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12.42 pm

Mr. Mark Field (Cities of London and Westminster): To follow on from the remarks of my hon. Friend the Member for Taunton (Mr. Flook), this is very much a debate full of maiden speeches. It is perhaps relevant that yesterday I was playing cricket and making my debut for the Lords and Commons team. We had to rush back for a couple of votes. My sartorial elegance, or otherwise, consisted of cricket whites and a blazer. Knowing that you are the Chairman of the all-party cricket group, Mr. Deputy Speaker, I suspect that you may have approved rather more than the Whips, who rightly ticked me off for not wearing the normal attire.

It has been an interesting debate and we have heard some thoughtful maiden speeches. I speak as a member of the new intake, who is making only his second speech

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in the House. The hon. Members for West Bromwich, East (Mr. Watson) and for Workington (Tony Cunningham) both made impassioned pleas about their constituencies and the importance of developing business in them. Likewise the two Scottish Members who made their maiden speeches, the hon. Members for Perth (Annabelle Ewing) and for Edinburgh, West (John Barrett), said some interesting things about Scottish issues. Unfortunately, the hon. Member for Birmingham, Perry Barr (Mr. Mahmood) is no longer in his place. He said a few words about his late father. Five weeks ago, when I was elected as a Member, my first thoughts too were with my late father, who passed away about 10 years ago. At such moments, these family links mean so much to many of us in this place.

Like many of the new boys and girls who have come to the House, it is a frightening realisation that we know so little about virtually everything that goes on in the House—or perhaps I speak only for myself. This week we have discussed such issues as Northern Ireland election fraud and statementing in schools for young children. I confess that before the debates took place— I suspect that it is a confession that will terrify many of my constituents—I reckoned that on either subject I could write on the back of one rather small envelope all that I knew about the issues. However, I can profess to be a comparative expert on small business, because I have spent the past seven or eight years running a business full-time and my business background goes back to my university days when I set up a publishing concern. My firm, which I run with a fellow director, now has 12 employees and turns over more than £2 million a year. I shall return to that subject later in my speech.

My constituency of Cities of London and Westminster is best known for its larger businesses. All the leading international investment banks are based in the City of London and a significant number of large companies that play on the global stage are based in Westminster. However, it would be wrong to imagine that the constituency has only large businesses—it has a thriving small business sector.

The congestion charge is at the forefront of people's minds in London this week, because the Mayor of London has made it clear that he will impose such a charge on people coming into central London. Understandably, the focus has been on the effect that the charge will have on motorists and other commuters and it was initially promised that we would see a distinct improvement in public transport before it was introduced. However, the real sufferers from the charge will be those small businesses—often sole traders or small family businesses—based in central London, which will find that the 15 to 20 per cent. projected reduction in the number of commuters will make a big dent in their turnover and profits. That is one reason why we should think again about what will be a controversial subject in the years ahead.

We have had an interesting debate this morning. In the past, small business matters tended to be seen as the preserve of Conservative Members, but it is clear that the sector is increasingly important to the Government. I agreed with much of what the Minister said, but red tape is of concern to small business. The political battleground lies in what we would call red tape and the Government and various unions would describe as employee rights. Our aim is to ensure that small business does not suffer from the debate on the opposite sides of the same coin.

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Many of the Government's actions are to be welcomed. For example, the Chancellor has made some great changes in the capital gains tax regime. I support many of those changes, but he has made the regime more complicated than it needs to be. We must also recognise the importance of a low tax economy. We live in a global economy, whether we like it or not, and that applies to small business as much as to the largest companies. We therefore need low income tax and a low capital gains tax regime to ensure that entrepreneurs are not persuaded to leave these shores in a brain drain.

