HC Deb 10 March 1999 vol 327 cc367-80 3.32 pm
The Secretary of State for Trade and Industry (Mr. Stephen Byers)

With permission, Madam Speaker, I wish to make a statement on enterprise and competition. Yesterday, my right hon. Friend the Chancellor of the Exchequer delivered a Budget for Britain to succeed in the new knowledge-driven economy and to promote prosperity and fairness. Today, I wish to announce a number of complementary measures, which will boost enterprise and competition.

First, I am publishing a detailed implementation plan for our White Paper, "Our Competitive Future: Building the Knowledge Driven Economy". For each commitment, we have set out a series of targets, a timetable and the contact details of the officials in my Department who are responsible for delivering those commitments. That unprecedented step demonstrates our belief in open government, our desire to work closely in partnership with business and our determination to deliver on our commitments.

I am also publishing today a strategic framework for the Department of Trade and Industry, setting out the objectives for my Department and the work that we will undertake in pursuit of those objectives. Copies of both documents have been put in the Library and the Vote Office.

The policies in the White Paper that we published before Christmas apply to all sectors: traditional and high-tech, manufacturing and services. Work is well under way on many of the proposals contained in the White Paper. I have established a review of bankruptcy and insolvency law, to examine whether we can encourage responsible risk-taking while coming down hard on those who set out to defraud creditors. It will report to me next month. Separately, I am reviewing arrangements for business rescues to find out whether the law should be changed to give businesses in difficulties more chance and more time to turn things round. I shall announce our conclusions in the summer.

This afternoon, I want to announce four new funds to support business. First, we will be providing £20 million to achieve our target of high quality support for 10,000 business start-ups by 2001. The programme will be launched this summer.

Secondly, a new enterprise fund will stimulate the availability of finance for the small and medium enterprise sector. I have increased the fund to £160 million. It will lever in an additional £350 million from the private sector to ensure that more than £500 million is available to support loan guarantees for small firms and for support for regional venture capital funds aimed at the provision of small-scale equity and a national scheme to support high-tech businesses.

Thirdly, following the Chancellor's announcement yesterday of a further £20 million for high-tech venture capital investment, we will create a new fund operating across the United Kingdom, focusing on young high-tech firms that need small amounts of equity.

Fourthly, I can announce that we have decided to expand the successful SMART—small firms merit award for research and technology—scheme. From April, a wider range of individuals and businesses, particularly those in the manufacturing sector, will be able to receive help to research or acquire technologies needed to turn good ideas into commercial reality. We shall increase annual spending by more than a third and provide almost £100 million over the next three years.

Science and the commercial exploitation of scientific research have a key role to play in improving Britain's competitive position. That is why we will develop a strategy to improve knowledge transfer, stimulate the flow of scientists and engineers into industry, and encourage knowledge-based industries. We shall publish proposals in that key area by the end of the year.

Today, following yesterday's Budget statement, we are publishing four documents on tax changes to stimulate innovation and enterprise, especially in smaller companies. The introduction of a tax credit for research and development will be a major step on the road to raising the UK's performance, giving real help to thousands of smaller firms that are working to introduce new products and processes. It will underwrite almost a third of research and development costs for small business, giving the sector a boost of £150 million a year.

Enterprise management incentives will allow smaller companies to give tax-advantaged equity remuneration. We shall also publish proposals on corporate venturing and tax reform for intellectual property. Together, these papers demonstrate our commitment to a framework in which small business can thrive.

Small and medium-sized firms need further help too. I intend to establish a new body—the Small Business Service—which will be specifically designed to meet the needs of smaller businesses. I can announce that it will have more than £100 million of new money to support its important work. The body, which will report to me, will be headed by a high profile chief executive. It will have two key responsibilities: to act as a strong voice for small business at the heart of Government; and to improve the quality and coherence of delivery of Government support programmes for small business and ensure that they address their needs.

The areas in which I expect the service to be involved include: the provision of a new automated payroll service for all new small and medium-sized enterprises; supporting the Revenue in providing business support to discuss problems within 48 hours; giving advice with Customs and Excise for exporters and importers; and, working with the Revenue on internet filing of tax returns. Consideration will need to be given to the relationship between the service and the newly established regional development agencies.

A modern, effective competition regime is necessary to reward innovation and enterprise, and to bring real benefits to consumers. The Director General of Fair Trading is already looking at a number of areas— including cars, supermarkets and private medical insurance—and he has referred over-the-counter medicines to the restrictive practices court for examination.

