Previous SectionIndexHome Page

Mr. Blunkett: Who is complaining?

Mrs. May: One only has to look at the figures on business representation--[Interruption.]

Mr. Deputy Speaker (Mr. Michael Lord): Order. The House listened carefully to the Secretary of State when he was speaking and those on the Treasury Bench should extend the same courtesy to the hon. Lady.

Mrs. May: Thank you, Mr. Deputy Speaker. It is normal in education debates for Ministers to be wholly unwilling to listen to the truth about their policies; they prefer to ignore the reality of the impact of their measures on people's lives.

Businesses are complaining about the lack of business representation on learning and skills councils. The Government claimed that they would ensure that there was 40 per cent. business representation on every regional LSC, but on Berkshire LSC, for example, business representation is less than 40 per cent., and businesses complain that there are only two people with current business experience on the national Learning and Skills Council.

It is not only business that the Government have let down. They have let head teachers down, as we learned from yesterday's release from the National Association of Head Teachers and the Secondary Heads Association. The Secretary of State's comments at the NAHT conference earlier this year raised head teachers' hopes that the Government would change the way in which schools are funded and get funding directly to schools based on a national funding formula, but the Green Paper published in September by the Department of the Environment, Transport and the Regions did nothing to improve the system of school funding. It did not ring-fence or put money directly into schools; instead, it maintained the status quo and schools and head teachers feel let down.

The Secretary of State for Education and Employment said that the Queen's Speech was all about the big picture and showing people that the Government were on their side. If the Government were really on the side of schools, teachers, parents and children, the Queen's Speech would have contained measures to introduce a national funding formula; it would have contained measures to set our schools free, trust our teachers, give parents choice and enable schools to raise standards. The Government promised education, education, education, but today, teachers are leaving the profession in droves, schools face a four-day week, secondary class sizes are at their highest for more than 20 years, standards are falling and children's education is being damaged. That will be the legacy on which the Government are judged at the next election, and they will be found wanting.

8 Dec 2000 : Column 265

10.38 am

Mr. Martin O'Neill (Ochil): Perhaps I can be forgiven for not pursuing the issue of education. Scotland now has a Parliament that has responsibility for education--at least, the education of my constituents--and it is making a reasonable fist of it, so I shall focus today on the aspects of the Queen's Speech relating to industry.

As my right hon. Friend the Secretary of State for Education and Employment said, legislation is the tip of the iceberg--it plays only a part, albeit an important one, in determining the thrust of Government policy. In industry, what is necessary above all is to establish an air of stability and, even if there cannot be certainty, to remove some of the most obvious uncertainties, so that businesses can plan. The Government successfully tackled inflation and provided businesses with the opportunity offered by stable interest rates, so that, in that respect at least, investment and borrowing can proceed satisfactorily. Given those elements of stability, the Opposition and business must find a new focus for their whingeing and complaining.

I accept that regulation can be a problem. It can be difficult when the Government want to attack the problem of poverty pay. It is unfortunate for some employers that they must start paying decent wages for the first time in their industrial lives. It may be tiresome that employees will be entitled to four weeks' holiday a year, and that agreements must be entered into with employees so that if excessive hours must be worked, that can be done on the basis of a social partnership and an understanding between the employer and the worker.

Equally, it may be regrettable for some employers that the tax system is to be used to supplement the low rates that they pay their workers. The working families tax credit is part of the succession of measures that the Government have introduced, including the new deal, to get people into work for the first time and off benefit, and the national minimum wage, which is not as high as some of us would like it to be, but which certainly has not acted as a deterrent to employment, as the Opposition suggested it would. The working families tax credit offers families the opportunity to benefit from the parents being in work--being about the world, rather than languishing at home, as so many of our constituents had to do for so long.

In the weeks and months ahead, we will hear further complaining and moaning when programmes for parental leave are introduced, to enable all members of the family to play an appropriate part in the early stages of bringing up their children.

