Ed Davey
MP for Kingston and Surbiton · Liberal Democrat · United Kingdom
“I associate myself with the Prime Minister’s opening remarks, not least about the 25th anniversary of the horrific terror attacks of 9/11. I welcome the Government finally banning imports from illegal Israeli settlements, something Keir Starmer should have done a long time ago.”
“I thank the Prime Minister for that answer. Britain should be the safest country in the world to have a baby. We will keep raising this issue until it is the safest.”
“No mother should have to give birth in such circumstances. Does the Prime Minister agree that Musgrove Park cannot wait until 2033 for work to start on a new maternity unit? Will he offer a meeting to local MPs, so we can move it forward? And will he make fixing the maternity scandal across our country a top priority of his Government?”
“I hope at that summit the Prime Minister will negotiate a good deal for our country, our economy and our defence, and that means rejoining the single market. North Devon’s maternity unit has been closed for three weeks due to staff shortages, so women now have to travel for up to two hours to give birth.”
“The Prime Minister said yesterday that Brexit ushered in “a decade of low growth and stalled regeneration.” —[ Official Report , 1 September 2026; Vol. 790, c. 27.] He is right. Our economy is stuck in this mess thanks to the Conservatives—and the leader of Reform UK—and their terrible Brexit deal.”
“There are so many more problems in our political system: too much power in the hands of social media barons who interfere in our politics and crypto billionaires who use donations to buy influence; and too little power in the hands of our people.”
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“That is not to decry today’s contributions, but we must look at the evidence to ensure that we get to the real causes of late payment so that we can identify the best means of tackling it. We need to diagnose the problem properly. Late payment is not exclusive to any sector or to any style of business. Although I sympathise with those who say that this is big business abusing its power, an awful lot of payment is between small businesses. The majority of contracts that any small business has are with other small businesses. We should not say that it is just a big business problem against small businesses, because the issue is about more than bully-boy tactics. Research shows that of the moneys owed by large businesses, around 40% is overdue compared with 30% for small businesses. The problem therefore affects businesses of all sizes.”
“In 1998, Labour passed legislation allowing compensation to be paid in cases of late payment. I never thought that measures such as that would be a silver bullet, but I hoped that they would begin to change the culture. I therefore welcomed that legislation and felt that it was the right approach. None the less, legislation can never sort out a problem. It can begin to change attitudes, particularly in an area in which millions of contracts are made between many different companies of all shapes and sizes. Things are slightly better than they were in the early 1990s. Nevertheless, we have heard from some eloquent speakers that there is still a problem here, so we need to tackle it. Sometimes, however, the debate on late payment becomes a little simplistic and lacks real evidence.”
“This has been a fantastic debate, Mr Hood, and we all owe a debt of gratitude to the hon. Member for Oldham East and Saddleworth (Debbie Abrahams) for introducing it. In pursuing this issue, she has shown both her knowledge and her determination. I am sure that she will agree with me that all Members here have not only shown knowledge of what is going on in their own constituencies and in the sector but contributed some interesting ideas and a number of questions. I will try to do justice to this debate by explaining what the Government want to do. I was economic researcher for the Liberal Democrat party during the recession between 1989 and 1992, and late payment was one of the biggest issues on which we pressed the then Conservative Government. It is depressing that this issue has not gone away.”
“Actually, UK legislation on late payments has played a really important part in shaping the EU legislation, and the recently revised EU directive on late payment very much mirrors UK practice. Because the revised EU legislation follows UK practice so closely, we are seeking advice on whether it will entail any changes whatsoever to existing UK legislation.”
“Instead, when these matters have been examined, it has emerged that sometimes it was the supplier that failed to invoice the customer properly. That is not to say that I do not see legislation as being entirely unimportant for setting the environment in this area. I encourage suppliers to set out their invoices with the agreed payment terms, stating very clearly the fee that will accrue if payment is not made by the due date. That is what the hon. Member for Streatham (Mr Umunna) was advising his clients to do when he was in the legal profession. It is very important that these contracts are set out clearly. If they are not set out clearly, suppliers have no chance of using the legislation, whatever it might be. There was a question about the European legislation on late payments.”
