My Department continues to help small and medium-sized enterprises to grow overseas and export to the world, especially this year—the year of the SME. Businesses can access a digital self-serve offer and a wide network of support, including trade advisers, export champions, the UK Export Academy, our international markets network and UK Export Finance. Last year, UK Export Finance provided £6.5 billion to exporters of all sizes, with SMEs comprising a record 84% of those supported directly with a product.
SMEs in Merthyr Tydfil and Rhymney tell me of their frustrations around exporting goods and now the Government have scrapped the trade show programme, which was set up to support British businesses to attend events and win overseas orders. Will the Minister tell the House and the thousands of businesses that rely on that vital support when there will be a replacement?
UK exports are increasing. Using current prices, they are up by £21 billion compared with 2023.[Official Report, 12 March 2024, Vol. 747, c. 5MC.] (Correction) The UK trade show was a pilot programme that did not yield the successes we thought it would, so we have other schemes in place, including the UK Export Academy, international trade advisers, Help to Grow and the export support service. Focusing on Wales, we will soon be appointing a new international trade adviser to help SMEs.
We are lucky that Enfield North has quite a lot of small and medium-sized businesses, but they are suffering because of the cost of spiralling bills and no Government support. Does the Minister think it is the lack of a Government industrial strategy or the lack of individual support for exporters that is most holding our businesses back?
That is an extraordinary statement, because in the hon. Lady’s constituency the greatest level of exports is from professional and business services, and those exports are increasing not only to the EU but to countries outside the EU.[Official Report, 12 March 2024, Vol. 747, c. 5MC.] (Correction) That is the reality on the ground, so our strategy is working. UK exports were £859 billion in 2023—a figure that has gone up, not down, by £21 billion. The UK is the second biggest services exporter in the world—she should be proud of that because many such businesses are in her constituency. Those exports have increased to 54% from 48%, so there is good news, but we are keen to do more.
The Office for Budget Responsibility said yesterday that exports, including from SMEs, will fall even more than expected this year; growth in exports will be less than 1% in each of the next three years; and other countries will not be hit the same way. There have been cuts in the funding to help businesses start exporting and there has been no deal with the United States, no Diwali deal with India, and no veterinary agreement with the EU to cut red tape and slash costs. What does the Minister think is the best explanation for the Government’s dismal performance on exports so far?
We can get the best explanation from looking at the data behind what the hon. Gentleman set out. He obviously omitted the international reality. In the same report, the OBR referenced the “sluggish growth” in “global economies” and mentioned that British goods and services will outperform, on average, G7 countries. Those are the facts on the ground. When it comes to exports, we are exporting not only into the EU but outside the EU. As I said earlier, professional and business services are increasing outside the EU by 19%.[Official Report, 12 March 2024, Vol. 747, c. 6MC.] (Correction) We have substantial programmes in place to help small and medium-sized enterprises. We are keen to learn and do as much work as we can. There will be far more work coming through as this is the year of the SME.
The trade and co-operation agreement has hit small and medium-sized exporters the hardest, as most do not individually have the capacity to deal with the additional bureaucracy and paperwork created by that trade deal. Does the Minister recognise that the TCA has disproportionately damaged the competitiveness of SMEs? What support can the Government offer SMEs to recapture the market share they have lost in Europe since then?
There has not really been a loss in the market share. I have talked about what is happening internationally. We appreciate that small and medium-sized enterprises may not have the resources they need to export into new markets. That is why we have the UK Export Academy, international trade advisers, Help to Grow and the export support service. We are also looking at what trade barriers we can break down and bust to make it even easier for SMEs to access new markets through the trade deals secured by the Secretary of State.
Our commitment to the UK steel sector is clear. The Government are contributing up to £500 million in a joint investment with Tata Steel. We are in talks with British Steel following our generous offers of support. We have delivered more than £730 million in energy costs relief since 2013, and the British industry supercharger is coming soon. We updated our procurement policy note to ensure we are procuring more in the UK, and we are trying to do everything we can to continue to support the steel sector.
Small Business Council
Craig Tracey (North Warwickshire) (Con)
3. What steps her Department is taking to support small and medium-sized enterprises through the Small Business Council.
Free Trade Agreement Negotiations: Israel
Trade with Commonwealth Countries
EU Withdrawal: Impact on Businesses
Free Trade Agreement Negotiations: South Korea
Trade with Zimbabwe
Trade Agreements: Environmental Protections
Kinship Carers: Employment Leave
Infrastructure: Impact on Business Investment
Regulatory Costs: Small and Medium-sized Enterprises
We are all disappointed that the Government, having abandoned Teesside steel several years ago, are now ready to give up on primary steelmaking in the UK and to rely on recycled material utilising electric arc furnaces. I am pleased to hear that Teesside is pencilled in for one of them, but not so pleased that there have been attempts locally to circumvent proper procedures to secure planning consent. Will the Minister look into that? More importantly, will she confirm that the Government have a final copper-bottomed agreement with the industry that the furnace will definitely be built on Teesside?
A number of the issues that the hon. Gentleman raises are fundamentally locally. We work closely with Mayor Ben Houchen, who has done a remarkable amount of work for his part of the country. The reality is that the steel sector was placed in an area of uncertainty for some time. We were able to provide support for Tata, which has ensured that the steelworks continue at Port Talbot. We provided the largest grant ever made available to steel, and we are now in conversation with British Steel. That is what it means to have a long- term steel strategy to ensure that steelmaking continues here in the UK.