More needs to be done. I shall therefore exercise my powers under section 12 of the Fair Trading Act 1973 to give the director general directions indicating issues that he should take into account in determining his priorities. I shall also exercise my power under section 13 of the Competition Act 1980 to ask the director general to investigate particular prices.

In relation to prices, there is widespread concern that those paid in the UK for goods are higher than prices in other countries. I have begun today a study on international price comparisons, which will help competition authorities to identify markets that require their attention. It will be made public, so that consumers and others can comment. I will then decide which prices I will ask the director general to investigate.

We are also taking action to provide a modern framework for utility regulation. Electricity standing charges are a matter of pressing concern; they account for around 13 per cent. of a typical household bill and can rise to 20 per cent. for low volume users. Figures which I am publishing today show a wide variation in standing charges by region and by method of payment. I have today written to the energy regulator asking him to look at standing charges to ensure that pensioners and the poor, in particular, are not disadvantaged.

I also believe that the time is right to introduce a modernised merger regime. Businesses need stability and confidence that decisions in those important areas are not taken for short-term political considerations. I believe that the system could be improved if merger decisions were normally taken by independent competition authorities against a competition-based test. A small minority of cases will raise important and wider public interest issues, such as those involving the defence industries, and Ministers would continue to have a role in such proposals. I intend to publish a consultation document to begin a full debate on that important issue.

To secure real competition we need knowledgeable and well-informed consumers. To that end, we shall publish a consumer strategy White Paper before the summer. However, there is one area of particular concern. A mortgage is the largest and most complex financial commitment that most people will ever enter into. I have today announced proposals to improve the information available to customers in relation to the marketing of mortgages and other credit. Our proposals will give them access to clear information about the interest rates on offer.

The measures that I have announced today show our determination as a Government to support enterprise and to succeed in the knowledge-driven economy of the future. They complement the radical proposals set out yesterday by the Chancellor and I commend the statement to the House.

Mr. John Redwood (Wokingham)

I thank the Secretary of State for his statement, although I was perturbed to read all its main points, before I came into the Chamber, on a Press Association tape and to learn from journalists that every major item had been briefed to the press by the Secretary of State and his officials before he made the statement. It is not right that Members of Parliament should hear about his proposals from the media before they do so in this House.

I hope that when the Secretary of State draws up his list of sinners who need referral for high pricing, he will include the Chancellor of the Exchequer. He is the main offender on petrol and diesel prices and on costs for the haulage industry. I hope that he will take responsibility for the problems that the motorist is now experiencing.

It has taken the Government nearly two years to decide that Britain needs lower prices and more competition. They have abandoned the case-by-case approach of the previous Government. Conservatives broke monopolies and introduced competition on an industry-by-industry basis. This Government have spent two years talking about competition but done nothing significant to further it. All they have done is to put up business costs and business taxes. My right hon. and hon. Friends and I are all for lower prices and more competition. That is why we broke the monopolies in telephones, electricity and gas and that is why I have urged the Government to break the monopoly in water. Will the Secretary of State now pledge to introduce water competition for retail householders as well as for businesses? Do the Government want to break the present car distribution system and introduce car supermarkets? Simply telling us that car prices are too dear does not tackle the problem. Do the Government intend to outlaw recommended prices for newspapers, or does the Secretary of State value the present newspaper distribution arrangements? Does the right hon. Gentleman want to change the tied house arrangements in the brewing industry, or not? Will he remove the advantages local pharmacies currently enjoy?

The Minister for Energy and Industry (Mr. John Battle)

What a cheek.

Mr. Redwood

The Minister may say that, but those are the policy issues, and if the Government want to introduce more competition and lower prices, those are the issues that they should tackle. The previous Conservative Governments were tackling them case by case; we had a fine record of breaking many monopolies, but there are still more to be broken—will the Labour Government do it, or not?

It is a cop out to say that the Government will run a poor man's Which? magazine to tell us how much we are suffering, but that they will take no policy action where they could do so to tackle the problem at source. There is absolutely no evidence that the Government are the customer's friend; they talk about being so and spin that they are, but they funk the decisions necessary to bring prices down.

