Second Reading

Part of Small Business, Enterprise and Employment Bill – in the House of Lords at 5:40 pm on 2nd December 2014.

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Photo of Baroness Byford Baroness Byford Conservative 5:40 pm, 2nd December 2014

My Lords, I would like to make a short contribution to this important Second Reading. Rather than repeat many of the items that have been raised by other noble Lords, the areas that I shall concentrate on are late payments; broadband; pubs and work experience; encouragement and enterprise; farm businesses; and regulation.

The Bill is to be welcomed. Among other things, it outlaws a number of practices that are difficult to prosecute because, while clearly wrong, they are not statutorily illegal. I believe that some of them contain unintended consequences of legislation passed by previous Parliaments that were formed of and staffed by people who were basically straightforward. We shall need to be aware of our own unintended consequences as our scrutiny of the Bill progresses. At the same time, we should not create laws that are too easy to amend without proper debate and the ability to alter the official proposals. The use of the affirmative procedure is welcome in many cases, but I have doubts about applying it to amend at some time in the future the purposes of a piece of legislation, as reflected in Clause 8, which will be passed today when we finally have the Bill.

Bearing in mind my farming interests in a small farm business, I am particularly pleased with the clauses that should have a positive impact in rural areas. I am pleased to see the proposals on streamlining company registration that move to make it easier for the residential landlord to allow a tenant to run a business from home. As the cuts bite, as they have done over recent years, the plight of rural dwellers dependent on public transport worsens in many rural areas. I believe that these moves will make it easier for numbers of people to work in their own village instead of having to travel into town.

Farming directly employs some 464,000 people as a small part of the very important food industry as a whole. Some 56% of farms surveyed in 2012-13 have diversification on them. However, I should like to raise a general query about the timetable for the introduction of a streamlined system. Is the deadline of 2017 sufficient for the computer system specification, the tender process and then the development, testing and final approval prior to installation and rollout with regard to new systems? Perhaps the Minister will comment further on this aspect when she comes to wind up.

The change of definition for small and micro businesses makes sense, but I have questions about the effect on the numbers involved. Businesses will be reclassified to their disadvantage or advantage, so is there any danger that some at the margin will fall in and out of a particular classification as their turnover fluctuates? This last point may particularly affect the farming community, where employee numbers may tend to stay the same but the prices obtained for their output can vary widely. The annual statistics on farm incomes reflect this aspect.

Many noble Lords have spoken in great detail about the Pubs Code. I will therefore not go into it but I take up the comments about flexibility from the noble Baroness, Lady Harding, who at the moment is not in her place. Having had two grandchildren who worked in pubs to earn money while they were at university, I know that the experience of getting work in them is hugely beneficial. I realise that there are other aspects to employment, but the point should not be lost that giving someone that opportunity to work in the first instance is very valuable.

I turn to late payments. In many cases, sadly, small businesses are totally dependent on large businesses paying their dues at the right time. My late father-in-law ran Byford’s, which sold socks and sweaters. It started as a very small company at the turn of the 1920s, when he employed three people, and ended up as a company employing 2,000 people. He used to say of his competitors or the people that he was supplying, “Could you at least put my invoice into the hat so that I might have a chance of getting paid at some stage?”. I suspect that that is something I shall always remember. I suggest to the Minister that that message should be passed along to other government departments, because public procurement is clearly one of the big offenders. That is something that we should not lose sight of.

Another big problem for those living in rural areas is the whole question of having rural broadband. I am sure that some noble Lords who are based in urban areas cannot believe that there are still areas in the countryside where broadband is just not available, let alone at the speed of two megabits per second. I believe that the last 10% of areas that do not have broadband still need to be connected. I wonder if the Minister is in a position to tell us any more about that, because any small business has a better chance of succeeding if it is attached to broadband. You can operate anywhere in the country if you have access, but if you do not then it is very difficult.

I turn to regulation. I follow the noble Lord, Lord Curry, and my noble friend Lord Lindsay in support of the necessity for regulation, but it should be risk-assessed, proportionate and relevant. Where it is not, and where it has been surpassed, it should be done away with. I congratulate them on the work that they have been doing but there is much more to do. If I kept within my farming context, there are still some items covered by the Macdonald task force that have not been fully concluded. Again, I hope that they will not get lost because this new Bill is coming into being.

I want to pick up the theme of the right reverend Prelate, who spoke about the input of churches. I would like to give two examples of ways in which we can stimulate and help people to get started on the first rung of the ladder. I give them very humbly; they are fairly small but both relate to agriculture and the countryside. I cannot see anywhere in the Bill—I am not asking for this, but I think we should recognise it—a provision to urge individuals, charities, trusts and businesses to encourage apprenticeships or give start-up loans. I am not calling for this to be included in the Bill, but we should at least recognise it. I shall give two examples. The first is the Prince’s Countryside Fund, which gives grants to projects that support people who care for the countryside. Grants of up to £50,000 have been given and since 2010 they have aided 87 projects, helping some 64,000 people. In the overall global context of our debate today that might seem quite small, but one success then goes on to help someone else.

The second, more recent example that I share with noble Lords is the newly formed Henry Plumb Foundation, which in the past 18 months has helped 18 young people who have come up with ideas about what they could do by giving them small grants. More important than that, though, was the fact that they were allocated a mentor as well. So they started with a small grant but they did not get the rest of their grant until their mentor was happy that their business would succeed. I commend these examples to the House because they are but one small way in which we could do more.

I commend the Government on bringing the Bill forward. There are many good measures within it and I look forward to taking part in the debates that follow.