Industry and Exports (Financial Support) Bill

I thank the Minister for his opening remarks. I have some sympathy with him because, as a Minister in both DBERR and the Treasury, he has the unenviable task of defending not one, but two dysfunctional Departments. The Bill substantially increases the limits of Government financial support for business and exports—first, as we have heard, to £12 billion and then, potentially, to £16 billion. These are substantial provisions, reflecting the severe economic climate. We agree that business urgently needs practical help, but our concern is that these good intentions will not become the practical aid that business seeks. I say that because, to date, this Government's record of financial support for industry has largely been one of talk, not action; it has been a story of half-baked ideas badly implemented, and it has resulted on numerous occasions in confusion and anger among the very people whom Ministers claim they are trying to help. Ever since the fall of Lehman Brothers in September and the collapse of world markets in the autumn, the need for urgent action has been clear, to enable working capital to reach real businesses. That is why last November the Conservatives set out a plan for a national loan guarantee scheme of some £50 billion for viable businesses of all sizes and all sectors—clear, easy to access and simple to understand, it could underpin conventional bank lending. I wish that the Government had done what they often do in these circumstances—stolen our policy and claimed it as their own. After all, we see that all too often, yet on this occasion the Prime Minister has been deaf to good advice. Despite promises made last November, it was not until January that the Government's schemes were finally announced and even then—in the opinion of business—it was clear that they were half-baked. Let us consider the capital for enterprise fund, which is worth £75 million and is intended to provide equity funding to small businesses. When it was first announced last November, the Department said that it would""be ready to start investing by the end of January 2009"." January came and went and the snow fell in February and thawed, yet there was still no news and no investment, so last week, in the middle of March, as spring approached, I inquired exactly how much had been invested. I naturally assumed that the sum might have been £10 million or £15 million, but the people who run the scheme—Capital for Enterprise Ltd—told me that in fact not a single pound has been invested in any business. What about the working capital scheme, which was announced on 14 January? We were told then by none other than Lord Mandelson that it would be the centrepiece—the linchpin—of the Government's policies. It was to provide up to £10 billion in Government guarantees to underwrite bank lending and to be available from 1 March. That date came and went, so on 4 March we asked the Leader of the House when the scheme would commence. We thought that if we were lucky, it would be this month, but, who knows, it might begin on 1 April—how appropriate that would be. She could not say, and although I realise that she and Lord Mandelson are not exactly bosom buddies, surely between them they must have some idea when this scheme might actually start. One scheme is up and running: the enterprise finance guarantee scheme, which is worth £1.3 billion and is intended to underpin lending to small firms. On Friday, the Minister for Employment Relations and Postal Affairs, whom I am delighted to see in his place, gave us a remarkable two-hour oration, during which he confirmed that 26 applications had been approved. There was another hour to go before he finally sat down, but what he did not tell us was how many firms had actually got the money; perhaps the Minister here today could complete that speech in his reply. Part of the problem is that when Ministers make their announcements, they often have not really worked through the details—indeed, in some cases, they have not even cleared the schemes with the European Commission, as they are meant to do—and meanwhile, our competitors are stealing a march on us. For example, by last Christmas, the Germans, French and Americans were all ready to act. In Germany, some €2 billion has been extended to industry; in France €6 billion; and in America, some $17 billion was on hand for its car industry. The question that British businesses put to me—and I hope that the Minister will reply when he responds to the debate—is "Why is it that, under this Government, British businesses are the last to get the help that we need?" The answer may in part be the fondness that the Prime Minister—who, after all, was once Chancellor—has for tinkering and meddling, and creating myriad complex schemes that prove so confusing in practice. Thus we have the working capital scheme; the enterprise finance guarantee scheme; the capital for enterprise fund; the transition loan fund; the European Investment Bank's supported loans scheme for growing firms; the EIB-backed automotive industry loan scheme; and the £l billion non-EIB-backed, automotive loan scheme. Each of these schemes has different eligibility criteria and different rules. These in turn need different forms and different sets of business data. So the problem is that businesses are unclear about what is available, what they can apply for, and which scheme is best for them. They are not the only ones. Most of the banks tell me that they have yet to receive the detailed terms and conditions for many of these schemes, so that they can brief their high street branches—