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Queen’s Speech

My Lords, no one can complain that this Queen’s Speech is a bit thin, given the inevitably short nature of the Session that it opened. However, I thought it worrying that no mention was made of small businesses in the gracious Speech, and very little in the Minister’s speech, although he referred to them briefly at the end. I have worried about small businesses all my political life and I remain a member of the Small Business Bureau and the Genesis Initiative, a cross-party umbrella which draws together in discussion the representative organisations, covering about 1 million small businesses and employing about 3 million in practically every sector of the economy. I am glad that the noble Lord, Lord Sugar, is advising the Government on small business because, as he told us, small businesses are suffering in the recession and we will need them when the economy turns up. Their problems will change but they will still have serious problems. Unless we look out for them, we will lose too many, with a consequent loss of jobs, initiative and flexibility in the economy. Maybe the Pre-Budget Report in a day or two’s time will bring some tax changes to help, but in the gracious Speech I would have liked to hear that the Government were taking seriously the problem of overregulation. A complete review of government regulations on business is necessary. The Government have sporadically paid attention to better regulation and taken some initiatives in the past, but they should do so again. Regulations are very like weeds in a garden. If you turn your back, they flourish in no time and throttle the plants that you want to grow. We all see here the statutory instruments pouring through the system. Of course, many of those are regulations that affect businesses of one sort or another. Here we have the hard-working Merits Committee—reappointed again yesterday—which helps us to keep in touch with them and sort them out. Imagine trying to do it as a one-man business or small business when they all potentially affect you. Last year there were well over 1,000 statutory instruments—slightly fewer than in the previous year but nevertheless a huge number. In passing, I hope that there will be an opportunity soon to debate the Merits Committee’s excellent report on post-implementation review of statutory instruments. It found that over half the statutory instruments had no provision for follow-up consideration to see if the regulations were working and to assess their impact after the event. Of those that theoretically had follow-up provision, only half had been followed up. It is very difficult to see how a business, without the guidance that we have, can keep up with more than a fraction of the new regulations which may apply to them. The European Commission issues each year, on average, 200 new regulations and directives to do with food hygiene and related matters, each of which potentially applies to food businesses. That is roughly one new food regulation every normal working day. Of course, shops are open seven days a week, so they get less than one a day in that sense. Two hundred new regulations just in that one field is an enormous number for small businesses to have to deal with. On an earlier day in this debate the noble and learned Lord, Lord Woolf, complained about the sheer volume of criminal law that has poured out of the Home Office and the Ministry of Justice, making it difficult for the judiciary to keep up. Small firms would know exactly what he was talking about. I was told recently that there are now 436 separate enforcement agencies in Britain. That is an enormous number. I do not know whether that is the correct number, but, if it is not, I would be grateful if the Minister would tell us what it is. Most of those are chasing businesses, as well as other people. That is why it is time for another vigorous bout of regulation-weeding by the Government. If we can release the energy that is being spent on complying with ever more regulations, it can be used in building businesses and jobs. I also want to plead for a change in public sector purchasing practices to encourage buying from small businesses. When, many years ago, I was the Small Firms Minister, we had a programme of encouraging public sector purchasing officers across Whitehall and the public sector to look at small businesses for value for money. It was not so as to pay more but to be alert to the possibility that, while it may well be easier to buy from one massive supplier, value for money can often be found by shopping around, particularly in small businesses. These days I am no longer in a position to make that point to government purchasing officers, but I make it to my wife occasionally when she does all the shopping in the supermarket, rather than the smaller shops. That is easier, too, but it is the same point. Government purchasing officers are now actively discouraged from buying from small businesses by the rules and guidance on how to do their job. That is most damaging to small businesses and I do not believe that it is good for getting value for taxpayers’ money either. Some small businesses grow into large businesses. The presence of the noble Lord, Lord Sugar, here today reminds us of that fact. Some small businesses fill niches. They are often highly innovative. They provide choice for customers and jobs for 13 million of our fellow citizens. We must look after them as well as the banks.