We are told for the 16th time that the Secretary of State wants to reserve to himself competition issues relating to defence and some other cases, despite his belief in independence; so will he rule out now all Secretary of State involvement in media cases? If his argument is that his views as a Minister could be in conflict with making a fair judgment in certain cases, surely that must apply most of all to cases involving the media, given the Government's predisposition to trying to influence the media in their direction.

Will the Secretary of State assure us that he will have nothing to do with the BSkyB bid for Manchester United and that he will rule out interest in all media bids in the future, contrary to the generosity displayed by him and his colleagues in all their press briefings up to today's briefing on this statement? Does he not understand that to achieve a judgment in the BSkyB-Manchester United case that is fair to the two balanced teams that are fighting that bitter battle, he should set out in advance, working from general principles, whether or not the Government think that media interests should be able to buy sports clubs. His failure to set out a general policy leaves him wide open to the charge of being unfair to one or the other of the parties when the judgment is finally made.

The Secretary of State has announced an enterprise fund; it has been announced countless times before. It shows how much Labour believes in policy recycling if in no other sort of recycling that we have to hear such announcements time and again. This time, £10 million has been added to the fund to give the excuse for re-announcing it, but, in Labour's old language, it is not new money. The fund is small recompense for the massive tax hike that business is experiencing. Why do the Secretary of State and the Prime Minister not realise that hiking national insurance contributions for the self-employed and hitting business motorists takes away far more money than is being put back through that small enterprise fund? If the Secretary of State left business more of its own money, he would need to propose fewer handouts.

The right hon. Gentleman proposes a Small Business Service at considerable cost. I can tell him what small businesses want: less regulation, lower taxes, no increase in national insurance for the self-employed, no increase in motoring taxes, no increase in haulage taxes, no increase in stamp duty, and no increase in VAT levies—all things that are in the Chancellor's Budget, but which he does not understand are bad for business. Businesses face a massive tax hike as a result of the Chancellor's third Budget, just as surely as the huge tax hikes that resulted from his first two Budgets.

If the Government want to earn the name of friend of business, they must sweep aside the regulations that they are putting in place and genuinely cut business taxes. Instead of gimmicks, they must offer real support to the business community.

Mr. Byers

It is most noticeable that the right hon. Gentleman has clearly not discussed with business its response to yesterday's Budget and to the measures that I have announced today. Were he to do so, he would learn that the targeted support that we intend to give has been warmly welcomed by industry, which recognises the assistance and support the Government can give in particular areas. I would point out to the right hon. Gentleman, in a friendly way, that he should begin a dialogue with business if he wants to speak as shadow Secretary of State for Trade and Industry. Clearly, he is failing to do that. In addition to that, he appears to be suffering from memory loss: judging by his remarks just now, the policies that he supported as a member of the Cabinet—for example, in voting for the petrol duty escalator—have been suddenly forgotten.

The right hon. Gentleman is right to talk about breaking down utilities and removing them from the public sector, but the Conservative Government effectively created private single monopolies in those areas. It has been left to the Government to break down monopolies and create a market that will deliver benefits to consumers. I can confirm that, as the Chancellor announced yesterday, there will be a review of the water industry as well.

On the new, modernised merger regime, we will operate under the existing provisions for as long as they are in place. I will discharge my responsibilities as Secretary of State, but we will consult because we believe that there is a better procedure that could be adopted. I hope to be able to bring the results of that consultation to the House in due course. There is no question that we shall discharge our current statutory duties in a quasi-judicial manner that is fair to all parties, and we will be guided by the report from the Monopolies and Mergers Commission. I expect to receive its report regarding BSkyB and Manchester United on Friday of this week.

I was disappointed by the right hon. Gentleman's response—I know that that should come as no surprise, but I live in hope. It is remarkable that he did not mention Brussels once in his contribution—which must be a first for him. However, he still missed the point. The statement that I have delivered this afternoon and the range of measures that we intend to introduce will support business. They are about innovation and enterprise and will at last give a new deal to consumers—an area that was totally ignored in the 19 years of the previous Administration.

Mr. Redwood

Eighteen years.

Mr. Byers

It seemed like 19 years. I believe that our measures will be welcomed warmly.

Several hon. Members


Madam Speaker

Order. We have a lot of business before us today and I am having to restrict Back-Bench speeches to 10 minutes in the major debate. I hope that there will be brisk questions and brisk answers from the Dispatch Box so that I will be able to call as many hon. Members as possible.

