Economic Growth and Employment

Part of Opposition Day — [Un-allotted Day] – in the House of Commons at 2:18 pm on 23rd November 2011.

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Photo of Vincent Cable Vincent Cable The Secretary of State for Business, Innovation and Skills 2:18 pm, 23rd November 2011

I thank the hon. Gentleman for reminding me of one of my best lines. It is partly a compliment to Ireland that we trade with it so extensively, but that fact is an appalling commentary on our neglect of the big emerging markets.

Export growth is one key focus for us. The second is people and apprenticeships. The Minister for Further Education, Skills and Lifelong Learning will say more about this in his summary. Despite a severely curtailed budget, we have increased apprenticeships—actual people doing training—by 50% over the past year. There are now 350,000 people in such training. We do not accept that that is the end of the road. We have to improve the quality and refocus as much as possible on younger apprentices, thereby addressing in part the problem of youth unemployment. This is a major success story and we are proud of it.

On access to finance, one of the major themes of my analysis has been that what we are dealing with is a collapsed and non-functioning banking system. It is right for Members to continue to cross-question us on the Merlin agreement, because that is at the heart of the problem. We have stopped, at least in relation to small and medium-sized enterprises, a process of rapid deleveraging. We are using Government funding through the regional growth fund and, from next year, the Green investment bank to co-finance private capital so that there is access to finance for British industry. We are taking initiatives to support equity finance. The business growth fund is not Government owned or controlled, but it is a major initiative that should have been taken decades ago to get equity finance functioning. Access to finance is a critical issue—of course we accept that. It is a consequence of the banking crisis that we are focused on it.

I want to give one final concluding thought. When I hear the Opposition speaking about the economy, I think that lying at the back of their world view is the idea that what we are currently in the middle of is a cyclical problem—we had a boom, we had a bust, we will press a few buttons, spend a bit more money, and we will get back into a boom again. This is not a cyclical problem; it is a profound, long-standing structural problem. We had the wrong model. Growth was based on fundamentally the wrong principles, it was not sustainable and it collapsed. We are now having to repair the damage.