will always be the case.

The Antarctic peninsula is one of the fastest warming and therefore most rapidly changing places on the planet. There are serious challenges ahead as the ice melts, accessibility increases and the climate becomes more welcoming to new species carried there either by natural means or by human activity. Britain will continue to provide global leadership in responding to these challenges and, in the spirit of Scott, we will strive for success no matter how difficult things get. In particular, we will work to ensure that the prohibition on the commercial extraction of minerals and hydrocarbons remains in place. We will seek agreement to ensure that everyone who visits Antarctica does so in a safe and environmentally friendly way. We will support new legislation to implement a new agreement on liability for environmental emergencies in Antarctica. We will press for higher standards for vessels visiting the Southern Ocean, particularly fishing vessels. We will advocate the establishment of further marine protection measures for the Southern Ocean, building on our experience of creating the world’s first high seas marine protected area to the south of the South Orkney Islands in 2009.

However, given the rich Antarctic tradition, concerns about the future of British engagement are understandable. Noble Lords have raised a number of important issues this afternoon in relation to the future of the British presence. I want to be absolutely clear; Ministers have agreed that the dual mission of science and presence will continue and that Britain’s physical footprint in Antarctica in ships, aircraft and bases will be maintained. Importantly, I assure noble Lords that the iconic British Antarctic Survey name will be retained for all activities and logistics relating to the Antarctic and the South Atlantic. I take the important point made by the noble Earl, Lord Selborne, on branding and that made by my noble friend Lady Walmsley on reputation.

The Natural Environment Research Council has confirmed that it will continue to deliver for the UK both regional presence in Antarctica and the South Atlantic and a world-class science programme. It has also confirmed that it will maintain an overt and clearly branded British presence in Antarctica, maintain the logistical and strategic footprint of the British Antarctic Survey, ensure full ongoing support for the Antarctic treaty process and appoint a British director to manage and oversee all British activities in Antarctica. I am grateful to my noble friend Lord Willis for his clear and concise contribution, which dealt with some of the misunderstanding around the recent consultation.

These and others are strong and good reasons to be confident about the future of Britain’s scientific activity and physical presence in Antarctica. The next four months will see the start of the sub-glacial Lake Ellsworth drilling project, the official opening of the brand new Halley VI module on the Antarctic ice shelf and, I hope, an opportunity for this House to debate the new Antarctic Bill to increase environmental protection for the region. These are all genuine reasons for optimism.

Yes, Ministers have been actively engaged in this decision, including the financial case that was raised by my noble friend Lord Avebury. No final decision has been made on the merger; all responses on the consultation, as well as the views of noble Lords heard in the House today, will be considered.

The noble Baroness, Lady Andrews, raised a specific question about financial contributions to the conservation of the Scott huts. The Government of the British Antarctic Territory, an overseas territory, provide ongoing funding to the UK Antarctic Heritage Trust. The trust uses that funding to support the conservation of British huts.

My noble friend Lady Hooper asked a specific question about the Antarctic science strategy. The Natural Environment Research Council is developing its forward strategy and will require its research centres, including the British Antarctic Survey, to do likewise.

The noble Baroness, Lady Worthington, raised concerns about why science is increasingly required to focus on commercial interests for commercial activity. Research councils, including NERC, fund research into all aspects of science, from frontier science to closed-market activities. Scientific excellence is the essential criterion.

The noble Lord, Lord Hunt, raised the issue of communication. I share the view that the Antarctic treaty needs to do more to communicate with the public. For the UK’s part, the FCO developed with BAS and the Royal Geographical Society a BAFTA-nominated educational website, www.discoveringantarctica.org.uk, which was developed to do just that.

I hope that in answering noble Lords’ concerns, I have assured the noble Lord, Lord Lea, that the Government are asking the right questions to get the right answers.

