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30 Oct 2008 : Column 1068

Small businesses encounter problems when creating jobs. A sole trader in my constituency makes a very good living helping people to create more storage space in their homes. As can be imagined, he is quite busy at the moment with people choosing not to move house and to do a conversion or to make use of the space they have instead. He told me that he would very much like to take on another person to work with him but he is put off by the increase in paperwork and the regulatory burden that that would create for him. That is a great sadness.

We talk about corporate social responsibility within small businesses; there is nothing more responsible than allowing small businesses to create employment opportunities. Most employment opportunities I believe—I could be wrong; if so, I am sorry for misleading the House—are still created by businesses employing fewer than 10 people. I would be truly grateful if the Government went away and thought about how they could help the very smallest businesses to create additional jobs.

Mr. Prisk: It might help my hon. Friend and, indeed, the House if I said that it is my understanding that, over the past 10 years, the proportion of small businesses that employ people has fallen; now, seven out of 10 small businesses employ absolutely no one.

Mr. Walker: If those figures are correct—I have no reason to believe that they are not—that is a great sadness. This House recognises that small businesses should be the engine room of the economy. If we have a healthy small business sector, we have a healthy, growing and expanding economy.

I conclude by making a plea to the Bank of England. If anyone at the Bank is watching proceedings here today, will they please take on board that small businesses need their interest rates reduced? We need to get interest rates down and to reduce the costs of borrowing and of capital. We need to give small businesses a fighting chance to have a prosperous future.

1.43 pm

Mr. McFadden): I will not detain the House for long, but I wish to make a few concluding points. I thank all hon. Members for taking part in the debate on what we all agree is an important issue. It is the second time in two weeks that the House has discussed it and I agree with the hon. Member for Broxbourne (Mr. Walker) about its importance.

The hon. Member for Hertford and Stortford (Mr. Prisk) spoke about small businesses and public sector procurement. It is not the case that businesses need to show three years of full accounts to bid for public sector contracts. How to enable more small businesses to bid for those contracts is a legitimate issue to consider, and the Glover review, which we commissioned to look into that, should report next month.

The House will have noted the evasive responses of the hon. Member for Hertford and Stortford when asked three times whether his party would keep or close the regional development agency offices overseas. Perhaps I can enlighten him with a quote from the hon. Member for Rutland and Melton (Alan Duncan) who said:

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If the hon. Gentleman was unenlightened about his party leader’s position on RDAs, he is now enlightened about the position on overseas offices.

My hon. Friend the Member for Stafford (Mr. Kidney) quite rightly praised good companies such as JCB which do an excellent job in this country and abroad. He also raised important issues to do with cash flow and credit—matters of significant concern for businesses at the moment.

Mr. Prisk: On credit, will the Minister answer the question that was put earlier? Why is it that in France the first tranche of money has already been given to small firms but, in this country, the Government are still dealing with the paperwork?

Mr. McFadden: As I said to the hon. Gentleman earlier, this very day the Chancellor and my noble Friend the Secretary of State are meeting the European Investment Bank and other banks to progress this matter, and I assure him that it will be done with all due speed.

The hon. Member for Caithness, Sutherland and Easter Ross (John Thurso) spoke about the value of having representation abroad for a rural area such as his and also raised the important issue of access to finance. As the Chancellor said at Treasury questions earlier, this point is taken extremely seriously by the Government.

The hon. Member for St. Albans (Anne Main) agreed with her party leader that the RDAs should be scrapped. My only point with regard to the benefits and costs to the east of England of various expenditures is that the east of England, too, will benefit from increased expenditure on housing. I suspect that housing is an issue in the east of England and the £1 billion package announced last month will bring benefit to the area.

On small businesses and employment, raised by the hon. Member for Broxbourne, not only are there significantly more small businesses in the country than there were a decade ago, but they employ 1.5 million more people than they did a decade ago. We have more small businesses and we have more employment in those businesses thanks to the stable economy and growth that we have enjoyed.

In conclusion, we will keep working with both banks and businesses to see the economy through the coming months.

Question put and agreed to.


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Defence Policy

1.48 pm

The Secretary of State for Defence (Mr. John Hutton): I beg to move,

It is a great privilege for me to be able to open today's debate on defence policy, and I am very much looking forward to the contributions of all right hon. and hon. Members. There is a depth of experience in this Chamber on which I would like to be able to draw in the weeks and months ahead. We all know that our country and its armed forces face real and obvious dangers. I hope that we can all work together to help to overcome them and to show our support for and pride in the men and women who serve our country so well.

