Regulation

Oral Answers to Questions — Trade and Industry – in the House of Commons at 11:30 am on 27th January 2005.

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Photo of Jacqui Lait Jacqui Lait Shadow Minister, Home Affairs 11:30 am, 27th January 2005

How many regulations affecting business her Department introduced in the past year.

Photo of Nigel Griffiths Nigel Griffiths Parliamentary Under-Secretary, Department of Trade and Industry

In 2004, 130 regulations were passed under seven items of primary legislation, as compared with 1994, when the previous Administration passed 148 regulations. The hon. Lady will join me in welcoming that reduction.

Photo of Jacqui Lait Jacqui Lait Shadow Minister, Home Affairs

It is no cause for congratulation that industry is increasingly regulated, which is why it believes that the Government do not care for industry. In the light of the cost to British industry of increased regulation and the findings of the British Chambers of Commerce that the Government did not use sunset clauses in 2002–03, will the Minister heed the Cabinet Office, which has urged the use of sunset clauses, or does he still believe that sunset clauses are a quack cure?

Photo of Nigel Griffiths Nigel Griffiths Parliamentary Under-Secretary, Department of Trade and Industry

I believe that we must bear down on regulations, some of the worst of which have been effectively tackled by our unit. It is important to examine all the options, but if the hon. Member and her party believe that sunset clauses are the universal solution to the problem, why did they not introduce them during their 18 years in government?

Photo of Liam Byrne Liam Byrne Labour, Birmingham, Hodge Hill

This month, Barclays bank has published new data showing that the business start-up rate in Birmingham is set to rise by 17 per cent. Regulations aside, does my hon. Friend agree that there has never been a better time to start a business in this country?

Photo of Nigel Griffiths Nigel Griffiths Parliamentary Under-Secretary, Department of Trade and Industry

My hon. Friend is right. That point was reinforced last week by Global Entrepreneurship Monitor, which said that this country is more entrepreneurial than all our major European competitors and Japan, too. The Barclays survey shows that more companies started up last year than at any time since the survey began in 1988. More people are in work than at any time in our history and economic growth has occurred for 50 consecutive quarters. My hon. Friend's constituents are working hard and growing their businesses and their experience is reflected up and down the country.

Photo of Mr Andrew Hunter Mr Andrew Hunter DUP, Basingstoke

Many people in industry believe that the Government are oblivious to the damaging downward spiral of excessive regulation and increasing non-wage costs, which undermine competitiveness. Are the Government aware that the two factors are combining to make the UK a less attractive place to do business?

Photo of Nigel Griffiths Nigel Griffiths Parliamentary Under-Secretary, Department of Trade and Industry

The representations that I have received as Minister for Small Business and Enterprise include a big thank you for abolishing automatic fines on VAT, which hit 200,000 businesses and cost them £99 million in fines in the final year of the last Conservative Administration. Businesses have thanked me for raising the audit threshold to help almost 300,000 companies avoid bureaucracy and for abolishing corporation tax for 150,000 small businesses. We have done a lot to ensure that businesses do not face bureaucracy and tax, but I am first to admit that more remains to be done, and we will do more in another term.

Photo of Jim Sheridan Jim Sheridan Labour, West Renfrewshire

Will my hon. Friend examine the regulations surrounding employment agencies? He may be aware of the recent investigation by the BBC Radio 4 "PM" programme into the exploitation of migrant workers by bogus employment agencies, which take money from migrant workers to provide jobs that do not exist. Will he examine the current regulations and, if necessary, block any loopholes to stop bogus employment agencies exploiting poor, vulnerable migrant workers?

Photo of Nigel Griffiths Nigel Griffiths Parliamentary Under-Secretary, Department of Trade and Industry

My hon. Friend is right. I know that the House and the country will thank him for his Gangmasters (Licensing) Act 2004, which is designed to crack down on this. My hon. Friend the Minister for Employment Relations is determined to reinforce those efforts and to bear down on such disgraceful practices.

Photo of Stephen O'Brien Stephen O'Brien Shadow Secretary of State for Business, Innovation and Skills, Shadow Secretary of State for Industry

For British business to reverse its declining competitiveness under this Government, it needs Government to get out of its way. Yesterday, the Institute for Fiscal Studies demonstrated that a Labour Government would have to raise taxes by £11 billion were they to stay in office. Labour offer no hope for business, in contrast to the Conservatives, who will reduce taxes.

The other crushing Labour tax on business by another name is the burden of over-regulation. Precisely by how much will compliance costs to business rise if, preserve us, Labour cling on to office for a third term?

Photo of Nigel Griffiths Nigel Griffiths Parliamentary Under-Secretary, Department of Trade and Industry

Many measures are being taken to reduce compliance costs to business, so the hon. Member has clearly got the wrong end of the stick. Having read his report complaining about thousands of regulations being passed last year, I would be interested to know why the Conservatives prayed against only eight of them.

Photo of Stephen O'Brien Stephen O'Brien Shadow Secretary of State for Business, Innovation and Skills, Shadow Secretary of State for Industry

The Minister has failed to answer the question because he has absolutely no idea, and does not care, about how much compliance with regulations is costing British business and British competitiveness. Does he agree with the Prime Minister, who said that the problem with regulation is cultural, which is the case not least in his Department? The Minister and his Secretary of State are all talk. Will he tell the House how he intends to reverse the flow of regulations spewing out of his Department? What career incentives have he and the Secretary of State put in place for DTI civil servants to suggest specific repeals of regulations, as we have done, and not to propose yet more burdens on business?

Photo of Nigel Griffiths Nigel Griffiths Parliamentary Under-Secretary, Department of Trade and Industry

It is wax out of the ears time. The hon. Member will have heard me say that 137 regulations were passed last year compared with 148 in the same period 10 years ago. We will take no lessons about that from him. We are the envy of the advanced industrial world in terms of the expansion of our economy as against the other G7 economies. He makes gibes against our Department, which he would abolish—a scheme that commands almost no support—but he should know that we are highly rated on our regulatory impact assessments and our regulatory reform orders. He should read the Whitehall memos with more care.

Photo of Mrs Anne Campbell Mrs Anne Campbell Labour, Cambridge

Will my hon. Friend find out whether there is anything that he can do by regulation to increase the number of women entrepreneurs in the UK? When my right hon. Friend the Minister for Industry and the Regions visited my constituency last week, she revealed that 101,000 women are running their own businesses in the east of England. That represents 27 per cent. of all self-employed people. Women in the east of England are clearly doing excellently in helping to promote business and prosperity in the region, but there is still a long way to go.

Photo of Nigel Griffiths Nigel Griffiths Parliamentary Under-Secretary, Department of Trade and Industry

I agree. That is a key component of the Small Business Service and the whole thrust of the DTI. My right hon. Friends the Secretary of State and the Minister for Industry and the Regions take that seriously. My hon. Friend will be pleased to learn that the Global Entrepreneurship Monitor report that was published last week said that 177,000 women set up a business in Britain last year—a record number. She will know that if as many women as men had done so, we would have another 100,000 potentially thriving businesses. That is the task that my colleagues and I have set ourselves, and, if I may say so, my right hon. Friends have set about it with relish.