The Parliamentary Under-Secretary of State for Trade and Industry (Mr. Gerry Sutcliffe): The Government recognise the need to protect consumers against unfair lending practices. The Consumer Credit Bill will modernise the consumer credit market and drive out rogues from the market. The Bill will make it much easier for consumers to challenge unfair loan agreements. There will be a new right to challenge unfair relationships arising out of the terms of loan agreements or the way in which the lender acts, and borrowers will also have the right to take disputes with their lenders to an ombudsman service, so that they do not have the added burden of going through a lengthy and expensive court battle.
Mr. Allen: May I pay a personal tribute to the Minister for moving forward the Consumer Credit Billit may well be the first Bill of this Parliament that passes all stages; I certainly hope soand to Opposition Members for their constructive contribution to it in Committee? The Minister will remember that I brought a case to his attention recently. Mr. Frederick Jones took out a loan of £7,700 and ended up having to pay back £110,000. Will the Minister ensure that even people like Mr. Jones, whose cases have been through the courts, will now be caught by the retrospectivity clauses in the Bill? We are all very grateful that those clauses have been included, particularly people such as Mr. Jones and, I am sure, the constituents of many other hon. Members.
Mr. Sutcliffe: I thank my hon. Friend for his kind remarks and the work that he has carried out on behalf of Mr. Jones. He knows that I cannot go into the detail of the case, but Mr. Jones's case was an inspiration to all of us in bringing forward legislation. I would like to add my thanks to the Opposition for the constructive way in which the Bill has gone through the House so rapidly. I assure my hon. Friend, however, that the unfairness test and the licensing regime will prevent the type of case with which Mr. Jones had to deal from happening again.
James Brokenshire (Hornchurch)
(Con): As the Minister will be aware, we had good debates in Committee, on Report and on Third Reading. I echo his comments in terms of the constructive approach taken by all parties to getting a way forward for protecting debtors and lenders. Will he give a firm commitment to review the effect of the legislation once it is in place, because considerable concerns were expressed as to the effect of the new law, and particularly whether it would have the unintended consequence of driving commercial lenders out of the market for those on low and uncertain incomes, thereby giving succour to the loan sharks whom we do not want preying on the most vulnerable members of our community?
21 Jul 2005 : Column 1388
Mr. Sutcliffe: The point is well made. The Consumer Credit Bill is not to be seen in isolationwe have introduced loan shark pilots in Birmingham and Glasgow, we are working with credit unions, and we are working on financial inclusion We are considering all the issues in relation to education, money advice and debt counselling. The Bill is central to that, but we will review the situation in two years, as is normal practice for Governments. I remind the House, however, that the last time that consumer credit was considered in terms of legislation was 1974, so the Bill is certainly needed.
Mr. John McFall (West Dunbartonshire) (Lab/Co-op): The best way to ensure that those who are victims of loan sharks no longer become victims is through financial inclusion. In that respect, the Government's response to the Treasury Committee's report on cash machines is breathtakingly complacent and blind to the trends in that industry. Can the Minister assure me that he will work with his colleagues in the Treasury and the Department for Work and Pensions, along with the Treasury Committee, to ensure that we get reasonable financial inclusion and achieve the goal of bringing the financially excluded into the mainstream financial community?
Mr. Sutcliffe: I pay tribute to my hon. Friend, who is the Chairman of the Treasury Committee, and to the work that that Committee has done on this and related issues. I assure him that the financial inclusion fund will provide £45 million to be spent on education and support for bodies that help individuals. We are determined to make sure that people get as much advice as possible, that they are financially included, and that they benefit from the country's good economic position.
The Minister for Industry and the Regions (Alun Michael): Our policy is to provide the right macro-economic conditions and support to enable British companies to compete successfully in world markets. Manufacturing employment is falling in all advanced economies as global competition increases, so the Government manufacturing strategy seeks to help manufacturing companies move to high-value manufacturing with high-skill jobs.
As Parliament faces the recess, workers in two factories in my constituency face a summer shutdown tomorrow. This morning, I was yet again contacted by the BBC informing me that 250 workers at the Pendragon furniture factory will face that shutdown with redundancy payments. What reassurance can I take to the workers of Christy Tyler, Sony and Wrigley Kraft that they will not face a summer of uncertainty about whether there will be jobs waiting for them at the end, that the Department will work with its equivalent in the Welsh Assembly Government to bring new high-value, high-quality jobs to Wales that will suit their
21 Jul 2005 : Column 1389
capacity and skills, and that they will not face a future on the scrap heap as they would have done under the Conservative party?
