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Mrs. Roche: Would the hon. Lady care to read the rest of that letter? It might help.
Mrs. Gillan: I am happy to place the letter on record, although I shall certainly not go through it chapter and verse. The last paragraph states:
- "You also asked whether micro and small businesses will be excluded from the minimum wage proposals. No exemptions are envisaged for small businesses."
Mrs. Gillan: The Minister adds that there will be a "wide ranging consultation exercise", but the earlier sentence presumes that there will be no exemptions for small businesses. I cannot see how she can wriggle out of that.
Mrs. Roche: The House will have noticed the hon. Lady's reluctance to read the rest of that paragraph. May I invite her to do so?
Mrs. Gillan: The letter states:
- "You also asked whether micro and small businesses will be excluded from the minimum wage proposals. No exemptions are envisaged for small businesses. However, in formulating its recommendation to Government on the initial level at which a minimum wage might be set, the Low Pay Commission will undertake a wide ranging consultation exercise which will include the small business sector."
Mrs. Gillan: That sentence does not affect the fact that the Minister said:
- "No exemptions are envisaged for small businesses."
Mrs. Gorman: In endorsing my hon. Friend's concern about the introduction of the minimum wage, we must not let the House run away with the idea that small firms pay only small wages. Some of the worst payers are the great nationalised industries, such as the health service.
It would be interesting if the Minister told us a little bit in her reply about what the Government will do to find the money to improve the wages of people in the health service.
Mrs. Gillan: That would be interesting, and we look forward to it.
What do small businesses face under this Government? They have already faced the interest rate rises and the raid on pensions. They will have to extend parental leave to paternity leave. We have established that there will be no exemptions from the minimum wage. The working time directive, the telephone tax, the fossil fuel tax and the new workers councils are all coming in. At the same time, small businesses will have to go through millennium compliance and euro preparations. My goodness, am I glad that I am not in small business today. With this weight of legislation and all the impositions of this Government on them, small businesses will have a difficult job innovating in that climate.
Mrs. Roche:
The hon. Lady has been very courteous in giving way. I did not catch what she meant by "millennium compliance". What is she suggesting?
Mrs. Gillan:
It may have struck the hon. Lady that we are approaching 2000, and businesses are having to undergo millennium compliance, which takes time, effort and money.
Mrs. Roche:
I agree. That is why the Government take the century date change problem seriously and why we have launched Action 2000 under the chairmanship of Don Cruickshank, whose appointment was announced recently. I think that the House was confused because the hon. Lady seemed to be saying that the problem was a Government regulation or to be implying that it was the Government's fault. I know that the Government's reach is far, but I did not think that our powers extended there.
Mrs. Gillan:
The hon. Lady has confused herself. She had better go back to sleep. I know that it was difficult for her to read her official speech so fluently this morning.
All the regulations that the Government are imposing on small companies at the same time as they are having to deal with unavoidable millennium compliance and euro preparations mean that untenable burdens are being placed on our small businesses. The Government have not thought it through. I am most disappointed about the lack of exemptions for small businesses, especially in respect of the minimum wage.
Mr. Timms:
The hon. Lady encouraged the House in the 24th minute of her speech by mentioning innovation. Perhaps she could turn her attention to that, which is the subject of the debate.
Mrs. Gillan:
The title is "Innovation and the Role of Small Firms"; I am discussing the role of small business. Mr. Deputy Speaker, I find it impertinent that the hon. Gentleman should try to do your job for you. I believe that I have been in order throughout my speech, otherwise you would have leapt to your feet.
Mr. Deputy Speaker:
Order. I think that it would be sensible if we got on with the debate.
Mrs. Gillan:
When I wrote to the Minister about exemptions for small business, I wanted to her to take
The one thing that the Government have done for small businesses is to produce a Green Paper on late payment of debt. The Government intend to legislate along those lines. I am surprised that that is the only tangible product from the Department of Trade and Industry for small firms. It is great hypocrisy that the Government should be considering legislation, which many small businesses do not want or regard as necessary, when they should be putting their own house in order. I tabled some written questions on the matter. I again received poor replies, which did not tell me how many bills were outstanding in various Government Departments. I did, however, get a detailed reply from the Department of Health about NHS trusts. I was very worried by what I received.
Mr. John Wilkinson (Ruislip-Northwood):
My hon. Friend is saying something of the greatest importance. She is right to castigate late-paying Government Departments, but is not the late payment of debt to small companies a very serious problem for them, especially if they have only one or two suppliers, some of which are large companies that are deliberate late payers? While being critical of Government Departments, will she think long and hard about whether she should oppose in principle legislation in this area, because many small business men would welcome it?
Mrs. Gillan:
I have no problem with my hon. Friend's remarks. If businesses are to innovate and grow, they cannot face having large sums being owed to them, especially by Government Departments
Mrs. Roche:
Will the hon. Lady give way?
Mrs. Gillan:
No, I am coming to the end. I have been most generous in giving way.
The figure given to me in the written answer was that NHS trusts pay 3 million bills every quarter but that while 80 per cent. are paid on time, 20 per cent. are not. That means that 600,000 late payments were made in the first quarter of this year. If one extrapolates that figure over the year, it reveals that 2,400,000 bills are paid late by NHS trusts to other companies. Instead of producing Green Papers, consulting and murmuring warm words to small businesses, surely the Minister should visit Government Departments to find out about the payment records of her colleagues.
Let me return to my opening remarks: the Government have removed ministerial responsibility for small businesses from each and every Department and instead created an ad hoc group. The Department of Trade and Industry does not know what is going on in other
Departments that affect small business, and it is now about to embark on one of the greatest tranches of legislation governing the business community that we have ever witnessed. How on earth can our businesses thrive and contribute to the economy if they are stifled by the Government? The Minister needs to go back to the drawing board and to look at affairs closer to home before she continues her brief. Before legislation is brought before the House, she needs to ensure that she has cleaned up her own Government's act.
Mr. Stephen Timms (East Ham):
We have just listened to a remarkable speech by the hon. Member for Chesham and Amersham (Mrs. Gillan). The subject of the debate is innovation and the role of small firms and the context for it is the Government's response to the third report of the House of Lords Select Committee on Science and Technology, which was published last month. I do not know whether the hon. Lady has read it or is even aware of its existence. Certainly, she made no reference to it and we are none the wiser as to whether she supports or disagrees with the Government's response to it.
I congratulate my hon. Friend the Minister for Small Firms, Trade and Industry on her achievements and the extent to which she has established the Labour party as the party that listens to and speaks up for Britain's small businesses.
Just after the election, I attended a seminar organised by Barclays bank at Dartford, held to brief the bank's small business customers on the single currency. It was attended by about 60 representatives who without exception believed that Britain would join the single currency as a matter of course in the interests of the British economy and of their businesses.
We know from the events of the past couple of weeks that that view is shared by the former Deputy Prime Minister, the right hon. Member for Henley (Mr. Heseltine), and by the hon. Member for Esher and Walton (Mr. Taylor), who is in his place this morning and who found it necessary to resign from the Opposition Front Bench over the issue. Their view on the single currency is overwhelmingly shared by small businesses up and down the country, but it has been rejected by the current powers that be in the Opposition.
On issue after issue the Conservative party has ceased to listen to small businesses.
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