“As I mentioned earlier, the UK was one of the first countries to introduce legislation setting out the rights of a supplier to agree payment terms and to secure payment. When we consider what other legislation might be introduced, I must point out that the majority of business bodies oppose any strengthening of the current legislation. Partly that is because many suppliers have long-standing relationships with their customers and—as has been mentioned—they are unlikely ever to resort to legal action to chase up payment from those customers. Where suppliers seek to use legislation to secure payment, weak invoicing means that all too often the courts are unable to intervene meaningfully. It is not that the courts are unwilling to intervene to enforce the law.”
“What typically happens is that suppliers assume a 30-day payment period, while the period adopted by the majority of larger businesses is 30 days net monthly; that is, 30 days from the end of the month in which the invoice is received. So we need to work really hard to ensure that suppliers have the information support that they need to manage their customer relationships and cash flow. Work is being done to try to help suppliers not only by the Department but by outside organisations. For example, since 2010 there have been more than 250,000 downloads of the simple checklists developed by the Institute of Credit Management to help suppliers manage customer relationships. Inevitably, legislation was discussed during the debate.”
“That research, which was carried out under the previous Government, identified clear evidence of poor invoicing by some suppliers. By that, I mean that invoices were completed incorrectly or submitted late. Consequently, data on payment across the UK economy are generally flawed, because of a single factor—due dates for payment are collected using the date provided on supplier invoices and more often than not those invoices reflect the terms assumed by the suppliers rather than the terms assumed by or contractually defined by the customer. So, there can be confusion about how that type of payment operates in practice. That is why we see the average time for payment in the UK economy coming out at around 16 days beyond agreed terms.”
“Under the previous Government, my Department undertook some research with Experian to look at payment of invoices to suppliers by four large FTSE 100 businesses. The total value of the sample invoices was more than £1 billion. There was no evidence at all of systemic late payment by those four companies. Typically larger companies in the UK have moved to electronic purchasing and invoicing, which means that late payment is no longer an option for them. I am not saying that there is not a problem with smaller companies; clearly there is, and we have heard contributions to the debate that show there is. However, it is worth putting on record that electronic payment systems in some of the largest companies are beginning to change things.”
“There is an important point that was not made as often as other points during the debate, but it is none the less important to stress, which is the need to improve the way that companies manage their invoices. Obviously, many companies manage their invoices well, but some companies create the problem of late payment for themselves. Better management of invoices is something that we should emphasise. We believe that more than half of all UK business transactions take place with no pre-agreed payment terms, which is astonishing. Barclays has done some analysis in this area and its data suggest that only one in 10 suppliers regularly credit-checks their customers. Clearly, companies themselves need to do some work.”
“I must confess to the hon. Lady that I myself have not made any assessment of Government Departments in relation to local post offices. I will see whether my Department or Post Office Ltd have made that assessment. If Post Office Ltd has made that assessment, I am sure that it will want to share the information with her. The hon. Lady said earlier that the Government should work with the devolved Administrations on this issue. The whole of government—whether it is the devolved Administrations, local authorities or even parties working on a cross-party basis—needs to send out a clear signal that we want companies to pay their bills on time. That would make an important contribution towards ensuring that this economic recovery is as strong as possible.”
“She will be aware that the Government do not want to tie up business in red tape, but as I am the Minister with responsibility for corporate governance and as I am looking at narrative reporting, I will certainly take on board her points and consider them very carefully. The Minister of State, Department for Business, Innovation and Skills, my hon. Friend the Member for Hertford and Stortford, who is the Minister with responsibility for small businesses, will read this debate with relish, because of the quality of the contributions to it. I thank hon. Members for their contributions, and I particularly thank the hon. Member for Oldham East and Saddleworth for ensuring that we had the opportunity to debate this issue.”
“She referred to the sausage firm in her constituency, which is obviously now growing with a bang, and she was quite right to say that trade credit insurance is not the answer for everything. My hon. Friend was right to say that we should be very careful before we go down the compulsion route. That has always been my view too and the examples that she referred to from Australia and other EU countries that have gone down that route showed that in the end compulsion is not helpful to businesses on either side of the late payment issue. My hon. Friend also talked about accounting standards.”