I am grateful for the opportunity presented by my noble friend Lady Hooper to pay tribute to Captain Scott and his brave team, and to his enduring legacy. Today Antarctica matters to the United Kingdom more than ever as a place of peace, common scientific endeavour, international collaboration and environmental protection. Looking back across the years and the vast whiteness of the Antarctic continent to that last desolate camp where they met their fate, I would like to think that Scott, his team and their descendants would be proud of what we have achieved in Antarctica and what we will continue to achieve in the years ahead.

[Lord Hunt of Chesterton]

My Lords, in summarising the research, the Minister has referred to the British Antarctic Survey, which is fine, but 50% of that research is done in universities, which she has not mentioned.

[Baroness Warsi]

My Lords, the questions raised today have predominantly been about the British Antarctic Survey. I hope that in addressing noble Lords’ concerns I have specifically referred to BAS. The Government remain committed to science, wherever it may take place.

I believe that the debate today has shown that, in Antarctica, Britain has the strongest possible tradition, the clearest ministerial commitment to maintaining and developing our scientific and physical presence, and significant opportunities for the future. With the commitment and skill of the brave men and women of the British Antarctic Survey, those of the Royal Navy and the many other researchers and workers in Antarctica, I have every confidence that we will be able to live up to what Scott described in his final moving message as,

“a tale of hardihood, endurance and courage”,

to stir the heart.

UK Trade and Investment

Lord Hunt of Chesterton Excerpts

Tuesday 9th October 2012 Grand Committee

[Lord Hunt of Chesterton]

My Lords, I welcome this debate, introduced by the noble Baroness, Lady Liddell. I have experience with high-tech SMEs applying UK research and have had discussions with medium-tech SMEs around the world. I declare an interest as chair of a small company in Cambridge and am glad to say that we have just sold software to Beijing to predict its air pollution, which is quite a coup for the UK. It is the same software as that used in London and reported on by Ministers in May.

We have to remember that the development of SMEs was once extremely controversial politically. For example, in Cambridge, both the Conservatives and the Labour Party were dead against Cambridge turning into a high-tech town, and one of my Labour colleagues said, “My God, this is going to turn Cambridge into an inland Bournemouth”. We have moved a long way since those days. All parties now accept the importance and social value of SMEs. I believe that there is some statistic that shows that some two-thirds of UK school leavers would have their own business if they could, whereas the figure is less than one-third in France. I do not know where that statistic came from, but I heard it some time ago.

A propos the strange remarks of the Chancellor yesterday, I should add that SMEs are not here as a sort of gambling operation, they are here to set up and do tasks and to provide reasonable employment. They are not speculations. Some people speculate on them—good luck to them—but that is not the primary role of people who have set them up, including people I know.

SMEs were invented by the Victorians and are remarkable organisations. Being a limited liability company enables you to do things you cannot do as a charity or as a partnership; an SME can do them. I support the present Government in their efforts to simplify things for SMEs so that they can run better. It is very much easier for SMEs here than in France, for example, which I know because our company deals with colleagues in France. The tax regime was improved by the Blair-Brown Government, particularly in maintaining tax relief on research. The present Government had a few wobbles on that when they first came in, but now they are solid on allowing tax relief on development.

The role of women in SMEs has increased enormously. Our own software company is composed of 80% women and is thus probably unique in the world. We have a very firm No. 2 who is a woman, and she jolly well made sure of that. The important point to make is that the Government introduced regulations to ensure that companies enable women to come back into employment. This is allowing highly skilled women to stay in the SME workforce.

This debate is about the role of UKTI. One of the issues for SMEs in Europe is the question of funding for research and development. The Technology Strategy Board is an effective body, and it is gratifying to note that the present Government have maintained it. However, I did not see any reference in the UKTI document provided for this debate to its connections with the board. It is important that UKTI should work with the TSB to look at where the overseas market areas are. In my view, we are still way behind the United States, which funds research undertaken by foreign scientists. Two or three of my papers were immediately funded to do research over in America; there was no such funding over here.

The other important feature of SMEs is the matching-grants approach adopted by the European Commission. In Britain it is difficult to get this sort of funding. You cannot easily get money from the research councils, so the approach of the EC of providing a matching grant equal to the funding provided by the SME is a good one. We do not do that in the UK and I believe that we could move more in that direction.

