Small and Medium-sized Businesses

Without our small businesses, we as a country are nothing, which is why we have published the first small business strategy in 10 years. We are going to change the law to tackle late payment, unlock billions to support businesses to invest, and revitalise the British high street.

Love Beer Brewery in Milton in my Oxfordshire constituency of Didcot and Wantage supplies fantastic ale for events and a number of local pubs. However, its viability is threatened by the freeze of income tax thresholds and the increase in beer duty. Its monthly beer duty costs are now between £1,500 and £2,000, and if its owner did not have a day job, it probably would not be able to survive. In that context, will the Minister say a bit more about what else the Government can do to support small businesses and small breweries such as Love Beer in Milton?

When I visited those at the de-alcoholisation unit at another brewery, the Budweiser factory just outside Newport, last week, they said that one of the really important things was being able to diversify, because of changing drinking habits in the UK. However, they also want the British Government to focus on making sure that businesses have access to capital and that people pay their bills on time. When we introduce legislation, as we intend to do later this year, which will tackle the problem of late payments, that will make a dramatic difference. It will be the most important piece of legislation in the UK in this field for 25 years.

Clean Power Hydrogen, a small business in my constituency, is a UK leader in the manufacturing of membrane-free electrolysers for green hydrogen production. It employs about 60 people in Doncaster, and it has the ability to expand that to hundreds by 2035. Will the Minister set out what he and his Department are doing to support companies such as Clean Power Hydrogen in Doncaster and across the country?

I congratulate my hon. Friend on being a great defender of the businesses in her constituency. We are delivering targeted catalytic public investment in our clean energy industries. Some people see climate change as an economic challenge for us, but we see it as an economic opportunity in this country, because it is about future jobs. That is why we are so different from the political parties on the other side of the Chamber.

Slough is a dynamic and innovative business hub, but as we enter the festive period, retail, hospitality and leisure businesses, for example, are under immense pressure. Although businesses, particularly small and medium-sized enterprises, welcome the support measures that have already been introduced, what specific immediate actions are the Government taking to boost the high street and ensure that Slough businesses not only survive but thrive?

As my hon. Friend knows, I know a bit about Slough, because my brother is a headteacher there—and I am sure he has been helping out some of the pubs. The most important point is that we fully acknowledge that it has been a very difficult few years for the hospitality industry across the whole of the UK. That is one of the reasons we set a target of 50 million international visitors to the UK by 2030. If we are to do that, we have to make sure that pubs survive. My hon. Friend will know that, when the Conservatives left office last year, they had no plan to replace the covid recovery funds and no plan to meet the coming cliff edge in the revaluation of business rates. That is why it is so important that we have put in £4.3 billion to protect businesses and provide transitional relief.

Will the Minister outline what work he is doing with the Ministry of Defence to support our defence SMEs, given the situation in Ukraine at the moment?

The single most important thing is that we have a defence industrial strategy. We should always have had a defence industrial strategy, because as many of us will know, up and down the land there are small and larger businesses that rely on the support they get from providing for the MOD. When I was in Auckland a few days ago, I was able to speak to the New Zealand navy about buying British frigates, which would be made in Rosyth. I very much hope that we will be able to get that over the line. We are determined as a Government to use these industrial opportunities in the MOD to deliver good jobs across the whole of the UK.

I call the shadow Minister.

Last month in Business and Trade questions, I asked the Secretary of State to show some backbone and stand up to the Chancellor and say, “No more business taxes”. But he did not: far from permanently lower business rates, small and medium-sized businesses on our high streets are experiencing enormous rate hikes. Will the Minister apologise to those retail and hospitality businesses who feel so misled?

No, because I want the hon. Lady to apologise for what the Conservatives did to the British economy and British businesses. Why is it that, following the Brexit that they delivered to this country, only one in 10 British businesses are exporting, whereas three out of 10 French businesses and four out of 10 German businesses export? It is because they gave us a Brexit which, frankly, was not fit for purpose. That is precisely what we should be changing.

