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Small Businesses

6. Ann Winterton (Congleton) (Con): If she will introduce legislation regulating the activities of shadow directors in small businesses. [177756]

The Parliamentary Under-Secretary of State for Trade and Industry (Mr. Gerry Sutcliffe): The answer to the question is no: the activities of shadow directors are already regulated, as the hon. Lady knows. We would not want any unnecessary red tape.

Ann Winterton: I welcome the fact that the Department of Trade and Industry has recognised the problem of shadow directors. They are not illegal, but surely the public have the right to know who directs or runs a company. Fewer cases of abuse now exist, but is the Minister aware that some still persist in manipulating the system, virtually defrauding individuals and companies—more often than not smaller companies that can least bear the loss—that have provided goods and services? I have one such example in Congleton. Will the Minister undertake to look into the matter on behalf of my constituents to see what further action could be taken?

Mr. Sutcliffe: I am grateful to the hon. Lady for raising the issue of how directors operate in certain conditions, which causes concern to many people. She will know about the disqualification hotline, which has produced much information about people who act as directors inappropriately. For the information of hon. Members, its number is 0845 601 3546. If the hon. Lady gives me details of the individual case that she mentioned, I shall look into the matter as soon as possible.
 
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European Commission Cohesion Report

7. Mr. Michael Moore (Tweeddale, Ettrick and Lauderdale) (LD): What assessment she has made of the European Commission's third cohesion report. [177757]

The Minister for Industry and the Regions (Jacqui Smith): The Government welcome proposals in the report to ensure a greater strategic focus for EU regional policy and the commitment to simplify the delivery mechanisms for structural funds projects. However, we have serious concerns about the proposals for the future size and focus of the structural funds, which fail to meet the objectives that we laid out in our consultation document of last year and our statements to Parliament following that consultation.

Mr. Moore: The south of Scotland has an allocation of £50 million for the current European structural funds programme, which is vital for the restructuring of the fragile local economy, especially in the Scottish borders. How will the Minister reconcile the Commission's proposals in the document with the Government's plans and ensure that we continue to receive support after 2007?

Jacqui Smith: The important point about the Commission's proposals in that plan is that no money is currently on the table, because there has not yet been agreement on the overall budget. There are now many member states, and the majority of net contributors have made clear their wish to ensure that the EU budget as a whole remains within 1 per cent. of EU gross income. No agreement has been reached about the total amount of money, nor are the data available that would be necessary to determine how any future funds would be distributed. There is no money on the table, but the Government have made it clear—in the guarantee in our document and in subsequent parliamentary statements—that we remain committed to regional policy. If our recommendations are accepted, we will ensure that we increase the resources necessary in the regions and the devolved Administrations to continue the focus on productivity and skills and make the necessary investment to ensure that they are successful.

National Grid

8. John Thurso (Caithness, Sutherland and Easter Ross) (LD): What plans she has to facilitate the connection to the national electricity grid at affordable prices of potential consumers living in remote areas. [177759]

The Minister for Energy, E-Commerce and Postal Services (Mr. Stephen Timms): I have no new plans to announce on this. There are no firm data on homes without mains electricity, although the proportion is thought to be less than 1 per cent. Certainly the vast majority of properties for which mains connection is cost-effective have already been connected. Properties without a grid connection tend to be in very remote locations without neighbours with whom connection costs could be shared, so there is a substantial cost barrier.
 
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John Thurso : I am grateful to the Minister for that answer. I draw his attention to one of my constituents who lives relatively near the village of Lairg, but who is two miles away from the grid and would have to pay about £50,000 to be connected. Does the Minister recall that when the Hydro Board was set up, a statutory duty was laid on it to enable people in remote areas to be connected to the grid? In many rural areas in the United Kingdom, there are still homes for which connection to the grid is prohibitively expensive. As wind generation is being put in place in many such areas, will the Minister consider a scheme to lay a statutory obligation on wind generators to help the people who host the generating facilities to be connected?

Mr. Timms: I am not familiar with the case of the hon. Gentleman's constituent. I draw to his attention the fact that there is a safeguard in the system: once a formal request for connection has been made, the person can seek a determination on the terms that are being offered from Ofgem. Ofgem is empowered to make a determination on the appropriateness of the charges and the terms. Whether that will be helpful in this particular case, I do not know.

The hon. Gentleman raises the previous arrangements that applied in the north of Scotland, and he will welcome the steps that we are taking in the interests of electricity customers there. For example, in the Energy Bill, we are introducing a replacement for the hydro benefits scheme, which may well be of similar age to the one to which he referred, to protect customers from the impact of high distribution costs in that region. We are also replacing the common tariff obligation to ensure that rural customers in the north of Scotland are not discriminated against in favour of urban customers. That will be in the interests of quite a number of the hon. Gentleman's constituents.

I am afraid that I cannot offer the hon. Gentleman the prospect of additional legislation to place obligations on parties in the way that he proposes, because in some instances the cost of connecting a remote location could be very high indeed. It would be unfair to expect other customers to subsidise what might be a costly arrangement.