“Friend the Member for Newton Abbot (Anne Marie Morris), who showed a lot of knowledge of this issue. She made the point that late payment is, in many ways, a private sector issue, because both this Government and its predecessor have made some headway on late payment within the public sector. She also referred, quite rightly, to the issue of trade credit insurance. That is one of the issues that I asked about in preparing for this debate. In many ways, trade credit insurance is a private sector solution. The market for trade credit insurance is relatively small and—almost by definition—those people who use it tend to be more educated and better trained in managing their cash flow and invoicing.”
“Friend the Member for Solihull (Lorely Burt) asked how we are progressing with the approved supplier status, having committed ourselves to trying to simplify the application forms. I recommend that she reads the Cabinet Office report published in July that shows that 14 out of 17 Government Departments have removed the requirement for pre-qualification questionnaires for contracts for less than £100,000. As she is aware, those questionnaires were the really big bugbear that many companies complained to us about. The remaining three Departments are piloting an open group process. So there has been some real progress. Clearly there is more to do, but we are going in the right direction. There were a number of excellent contributions to the debate. I particularly liked the contribution of my hon.”
“The Secretary of State for Communities and Local Government is keen to ensure that all Government Departments are doing their best, and I am sure that when he reads this debate he will note the hon. Gentleman’s comments. Regarding the hon. Gentleman’s comments on the EU directive, we will undertake a second consultation in the winter of 2011-12 and will then transpose the legislation into UK law in the first half of 2012, which is earlier than we are required to do. I hope that that addresses some of the concerns that colleagues have expressed during the debate. In the final minutes that I have left, I want to try to address some of the points that I have not yet dealt with. For example, my hon.”
“Friend asked about, will remain under the new regime. Exactly how that role will be delivered is obviously still under consideration and will need to include comments from the ongoing consultation, but as I said, we are talking with interested parties, including the Welsh Government and Citizens Advice, to design a model of consumer representation in Wales that meets our objective. We believe that the concerns expressed by my hon. Friend and Consumer Focus Wales are not insurmountable, and I hope that we can cover them all in our considerations.”
“We will consider all responses carefully, but we believe that our proposals to rationalise further the functions of consumer protection bodies, strengthening the front line of consumer protection while reducing the complexity, confusion and waste of the current wide variety of bodies, are a positive step forward for consumer advocacy in Wales and across the UK. We have absolutely no intention of reducing the level of support afforded to consumers across Wales; in fact, the whole purpose of the exercise is to see how we can improve it. I agree with the assertions made by the Welsh Government and Consumer Focus Wales that Consumer Focus Wales’s functions in representing Welsh consumers should be retained in Wales. The organisation’s important role in providing support for particularly vulnerable consumers, for example, which my hon.”
“It also shows that Consumer Focus Wales has done an excellent job. My hon. Friend is right that we are still consulting, and the consultation will not close until the 27th of this month. To reassure him and other Members, particularly Members from Wales, that we are listening, I can tell him that officials from my Department will be in Cardiff next week talking to officials in the Welsh Government about what they want. We have a genuine desire to reach out, listen, consult and find a way forward, and to ensure that all the great things that Consumer Focus Wales has done are maintained and that the Welsh voice is heard in whatever we end up with as a result of the consultation. We must await the end of the consultation process.”
“May I start by thanking my hon. Friend the Member for Ceredigion (Mr Williams) for securing the debate? As he said, he and my hon. Friend the Member for Brecon and Radnorshire (Roger Williams) came to see me in June, just after the consultation had begun, to press their case. My hon. Friend the Member for Ceredigion has pressed his case again today with his usual energy and enthusiasm. He was right to discuss in his initial remarks the excellent work done by Consumer Focus Wales. Any changes made will not reflect on that work; in many ways, we want to build on it and its excellence in representing consumers in Wales. My hon. Friend mentioned Sharon Mills, whose son Mason tragically died during an E. coli outbreak in Wales. Ms Mills showed through her excellent work on food safety with Consumer Focus Wales that citizens can play a role.”
“For example, if Royal Mail wished to make even a minor change to their service, devolvement of consumer advocacy, which some have proposed, would require them to have detailed conversations three or four times over, which could lead to differing levels of service. I hope that hon. Members can understand that some industries covering the whole United Kingdom are not devolved, and that we do not want to add unnecessary costs that will not serve the consumer.”