May I also begin by paying tribute to my immediate predecessor? My right hon. Friend the Member for Kilmarnock and Loudoun (Des Browne) was a distinguished Secretary of State. In my first week as Defence Secretary, I attended a meeting of NATO Defence Ministers in Budapest. I can pass on to my right hon. Friend that, as I was being introduced to colleagues from different member states, every one of my counterparts spoke of him with genuine warmth and respect, and rightly so. Those comments are a testament to his integrity, dignity and intellect, and I should like to pay my own personal tribute to the leadership that he gave to the MOD over recent years.

At the outset of my first defence debate, I would like to remember the men and women who have been killed or injured serving their country. My thoughts and prayers are with their families, friends and colleagues. The individual sacrifices of this generation stand comparison with those of any other in our nation’s history. We must never allow their service and sacrifice to be forgotten, because we owe them so much.

I welcome this debate on defence policy. The primary purpose of our defence policy is to protect and enhance the security of our people. That is why we currently have 8,000 troops serving in Afghanistan and more than 4,000 troops in southern Iraq. It is also why we are investing more than £6 billion this year in new capabilities to serve the needs of our armed forces now and in the future.

The nature of conflict changed throughout the 20th century. Thankfully, large-scale inter-state warfare is today less likely than it has been for some considerable time. Although we must always have the capability to defend ourselves, if necessary by ourselves, today our security will more often than not be aligned with that of our allies.

Over the past few years, Her Majesty’s Government have set out the modern nature of the global context in which we now operate. In the strategic defence review of 1998 and its new chapter in 2002, and more recently in the national security strategy, we have sought to identify the nature of the modern threats we now face: terrorism, failing states, weapons proliferation and energy insecurity. The UK’s defence policies contribute towards three overarching strategic objectives: to achieve success on operations; to be ready to respond to tasks that might arise; and to build for the future. I would like to say a few words about each of these objectives.

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Mr. Bernard Jenkin (North Essex) (Con): The SDR set out a number of key long-term capabilities that the Government were to acquire over a period. The Secretary of State has now said that one of the big projects will be cut. Which is it?

Mr. Hutton: No, I have not said that; I want to make that clear to the hon. Gentleman and the House. The SDR continues to inform our thinking; our future procurement strategies are designed around the analysis contained in it. An equipment examination is under way—as the hon. Gentleman, who is a distinguished Member of this House and of the Defence Committee, will know—but we have not made any decision not to proceed with any major procurement. I am grateful to the hon. Gentleman for giving me the opportunity to make that clear.

Let me say a few words about each of the three important areas of interest. Our first objective—to achieve success on current military operations—is the most critical responsibility that my Department has to discharge. I have recently returned from visiting Afghanistan and Iraq. Along with many Members, I witnessed the professionalism and courage of our armed forces as they undertook their missions in what are challenging and very tough conditions. Like everyone else who has visited those theatres, I have returned impressed by the strength and common purpose of the UK’s military-civilian effort in both Iraq and Afghanistan, and particularly in Helmand. It is testament to the widespread belief that sustained progress in Afghanistan will depend on security and governance combined—as, in fact, is the case in every modern conflict. I am glad to be able to report to the House that morale among our troops is strong and high. There is a deep sense of duty and commitment to the mission.

I am also clear about the primary purpose of that mission: protecting the British people here at home. The passage of time and the complexity of modern counter-insurgency campaigns can sometimes combine to obscure the simple and unambiguous reason for our intervention in Afghanistan. Those who question the mission in Afghanistan need to be clear about the alternatives. This is not a discretionary campaign. The return of the Taliban and al-Qaeda to power in Afghanistan to re-create a safe haven for international terrorism would constitute a disaster for the international community, and it would represent a clear and present danger to the security of the UK. For those reasons, we cannot allow that to happen.

Harry Cohen (Leyton and Wanstead) (Lab): I hear what the Secretary of State says, but that was not the point made by British commander Brigadier Mark Carleton-Smith, who said:

and that if the Taliban were prepared to

that would be

Should we not be going down the route of trying to get a political settlement, even if that brings the Taliban into some form of Administration?

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Mr. Hutton: Brigadier Carleton-Smith is a very fine officer, and 16 Air Assault Brigade did a fantastic job of work in Afghanistan. However, my hon. Friend has taken those words out of context. The brigadier was saying that we will not win the campaign in Afghanistan by military means alone, and I agree very strongly with him. There will have to be progress on the political side at some point—no one disputes that—and the sooner the better. We should be clear that if people are prepared to renounce violence, support the democratic process and ensure peace and stability in Afghanistan, we would not have any problem with such a political process being kicked off, but it is totally unacceptable for there to be in any sense a political reconciliation—to borrow my hon. Friend’s words, I think—with the Taliban, who are an armed insurgency with a poisonous hatred of the west and of the decent values for which we and our allies stand. That would not be a political reconciliation; that would be a surrender, and that is not going to happen. Therefore, we must be clear about the military purpose, and we should not become confused over the semantics.