As I have mentioned, I run my own business, which I set up some eight years ago. Others who have set up their own businesses will know that there is nothing more exciting. My business partner and I started in a small room with a couple of telephones and a fax machine. We had to lick the stamps for the first letters to our prospective clients, and it was a more exciting experience even than getting into Parliament. We have tried to develop the business and we now have a dozen staff, but I am concerned that red tape and bureaucracy disproportionately affect small business. Large companies have payroll departments, human resources departments and office managers, and they can cope with the demands. Even in my own business, which is now 12 people strong, that administrative burden falls heavily on me and my fellow director, as we cannot pass it on elsewhere. I beseech the Government to consider the matter carefully before gold-plating any directives from Europe and to ensure that in their own legislation new red tape is kept to a minimum. As has been mentioned from all parts of the House, the small business sector will be the vehicle for growth of employment opportunities in this country in the years ahead.

We heard from the hon. Member for Dagenham (Jon Cruddas). What is happening in his constituency is a tragedy, with the largest employer for the past half century making many people redundant. In future, international companies will not offer great numbers of jobs. There is a risk that all those companies will downsize, and with the push to keep costs, particularly labour costs, at a minimum, more and more skilled and semi-skilled jobs will go to third-world countries.

We must ensure that we do not strangle small business in Britain. My principal worry is that we will discourage small businesses that employ 10 or 12 people from becoming businesses employing 25 people, simply because we will not have a light regulatory regime in place. I look forward to working closely with my hon. Friends and, I hope, with Ministers to begin to build a regime that ensures that there are no such constraints on the growth of smaller firms.

The extension of maternity and paternity leave, which applies beyond the small business sector, is seen as a family friendly right. It is easy for freelance journalists and others who work on a piecemeal basis to extol the virtues of part-time working, but that creates difficulties for small businesses. In my own business, two of our dozen employees were on maternity leave in the early part of this year. That made matters extremely difficult. Jobs had to be left open and we did not know whether to take on part-time staff. The burden should not be underestimated, especially in businesses that are trying to

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employ young people, graduates and people in their 20s. We should consider whether smaller businesses could be exempted from some of that regulatory burden.

It has been a pleasure to contribute to the debate on a key sector of our economy, which will be the great vehicle for employment growth in the next decade or so.

12.53 pm

Nigel Griffiths: With the leave of the House, I shall respond to the remarks made during the debate. First, however, I join in the welcome for the excellent maiden speeches that we heard this morning.

My hon. Friend the Member for West Bromwich, East (Mr. Watson) showed a close knowledge of the needs of all his constituents. His remarks that were particularly appreciated were his references to the achievements of disabled constituents and to his predecessors in West Bromwich who were distinguished Members of the House—Peter Snape and Betty Boothroyd.

My hon. Friend's detailed knowledge of "Spring Town", as he called it, will no doubt allow him to spring to prominence and high office in this place. I liked the analogy that he made between Business Link and general practitioners, stressing the need to tap into the best expertise available. I am delighted to tell him that one of my first acts as Minister was to approve the Business Angels programme, which will allow such expertise to be harnessed by our new generation of entrepreneurs.

My hon. Friend the Member for Dagenham (Jon Cruddas) made a very forward-looking speech, which combined a close knowledge of his constituency with a commitment to social inclusion. As he knows, that cause was very close to the heart of his predecessor, Judith Church. His determination to support Ford and other companies in their reinvestment shows that he will be leading the drive to bring prosperity to all parts of his constituency.

It was a pleasure to hear the speech of the hon. Member for Perth (Annabelle Ewing), especially her description of her beautiful constituency which I know well. Her predecessor excites the envy of the House in still being able to enjoy representing that constituency in the Scottish Parliament. I do not know what the Gaelic for doppelganger is, or whether the hon. Lady is a fan of "Dynasty". Her mother must be very proud of her and I am sure that she will relish her triumphs in this place.

The fourth maiden speech this morning was made by my hon. Friend the Member for Birmingham, Perry Barr (Mr. Mahmood). His predecessor has a long history in this place—27 years—and I am sure that he will have a great future in the other place. My hon. Friend rightly outlined the historic role of his city in supporting small businesses, growing great businesses over a number of centuries from the beginning of the industrial revolution. He spoke also of his traders' association and business park and the key role that people play in bringing about change. I am sure that he will provide the leadership that is required to take his city forward in this century, with links with business, university, local government and other elected representatives. I am sure that his father is looking down on him with pride.