“The hon. Gentleman will understand that that is part of the deliberations and consultation. I cannot pre-judge the findings of the consultation, but funding is clearly key among our decisions. One big issue raised is governance in Wales. We see no reason why the new model cannot replicate the current one. We understand how important it is that decisions affecting Welsh consumers should be made in Wales. I hope that that reassures hon. Members. We do not want to add layers of bureaucracy. In these difficult times, that would be wrong, as my hon. Friend said. Although it is important that each country should have national representation on issues of specific interest to it, universal industries should also continue to have a single national voice and should not have to negotiate three or four times whenever they wish to do something.”
“In the surveys, its brand recognition is extremely strong and it is extremely well trusted. That is one reason why we have shaped the consultation as we have. It is a distinct advantage for an organisation with such strong recognition and trust to be up front, championing the consumer.”
“I understand how my hon. Friend feels about that point. I hope that we can come to some agreement, not just in this debate but in due course. We want to give consumers and others greater clarity about who is championing their rights. Consumers need to know who their advocate is. We want to increase the impact of publicly funded consumer advocacy domestically and internationally and to reduce overlap. We want all that to be delivered by a known and trusted organisation with high visibility and outreach. I will talk tomorrow to the Welsh Minister, Carl Sargent, about the issue. I hope that that indicates to colleagues that we are taking Welsh concerns seriously. Citizens Advice in England, Wales, Scotland and Northern Ireland is widely recognised and trusted by the public.”
“I am glad that the hon. Gentleman made that point, as it enables me to clarify something that has been slightly confused in this debate. One must remember that at the moment, Citizens Advice has a national organisation, which undertakes much of its research for consumers, and local bureaux. We are talking about the national organisation, Citizens Advice, taking forward the work of Consumer Focus and other organisations to ensure a powerful research and expertise base for advocacy, education and information at the national level.”
“Instead, we want to bring together its policy and research expertise, especially in the energy and postal services sectors, with the long-standing success of Citizens Advice and its bureaux in helping consumers. By operating in that way, we can connect consumer policy and research functions with the concerns and problems of citizens in their communities. There are benefits to be realised by making that connection. We remain committed to working with all, including those across Wales, to make it a reality. Question put and agreed to.”
“It is another reason why I think that our model has a lot of strengths. I emphasise that Citizens Advice has an excellent track record of advocacy on behalf of consumers at a national and local level. We want to build on that track record and the brand awareness that it enjoys and direct resources for consumer education, information, policy and advice to Citizens Advice. We also want to bring together local, bottom-up information with the national research and expertise currently carried out by Consumer Focus, which is, as we have heard, of extremely high quality. That will create a powerful consumer body to which businesses will have to listen. We do not intend to lose the experience and expertise held at Consumer Focus.”
“I must end my remarks, I am afraid. That will be in no way affected by local pressures. Most funding for the national work comes either from levies or from the taxpayer; a lot of the local funding comes from local government. They are two connected organisations, and the strength is in their connection. Citizens Advice, the national organisation, gets information fed up from the grassroots all the time. That is one reason why the brand is so trusted and why the organisation has a special, and perhaps unique, role to play in our country. Citizens Advice has local representation through its bureaux in communities. Although those bureaux will not be conducting research, they will be able to feed into the analysis. That is particularly important for the most vulnerable in our society.”
“The hon. Gentleman is making an important point, which is why the Government have introduced the access to apprenticeship schemes—to tackle that very problem.”
“The hon. Gentleman and his colleague from Wales, the hon. Member for Islwyn (Chris Evans), have praised the Welsh Government. Can the hon. Member for Swansea West (Geraint Davies) explain why the average spend per school pupil in Wales is £604 less than in England in 2010-11?”
“I could not have told the House then that we would not just hit it but do it twice over, doubling our target with 100,000 new apprenticeships in our first year—a record that we are proud of. There is a lot of enthusiasm among workers and businesses up and down the country for our approach to apprenticeships. There was also some debate about the quality of apprenticeships—an important issue. We aspire to ensure that the apprenticeship is the gold standard approach to vocational training. We want to ensure that in putting this investment into the apprenticeships scheme, we manage to reshape it. I have talked about the idea of access to apprenticeships to ensure that people who are unable to persuade employers to take them on have the chance to experience that learning. We also want to look at higher apprenticeships.”
