I am delighted to be called to speak in this debate and apologise to the shadow Minister and to those on the Treasury Bench for not being here at the beginning. It is a very important Bill that the Minister has brought before the House, and it is one that I feel strongly about, because my first job was running a very small business, and then I ran one that was only slightly larger. When one has lived and breathed cash flow, and dreamt about lack of payment for invoices that have been outstanding for 60, 70, 80 or 90 days, one knows why the provisions in the Bill are so important.
I know that the Minister understands small business; he was brought up in it. I also know that the shadow Minister is one of the very few people on the Opposition Benches who has business experience. It is good that we are having a discussion about some of the things that are incredibly important and pertinent to small businesses —pre-packs, zero-hours contracts, payment terms and director disqualification, all of which I plan to talk about —but it is also good that we are having this discussion, full stop, because they were not discussions that were had in any detail under the previous Government.
I would like to start on that note, because one of the things that I, as a small business owner and manager, turned to time and again was the Late Payment of Commercial Debts (Interest) Act 1998, a piece of legislation that was well meant by the previous Administration, brought in early as a result of a manifesto pledge, but that was almost completely useless. No one was really able to go to their customers and enforce the 8% above base stipulation set out in the Act, because they were afraid of upsetting them. I had recourse to it on only two occasions when dealing with customers. The frustrating thing was that although Parliament had willed the means, following a long campaign at the end of the Major
Administration and the beginning of the Blair Administration, it was unable to will the ends. That is why I am so pleased with what the Minister has created in the Bill, because we are getting much closer to a system that will work.
The first thing we must recognise is that it has taken this amount of time, and the innovation of the coalition Government, to be able to do something of this magnitude. That is why I think that criticising the Bill and trying to claim that it is deficient in some way or other is a pretty mealy-mouthed approach to what is a big step forward in helping small businesses control the terms of trade that they have with their customers.
Having run a business that, at the start, was turning over only a few hundred thousands pounds, I know the pain that was caused to my business when every week the results showed, almost invariably, that we were trading at a profit, yet that was not reflected in the bank account because of poor payment terms by large companies and, frankly, large parts of the public sector, and that is a pain I will never forget. I remember getting towards the end of the month and being genuinely terrified that I might not be able to pay the people working for me because I had not been paid by big customers. It is a very unnerving, frightening and frustrating experience. The amount of energy it takes out of small business people, who should be deploying that passion and energy in building a business, employing people and increasing wealth and prosperity, means that it is very destructive to business growth.