Small Businesses

Oral Answers to Questions — Scotland – in the House of Commons at 11:30 am on 18th March 2009.

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Photo of Anne McGuire Anne McGuire Labour, Stirling 11:30 am, 18th March 2009

When he last met representatives of small businesses in Scotland to discuss their economic situation.

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Photo of Jim Murphy Jim Murphy The Secretary of State for Scotland

I have met the Federation of Small Businesses, the Scottish Chambers of Commerce, the Scottish Council for Development and Industry and the CBI Scotland to discuss the economic situation.

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Photo of Anne McGuire Anne McGuire Labour, Stirling

The feedback from many of the small businesses in my constituency, many of which are involved in tourism, shows that there is a lack of knowledge at the local bank branch level about accessing Government schemes. In his discussions with Scottish Ministers, will my right hon. Friend emphasise the importance of Scottish Business Gateway and its contractors, and ensure that people understand the Government-backed schemes that are in place and disseminate that information not just to businesses in Stirling, but to small businesses across Scotland?

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Photo of Jim Murphy Jim Murphy The Secretary of State for Scotland

My right hon. Friend raises a point about Stirling and tourism that is specific to her constituency, as she always has done in the House. She is right: we must ensure that the enormous investment in the schemes to support Scottish businesses is accessible and understood, particularly for small businesses. We are trying to encourage businesses to go to the "Real help now" website, where all the information is available. We also need to ensure that the advice through Scottish Enterprise's networks and through UK Government and Scottish Government agencies is readily available, easily understood and deliverable, and we are working very hard on that.

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Photo of Angus MacNeil Angus MacNeil Shadow SNP Spokesperson (Scotland), Shadow Spokesperson (Culture, Media and Sport), Shadow Spokesperson (Environment, Food and Rural Affairs)

Small businesses are indeed having to shoulder a big responsibility. According to excellent work by the Scottish Trades Union Congress, at the jobcentre in Stornoway in my constituency, 44 people are chasing each available vacancy, which is the highest rate in Scotland. Will the Secretary of State join the Scottish National party and the parties in Wales in the fight against Westminster's forced £1 billion of cuts that are coming our way? Otherwise, more people will be chasing each vacancy in small businesses and other businesses all over Scotland.

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Photo of Jim Murphy Jim Murphy The Secretary of State for Scotland

In these difficult economic times, the SNP's economic policies are indeed a fantasy; they are beyond all fiction. Scottish families in the hon. Gentleman's constituency and mine—and, indeed, across the whole country—are finding additional ways to tighten their belts. There is only one organisation in Scotland that believes that it cannot make any efficiency savings, and that is the SNP Scottish Government. The Scottish Government have more money than ever before and they should get on with delivering it. Instead of this endless constitutional obsession, we should all be focusing on the economic recovery, not constitutional referendums.

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Photo of Brian H Donohoe Brian H Donohoe Labour, Central Ayrshire

My right hon. Friend will remember coming to a meeting with small businesses in Ayrshire at which the problems associated with the banks being able to make loans and the extra charges now being imposed were raised. With the Government owning 67 per cent. or thereabouts of some of the banks, surely the Government should be putting more pressure on those same institutions to lend the money and to reduce the charges that are now being faced, so that people can get on with their business and unemployment can be maintained at a low level in Ayrshire.

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Photo of Jim Murphy Jim Murphy The Secretary of State for Scotland

My hon. Friend makes an important point. I enjoyed my visit to Ayrshire with him and my hon. Friend Sandra Osborne. Points were made in that meeting with small businesses about the availability of credit, which is why we have taken the measures that we have. The Royal Bank of Scotland has announced that it will commit £25 billion of additional lending, while the Lloyds group has announced £14 billion of additional lending, as part of the asset protection scheme. That is legally binding, because we need to ensure that Scottish businesses—particularly small businesses, but also businesses across the whole of the UK, not just in Scotland—can access credit and trade again, as part of a future recovery. I look forward to coming to Ayr again to discuss those matters with him and his businesses.

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Photo of David Mundell David Mundell Shadow Secretary of State for Scotland

I welcome the fact that the Secretary of State has met small business leaders and the First Minister to discuss the economic situation in Scotland. However, I am disappointed that once again post-meeting reports were characterised by the First Minister and the Secretary of State briefing against each other. When will we see the mature relationship between Westminster and Holyrood that we should expect in order to tackle an economic crisis of this scale? Perhaps the Secretary of State can make a start on this new relationship today by embracing the Chancellor's call for humility and collective responsibility and apologising to the people of Scotland for the multitude of economic mistakes that his Government have made.

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Photo of Jim Murphy Jim Murphy The Secretary of State for Scotland

Like every Labour Member, I am always sorry when anyone loses their job, and today we are seeing some very difficult unemployment figures for Scotland and the whole of the UK. As we all know, behind those figures there are real people and real families. I am disappointed, as I am sure many Scottish families will be, that, rather than focusing on the real pressures that real families are experiencing, the hon. Gentleman again chooses to participate in the soap opera of the process of politics. People are interested in solutions, not in his soundbites. It is important that we make progress on this matter, and we will do whatever we can to support the newly unemployed, so that they do not become the long-term unemployed.

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Photo of David Mundell David Mundell Shadow Secretary of State for Scotland

I am sure that the 1,000 additional people in the dole queues of Scotland this month, and their families, will very be interested to hear the Secretary of State's solutions. In December, he announced that he was putting together a council of economic advisers, who would be named in January. Since then, we have heard nothing. What is the reason for that delay? Is he trying to avoid the mistakes of his predecessor, who used to vaunt the fact that Sir Fred Goodwin represented Scotland in the Chancellor's high-level group on financial services? Does the Secretary of State think that his Government no longer need economic advice, or is it perhaps that nobody wants to be associated with his group?

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Photo of Jim Murphy Jim Murphy The Secretary of State for Scotland

I made no such announcement, then or since. The announcement that I made was about how to get those involved in academia and campaigning together with experts in poverty to ensure that the poorest could see a way through this recession, so that there would not be a generational legacy as a consequence of that, as there was after previous Tory recessions. We will not allow jobcentres to redirect people from unemployment benefit on to incapacity benefit, which is what happened in jobcentres during the previous Tory recession. That policy was wrong, immoral and unforgivable.

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Photo of John McFall John McFall Chair, Treasury Committee, Chair, Treasury Committee

When the Treasury Committee visited Edinburgh two weeks ago, we found dismay among small businesses that banks were putting arrangement fees and other private charges on them, rather than interest rates. When the Secretary of State meets representatives of the banks, will he remind them that the Committee is undertaking an inquiry into the banking crisis, and that we will be monitoring their lending agreements, under which transparency and value for money for the taxpayer are going to be the key requirements?

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Photo of Jim Murphy Jim Murphy The Secretary of State for Scotland

On behalf of all hon. Members, I want to put on record the respect that exists across the country for the work that my right hon. Friend and his fellow members of the Treasury Committee do, and will continue to do, on this important issue. After seeing on television the hearings involving his Committee and the bankers, I do not think that the bankers will need me to remind them that he is determined to stay on top of this issue. Now that he has asked me to do so, however, I will of course raise the matter with the banks.

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