“I was particularly impressed to hear about the apprenticeships fair being organised by my hon. Friend the Member for Worcester and the increase in apprenticeships that my hon. Friends the Members for Burnley (Gordon Birtwistle) and for Eastbourne (Stephen Lloyd) have managed to achieve by working with businesses in their areas. There was some debate about the numbers involved. This is only the second time that I have been able to address the House on apprenticeships. The first time was towards the beginning of this Government’s time in office, when Labour Front Benchers pressed me on whether our target of 50,000 apprenticeships in our first year would be hit. I was rather nervous about responding to that, and I said that I hoped it would.”
“The youngsters who have left school, are not looking for work and are not in training are those we should most worry about because their opportunities are most scarred, and they are out of contact with the many people who could help them. If we do not give opportunities to those groups of young people, the scars will be with them for life, and it will be a big loss to our whole economy and society; we need a national mission to focus on them. We heard passionate contributions from many Members in all parts of the House. There was a degree of consensus on apprenticeships. The hon. Member for Newcastle upon Tyne North (Catherine McKinnell) and my hon. Friends the Members for Harlow, for Worcester (Mr Walker) and for North Swindon (Justin Tomlinson) talked about the important opportunities provided by the increase in apprenticeships.”
“I welcome this debate because I believe that all Members of this House came into politics with the intention of trying to ensure that the next generation has greater opportunities than the current generation. It is a debate that we need to take very seriously because there is a real problem in our country, and there has been for many years, regarding opportunities for the most vulnerable and disadvantaged in our society. The UK’s performance in relation to youngsters who have never been in education, employment or training has been lamentable for many years; we have been near the bottom of the OECD table for a very long time.”
“Friends the Members for Wirral West (Esther McVey) and for Solihull (Lorely Burt) said, under Labour youth unemployment increased by 40%, and the number of NEETs increased. One of the most surprising facts is that as the number of NEETs was increasing under the Labour Government, it was falling internationally, so we fell behind Hungary, Greece and the Slovak Republic in what we were doing for the most vulnerable young people in our society. That is not a record for Labour to be proud of.”
“We are doing a lot better than under the apprenticeships guarantee. The hon. Gentleman should have apologised for his motion, because, as my right hon. Friend the Minister for Universities and Science clearly showed, it does not tell the real story—the success story—about apprenticeships by suggesting that it is a negative story. The truth is that the absolute number of all apprenticeships is up, as is the absolute number of young people on apprenticeships. I am afraid that there was some misunderstanding of that success story, despite the support for our overall policy. That is not surprising, in a way, because Labour’s record is surprisingly poor in this respect. As my hon.”
“We have discovered that there is agreement across the House that issues of youth unemployment and the need to increase opportunities for young people are a challenge and a problem, and have been for many years, and that many of the Government’s policies, particularly on apprenticeships, are a real way forward in tackling them. We have discovered that things got worse under the Labour Government, particularly for the most disadvantaged young people. We have discovered that, despite the rhetoric of Labour Members, this Government are determined really to do something for young people and to put social mobility at the heart of our plans to succeed where the previous Government failed. Question put.”
“She shook up the cosy consensus that was allowed to develop under the previous Government and made it clear that things were not all hunky-dory and that we needed to back apprenticeships, which the Government were doing, but also, crucially, to increase the quality of vocational education and ensure that those on such courses still managed to achieve basic skills in maths and English. This Government will take forward her recommendations because we believe that that will make a real difference. We have discovered a number of things today.”
“The shadow Secretary of State complains that we have somehow targeted young people in our policies, but nothing could be further from the truth. Despite the financial situation, we are going forward with raising the participation age in education and training to 17 in 2013 and to 18 in 2015. We should be proud of that policy. We have gone further than the previous Government did. We have increased the number of trials to ensure that the roll-out of the policy is more effective, and we have freed up local authorities to come up with new, more imaginative ways to deliver on it. These are the sorts of policies that will bring real opportunities for the most disadvantaged in our society. Secondly, there are the reforms to vocational education that we plan to take forward following the report by Professor Alison Wolf.”