Such measures result in regulations and in problems. I would far rather have those regulations than the regulations introduced in the final years of the previous Government, which in sheer weight of numbers were little different from those introduced by the present Government. The difference is that the regulations introduced by this Government will improve the lot of working people, increase the number of working people, and benefit the welfare of the poorest families in our community. We are happy to be attacked for introducing such regulations, because we believe that what is being done is socially defensible and economically desirable.

It is fair to say that there are regulations that could be removed to get rid of the clutter. Such regulations may have been appropriate when they were introduced, but they are difficult and complicated to implement. I welcome the Bill that will introduce regulatory reform.

8 Dec 2000 : Column 266

It will be good for us to have sunset regulation, which will enable regulations to wither on the vine painlessly and, in terms of the business of the House, to be removed as quickly as possible. We should be grateful for that.

I shall deal now with manufacturing industry. One of the surprising features of manufacturing industry in recent months has been the strength of its performance. Given the cost differential between British manufacturers and those in the euro zone, many of us were frightened at the prospect of our industry going under in a way that no Government could prevent. However, to its credit, British industry has tried to absorb the costs in order to reduce the differential between the United Kingdom manufacturing base and that on the continent.

The absorption of costs has not been accompanied by a dramatic increase in productivity. That may be due to the fact that prices have been held back and workers have restrained their wage demands because they understand the nature of the problem.

My colleagues on the Select Committee on Trade and Industry and I have visited a number of car plants over the course of the year. During our visits, starting with the Longbridge crisis and continuing with the circumstances surrounding the changes at Dagenham, we saw tremendous efficiency at the assembly plants. It was interesting that different companies had varying approaches. The message became increasingly clear as we went around: the cost differential between components sourced in the United Kingdom and those sourced in the euro zone, or even more so in eastern and central Europe, where prices are that much cheaper, presents a problem for our manufacturing industry, and particularly for the car industry.

That will not be a problem for car assembly. It is likely that we will continue to have excellent plants across the country. The difficulty will be faced by firms that have traditionally supplied the components for the car industry. They will require assistance, but not in the form of subsidy. If they are to match the productivity levels of their competitors on the continent, a more imaginative approach will have to be adopted to capital allowances and the like.

In the nine months since the Budget, there has been a dramatic increase in the willingness to invest in IT equipment, as a consequence of the writing-off of capital used for the purpose of installing information technology. The purchase of computers by companies has increased dramatically because of the tax rewards available.

We must be far more imaginative in future, and the Treasury must get out of the mind-set that it has been in for too long, believing that companies that want to invest will invest, and companies that do not want to invest will not do so, so there is no need to give engineering companies and the like any incentive to invest. The costs, the differentials and the need to absorb costs has stripped back the financial basis of much of our manufacturing industry. We must look on the sector as a special case and offer it support. If we can do that, we will help British manufacturing industry to get through this difficult period, until, I hope, we can join the European monetary system.

Were we able to join, the opportunities afforded to our companies would be considerable. Price transparency is the most obvious. Flexibility of trading is equally important, and once the system moves into top gear the year after next, our failure to join will be an even greater disadvantage. However, in view of the disparity in the

8 Dec 2000 : Column 267

value of our respective currencies, we cannot realistically envisage joining the European monetary system in the foreseeable future.

The pound may be slightly overvalued, but the fecklessness of the European central bank is such that its monetary controls and the behaviour of its currency are a source of concern. The short-term advantage that has been gained by the European manufacturers will not be sustained in the longer term, when the cost of imports into their zone begins to be properly reflected by the cost of the devalued currency under which it is operating at present.

That is rather sad, when one recalls the rigour and robustness of the Bundesbank and the way in which it pursued monetary policy over decades, and compare that with the way in which the European central bank is behaving.

The success of the monetary policy committee of the Bank of England and the flexible way in which it has gone about its task shows that it is still possible to run monetary controls in a sensitive way that gives industry a chance.

We all recognise that the Queen's Speech applies to a five-month term, at most.

Next Section

IndexHome Page