Mr. Tobias Ellwood (Bournemouth, East) (Con): I hope that the Secretary of State does not confuse Opposition Members’ commitment to the mission with our right to question the strategy, which we very much do question. I am grateful that the Secretary of State is present, but I am concerned that, while today’s proceedings will focus on Afghanistan, neither the Secretary of State for International Development nor the Secretary of State for Foreign and Commonwealth Affairs will be present. Hugh Powell, who is in charge of the provincial reconstruction team, answers to the Foreign and Commonwealth Office and the counter-narcotics operation is also FCO. Reconstruction and development is all to do with DFID, yet the Secretary of State for International Development will not be present to answer questions on that. We are firing 10,000 rounds of ammunition every single day, and we need to have more scrutiny over Afghanistan than is currently the case.

Mr. Hutton: I do not question the hon. Gentleman’s motives; he is entitled to his opinions and to express them freely and fairly in this House without any let or hindrance, and he does that—and good luck to him. However, it is one thing to be long on the analysis of the problems, but we in this place must also be clear about the solutions. Those who are suggesting that the mission is doomed to failure and should be curtailed or ended, and that our guys should come home— [Interruption.] Well, I respect the hon. Gentleman for not saying that, but those who do say it have to be able to deal with one other question, which is important as it affects security here in the UK: would they be happy with the return of the Taliban and al-Qaeda and the safe havens that would be generated? [Interruption.] I understand that that is not the hon. Gentleman’s point, but there are many who do put that point.

The hon. Gentleman is entitled to question the mission and to question Ministers; that is fair and proper and it is what we gather here to do. In answer to his questions about the Secretaries of State for International Development and for Foreign and Commonwealth Affairs, let me point out that this is a defence policy debate. The strategy in Afghanistan is a combined political and military strategy. There are plenty of opportunities in
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this place—the hon. Gentleman will know all about them—to question both those Secretaries of State about all such matters. I suspect that if both of them were present we would all make rather long speeches, and that the hon. Gentleman would probably not be called to contribute today—and we would all be the poorer for that.

To turn to a point that I suspect addresses the concern of my hon. Friend the Member for Leyton and Wanstead (Harry Cohen), I acknowledge that in its form and length the conflict in Afghanistan is different from many in which we have been engaged during the past century. Progress will be measured; it will be incremental, and it will take time. We will need patience, which is difficult in an era that often demands instant solutions. I understand the responsibility on me to continue to make it clear to the House and the British people why we are asking the men and women of our armed forces potentially to pay the ultimate price. I believe, very simply, that it is to protect our freedom, our values and our security as a nation.

Clearly, 2008 has been a difficult year for coalition forces in Afghanistan. We have lost 35 brave men and women in the service of this country, and there remain issues of real concern, such as the increasingly porous nature of the border with Pakistan, the fragile nature of governance in parts of Afghanistan, and the corrosive effect of the drugs trade on civil society.

As with most things in life, however, sweeping generalisations often fail the test of serious scrutiny. So it is in the case of Afghanistan, where there is real and tangible evidence of progress. With the support of our troops, the Afghan national army is becoming a force capable of independent counter-insurgency operations, as those in Lashkar Gah recently demonstrated well. The ambition to increase ANA force capacity from 60,000 to 122,000 over the next few years is the right strategy for coalition forces and the Afghan Government. We will give our full support to the ANA’s increasing role and capability.

In 2009, there will be provincial and national elections in Afghanistan. We know that the insurgents will do everything that they can to disrupt the democratic process, because they are opposed to it, but the simple principle of the democratic ideal is universal: that every man and woman in Afghanistan should have the chance to choose their Government, free from violence and intimidation. Of course, it is for the Afghans to decide how they want their country to develop, and it may take many forms, but I would argue consistently for that strong, clear, simple, universal principle.

Effective security and governance are linked by the third challenge in Afghanistan, which is tackling corruption. Narcotics remain the poison that permeates Afghanistan’s political and economic system as well as its people. There has been some progress, and 2008 has seen a fall in opium production. Following the recent NATO summit in Budapest, I am confident that the international security assistance force in Afghanistan can make greater progress still in targeting the opium factories and narco-traffickers to cut the primary source of funding for the insurgency. I accept that there is more to do, and that the Afghan forces themselves must increasingly take responsibility.

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