Last year I went with the noble Lord, Lord Oxburgh, to the big water show in Singapore. It is the world’s biggest annual exhibition of water. Water does not feature much in this UKTI report, perhaps because it is a low-growth industry, but it is jolly important. We saw enormous displays of water technologies from all around the world. Britain had only a small display, and we heard grumbly representatives from British companies say that they got little support from UKTI to come to meetings such as this one. They were very vociferous. In fact we met the UKTI man who had come down from Kuala Lumpur. He listened to and recognised those grumbles. He commented on it later, when I visited the embassy and high commission, saying that there are so many trade exhibitions that there simply is not the funding available to enable small UK companies to attend.

The other important task for UKTI and the Government is the promotion of the role of governmental agencies in the UK. I used to be the head of the Met Office. At no point did my job description include anything to do with British industry. I complained about it to the then Conservative Government. They said, “Why don’t you go to the Sunday fete and help them?”. I was pretty cross and I expostulated about it. The representative, now a fine Member of the House of Lords, then said, “Well, that is the sort of thing they do in France, isn’t it”. The point is that our big government agencies could play an enormous role. However, the Environment Agency is not allowed to promote UK environmental software or technology abroad. I have spoken to the head of the agency about it. We have extraordinary limitations.

I have almost used up my six minutes. I believe that this document is helpful. Finally, there is a new point that is very interesting. As I understand it, the UKTI is now providing funding in order to bring companies into the UK, such as into the high-tech centre in east London. Doing that is fine, but the department might talk to those British companies which are working in the same area so as to make sure that it is about collaboration, not spurious competition.

--- Later in debate ---

[Lord Green of Hurstpierpoint]

My Lords, I begin by congratulating the noble Baroness, Lady Liddell, on securing a very important debate on trade and investment, especially relating to small and medium-sized enterprises. The role of UKTI is complex and I will focus my remarks on the involvement with SMEs. I assure the noble Baroness that SMEs are an extremely important focus. As the noble Lord, Lord Bilimoria, reminded us, more than 90% of the client base of UKTI is SMEs. I will talk a little about how an organisation that, as the noble Lord, Lord Haskel, commented, is in transition—I agree that it is—and is attempting to make sure that it does the best possible job of support for SMEs.

The noble Baroness has long supported business, as Economic Secretary to the Treasury and Minister for Energy and Competitiveness in Europe in the first term of the previous Government, and as a successful high commissioner in Australia who was very active in supporting British business there. I checked the statistics. Whereas in most markets over the past 10 years Britain steadily lost share or had a share so low it was difficult to lose, in Australia between 2006 and 2009 we at least had a stable share and in some respects, particularly services, grew it. I am afraid that it rather declined after 2009; I wonder whether this was cause and effect.

I think that we all agree that we face a national challenge as we seek to rebalance our economy and find a stable and sustainable growth path that will create jobs. The old model that was in place in the run-up to the financial and economic crisis is, as we all know, bust. The economics textbooks state that if we cannot grow on the basis of consumers piling on debt and government spending growing larger, it will have to be on the basis of more successful trade and investment.

I shall not comment much on investment because it is a separate and complex topic, except to say that, on the whole, this country has had for a number of years a fairly good record in attracting foreign direct investment. We cannot be complacent. We need to ensure that government policies are in place to ensure that that performance continues. However, we have a big challenge in trade. We have had a weak trade position for the past 40 to 50 years—this is not a new problem. For most of those years, trade has been a drag on growth rather than a contributor to it. I have already mentioned our market share in goods, which is down and/or the lowest during the past 10 years in virtually every priority market. It is rather better in services, but when you look at our performance in places such as Brazil, China, Colombia, Indonesia, Japan, Mexico and Russia—I could go on—you see that it is lamentable, being behind not only that of the Germans, which might be expected, but that of the French and the Italians, and I can think of no good reason why that should be the case.