Mr. Martin O'Neill (Ochil)

Is it recognised that, in recent years, the Office of Fair Trading has lacked focus and resources because of the number of jobs that it has undertaken? Those of us who have had dealings with the OFT have been disappointed with the speed at which it has moved and the urgency with which it has often dealt with matters. I hope that those difficulties will be remedied by the extra resources and extra powers that my right hon. Friend is choosing to commit.

Mr. Byers

My hon. Friend makes an important point. There is no doubt that the Office of Fair Trading was under-resourced as a result of the decisions taken by the previous Government. During my time as Chief Secretary to the Treasury, I was pleased to be able to agree some extra funding—a 20 per cent. increase—for the OFT. I think that will help enormously in ensuring that the office can work to a programme that is far more extensive than any of its programmes to date.

Most importantly, the OFT must approach issues more proactively. It must play an active role and guarantee that consumer interests are at the forefront of the work of the Director General of Fair Trading. If that happens, I am sure that the Government and the independent OFT can work together and deliver a far better deal to consumers in the future than they have received in recent years.

Mr. David Chidgey (Eastleigh)

I should like to ask the Secretary of State three specific questions in the interests of clarity and speed. Can he tell me precisely what targets his Department has set for improving competitiveness and productivity and closing the skills gap? How will he measure progress towards those targets? What account has the Secretary of State taken of the forecast by the Institute for Fiscal Studies that 20 per cent. tax credit rates for small and medium-sized enterprises would increase the ratio of research and development expenditure compared with gross domestic product by less than one tenth of 1 per cent? Although I welcome the Secretary of State's proposed investigation into price competitiveness and the wide range of prices that consumers are charged, does he agree that his task would be easier if he were able to compare like with like— perhaps in just one currency: the euro?

Mr. Byers

I shall not go down that road this afternoon. [HON. MEMBERS: "GO on."] Well, they say that Labour Secretaries of State count their time in office in days rather than in months and years, and I want to try to get a few months under my belt.

On the important points that the hon. Gentleman raised, I have seen the IFS figures for its projections of the consequence of the tax credit for research and development, and I think that it is mistaken. The tax credit will make a big difference for SMEs. They have been asking for that measure and I am pleased that we were able to respond to their request in this Budget.

On productivity and improving skills, much joint work will need to be done across Government to deliver that agenda. I am already discussing in detail with my right hon. Friend the Secretary of State for Education and Employment the joint work that we can do to fulfil the need for skills to be developed and improved. I hope that we will be able to introduce many initiatives in the months and years ahead. On productivity, we need to continue working with the Treasury to identify ways in which we can make progress. The implementation plan for the White Paper that was published before Christmas reveals the timetable in which we shall achieve those objectives. When the hon. Gentleman has had the chance to read the implementation plan, he will recognise that we are serious about delivering on the commitments in that widely acclaimed document.

Mr. Peter Mandelson (Hartlepool)

I congratulate the Secretary of State on his excellent statement and wish him not only many months in his office but many years, which he will thoroughly deserve. I want to ask him about two aspects of the Government's agenda to which he has not referred. First, on the important subject of electronic commerce, when will the e-envoy—the digital ambassador—start work? Secondly, on competition and enterprise, when will the Government's proposals for the Post Office be implemented? It was envisaged that those would be introduced in the first quarter of this year. What or who is holding them up?

Mr. Byers

I am delighted that my right hon. Friend is here for my statement. Much of the implementation plan that we are publishing today builds on the excellent work over which he presided in the Department. I am pleased that we are able to implement many of the ideas that he advocated.

My right hon. Friend raises two important points. I interviewed two exceptionally good candidates for the post of digital envoy only 10 days ago, and I hope that we will be able to announce an appointment in the next few days. When my right hon. Friend finds out who is likely to be appointed, he will think that we have made a very good selection for that important post.

On the Post Office, a good deal of work is going on to make sure that we have a White Paper that will command broad support across the House and out in the wider community. It will be a comprehensive document, which will demonstrate that we want a forward-looking Post Office for the next century. That will take some time, but it will be worth it to get the proposals right. I expect to be able to publish that White Paper within the next two months.

Mr. Ian Taylor (Esher and Walton)

It would be churlish of me to criticise the Secretary of State too much because we started some of those measures when we were in government. I congratulate him on persuading his Chancellor in a way that I did not persuade mine about the proposals that he has announced this afternoon.