Alun Michael: I can certainly empathise with that final point. We must set this in context, because the Bridgend labour market is relatively buoyant, although the town has taken a battering lately, and I pay tribute to my hon. Friend and her colleagues in neighbouring constituencies for their work to try to address the immediate problems of the area. Some of the changes are inevitable. The Sony factory, for instance, which produces screens, is a pretty inevitable casualty of the move to flat screens, which are much more mobile around the world. That does not make it any less devastating, however, for the individuals and families involved. I know that colleagues in the Welsh Assembly Government are working with Team Wales partnersthe Welsh Development Agency, ELWa, Jobcentre Plus, Careers Wales and othersand are ready to provide co-ordinated assistance and support to help people move on to fresh employment opportunities in what remains, on the whole, a relatively healthy labour market.
Dr. Vincent Cable (Twickenham) (LD): The Minister will be aware that the French Trade Minister and Prime Minister are vigorously promoting the idea that the best way to protect manufacturing jobs is to create a wall of tariffs and quotas around industries faced with international competition. What success have his Government had in persuading the European Trade Commissioner and other Ministers that that would be totally counterproductive and disastrous in the long term?
Alun Michael: The hon. Gentleman is right to signal this point, which I made at the outset. The way to safeguard jobs for the future is to go for high-value, high-quality jobs and an innovative economy. We cannot be protective about these matters; we must compete in what is a challenging world market. In the short time in which I have been in this job, I have been very impressed by the engagement of people in the manufacturing industry. Yesterday, I attended a meeting of the Manufacturing Forum, which I chair jointly with Kevin Smith of GKN. The energy and will to take forward manufacturing in this country is palpable, and that is the direction in which we should take our economy.
Dr. Ashok Kumar (Middlesbrough, South and East Cleveland) (Lab): May I commend the Government on the protection that they have provided for manufacturing jobs and on the various policies that they have implemented? The steel industry is very important to manufacturing jobs in my area, and a research centre called the Teesside technology centre has done well in helping the industry, which faced closure in the past few years, butthank goodnessis to remain open. Will the Minister meet the Corus research and development team to see whether there is a way to support and protect the long-term future of the Teesside division of the steel industry?
I am pleased to tell my hon. Friend that I am meeting Corus top management this afternoon,
21 Jul 2005 : Column 1390
and I am certainly happy to look at any aspects of development that can assist. The steel industry is experiencing a challenging time after a relatively successful few years, and it is important that we work with it, and with Corus in particular.
Michael Fabricant (Lichfield) (Con): The Minister is right to say that there is a general decline in manufacturing jobsnot just in the United Kingdom but in other western countriesas we face competition from global giants such as China and other countries with low-wage economies, and he is also right to say that the Government must have total regard to macro-economic policy. However, given that we have lost 1 million jobs, and that the percentage of jobs in manufacturing has fallen from 18 to 13 per cent. in the past seven or eight years, what fresh initiatives can he announce today to stop this inexorable decline?
Alun Michael: I do not think it appropriate to try to pull rabbits out of the hat; rather, we must work continually with the industry to improve the situation. We live in a challenging environment and we do not like the fact that we lost some 81,000 manufacturing jobs last year, but that pales in comparison with the recessions of the 1980s and 1990s. Some 673,000 manufacturing jobs were lost in 1981, and 422,000 were lost in 1991. [Interruption.] Yes, those peoplethe sort of people whom we on the Labour Benches representlost their jobs as a result of the Conservatives' neglect of manufacturing. I should point out that some 51,400
Dr. Roberta Blackman-Woods (City of Durham) (Lab): Despite the support given to the LG Philips manufacturing plant in my constituency, tragically, it is closing tomorrow. Will my right hon. Friend join me in wishing the taskforce, which is funded by his Department, well as it seeks to get the excellent and highly skilled staff into new employment?
Alun Michael: Yes, indeed. We have an economy in which employment is at record levels. There is therefore strength in the economy and an opportunity for taskforces of that sort to look for high-quality jobs and to expand local economies in response to events. It is always sad when a long-standing employer, and very often a high-quality one, is affected by the competitive market in which we operate, but looking to the future is what is important. I recommend all hon. Members to support the enterprise week coming up in November and to encourage others. If we had the number of women setting up business that there are in America, for example, we would have another three quarters of a million companies. We need to encourage enterprise by our young people, and by everybody, to respond to the challenges we face, and I wish the taskforce well in tackling the local issues referred to by my hon. Friend.