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House of Commons

Thursday 14 February 2002

The House met at half-past Eleven o'clock


[Mr. Speaker in the Chair]


City of London (Ward Elections) Bill

Order for further consideration, as amended, read.

To be further considered on Thursday 28 February.

Oral Answers to Questions


The Secretary of State was asked—

Small Businesses

1. Mr. Ben Chapman (Wirral, South): If she will make a statement on proposals to assist small businesses in the north-west. [33789]

The Parliamentary Under-Secretary of State for Trade and Industry (Nigel Griffiths): In the north-west, business link operators have assisted 23,557 businesses since 1 April 2001, administered 98 offers of smart grants worth £4.8 million, guaranteed nearly 300 business loans worth £17 million, and helped more than 1,500 exporters in small and medium-sized enterprises. The present business plans of business link operators in the region aim to continue to drive up the quality of the service given.

Mr. Chapman: Companies in the Wirral are grateful for all that assistance, and we have done particularly well in terms of regional selective assistance. It is, however, the medium and larger firms that tend to benefit from that. The small firms—the seed bed of future growth—have traditionally faced a somewhat confusing plethora of sources of advice and assistance. Is the Minister content that he is simplifying access, rather than complicating it, by transferring smart and enterprise grants from the Government office to the Small Business Service, for example, and by making other changes such as moving regional selective assistance to the regional development agency?

Nigel Griffiths: My hon. Friend highlights the pressing need to streamline the process. We are doing so by strengthening the Small Business Service and the regional development agencies to ensure that effective help goes

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to small businesses, which are, after all, the driving force behind our economic prosperity. That is why these moves have been widely welcomed.

Mr. Roger Gale (North Thanet): Will the Minister explain to small businesses in the north-west, and to others around the country, precisely what they have to do, and how much they have to pay to whom, to secure the personal services of the Prime Minister in connection with their export ambitions?

Nigel Griffiths: That is unworthy of the hon. Gentleman. He should speak to the many small and medium-sized enterprises in his constituency that have benefited from the services of the Small Business Service and from the regional development agency. He should join me in praising them for their drive in exports—

Mr. Gale: Corrupt!

Mr. Speaker: Order. That is not a term that I wish to hear in the Chamber. Who was the hon. Gentleman referring to when he said "Corrupt"?

Mr. Gale: I was referring to the overall practice that appears to have been taking place, Mr. Speaker. If you feel that that is out of order, I will, of course, withdraw it.

Nigel Griffiths: The hon. Gentleman and other Conservative Members should speak for their constituencies and for the firms that need help. We are having to speak for them, because those hon. Members are dwelling on trivia.

Mr. Hilton Dawson (Lancaster and Wyre): Is it not rather strange that my hon. Friend the Minister, in referring to north-west businesses, has not yet referred to the extraordinary success of business in the city of Lancaster, where £1 million of extra grant from the Government has brought in £10 million of private sector finance and created 1,000 jobs; where we have economic development zones; and where the University of Lancaster is at the cutting edge of broadband technology? The city is truly at the heart of the north-west and of future science-based enterprise. Surely the answer to the question of how to help small businesses in the north-west is, "Come to Lancaster".

Nigel Griffiths: I could not agree more, and I cannot wait to join my hon. Friend.

Mr. Philip Hammond (Runnymede and Weybridge): Small businesses in the north-west and elsewhere are struggling to cope with a continuing deluge of regulation from the Government. I am sure that the Minister is an avid reader of the New Statesman, and that he will have read the interview in which Lord Haskins—the head of the Government's better regulation task force—revealed that 16 of the 23 members of the Cabinet are wedded to regulation as the only way to achieve results. Does not that show that there is no hope for small businesses under the Labour Government?

Nigel Griffiths: Perhaps I can commend another publication to the hon. Gentleman. He clearly has not seen a copy of the report that the Commission issued this week

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on the EU charter for small enterprises, which singles out the United Kingdom's Europe office of the Small Business Service as an effective voice against Brussels bureaucracy. The report commended the office to all other states. I would also be interested to know how the Conservatives defend the 10,000 regulations on business that they introduced between 1994 and 1997.

Postal Services (Slough)

2. Fiona Mactaggart (Slough): What assessment she has made of the quality of postal services in Slough. [33790]

The Minister for E-Commerce and Competitiveness (Mr. Douglas Alexander): Postcomm and Postwatch are responsible for monitoring the quality of service provided for scheduled postal services. The targets for those services are agreed by Postwatch and set by Postcomm in the Consignia licence.

Fiona Mactaggart: Indeed they are, and Slough consistently fails to meet the targets. Discussions with Post Office staff and management have led me to conclude that the main reason for the chronic failure of all Slough's postal services is weak management. What can the Minister do to improve the quality of management?