The fifth maiden speech was from the hon. Member for Edinburgh, West (John Barrett). Again, I hope that the House will indulge me in welcoming a near parliamentary

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neighbour who speaks for another great city. It was heartwarming to hear him talk of a city that we both love and mention his concerns for the third world. I helped found the fair trade non-governmental organisation Scottish Education and Action for Development in Edinburgh two decades ago and it is a cause dear to the heart of many right hon. and hon. Members on both sides of the House. He will forgive me for saying that the impact of alternative voting systems on the turnout in the Scottish Parliament and European elections was no great advert for such changes, but I look forward to hearing his views develop in future speeches.

The sixth maiden speech was from my hon. Friend the Member for Workington (Tony Cunningham), who rightly paid tribute to Dale Campbell-Savours, who was an exemplary parliamentarian admired by us all. My hon. Friend gave us one of the wittiest anecdotes about his predecessor which I am sure Dale will have enjoyed listening to and reading in Hansard. He mentioned that his constituency is the country beloved by Wordsworth:

and spoke of the industrial relevance of his constituency today.

My hon. Friend also referred to the impact of foot and mouth on his constituency. I was brought up in a rural community and my heart goes out to the farmers, farm workers and other members of that community, some of whom I went to school with and whose great hardships I know of at first hand. He took the opportunity very early in this Parliament of passing me his proposals for helping his constituents and I know from his speech and his actions that he is a powerful and passionate advocate for rural communities.

The hon. Member for Taunton (Mr. Flook), whose own maiden speech impressed me, made a number of cogent points in his second speech. I have been looking at all the forms that businesses have to complete. If he will send me the forms that his one-person business had to study and complete to take on a second employee, I shall be interested in seeing them.

The hon. Gentleman stressed the importance of the small business community in terms of the impact of foot and mouth disease. I know, in unrelated areas, that my attempt to traverse the Cuillin ridge earlier this year had to be postponed for a month because of foot and mouth, despite the fact that there was no disease in the area. I know about its impact on the tourism industry. He also asked why only four applications had been received from the business recovery fund in his area. I will investigate that and get back to him.

The hon. Member for Cities of London and Westminster (Mr. Field) made a thoughtful contribution. I believe that George Bain did an excellent job on the national minimum wage, which is now accepted by Members on both sides of the House. He is looking at the very issues that the hon. Gentleman raised, and I have equal confidence that he will come up with a solution that will not overburden other areas.

The hon. Member for Weston–super–Mare (Brian Cotter) said that some regulations are an inch thick. We all want that reduced; a number of working groups made up of people of no political party and business people are examining that issue. I gave an example in my

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introductory remarks, of which I am rather proud, of the work that the Small Business Service did to produce a book for people starting in business on the tax that they have to pay. The book is half the size of the original draft that came from the Inland Revenue, and that 50 per cent. reduction should set a trend that should be followed.

The hon. Gentleman also mentioned the impact of the banks. As he will know, these were referred by my right hon. Friend the Secretary of State for Trade and Industry to the Competition Commission. We are awaiting its response in October, and I am sure that the hon. Gentleman will join me in hoping that the news is good.

The Small Business Council report was produced yesterday, and I forgive the hon. Gentleman for his selective reading of it. He failed to mention the effect of the Small Business Service in lobbying in Whitehall to make sure that the proposals in the Green Paper for a supplementary business rate were defeated. That shows just how effective David Irwin and his people are. [Interruption.] I am pleased to hear the hon. Gentleman acknowledge that from a sedentary position.

The hon. Gentleman responded courageously to my intervention on business rates. I have one advantage over him: I live in a city that was once run by the Liberal Democrats and the Conservatives. The rates went through the roof, with business rates going up even more than domestic rates. That perhaps explains why they formed a one-term administration in local government and have not returned to power there.