I share the view of so many noble Lords who have spoken in this debate that it is critical that we focus strongly on SMEs. SMEs account for more than half of all goods exports—they account for rather less of services, but they are none the less an important part of the export proposition. We are behind the European curve. The noble Lord, Lord Bilimoria, has already mentioned that only 20% of our companies export versus a European average of roughly 25%. One way of looking at our challenge is to seek to get our SME propensity to export up to that European average. If we did that, we would go a long way towards curing our trade deficit problem.

I am convinced—again, I echo the sentiments of a number of noble Lords—that we have the potential to do this. The sheer variety of SMEs is an extremely important factor. The thing that I have enjoyed most about my job during the past 20 years is going around this country—I have gone around the world a lot, of course—meeting businesses of every shape and size in every sector and every region of the country. You find examples of creative, energetic exporters, with a high profile in their local community, who are going out and taking on the world. If one ever had a moment’s doubt about this country’s ability to pay its way in the 21st century, you need only to do what I have been doing to allay those doubts.

Furthermore, the evidence is clear that there are significant efficiency gains on average for any company that gets into the export markets. Therefore, succeeding in this SME exporting campaign is not only addressing our balance of payments but strengthening the backbone of the economy while we do it.

The Prime Minister last November set a target of 100,000 extra SMEs in the export markets by 2020. There is a strong focus on emerging markets, because, as I think we would all recognise, that is where the growth is coming from now and is likely to continue to come for the next generation. The central gravity of the world’s economy is shifting from west to east and from north to south, and the emerging markets in Asia, the Middle East, Latin America, Africa—at the moment, six of the 10 fastest-growing countries in the world are African—represent opportunities.

However, we all know that this is a challenge and that the first time that an SME exports is a daunting proposition—“Where do I begin? How do I go about it?”. As a number of noble Lords have said, they do not have the administrative apparatus that larger companies have; they are often one-person bands or employ 10 or 20 people. It is a difficult task. What is the role of UKTI in this? It is many-sided, but it is critical. It is there to provide direct help. There is a public commitment on the part of UKTI to double its client base from around 25,000 now to 50,000 by the end of 2015. It should be there to provide specific services to small companies. It has two particular packages that are well targeted to their needs: a Passport to Export package, which is for a first-time exporter; and a Gateway to Global Growth package, which is for those businesses that have already moved into one market and are looking at opportunities in others. It provides market information; it helps form partnerships overseas; and it is there to help deal with the finance access question, which I shall return to shortly. It is there to nurture investors, too, but I shall not dwell much on that, if noble Lords will allow, on this occasion.

What is the present condition of UKTI? First, it has a clear strategy. We have a list of priority countries on which we are focusing—there are 19 of them, four topmost and another 15 in a second tier. You might guess three of the topmost—China, Brazil and India. The fourth is Turkey rather than Russia. There are particularly interesting strategic reasons for engaging as proactively as possible with Turkey. Russia is in the next tier.

There is a clear focus on the sectors that we should cover. There are five main groups of sectors with 18 subsectors, one of which includes water and environment technology. I believe that there is a lot of work to do to ensure that the sector competence in UKTI is up to the demands of private sector businesses going into the export markets. We have work to do on that. I can assure noble Lords that we are on the case.

A new management team is in place. The noble Baroness, Lady Liddell, asked whether any of them had a background in the private sector, and specifically whether they had worked with smaller companies. I am pleased to report that the person we brought in to take specific responsibility for the SME business of UKTI comes from the private sector. He has had a 25-year career as an MD or group executive of more than 20 different SMEs over time in a range of sectors, including pharma and automotive software. His last position before joining UKTI was as CEO of Biocompatibles International. I think that he has demonstrable and credible expertise. I am pleased to report that because it is important as regards a key leadership position in UKTI. It should not be the only position occupied by someone with clear private sector experience. We need to ensure that there are plenty of others through the system.

I am very interested in the comments that the noble Lord, Lord Cope, and others have made about the importance of getting practical secondment experience into SMEs. I shall take that thought away and see how we can make a reality of it. Although I am ashamed to say that I have never done it myself—I have worked only in big companies—I fully take the point that seeing what it is really like on the inside is important.

