Small Businesses

Oral Answers to Questions — Treasury – in the House of Commons at 12:00 am on 17 January 2017.

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Photo of Craig Tracey Craig Tracey Conservative, North Warwickshire 12:00, 17 January 2017

What support the Government are providing to small businesses.

Photo of Maria Caulfield Maria Caulfield Conservative, Lewes

What support the Government are providing to small businesses.

Photo of Jane Ellison Jane Ellison The Financial Secretary to the Treasury

The Government absolutely recognise the key role that small businesses play in the economy, which is why, for example, at the autumn statement we announced an additional £400 million for the British Business Bank to help growing firms to access finance. Of course, we have taken a number of other steps, including introducing the seed enterprise investment scheme.

Photo of Craig Tracey Craig Tracey Conservative, North Warwickshire

Does the Financial Secretary agree that independent retail stores, such as Chalk & Linen in my constituency, add greatly to the character and vitality of our towns and high streets, and that the Government should do all they can to support them?

Photo of Jane Ellison Jane Ellison The Financial Secretary to the Treasury

As a former co-chair of the all-party parliamentary group on retail, I could not agree more that independent retail, and retail generally, is a vital sector. My hon. Friend is right that we want to support independent retailers on our high streets, which is why, from April, 600,000 of the smallest businesses—occupiers of a third of all properties—will not have to pay business rates as part of the £6.7 billion business rates package that will kick in over the next few years. I hope that he agrees that that is a helpful bit of support for key local businesses.

Photo of Maria Caulfield Maria Caulfield Conservative, Lewes

I recently attended my local chamber of commerce’s breakfast meeting in Seaford, and I met many small businesses that are pleased that the economy is doing so well and is being so expertly led by this Government. However, they have some concerns about the introduction of quarterly tax returns and the impact it would have on the costs of small businesses. They suggest the introduction of a threshold for the smallest businesses. Will the Minister consider that?

Photo of Jane Ellison Jane Ellison The Financial Secretary to the Treasury

I, too, have a good relationship with my local chamber of commerce; we get vital feedback from our chambers of commerce. Of course, we are not introducing quarterly tax returns; my hon. Friend is referring to the “making tax digital” project. Although the Treasury Committee recently said that the long-term future can, and probably should, be digital, we understand that we need to look carefully at the consultation responses and at the concerns of small businesses. Of course, we have already exempted a number of the smallest businesses from the threshold, but we are looking carefully at the consultation responses and at the Select Committee’s report. We do not recognise the figure from the Federation of Small Businesses on the cost, and we have not seen the assumptions that underpin it; if I am to address those concerns, seeing those would be helpful.

Photo of Rosie Winterton Rosie Winterton Chair, Finance Committee (Commons), Chair, Finance Committee (Commons)

Small businesses in Doncaster face a worrying skills shortage. Will the Minister support those businesses by impressing on her colleagues in the Department for Education the need for a speedy decision on Doncaster’s university technical college, to give the go-ahead for the money? Will she have a word, please?

Photo of Jane Ellison Jane Ellison The Financial Secretary to the Treasury

I am very happy to raise that issue with colleagues. More broadly, the Government absolutely support the skills agenda, which we have made a real priority. If we are to close the productivity gap in this country, investing in skills and high-quality apprenticeships is clearly key. We have taken a lot of action in that regard.

Photo of Helen Goodman Helen Goodman Labour, Bishop Auckland

The most useful thing that the Treasury could do for small manufacturers in my constituency is announce an objective of staying in the customs union. Up to now, the Treasury has been a beacon in saying that it wants decisions based on analysis, not on rhetoric and ideology. Can the Minister Secretary assure the House that that is still under consideration?

Photo of Jane Ellison Jane Ellison The Financial Secretary to the Treasury

Again, these are issues that we are looking at carefully; the Chancellor has had a series of roundtable meetings with different sectors and industries in recent months, as have all of us Ministers. We are looking carefully at what those detailed issues are. Of course, much more will be said on this and discussed in the House later today, but we are clear that we want to understand the detailed issues that businesses face, so that as we move forward to make our future outside the European Union, we can resolve the practical issues that businesses will face in a way that helps the British economy.

Photo of Alan Mak Alan Mak Conservative, Havant

Access to capital is vital for small businesses in my constituency and across the country, and a refusal from a big bank should not be the end of the line. Will the Minister continue to support the bank referral scheme, which helps so many small businesses to access alternative sources of finance?

Photo of Jane Ellison Jane Ellison The Financial Secretary to the Treasury

Absolutely, we will. The Government’s finance platform referral policy helps small and medium-sized enterprises whose finance applications have been declined by their bank to explore alternative options. It requires the major banks to refer SMEs that are rejected for finance—with their permission—to finance platforms. We can do a range of other things to support the good point that my hon. Friend makes. I encourage all Members with SMEs in their area that have had finance applications rejected to refer them to some of these schemes, because they are making a difference.

Photo of Alistair Carmichael Alistair Carmichael Liberal Democrat Spokesperson (Home Affairs)

Many small businesses in the Northern Isles are in the tourism sector. Given the Chancellor’s reported comments at the weekend, will the Government look again at the opportunities presented by the tourism industry’s proposals for a lower rate of VAT on that sector?

Photo of Jane Ellison Jane Ellison The Financial Secretary to the Treasury

The House will not be surprised to learn that the Treasury is receiving a number of suggestions as to what might happen to VAT when we are no longer members of the EU, and I am aware of the pressure from and representations made by the tourism industry. I am meeting the Northern Ireland Affairs Committee tomorrow; this is likely to be one of the issues on its mind. Of course we look at these issues carefully, but we are still members of the EU, and all our legal obligations and so on remain while that is the case.