Will the Secretary of State take great care to ensure that the enterprise fund and the Small Business Service are staffed by people at least as entrepreneurial as those to whom they will be giving advice? I speak from some experience and I know that the service will break down, however much money one puts in, if the two sides of the equation are not properly matched. He will find that very difficult to achieve.

Secondly, the Secretary of State knows as well as I do that the devil will be in the detail of the application of the research and development grant and its success will depend on how the Inland Revenue interprets it. Will he please keep his eye on that and not pass it across to the Revenue?

Finally, why did the Secretary of State not persuade the Chancellor to cut capital gains tax to 20 per cent. or at least to introduce a 20 per cent. rate? That is his one big failing in the Budget, and I hope that he keeps working at it.

Mr. Byers

I shall pass on those comments to my right hon. Friend the Chancellor of the Exchequer. The hon. Gentleman's important point about the people who might staff and give advice in the Small Business Service is absolutely right. We need people with good, up-to-date, relevant experience who are able to mentor and to pass on that experience to the individuals who will come to the service for advice and assistance. We must see to that. One of the tasks that we will set ourselves will be to recruit the best possible people. With the additional new funding—it is new funding—coming into the service, and the recognition that there will be a voice for small business at the heart of Government but at arm's length from the Government, people will see that we are serious about providing a focus for the needs and aspirations of the small business sector.

I hear what the hon. Gentleman says about getting right the detail of the tax credit for research and development, and I will take a personal interest in achieving that objective.

Mr. Richard Burden (Birmingham, Northfield)

I welcome the statement. May I raise two points with my right hon. Friend? First, does he agree that a particularly important part of the SME sector that will need to be targeted through these and other measures is second-tier suppliers in the automotive industry? The Accelerate programme in the west midlands suggests that more than 2,000 second-tier suppliers could face major challenges in the coming year. Can my right hon. Friend comment on the relevance of the statement to them?

Secondly, in relation to the small business fund—I suppose I am taking up a point made by the hon. Member for Esher and Walton (Mr. Taylor)—can my right hon. Friend assure me that the good ideas in that scheme will be properly linked to the RDAs and the regional agenda, so that the service to be established is not monolithic, but sensitive to regional and local needs and differences?

Mr. Byers

My hon. Friend makes an important point about developing the work closely with the RDAs to make sure that the small business service works with local agencies to give the best possible service to the small businesses in the locality.

With reference to the car industry generally, it is important that we give assistance to the supply chain, especially where there is a major producer in a particular region. My hon. Friend will be aware that we have established an industry forum to help the supply chain in exactly that situation, so that productivity can be improved and the quality of the product raised. By developing best practice, we can offer new opportunities to companies and businesses.

Mr. Alasdair Morgan (Galloway and Upper Nithsdale)

With regard to mortgage interest rates, does the Minister agree that the best guarantee of competition in that sector is the existence of a thriving mutual building society sector? Will he therefore undertake to have a word with his right hon. Friend the Chancellor to see whether something can be done to stop so many building societies having to spend such an inordinate amount of management time fighting off the attentions of a tiny bunch of predator carpetbagger members, who have no interest in lowering interest rates, but are simply out to make a fast buck?

Mr. Byers

I know that that sector is always being actively considered within the Treasury, to make sure that the interests of the wider community are served.

Mr. Dale Campbell-Savours (Workington)

As one who was formerly an entrepreneur, may I tell my right hon. Friend that I believe that the package for enterprise is excellent? It addresses many of the issues that small business men bring to me in my constituency. Can my right hon. Friend give me an assurance that when an examination is made of the bankruptcy laws—I understand that he may have to make a statement on them in the next month—that will not lead to an increase in the number of phoenix company operations being set up, such as the Tanning Shop or Cabouchon jewellery, or all the others that we know about? I seek that assurance because many of us know of phoenix operations in our constituencies.

Mr. Byers

My hon. Friend raises an important point. There are two categories of people that we are trying to identify legally, so that we can separate them. One type of person is the responsible risk-taker, who has an idea, puts up his own money, tries hard but fails. The other category is the one to which my hon. Friend referred— people who have nothing but contempt for their creditors and will exploit limited liability to its full extent. We must bear down as hard as we can on those people, while recognising that responsible risk-takers need some degree of protection so that they will not have to live with the stigma of failure for the rest of their lives.