I want to pay tribute to the bravery of the hon. Member for South-West Hertfordshire (Mr. Page) in spending so much time on the topic of regulation. He said that he signed up to some regulations and not to others. He should have added that the vast number of regulations signed up to by the last Government, of which he was a Member, beggared belief. We may not have been much better than them when it comes to statutory instruments, but we cannot have the pot calling the kettle black. The last Government introduced some 3,000 statutory instruments, not three or 300, even in their last full year of government and after almost a decade after their attempts at deregulation. I was concerned by the example that he gave as a case of ineffective and burdensome bureaucracy and of regulation that he claimed was not welcomed by small businesses. That example was the statutory late payment regulations. [Interruption.] I assure the right hon. Member for Bromley and Chislehurst (Mr. Forth) that there is lots to talk about in respect of the speeches made from his Benches. I know that he was not here to hear them, so it is not so much a case of refreshing his memory as rubbing salt in his wounds.

Before today, I thought that we had consensus on statutory entitlement to compensation for late payment. I know that the Federation of Small Businesses and even the Confederation of British Industry, which tends to represent larger businesses but has many SME members for which it speaks eloquently, see the merits of the late payment regulations. The legislation has had some considerable effect. It was the only example that we got of something that a Conservative Government would do, but if it is the first piece of legislation that the Conservatives would repeal, they will have even fewer friends in small business than they have now.

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There is no evidence that the Labour Administration are more inclined to regulate than previous Administrations, but I want to ensure that the number of regulations is kept to an absolute minimum. It is important that there is independent scrutiny of regulations in the audit of regulatory proposals. We want a system and guidance to underpin the regulatory impact assessment process and to ensure that the process is subject to reviews and improvements.

The hon. Member for South-West Hertfordshire criticised the establishment of the Brussels office of the Small Business Service. Its clear purpose is to give small business a voice in the Commission, especially before the Commission frames legislation. He criticised the funding arrangement for the office, which he said meant that the taxpayer would have an open-ended commitment—would sign a blank cheque—and that businesses that benefited from it would not be expected to contribute. I am afraid that we shall have to disagree on that, but we are at least two years away from business being asked to contribute to that service. The Government believe that it is vital that small businesses are represented in Europe, and that is why the Small Business Service SME liaison office is being run from Brussels.

Other issues put to me included inspections. An example was given of a premises that was inspected nine times. I agree that that is too often, and I have had discussions on how to cut the number of visits. There is a trend, especially with the creation of unified authorities, towards closer co-operation between inspectors.

There is no reason why an inspector should not play the role of both cop and coach. If the fire extinguisher is close to its deadline for renewal, there is no reason why the fire inspector should not say, "Look, get this replaced. Ring me when you have done so, but if you don't, we will be back to carry out an inspection. By the way, here

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are the telephone numbers of the places where you can get it replaced." Where one visit can serve a multiple purpose, that should be done. I know that we will have the support of the House if we achieve that.

There were a number of less than supportive comments about the SBS. However, I think the House acknowledged that its chief executive, David Irwin, who has direct access to the Cabinet Office and, indeed, to No. 10, has had a great effect in ensuring that the supplementary business rate was not introduced and in helping tens of thousands of small businesses with their programmes and business plans. Businesses are being helped to secure finance and with other matters. As the service is only just over a year old, that is a creditable record of achievement and I am confident that it will go on to achieve much more.

The hon. Member for North Thanet (Mr. Gale) raised issues in connection with residential care homes. He acknowledged in his speech that the provisions of the Care Standards Act 2000 will benefit users and providers of care by ensuring that regulations are consistent and coherent. Of course, regulations and standards are the subject of a regulatory impact assessment, which will be produced for consultation. I anticipate that he will ensure that the groups that he mentioned make representations.

Several of the contributions to the debate have been of considerable merit. The latter stages of the debate obviously drew Members to the Chamber—the quality of the speeches was doubtless circulating as Members sent their notes to Hansard. It is always a pleasure to respond to a debate that includes contributions by Members from both sides of the House who really care about the subject—in this case, small businesses in their constituencies.

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