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Budget Resolutions and Economic Situation

I must move on now. As we have turned this into a business debate rather than an industry debate, I shall briefly touch on the implications for small businesses and the contribution made to this debate from afar by Lord Mandelson and his Department for Business, Innovation and Skills. What we should all be talking about is how to return to growth: what is the future for British enterprise, and how do we make this economy successful again? However, until we tackle the debt problem, we cannot do so; there will be no return to normal growth until we satisfactorily address the deficit and the debt problem. Let us consider the current prospects for businesses. We have no fiscal stimulus, and if this Government survive, business faces a national insurance increase. Business faces a considerable increase in business rates—I believe it will be £1 billion in the year about to start—and the small business corporation tax rate is increasing from 21 to 22 per cent. in April 2011. So the first thing that business faces is an increase in taxation. Obtaining credit is the big problem for small business, and that is holding back growth on a great scale. Lord Mandelson accepted as much with some vigour in a speech he made about the behaviour of the banks a few days ago. What is in the Budget to tackle this? What is pulled out of the hat on the eve of the election? The answer is a credit adjudicator service. Apparently, some sort of new tribunal will be resorted to by every business man who cannot get the credit he thinks he ought to get from his bank; there is to be an appeals system. A whole new profession of sub-lawyers and separate risk managers could be about to appear. The banks are to be determined by some tribunal, some official or perhaps some political adviser. When someone is worried about their credit, they will have to say how marginal their constituency is and whether the Labour candidate is a Blairite or a Brownite. That might have a very significant effect on someone's success when they appear before the credit adjudicator service. It was rightly ridiculed by Richard Lambert, and nobody has the first idea as to how it is meant to act as an answer to the credit problem. Lord Mandelson is trying to sell his whole Government on "active government" and "interventionist government", but when he was last at the Department of Trade and Industry he did not take that view at all. Indeed, I often quote with approval one of the things he said when he first came into what is now the Department for Business, Innovation and Skills. He was against the Government picking winners, saying that the history of this had usually been losers picking the Government. That is a very good description of the industrial strategies of the past. It was a very witty remark, with which I wholly agree. However, suddenly we find that "active government" means that there is a kind of slush fund of grants from various parts of government. They have been holding back various grants and financial approvals that they could have given in the past few months and are now releasing them in a sudden rush on the eve of the election. The allocation to the noble Lord's budget in BIS is a one-off £750 million, which he got as a kind of dowry when he turned up—he called it a strategic investment fund. What has happened, as the Financial Times showed in some research a couple of days ago, is that no less than £7 billion-worth of grants or financial approvals have been given in the past week or two. This has been done by three Departments in particular—the Department for Transport, the Ministry of Defence and BIS—with the money to be spent on trams, trolley buses and defence contracts. Some of these grants to industrial enterprises are doubtless worth while, but this is happening all over the place; I advise anybody in a marginal seat who is looking for Government money to get in a bid quickly in the next few days. Let me discuss one of these grants. I shall not oppose it, because I do not know enough about it, and I shall go on to explain why I do not get up to oppose such grants. So let me give approval to one of Lord Mandelson's recent grants. Some £8 million has gone to the refurbishment of Blackpool tower; the iconic tower and Winter Gardens in Blackpool has suddenly got a grant.