A new structure is in place that will give a clear focus on SMEs and on what we call high-value opportunities. They are the opportunities in infrastructure in particular in many overseas markets where very large spending is taking place by overseas Governments and where I believe that there is an opportunity to bring together on a cohesive basis the British offer, which will include not only some big companies but, critically, some SMEs as well. We have been putting our money where our mouth is.

[Lord Hunt of Chesterton]

In addressing that point, will the Government do more to enable SMEs to attend these very large trade shows where these jobs and this technology can be displayed? The difference between the UK and other countries is enormous in that respect. As I understand it, the Government decided to cut back on funding of that sort. Can the Minister reassure us?

[Lord Green of Hurstpierpoint]

I am very pleased to reassure the noble Lord, Lord Hunt. When I arrived in this position I took the view that we had cut back too much. One might debate whether some of the earlier spending was fruitful but it may have been cut back too much. We have pulled it out of the nose dive and I am pleased to report that we have just allocated an extra £3 million to trade access programme activities, which is the area of trade fair attendance that the noble Lord is calling for.

This year, out of 288 missions, 178 were specifically focused on SMEs, a statistic which I should mention. I hope to reassure the Committee that we are serious about this. SMEs are critical to the long-term success of the economy and to the export challenge for this country. They are therefore at the centre of UKTI’s objectives.

There are plenty of challenges. More than one noble Lord has mentioned awareness. At the moment, the evidence is that about 56% of companies are aware of UKTI, which is simply not good enough. There is evidence also that only 24% are aware of UK export finance, which is miles away from being good enough. The satisfaction rates for the quality of service is not yet good enough. It is not that bad but it is in the mid-70s. I think that it should be at least in the high 80s or low 90s. Therefore, there is a direction of travel that we must make sure that we get to, which is partly about the quality of the people in UKTI. We are setting up a new unit within UKTI to focus on venture capitalists, because it is important to encourage venture capital into the economy and link it up with business opportunities.

I am conscious that my time is running out fast so I will just say a word on finance. The finance issue is quite complex. It is about venture capitalists and seed money. The noble Lord’s comments about the enterprise investment scheme resonated very strongly with me. I will take them away and we will see what we can do, but we are very clear that this is an important scheme.

More generally on business banking, there is a clear need to reinvest properly in business banking. In some ways I am better placed than many to say this. The banks have disinvested—unintentionally, but none the less in fact—in their business banking capabilities over the past 20 years. We need to turn that around. We need to reskill the banks. The good news is that the CEOs are all very committed to this. The challenge is that it is going to be a bit like turning around an oil tanker—I am afraid that it will take some time and we have some work to do on that. But I can assure noble Lords that I hold regular round tables with the banks, at both CEO and head of commercial banking level. I and the Secretary of State are on this case.

I am very conscious that I have run out of time. I thank the noble Baroness for introducing this debate and noble Lords for participating. This is a challenge that I care passionately about, as I hope noble Lords can tell. We have a great deal to do but I believe that we can be successful as long as we stick at it.

Commonwealth Parliamentary Association

Lord Hunt of Chesterton Excerpts

Thursday 8th September 2011 Lords Chamber

[Lord Hunt of Chesterton]

My Lords, I welcome this debate, introduced by the noble Baroness, Lady Hooper. My father was a diplomat in the Commonwealth Relations Office, so I was brought up to this. As a boy, I saw the Union Jack coming down in Kuala Lumpur in 1956 and heard the music changing—we had a musical discussion earlier this afternoon. In my career, I have visited scientific, meteorological and governmental institutions in about 14 countries. I declare an interest as a visiting fellow of the Malaysian Commonwealth Studies Centre at Cambridge. In my remarks I should like to point out how the UK might reorientate its diplomacy to combine more strongly its roles in the Commonwealth and in Europe, particularly to help deal with global issues of climate change, the environment and developing science and technology-based business. The UK high commissioners could, I believe, do more to help promote the idea in Commonwealth countries of flying the European as well as the UK flag. You can be quite sure that when the French have their embassies in countries in the francophonie, they will be flying the European and the French flag.

