To ask His Majesty’s Government what recent assessment they have made of the impact of the closure of the UK Tradeshow Programme on the ability of small and medium-sized enterprises to export to new markets
Although the DBT has closed the specific Tradeshow Access Programme, it still provides considerable support to small and medium enterprises to attend trade shows, ranging from training in language and culture and pitching and negotiations to networking receptions that use our embassies overseas and Meet the Buyer events.
My Lords, the Tradeshow Access Programme provided vital support to thousands of SMEs to attend international trade events. The return on investment was remarkable; then the Government closed it. Last year, UK exports were £860 billion—well short of the £1 trillion target. Does the Minister agree that we need to get out there and sell, sell, sell? Can he tell the House when the replacement programme for SMEs and their respective trade associations—the beating heart of our export economy—will be announced?
I thank the noble Lord for his mantra of sell, sell, sell. Mine is ABC: always be closing. The DBT is doing this. It is unfair to say that we closed this programme; it was not necessarily yielding the benefits we hoped for. We must look for value for money; we have instead gone to a more targeted approach, where the UK will take a pavilion and crowd in businesses in specific instances. Recently we have been to Mobile World, led by my noble friend Lord Offord; the World Defense Show in Saudi Arabia; Bett, the education show; and the Hydrogen show in Chile. Although the Tradeshow Access Programme looked like a good idea and was very popular among certain businesses, it was not used in the way we wanted. This approach is far more effective for getting to our £1 trillion target.
My Lords, there are 5.5 million firms listed in Companies House, but only 9% of them currently export, which seems low, optically. What does the Minister believe is an achievable percentage to aim for and what is the Government’s strategy to reach that target?
My noble friend is absolutely right. We have a cultural issue with companies in this great nation of ours actually deciding to export. The total is about 300,000, and we have a target of 500,000—the 500 club that was inspired by my noble friend Lord Offord. We will do this in a number of ways. The UK Export Academy is an important mechanism for teaching businesses and business leaders how to export. We have 160 international trade advisers around the country whose specific task is to hold the hands of these companies when it comes to exporting abroad. We have thousands of agents around the world, underneath our HMTCs, whose job is to help them on the ground and help them find distribution partners, most importantly. We have the Help to Grow programme, the export support service, and we now have growth hubs as well. There is more we can do, but we have made a phenomenal start and are starting to see the benefits of a very coherent action plan.
My Lords, will the Minister acknowledge that there has been a significant reduction in export sales by SMEs and small businesses since Brexit? Will he also acknowledge that, to take advantage of the limited number of trade deals that his department has managed to sign since Brexit, it is necessary to give significant help to SMEs and small businesses, if the gap is going to be closed?
I would say two things to the noble Lord. First, exports are up over the past year by 13%—and tomorrow we have a debate on the CPTPP, which will allow this country to join an £11 trillion trading network, which will result in significant benefits to our businesses immediately and into the future.
My Lords, I remind my noble friend that, many years ago, I secured the outsourcing of the export marketing research scheme to the British Chambers of Commerce from the then department; that was very successful for over 20 years, and continues as a scheme under the department. That plus the grant support for introduction into markets provides a significant benefit to small businesses. Can my noble friend say whether he and the department are working very closely with trade associations and chambers of commerce to ensure that they are also delivery vehicles and multipliers for the work that the department is doing?
I am very grateful to my noble friend for all the work that he has done to help exports and trade in this nation over his many years of service in this House and the other place. I draw attention to the fact that the British Business Bank also provides funding for small businesses to give them the training and skills to export, and UKEF provides billions of pounds to ensure that they have the capital to enable them to export. But my noble friend is absolutely right: we can do more with the chambers of commerce, and we have a specific group structured to enable us to have strong relationships with those organisations. On the ground, particularly in harder-to-reach markets such as China, they play an invaluable role, and I personally do everything I can to co-operate with and encourage them.
My Lords, with post-Covid demand for exhibition space now returning and with seed-corn start-ups reliant on new customer contact and wider market awareness, why cut or compromise this programme? Since the 1970s, we have had valuable DTI support for small business. Labour promoted it—indeed, all Governments have done so. Such programmes have helped a generation of young entrepreneurs penetrate export markets and build many of today’s successful companies. Why the restraint? Surely we should be expanding these programmes. The Minister referred to targeting, which too often leads to cuts, as we all know.
I am always grateful to the noble Lord for the challenge but, actually, I believe that we have come to the right conclusion, which is to crowd in significant numbers of businesses to single and key focused trade shows. We provide a great deal of support beforehand, including language and culture training and skills training to make sure that these businesses are prepared. During the mission, a Minister normally accompanies the businesses to get greater penetration into the market that we are trying to sell into.
It is no good just giving a few hundred pounds to a small business to have a small trade stand in a very large trade show. What you need is to put a proper front on. Great Britain is selling its wares to the world and, by concentrating that firepower, we have far greater effect. I also believe that we have better value for money. It is worth talking to some of the businesses that have participated in these trade shows, where the feedback has been excellent. I say this without prejudice, but other countries are jealous of the extraordinary quality of the stands that we build, which project the union jack across these wonderful events.
I am not entirely sure whether that is a question for me, but the noble Earl touches on defence, and I would say that we have been doing a huge amount on defence and security exports to promote our industries. New arrangements, such as AUKUS, are also incredibly powerful in driving our exports in that area. I also draw this House’s attention to the Saudi Great Futures event, which will launch on 14 May. Over the past few days we have sent out literally thousands of invitations to businesses, and we will fly a huge quantity over to Riyadh in the middle of May to celebrate the enormous opportunities that we see in that country, working on projects such as NEOM. Across the board there is an enormous amount that we are doing. I shall have to refer the question about banking to one of my colleagues.
My Lords, the Minister has just said that there will be “significant benefits” to this country from the trans-Pacific partnership. How significant is “significant”? Does he recognise that the Government estimate that the benefit to our GDP will be 0.08% and the OBR believes it will be 0.04%? Should the Government not be careful not to overegg their pudding?
Since many of our exports are going to be food and drink, I think overegging the pudding is precisely what we should be doing when it comes to encouraging our exports. The opportunities that CPTPP presents are, first, a new trade deal with Malaysia, which we do not have; far better arrangements around rules of origin, which noble Lords opposite who have been involved in motor manufacture will see the benefits from; and very important new opportunities to export our agricultural goods. CPTPP is not a single trade deal but a living agreement. We hope new members will join which are aligned to our ambitions. That will allow us to have access to even greater markets. I am very proud of this Government’s record of negotiating trade deals, but there is more to do, so I am excited about the future too.