“The 12,000 most disadvantaged young people will get up to £1,200 in a bursary that will help them more than EMA managed to do. I am afraid that her criticism ought to be of the Labour Government. Two of the coalition’s policies that are vital for young people did not receive the attention they deserved. The first of those is a policy that we should celebrate across this House because it was introduced by the previous Government—increasing the participation age in education and training. We had to make a difficult decision during the spending review about whether this Government would be able to find the funds to continue with that policy. It was a real challenge, but we found the money despite the problems.”
“The right hon. Gentleman will not admit that the percentage of unemployed young people increased. That takes account of all the issues that he is trying to wriggle out of. There were complaints about parts of the coalition’s policies, particularly on education maintenance allowance. We heard impassioned speeches from the hon. Members for North West Durham (Pat Glass) and for Scunthorpe (Nic Dakin); they both have a lot of knowledge in this area and I listened to them intently. The hon. Member for North West Durham said that she was particularly concerned, rightly, about the outcomes of the most disadvantaged. However, she failed to recognise that our reforms—our different approach—to EMA will mean that more resources are targeted at the most disadvantaged.”
“I am pleased to have this opportunity to remind the House of our recent successes. The recent political agreement to exempt micro-enterprises from onerous accounting and financial reporting obligations should save British companies between £150 million and £300 million a year. Thanks to the UK’s persistent efforts, a further commitment from the Commission to introduce proposals to exempt micros from new and existing legislation was also secured at the European Council in June.”
“I am delighted to be able to tell the House that I am now aware of that issue, because I have answered the hon. Gentleman’s written question on it. He is right that the scope of the EU waste electrical and electronic equipment directive has been problematic since its adoption at the end of 2002. For example, there is no reference in the directive to exemption for fixed installations, but the European Commission’s guidance does allow for one in its interpretation of article 2(1). European negotiations on a recast of the regional directive are under way and we hope for greater clarity on that and other scope issues once a new directive is agreed.”
“My hon. Friend will be delighted to know that in the Chancellor’s Budget we announced a three-year moratorium on regulations for micros. We have also set up the red tape challenge. We are dealing not just with future regulation but with the stock of regulation, an exercise that was long overdue.”
“I would like to thank my hon. Friend for the work he is doing as chairman of the all-party parliamentary group on Azerbaijan to develop the relationship between our two countries. I am pleased to say that more than 100 exporting and investing companies have been assisted in Azerbaijan through UK Trade & Investment in the past two financial years alone.”
“Across the Government, our new approach to commercial diplomacy is working in all those areas. My right hon. Friend the Minister for Europe visited Baku last year and took with him a number of companies involved in the infrastructure project. I am sure that my hon. Friend will agree that the British music industry will take all the possible opportunities presented by the Eurovision song contest being held in Azerbaijan next year, and that they are not “Running Scared”.”
“As part of the review, we have consulted on employment tribunals and unfair dismissal, launched the employer’s charter, commissioned reviews of sickness absence and of compliance and enforcement regimes, repealed the default retirement age, introduced a moratorium for micro-businesses and start-ups, and announced that we will not proceed with the dual discrimination provision in the Equality Act 2010. We have announced future work priorities for the review, and the red tape challenge will also consider cross-Government employment-related regulations.”
“I assure my hon. Friend that all Departments with responsibility for employment-related legislation are contributing to the review; it is important that they should, if the review is to have a real impact on burdens on business. I will talk to colleagues in other Departments to ensure that they are taking a clear role in it, as I am sure that they will.”
“The hon. Lady is right to quote the Chartered Institute of Personnel and Development on this issue, because it supports much of the coalition Government’s better regulation agenda in this area. She will know that the unfair dismissal period is out to consultation. A number of responses are very much in favour of the proposal, but she would not expect me to prejudge the consultation today.”
“The hon. Lady will know that the Government are working very closely with Citizens Advice on all these sorts of issues and that it is important to listen to the industry on a range of issues. I would have thought therefore that she welcomed hon. Members listening to the industry. She often does not listen to the industry and so often is not as informed as she could be.”