Of course there are problems for lots of businesses up and down the country, but I note that every single time we ask the Conservatives, “Where is the money to come from to pay for improving the NHS and putting our public services back on their feet?” they always say it will come from some random budget. [Interruption.] Just as when the shadow Business Secretary, the hon. Member for Arundel and South Downs (Andrew Griffith) was the Financial Secretary to the Treasury for Liz Truss, he wanted us to—

Order. Please, come on. I did cough twice!

I did not hear an answer to my question. To add insult to injury to the retail and hospitality businesses on our high streets, the letter that has gone out from the Ministry of Housing, Communities and Local Government about the change in business rates gives completely different information from the guidance on the Treasury website. The difference means thousands and thousands of pounds. Will the Minister commit today to getting in touch with his Cabinet colleague to ensure that those letters are corrected?

Mr Speaker, I will find some Strepsils for you later.

I think my throat will manage. The hon. Member should not worry.

Well, I will find some hearing aids for the hon. Lady, because she refused to listen to the answer I was providing. Basically, when the Conservatives left government, they had not provided a single penny to make sure the cliff edge would not affect every single small business in this country. That is the problem they should be apologising for. [Interruption.] I cannot hear what she is chuntering, so I probably need a hearing aid, too. Of course I am happy to look into the letters she is talking about, but, really, the Conservatives need to get with the programme. Even the leader of the Conservative party now admits that Brexit was a “shock” on a level with covid and the economic crisis—but it was a self-inflicted shock.

Businesses of all sizes across my constituency are struggling due to the strain of Labour’s increases to national insurance contributions and the pressures created by the Employment Rights Bill. Many tell me they are questioning their viability or even considering relocating overseas. Will the Minister set out what steps the Department will take to support entrepreneurship and ensure that businesses choose to invest and grow here in the UK, rather than being driven overseas?

Look, we want to back British entrepreneurs and investors. That is why we addressed some of the key issues in our small business strategy, which we published earlier this year, in particular late payments. The Conservative Government refused to tackle that in any serious way across their 14 years. It is why we are also looking at access to finance. One thing we know about a business is that if it exports, it will be more resilient, more likely to grow and more successful in future years. To enable that, I asked UK Export Finance this week not just to focus on big contracts around the world, but to ensure that it provides specific support for SMEs.

The Scottish Chambers of Commerce has said that this Labour Budget

“falls short of reassuring business owners”

and that SMEs in Scotland are being left “on the brink”. I have met a range of businesses in the Scottish whisky and hospitality sectors and the crucial energy industry, and this Budget is a missed opportunity to reverse cack-handed Labour policies, such as national insurance contributions, which are hurting our SMEs. Will the Minister explain to Scottish businesses why Labour has gone out of its way to let them down so badly?

First of all, we have given £5 billion more to the Scottish Government; I sometimes just wish they would stop whining and moaning, and get on with delivering what they can with the budget that we provided to them. Secondly, I have met the Scotch Whisky Association frequently since I came into this post at the beginning of September. It is delighted that we are delivering trade deals around the world. The trade deal with India, in particular, will reduce tariffs in India from 150% to 75% and, in 10 years, to 40%. That will make a radical difference to the ability to export Scotch whisky around the world.

I call the Liberal Democrat spokesperson.

The Government have repeatedly said that they would introduce permanently lower business rates. We were pleased to hear the Chancellor announce lower multipliers in the Budget, but the recently announced higher valuations will wipe out any benefit that businesses will get from the lower multipliers. UKHospitality estimates that the average increase for hospitality businesses will be 76% over the next three years; that compares with warehouses, offices and large supermarkets, whose rates will go up by 16%, 7% and 4% respectively. Given that it has transpired that the Government were informed of the higher valuations back in September, how does that align with their pledge to support small businesses, and how do the Government plan to meet the commitment, in their own small business strategy, to bring down business rates bills?

Look, the single most important thing is that everybody, including the Liberal Democrats and the Conservative Government, when they were in power, knew that after the revaluation in 2021—on the back of covid—there would be significant increases when a new revaluation came in 2024. Everybody was aware of that. At the same time, everybody recognised that there was a cliff edge, because not a single penny had been set aside to provide transitional relief following the general election. We provided relief last year, we provided £4.3 billion of relief this year, and that is why there is a very strong future for our hospitality sector under Labour.