The review that I have set in train will consider whether we can make that distinction. However, I assure my hon. Friend that we would not bring forward proposals which would allow rogue directors who have contempt for their creditors to escape the full force of the law. That law needs to be applied and we should give a clear message that that will continue to be the case.

Mr. Tony Baldry (Banbury)

There is a lot of detail in the Secretary of State's statement. I think that he used the word "unprecedented" with regard to a document that he was publishing containing the names and, I presume, the telephone numbers, of officials, so that members of the general public can speak directly to them. Presumably, the right hon. Gentleman will have no objection if hon. Members who take a particular interest in trade and industry matters, such as members of the Select Committee on Trade and Industry, also avail themselves of the chance to talk directly to those officials on the policy issues raised in the document.

Mr. Byers

I have no problem with that. Those officials also have an e-mail address, so if the hon. Gentleman has that facility that is another way in which he can communicate with them.

Mr. Michael Clapham (Barnsley, West and Penistone)

I welcome my right hon. Friend's statement. Yesterday, together with other colleagues, I met representatives of the Sheffield branch of the Engineering Employers Federation to discuss the problems that they faced. They told me that they need assistance in establishing a conduit with the local universities in order to transfer technology. Will my right hon. Friend consider what measures he can introduce or assist with to establish a network throughout the UK to transfer technology from universities to industry?

Mr. Byers

In due course, we shall be announcing funding allocations through our innovation budget, and I assure my hon. Friend that one area which will have our considerable attention will be the way in which ideas that are developed in universities can be exploited in the private sector to develop businesses as successfully as possible. If the group to which my hon. Friend referred would like to contact the Department, I am sure that we could give advice on how to facilitate such a dialogue with the local university sector. Over the years, Britain has been weak in that area, and we need to change our whole culture in terms of accessing ideas and innovation in the university sector for the benefit of all our people and for business generally.

Mr. Andrew Lansley (South Cambridgeshire)

Will the Secretary of State explain why, in his references to competition policy, he did not mention the implementation of the Competition Act 1998, given the importance which his predecessors attach to that? Is it because the Director General of Fair Trading and his office are having the difficulty which my right hon. Friend the Member for Wokingham (Mr. Redwood) and others predicted about the implementation of those measures in practice?

With regard to mergers policy, will the Secretary of State simply admit that he has had to propose an independent scrutiny of mergers decisions simply because, since May 1997, he and his predecessors have let mergers policy, which was governed by the Tebbit doctrine on a predictable basis, turn into a policy that has become unpredictable, causing difficulty to the City and to business?

Mr. Byers

The reality is that every merger application must be dealt with on its merits. Since I have been in post, no decision that I have taken on such matters will have come as any surprise to any informed commentator. If the hon. Gentleman has examples, I should be grateful if he would give them to me.

The director general has not drawn any particular problems to my attention. I met him only a couple of weeks ago and he felt that he had the resources to ensure that the Competition Act was implemented fairly and effectively.

Mr. Barry Sheerman (Huddersfield)

I congratulate my right hon. Friend on his statement, particularly its emphasis on the knowledge-driven economy. All who are interested in the area know that that economy has no respect for the divisions of Departments of State. Is he aware that one of the most refreshing things about the statement is that it has started vigorously to break down those barriers that we had to put up with for 18 years, where the Department of Trade and Industry would not talk to the Treasury and the Treasury and the DTI would not talk to the Department for Education and Employment? It is refreshing that the Government are breaking down those barriers, resulting in a co-operative effort across all Departments of State to get the knowledge-driven economy really moving.

Mr. Byers

I am delighted to confirm that. The Chancellor's Budget statement yesterday revealed clearly the extent to which we have co-operated across the Government to ensure that the Budget meets the needs of a range of different people. Today's statement and subsequent statements will do the same.

It would be a mistake not to record the valuable role that my hon. Friend has played over the years in breaking down barriers, particularly between higher education and the business sector, to develop innovation and enterprise, especially in his own region, but also throughout the country. Many of the ideas that we have introduced today are built on ideas that he has advanced in the past few years.

Mr. John Bercow (Buckingham)

Given the Secretary of State's statement that the creation of wealth is now more important than its distribution, can he explain why, in their first 22 months, his Government have introduced no fewer than 2,400 additional regulations, which adversely impact on business, and removed only 20? Why has he made no proposals today that would reverse that tide of nanny state interference in the affairs of British business?

