Finance (No. 2) Bill — House of Commons, 2015-03-25
Topic: Macroeconomics
Fiona O'Donnell (Labour, Centre-left): It is a pleasure to see you back in the Chair, Mr Hood I wish to talk particularly about the rural economy and the opportunities that the Government might be missing, given the importance of small and medium-sized enterprises to rural economies. Given that this may be my last contribution in this Parliament, I also want to reflect briefly on the political situation in Scotland We have had more than one eclipse in Scotland in recent weeks. It seems to be a daily occurrence that Alex Salmond’s moon blocks out Nicola Sturgeon’s sun. At one time, the current leader of the Scottish National party—people might easily be confused as to who that is these days, but I remind them that it is Nicola Sturgeon—did a U-turn on the SNP’s proposal in its White Paper "Scotland’s Future" to reduce corporation tax by 3%. I welcome that, because I do not think it would have been a progressive move or have provided the right environment for the stability, job creation, employment rights and pay and conditions that we want in a fair, modern and successful Scotland. The Minister may wish to reflect on that and the debate that went on around the referendum, because the measure was not popular with working people or businesses—certainly not with SMEs that would not have seen any benefit The Financial Secretary said that he does not want to do anything to risk the recovery, but I urge him to think about what more his Government can do to aid recovery in rural areas. Most of the conversation and discourse I have heard from Government Members—for example in the Enterprise and Regulatory Reform Bill Committee—was about employment rights. The Minister seemed to think that the way to help small businesses was to erode workers’ rights, but I think that has the opposite effect because it can be more difficult for them to recruit staff Much as I admire the beautiful city of Edinburgh, our capital, I am concerned that so many people from my rural constituency commute there for work. At a time when the population of East Lothian is set to grow at the fastest rate of anywhere in Scotland, with 10,000 more homes, we need jobs in our own communities. We must look at the impact that the Budget will have on SMEs with 50 or more employees, and we are asking the Government to pause and reflect on what that impact might be We are losing many skills in local, rural and remote economies, especially in the construction industry—that relates to the point raised by my hon. Friend the Member for Birmingham, Ladywood (Shabana Mahmood) about difficulties with lending. Small construction firms are finding it very difficult to access lending, which means that they are disadvantaged when it comes to procurement contracts. If they take on small housing developments in the community, the people working on the construction sites will often be local young men and women who are benefiting from an apprenticeship and learning skills, and they will be spending money in that local community. The healthy cycle of the rural economy is thus given new impetus and energy. Will the Minister at least reflect on that When small businesses fail, it does not make the headlines in the same way as when a large manufacturing company announces job losses. The news about Longannet, which is across the water from my constituency and where many of my constituents are employed, is deeply concerning. When a small business fails, it does not make the headlines in the same way, but for the rural economy and community it can be devastating. The village where I live in East Lothian, Pencaitland, has two village shops and a pub, and the thought that any of those could fold at any time would have a devastating impact on our community. At that point, community cohesion goes and the place becomes just a dormitory, somewhere people go to lay down their head at night, rather than the vibrant community we want We have heard much about devolution during this Parliament. When it comes to how we support and drive growth in the SME sector, we need to trust people at local authority and community level to make decisions about how businesses are supported, how they grow and create jobs and wealth, and how they provide sustainability. We must trust the people who know the area and the skill requirements to make those decisions. Talking about who gets to vote on what Bill does not have the same impact; it does not empower. It may take power away from individual MPs, but it does not empower communities, which is what devolution should be about I ask the Financial Secretary to consider the intervention I made on my hon. Friend the Member for Birmingham, Ladywood who spoke from the Opposition Front Bench. What evidence do the Government have that cutting corporation tax will create more jobs than supporting SMEs, particularly in the rural context I am very grateful to Members who have been sitting patiently and silently for allowing me to make this pitch on behalf of the rural economy. I look forward to hearing the Minister’s comments.