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Amendment of the Law

Part of the debate – in the House of Commons at 7:41 pm on 29th March 2010.

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Photo of David Simpson David Simpson Shadow Spokesperson (Education), Shadow Spokesperson (International Development), Shadow DUP Spokesperson (Business, Innovation and Skills) 7:41 pm, 29th March 2010

I totally agree with my hon. Friend. I was just going on to say that we have all heard very distressing stories from business people in our constituencies who are in complete despair because of the attitude of banks. These constituents are solid, sound people, who have done business with the banks over many years and, in some cases, over generations, yet far from offering those people help at a time of need, the banks have put obstacles in their paths. That is totally unacceptable.

Businesses also need to be encouraged to invest in innovation and skills and to increase their levels of exports. We should do everything possible to reduce the burdens on business. We need to move away from the culture of bureaucracy and red tape, as these things stifle business, especially small businesses, which are the very backbone of the British economy.

Although I broadly welcome the small business and infrastructure initiatives in the Budget, I do not think that they go far enough to persuade the markets that we are on the road to recovery and at a fast enough speed. Because of the fragile state of our finances, coupled with the impact of the recession, I fear that there is little incentive for businesses to take risks of any sort. The Small Business Forum said that just 5 per cent. of its members believe the Chancellor's proposals will create an environment for their businesses to develop, while 87 per cent. have said that the Budget will not increase business or consumer confidence.

I am also concerned about unemployment. It is good that the recent national trend has shown a fall in numbers, but it seems likely that high levels of unemployment will be with us for some time to come. John Philpott, chief economic adviser of the Chartered Institute of Personnel and Development, has said:

"Although a fall in unemployment is clearly better than a rise, this should not be read as a sign that the UK jobs market is recovering strongly."

I agree with that and I fear that chronic unemployment could well be one of the long-term effects of the recession. High unemployment reduces tax receipts, increases public spending, reduces consumer confidence and depresses the housing market. We must therefore target resources towards the creation and development of a well and properly qualified work force.

Schools must give realistic career advice to pupils at an early stage of their secondary education. We churn out too many graduates in fields that often provide few opportunities in the workplace. This leaves many good young people unemployed or near-unemployable. There is an urgent need for those problems to be tackled.

Let me end by quoting the words of Miles Templeman, director general of the Institute of Directors. He said:

"It's the entrepreneurs and business leaders of the UK who will make economic recovery happen. But they need confidence-confidence in their businesses and confidence in the Government's economic policy. So it's deeply worrying that instead of boosting confidence, the Budget appears to have had the opposite effect."

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