The present and the previous Governments have worked closely with other European countries and the EU to establish Europe’s leading research position in climate change and to establish policies for mitigating emissions of greenhouse gases and for assisting developing countries to adapt to climate change and reduce their damaging impacts. Collaboration with Commonwealth countries is growing; we are having strong policy initiatives. The Australian Government are introducing bold legislation and, I am glad to say, ignoring the trumpeting by certain present and previous Members of this House who are very loud and noisy. In Singapore, the Prime Minister has set up a climate change secretariat and foresees greater collaboration with south-east Asians. As I found in a meeting interview with him, there is great concern in that area about the rising sea level, which for reasons of physics is stronger in that part of the world, as the noble Lord, Lord Glenarthur, has just emphasised. However, one has to say that the Canadian Government policy is not helpful in following the United States. I hope that there will be vigorous discussion with the Canadian Government at the forthcoming meeting of Commonwealth Prime Ministers.

In July this year, the Divecha Centre for Climate Change at the Indian Institute of Science in Bangalore, together with the Malaysian Commonwealth Centre, held a workshop to review the special aspects of science and policies on climate change in Asia. The severity of the impacts, from the sea level rise to the melting glaciers in the Himalayas, were highlighted and the need to combine policies for energy and food was emphasised. Indian policy specialists commended the EU leadership for their climate policy and urged the EU, and the UK working with the EU, to keep up the pressure on the US Government to take a more constructive position, or at least not to prevent international collaboration.

The EU and the Commonwealth could work better to promote high-tech business and trade. Many of the most advanced projects in the UK are part of EU programmes—for example, Airbus and projects in space and the environment. In Singapore, I met the EU representatives—many Commonwealth countries have EU representatives. I believe that they and the UK High Commission could do more to explain how EU programmes are world leading and could be used more to help collaboration between the high-tech and advanced countries of the Commonwealth and the UK and Europe. Of course, many of these Commonwealth countries, as I again saw in Singapore, are now in a very advanced position in terms of their own work. Some of the leading groups and universities in the United States are setting up establishments there. UK funding, by Her Majesty’s Government, of UK technology at trade fairs is, in the views of many business people I have met, a poor shadow of the funding provided by other countries, including EU countries such as Germany. Perhaps, given the difficulties of our finances, Her Majesty’s Government should collaborate more effectively and economically with the EU in the promotion of UK industry and its development globally.

Finally, I should like to return to the point I have made several times before in this House and elsewhere that it is quite extraordinary that when scholars and researchers come to this country to work in universities—I have had many myself—there is no funding, no encouragement, nothing to bring these people to London, to Westminster, to show them what goes on. They know nothing. They go back to their countries—some of them become Prime Ministers—and they know nothing about the UK. It is quite extraordinary. Only Chevening scholars, a highly select group, are given, as it were, the treatment, but that is a tiny proportion, whereas when you go to other countries, they really use the opportunity to tell them about the country. After all, that is part of the reason why we do this.

One more thing: if they come to the UK, they should also learn that the UK is part of Europe, and perhaps that is how we should be moving. I have very little faith in this. I have spoken to leaders of the British Council and the Foreign Office, and they do not seem to understand that scientists need to know about the world in which they live, so there is a thought.

EU: External Action Service

Lord Hunt of Chesterton Excerpts

Monday 17th January 2011 Lords Chamber

[Lord Hunt of Chesterton]

My Lords, do the Government agree that the European external service may well provide a great opportunity for UK science and industry to have projects, many of the most advanced of which are done across the EU? We really need an EU presence and promotion of these projects, which I believe should be an important part of the external service.

[Lord Howell of Guildford]

I very much hope so, but of course that applies to other nations and other areas of the world as well. We want close scientific links with our American friends and with the rising powers of Asia, as well as with our European Union neighbours. Certainly, this may help as far as our immediate neighbourhood is concerned.