Lawrie Quinn (Scarborough and Whitby) (Lab): I know that my hon. Friend has visited my constituency on a personal basis, but he has generally been there in the summer. During the winter period, my constituents who live in remote locations in the North York Moors national park and along the coast in Scarborough and Whitby are vulnerable to loss of supply, often for many days, if not weeks, when power supply cables are blown down. Does he have any proposals to hold discussions, or does he keep under review with the electricity supply companies the quality and nature of the infrastructure that links such customers? The fact that supply cables are blown down and people are disconnected in winter often comes down to the need to reinforce the infrastructure; we need better security of supply.

Mr. Timms: I am a great admirer of my hon. Friend's constituency and I always enjoy visiting it. He raises important issues, which were highlighted by the storms
 
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of October 2002, when we saw serious disruption to the electricity supply in many parts of the country. A great deal of work has been done since then. The Select Committee on Trade and Industry carried out a valuable investigation that highlighted many of the issues. We have seen significant improvements in the procedures followed by the electricity distribution companies, and I hope that my hon. Friend's constituents will benefit from that. I hope that my hon. Friend will see improvements, but if he feels that insufficient progress is being made, I will be happy to have a look at the issues in his constituency.

World Trade Organisation

9. Tony Baldry (Banbury) (Con): What progress is being made on the World Trade Organisation negotiations. [177761]

The Secretary of State for Trade and Industry (Ms Patricia Hewitt): WTO Ministers are working towards securing the framework agreements on the major elements of the Doha development agenda by the end of July. That will enable negotiations to resume and to progress at a faster rate.

Tony Baldry: I thank the Secretary of State for that answer. If that happens, it will be very good news. There is a sense that the momentum has gone out of the process, although that may simply be because we have not heard much about it publicly. However, there is a suspicion that everything is being adjourned until after the American presidential elections, so it would help the House if the Secretary of State indicated where she thinks things are in relation to the discussions on agriculture, because there has been a lot of low-level snarling between the EU and the United States. Have the Singapore issues finally been dropped? Given all the promises made at Cancun, it would be helpful if she could assure the House that there is still the same momentum and that the same importance is accorded to the issues as at that time.

Ms Hewitt: I am extremely grateful to the hon. Gentleman for being in the House to give me precisely that opportunity. Earlier this year, I shared his concern that the negotiations had run into the ground and that nothing would happen until after the end of this year, with the transition to a new United States Administration and a new European Commission. I am glad to say that those fears proved unfounded; both Commissioner Pascal Lamy and Ambassador Zoellick have made it very clear that they want to get the framework agreement in place before the end of July and that, because of those other factors, it must be in place before the end of July.

The joint letter that Commissioners Lamy and Fischler sent on 9 May to all WTO members represented a significant step forward. It reassured, in particular, developing countries about the willingness of the European Union to negotiate an end date to all agricultural export subsidies, provided of course there is parallelism in the approach of other developed countries on equivalent support for agricultural exports. The
 
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letter also made it clear that although we, and indeed most others, would like to proceed with negotiations on trade facilitation, the other Singapore issues can be dealt with differently and need not form part of the single undertaking or the round as a whole. Although the framework is not yet in place, the work being done in Geneva and the discussions between Ministers and negotiators around the world is leading all of us who are utterly committed to the Doha round to be more optimistic about the prospect of that interim agreement by the end of July.

Mr. John Grogan (Selby) (Lab): What measures is my right hon. Friend taking to encourage capacity-building among developing nations, so that when the talks resume they will be more equal partners in the negotiations?

Ms Hewitt: My hon. Friend raises an important point. The British Government, especially the Department for International Development, have been at the forefront of supporting, and indeed putting money into, capacity-building efforts, both directly with developing countries and through the WTO. That is one of the reasons—not the only one—why the voice of developing countries was so much stronger at the Cancun meeting last September, despite all the other difficulties we experienced there, than it had been before. We shall continue that very important work.

Mr. James Arbuthnot (North-East Hampshire) (Con): We know that trade is more important than aid in helping developing countries to develop, but has the Secretary of State considered why it is that under the Government British trade has run into such difficulties? Why did yesterday's trade figures show another decline—£3.7 billion? The trade deficit under the Labour Government is the worst since records began 300 years ago. Why is that?

Ms Hewitt: The right hon. Gentleman does not seem to have noticed that the downturn in economic growth in almost all our trading partners over some years has inevitably had an impact on UK exporters, nor that the British economy has been growing steadily every quarter for the last seven years and indeed is enjoying its longest period of uninterrupted growth for more than 200 years—I think that is what the Chancellor said most recently; the Financial Times suggested this week that it may be the longest in all human history—and because of that it is inevitable that at the moment we are importing significantly more than we are exporting. But with resumed growth, especially in the United States, and with very strong growth in China, India and other Asian countries, British companies exporting to those markets are doing extremely well. As and when growth resumes in our major continental trading partners, I have no doubt at all that that deficit will shrink again.

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