Mr. Alexander: I agree that there is a need for better customer services and better management within Consignia. That is specifically why, as the Government and as owner, we have appointed a new finance director, Marisa Cassoni, to Consignia's board. Allan Leighton, who was first appointed as a non-executive director, is now acting as interim chairman. I am also pleased to announce that on 15 April David Mills will join Consignia from HSBC as the chief executive of Post Office Counters Ltd. and as a member of Consignia's board. He will further strengthen the management, and the post office network will benefit from his considerable commercial skills.

Michael Fabricant (Lichfield): The Minister will know that Slough—and, indeed, Lichfield—has an excellent talking books for the blind service. Free postal services are available for the registered blind, and the Minister will agree that their withdrawal would cause considerable difficulty. Will the Minister assure the hon. Member for Slough (Fiona Mactaggart) and my constituents that, notwithstanding changes to the postal service in years to come, free services for the blind will be maintained?

Mr. Alexander: I assure constituents in Slough and Lichfield that there is now a statutory basis for that service—the Postal Services Act 2000.


3. Mr. Mark Hoban (Fareham): What recent representations she has received regarding the performance of Consignia. [33791]

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The Secretary of State for Trade and Industry (Ms Patricia Hewitt): I regularly receive representations regarding the performance of Consignia from a range of sources.

Mr. Hoban: Given the impact of unofficial strikes by the Communication Workers Union on Consignia's performance, does the Secretary of State agree that the threat of such industrial action is reckless and irresponsible? Will she join me in condemning that union's threats against Consignia?

Ms Hewitt: The hon. Gentleman has perhaps forgotten that, under the Conservative Government, the average number of days lost each year through strikes in the Post Office was 145,667. We have slashed the number of days lost through industrial action, and industrial relations have improved significantly since the Sawyer report. As I have said before in the House, I continue to urge management and unions, with the help of mediation, to settle this pay dispute as quickly as possible.

Mr. George Stevenson (Stoke-on-Trent, South): In considering the performance of Consignia and its business, will my right hon. Friend also take into account yesterday's devastating news that Royal Doulton intends to close its north Staffordshire factory and transfer the business to Indonesia? As Consignia gets a great deal of business from Royal Doulton in north Staffordshire, will she be good enough to write to the company to find out the exact reasons for its decision, and its effect on Consignia's business and on other small businesses in the area?

Ms Hewitt: My hon. Friend makes an extremely important point about the effect of the job losses announced yesterday on Consignia, his constituents and their families. I will of course ensure that my officials are in touch with the company, so that we can understand fully the reasons for its decision and establish whether we can give any help.

Mr. Richard Page (South-West Hertfordshire): Under the Secretary of State's fingertip control, 30,000 redundancies have been announced; Consignia has lost money; thousands of sub-post offices face closure; and a terrible strike is about to hit. Does she accept that the best action that the Government can take is to set Consignia free by privatising it?

Ms Hewitt: As I said recently in the House, the Post Office's problems stem directly from the years of drift and decline under the Conservatives, and their failure to allow it the necessary freedom to make investments and changes at a time when every other postal service in Europe was making such changes. We have delivered what the Post Office needs—commercial freedom within the public sector. We are delivering the stronger management that is necessary, and management and unions are working together much more effectively since the Sawyer report, which we commissioned. Management and unions are sitting down together and talking about the business restructuring that must take place.

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I am confident that the changes that the Post Office needs are being made by Government, management and the unions. As a result, customers will get the better service that they urgently need.

Mr. Michael Connarty (Falkirk, East): Has my right hon. Friend seen the rather frightening report from Postcomm, the regulator? Has she also seen early-day motion 797—signed by more than 100 Members so far—which says that we should leave Government, management and work force to get together, as they are at present, to bring about an improvement in Consignia's performance, rather than taking precipitate action? Will she accordingly allow much more time for consideration of, and consultation on, what I believe to be an unnecessary and damaging recommendation by Postcomm?

Ms Hewitt: Postcomm's proposals are simply proposals for consultation. That consultation is taking place, and I have no doubt that Postcomm will take full account of the views of Members as well as others.

I remind my hon. Friend that in the Postal Services Act 2000 we have written into law, for the first time ever, a universal service obligation, which will apply to Consignia. We have also established that Postcomm's primary duty is to ensure that a universal service is delivered. Any proposals or decisions from Postcomm about market opening must be subsidiary to that duty.

Mr. Nigel Waterson (Eastbourne): Is not today's Order Paper stark testimony to the concern in all parts of the House about our failing postal service? Does the Secretary of State not agree with the regulator's proposals for the liberalisation of postal services? If there is a national postal strike, will she back any move by the regulator to safeguard our postal service by lifting Consignia's monopoly?

Ms Hewitt: I have already said that I share the concern in all parts of the House about Consignia's performance. I have also explained why the deterioration in its performance has taken place. The hon. Gentleman should be well aware of the failure of the Government whom he supported to enable the company to make the necessary changes. Those changes are now happening.

The regulator's primary duty is to ensure that a universal service is maintained, and that would apply in the event of a strike.

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