Examination of Witnesses (Questions 60-65)
MR BEN
BRADSHAW MP, JON
BRIGHT, RICHARD
BAYLY AND
THOSS SHEARER
30 MARCH 2009
Q60 Chairman: Has the task group
expressed any views on the range of Government initiatives? Has
there been any feedback? Some are waiting to be rolled out, but
which ones does it think will be most effective, and is it content?
Some are waiting to be rolled out, but which ones does it think
will be most effective, and is it content?
Mr Bradshaw: There has been a
whole range, hasn't there? Some of the measures that were taken
in the pre-Budget report bore very strong resemblance to some
of the issues that had been raised and lobbied for by the business
organisations on the task groups.
Q61 Chairman: Can you give some
examples?
Mr Bradshaw: The delay in payment
of bills by HMRC, for example. The introduction of the threshold
for empty business rates was an issue that was raised repeatedly
by business organisations. They would still like to see the whole
thing go, but again, that is another thing that representations
have been made on. Similarly, there has been real-time feedback
from the business organisations as to what is working best, whether
the banks are lending and whether the business loan guarantee
scheme is working. There is very useful intelligence as to how
things are working now.
Q62 Chairman: Are they now saying
that the banks are starting to lend? We are hearing mixed messages
now.
Mr Bradshaw: My colleagues will
correct me if I am wrong, but I recall the representative of the
Federation of Small Businesses, at our last meeting, saying that
she felt that the lending issue had become easier. That was also
the message I got back from a meeting I had with my own Chamber
of Commerce in Exeter just last week: the lending situation has
improved slightly over the last month. Certainly, the banks tell
us that they are lending more.
Richard Bayly: The latest business
surveys suggest that 43% of businesses report that they can get
the credit that they want, which is clearly not ideal. However,
as the Minister said, there has been an improvement. The thing
that feeds back to us—but is only anecdotal—is that
the lending patterns have reverted to the traditional model of
lending against security, rather than investing in a business
track record, a business plan, or a profit and loss accounts performance.
That may explain some of the differences of experience between
different companies. We are seeking more information on that,
and more understanding of how clearly the messages are passing
down through the banks and out into their agents in the field.
Q63 Chairman: The evidence that
I have picked up is that some of the groups were in the process
of retraining their managers. All the measures that were being
brought forward went straight into that training programme, and
managers were therefore better placed to take decisions in the
branches. However, some of the others were well behind, and you
had managers who had to refer everything to regional or even national
headquarters to get a response on loan requests. Is that what
the task group was suggesting to you, saying that that was happening
on the ground?
Mr Bradshaw: Yes, and DBERR has
made it clear that it is interested in being forwarded any practical
examples that you, or any other hon. Member, may come across in
your work as constituency MPs, as to where this was happening.
Q64 Mr Drew: Can I just finish
with a plea? It is to do with the RDPE—the rural development
programme, in which the south west has a considerable interest.
First, can we stabilise it, so that we are not for ever changing
it? I know that there are negotiations that have to be had, both
in this country and in Europe. Secondly, can we also clarify how
the programme operates on the ground? It is a tremendous programme
in concept, but I am not sure if it is working as well as it could
and should be in practice. Again, it is a programme that we can
have some particular traction over, and some benefit from, if
we are able to exploit it properly.
Richard Bayly: We would see this
going back to your earlier point about the opportunity in rural
areas. One has to be cautious about the total amount of GVA that
will come out of land-based industries. What we have seen is some
real innovation in diversification and new value being added in
the sector. For us, the really important thing is for the investment
to continue to go into that strategy of shifting the value added
up the curve and allowing people working in the sector to increase
their sustainable incomes. It is not enough just to have good
products or stable employment; wages in the industry are still
relatively low, and if the sector is to add to wealth in the region,
it has to be able to afford to pay higher wages as well. We would
see the whole issue of the value added being enhanced through
the programme.
Q65 Mr Drew: But if the rural
advocate's figures showing a £347 million gap in terms of
the countryside's unrealised potential is to be even a quarter
believed, the south-west has some real potential, which it is
as yet not exploiting. Are you looking to see that happen, particularly
at the moment, when we need to be seeing every green shoot—to
use an agricultural term—that we possibly can?
Richard Bayly: The interesting
question, which you raise yourself, is whether the market conditions
are changing so that the market will be able to go in that direction
anyway.
Mr Bradshaw: If you have examples
of where this scheme, which, as you say, is wonderful in content
but not necessarily, in your experience, in implementation, please
let me have them. That is certainly something that I can take
up.
Jon Bright: Can I just add a point
on that? The last time I met farmers' representatives, they were
fairly positive about the way the programme was operating, and
they had not been nine months earlier. I know that the RDA has
been working hard to improve its management of the programme,
and it has a stakeholder group at which the sorts of issues that
you have been discussing are raised.
Mr Drew: I would certainly say, Jon,
that the farm bits are working better than the other bits. What
the rural advocate was talking about was the non-farm bits, and
we really have to get a better handle on them.
Chairman: Thank you very much. We appreciate
your coming, giving us your time and answering our questions.
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