Mr. Byers

I would warn the hon. Gentleman to be very careful about his reference to regulations. In their last year in power, the Government whom he would have supported introduced 3,500 regulations compared with the 2,300 to which he referred. I am afraid that we are way behind, but that is not a target that we want to achieve.

Mr. Harry Cohen (Leyton and Wanstead)

I congratulate my right hon. Friend on his statement and I welcome the arrangements that he has announced on mortgages. Will he extend them slightly so that endowment policies associated with mortgages are looked at so customers using those financial services obtain clarity?

Mr. Byers

I am pleased to be able to clarify my comments and reassure my hon. Friend that today's announcement covers mortgages and other credit arrangements, including endowment policies. People will obtain clarity and know exactly what they are entering into when they make one of the largest investment decisions of their lives.

Mrs. Louise Ellman (Liverpool, Riverside)

I welcome the Secretary of State's practical commitment to enterprise and his promise to tackle one aspect of fuel poverty. Will he explain in more detail how funds from his Department will be made available to RDAs so that venture capital funds or other funds can meet opportunities that have been identified in the regions? Can he give us any further information on how he intends to tackle fuel poverty in a direct and meaningful manner?

Mr. Byers

The relationship between the RDAs and the new Small Business Service is one of the issues to which we will have to give careful attention. We do not want duplication, but we want bodies to work together and the activities in which they are both involved to complement each other.

We can do many things about fuel poverty and we will be asking the energy regulator to draw up in his response a social action plan that considers how energy regulation will work. We are also enabling the regulator to extend his consideration to include people on low incomes. Today's announcement about standing charges could make a real difference to many people on low incomes because the proportion of their household expenditure spent on fuel is three and a half times that of people on average incomes. Fuel poverty is a real problem that needs to be tackled; we are not walking away from it and the steps that we have announced today will begin to make a real difference.

Mr. Brian White (Milton Keynes, North-East)

Today's statement and the consultation paper on e-commerce published last week will be widely welcomed, but my right hon. Friend will know that the skills shortage in respect of information technology staff and the need for the infrastructure on which the knowledge-based economy must be built have been forgotten in the past. It is important that both those aspects are addressed, so will he elaborate on how they will be covered?

Mr. Byers

It would be a mistake to deny that there is a growing shortage of skills, which must be tackled. I am working closely with my right hon. Friend the Secretary of State for Education and Employment to establish—with the help of the skills task force set up by my right hon. Friend—how we can drive through the skills agenda.

This is one of the issues that have been neglected over the years, and we are now paying the price for that neglect. In the days following the Budget, however, announcements will be made showing that we are serious about tackling the problems.

Mr. Tam Dalyell (Linlithgow)

What concrete measures are available to stimulate the flow of scientists and engineers into industry? That was a reference to my right hon. Friend's statement.

Mr. Byers

I know that my hon. Friend takes a close interest in these matters. He will be pleased to learn that we are developing what we call the teaching company scheme, which provides for a genuine partnership between scientists in industry and higher education. We are also considering ways of encouraging children, during their school lives, to see science and the development of science as more exciting than it is traditionally presented as being.

We believe that a number of proposals in the Department—some have yet to be announced—will reflect the importance of science to our country, and to the scientific community. That is why, before the end of this year, we shall present a strategy showing clearly how we intend to use the science skills that we have here, in the United Kingdom, to the best effect. Science is a talent—a resource—that has been under-utilised, and we want to do all that we can to remedy that.

Mr. Geraint Davies (Croydon, Central)

Does my right hon. Friend agree that the most powerful weapon that we can use to combat uncompetitive pricing in various markets is probably the euro? Given his enthusiasm for electronic commerce, which I share—and, indeed, his enthusiasm for consumer empowerment—will my right hon. Friend encourage the publication of relative pricing across Europe in the electronic and other media, in order to empower consumers, bring about competitive markets and create more prosperity?

Hon. Members

The answer is yes.

Mr. Byers

Thank you.

Consumers do have an option in relation to mortgages, which are now being offered in the single currency. We announced today, in our paper on mortgages, that information will be available to those who are thinking of taking out a mortgage in the single currency, showing clearly how such an arrangement would operate in comparison with mortgage in sterling. Consumers will have a genuine choice. We are moving in that direction— certainly on mortgages.