Speech by: Lord Drayson
Venue: Nikkei BP Climate Change Symposium, Tokyo

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Good afternoon. It’s an honour for me to speak to you today.

Climate change, I believe, is the defining issue of the twenty-first century. It concerns me as the government minister with responsibility for the UK’s low-carbon industrial strategy. It worries me as the father of five young children. But it also excites me as someone who has spent the bulk of his career as a science entrepreneur.

Let me begin with the scientific evidence. As most of you will know, atmospheric concentrations of carbon dioxide are higher than at any time in the last 600,000 years, and they are increasing at their fastest ever rate. Seventeen of the warmest years on record have all occurred in the past two decades. Looking forwards, the mid-range estimate from the Intergovernmental Panel on Climate Change – the IPCC – is for a two- to three-degree rise in average global temperature this century. That’s equivalent to the Earth experiencing more extreme climate change than for at least 10,000 years.

In other modelling work, UK scientists have shown that higher CO2 emissions in the short term will require greater per-annum reductions in future – in order to stabilise the global climate at two degrees over pre-industrial temperatures.

Put another way, we have to keep cumulative emissions below one trillion tons to maintain a livable atmosphere; as humans, we’ve already exhausted more than half of that since the onset of the industrial revolution.

From the statistical to the personal, the gravity of this situation was really brought home to me a few years ago, during a visit to a NASA facility in California. There I saw supercomputer models of the polar ice caps projected onto a massive screen, and watched the caps recede and expand with the seasons. The effect was startling; it looked as if the Earth was literally struggling to breathe.

And yet we’re not going to bring about a radical transformation in human behaviour – and that’s what we need – by issuing a steady stream of dire warnings and forecasts of greatly diminished lifestyles. That simply won’t work – neither in mature economies like the UK and Japan, nor in emerging economies who, quite understandably, have little time for such sermonising.

Guilt rarely serves as a motivating force, and certainly not for long. The same goes for bullying people into change, which will only generate hostility and resistance.

Instead, we have to offer people a practical, accessible, attractive low-carbon future – one which presents them with solutions built on sound science and creative engineering.

Change must feel exciting and straightforward. People need persuading that their quality of life can actually improve, not decline. Low-carbon is going to have to be cool.

I’m absolutely convinced of this. In my spare time, I’m a racing driver and team owner. When I entered that world, it was with the expressed desire to demonstrate how it’s possible to achieve high performance by going green. Drayson Racing, for example, uses a second-generation bio-ethanol fuel that consists of old grains, peelings and wood.

Let me tell you: there’s nothing quite like taking pole position in the first race of the season to dispel the scepticism of your competitors. And when a glamorous and high-profile sport like motor racing shows how green innovation delivers power, speed and efficiency, car manufacturers and the general public take note. It’s about making products that are as good as – if not better than – what’s already on the market.

And for all the challenges that global warming will pose to our planet, it also guarantees huge future markets for low-carbon technologies. It’s vital that business leaders around the world seize upon that certainty. There is no high-carbon alternative.

Climate change is with us. Science- and engineering-based solutions must be found. So companies that invest in this space know that there will be demand for their products and services.

Now, just a few years ago, many UK businesses regarded the climate change agenda as a serious threat. They associated it with higher costs and greater state interference.

Such concerns were not – are not – misplaced. Costs will always be incurred with radical shifts in technology, energy supply and usage. Despite every effort to keep them to a minimum, new forms of regulation are unavoidable when change takes place on this scale.

But the key point is this. The UK sector for low carbon, environmental goods and services is one of the few areas of our economy expected to maintain positive growth rates through this global downturn – with forecasts of more than 4 per cent per annum up to 2014/15.

Recent estimates valued our market at around £106 billion – employing 880,000 people, either directly or through the supply chain. We expect that more than one million people will have jobs in this sector – skilled jobs, with market value per employee well above our national average – by the middle of the next decade.

Low carbon, therefore, is not a threat to economic recovery; it’s the market that’s driving recovery. Not just in the service sector, but in heavy industry and engineering.

We now have a situation where UK business, led by the Confederation for British Industry, has called on government to adopt a more ambitious approach to low carbon – which I’ll come on to in a moment.

Moving away from a UK perspective, it’s well worth recognising that the global market for low-carbon, environmental goods and services was already worth £3 trillion in 2007/08 – and close to half of that was in emerging fields like carbon financing, alternative fuels and building technologies. By 2015, it could grow to an estimated £4.3 trillion.

Our estimates put Japan behind only the US and China in their share of this market – with prospects, like the UK, of four per cent year-on-year growth up to 2015.

At the same time, I’m very aware that your actions over the past three decades have made Japan’s primary energy consumption among the lowest in the world, relative to its GDP. This is the only country, for example, with fuel standards for heavy-duty vehicles. And it’s here that forward procurement standards – agreed with manufacturers – are challenging Japanese firms to improve the energy efficiency of their production methods over time.

Looking forward, and with your expertise in areas like photovoltaics, the opportunities are there to be taken. The next step is to achieve global scale with this technology: building more solar panel farms, generating more energy from smaller panels, bringing this technology to a mass consumer market.

A similar case can be made for wind power. In the UK, we’re leading the shift from onshore to offshore wind and creating the largest market in the world for this renewable. But as the turbines go up, who’s going to provide the reliable machinery to run them? At the moment, it looks like a direct drive approach will supersede gear box technology – presenting another huge opportunity for manufacturers.

Of course, making bold predictions about the size of future markets is the easy part. It’s infinitely harder to realise those opportunities.

The UK Government is absolutely clear that that task cannot be left to the private sector alone. The scale of R&D required, the underlying infrastructure needed, the importance of coordination at both the national and international level, the demand for market certainty, the mission to win over hearts and minds – these are all challenges beyond any industry operating alone.

Clean tech investors over in Silicon Valley made this point to me emphatically just a couple of weeks ago. Emerging fields like carbon capture and storage, for example, carry significant technological risk – with the huge capital needed to eliminate that risk beyond the capacity of existing markets.

Government will have to get involved to produce the solutions fast enough to tackle climate change.

We’re dealing with a scenario where public-private partnerships are the only viable answer. It’s the only way for the UK to build on its status as a pioneer in wave and tidal energy, to be the best place in Europe for advanced manufacturing, especially in low carbon.

So we’re not seeking to increase the role of the state on ideological grounds. We want to target government support where it can really count – by improving the regulatory environment, by using public procurement to send the right market signals, by helping the most innovative small businesses to become high-growth enterprises.

Our policies are focused on refurbishing the UK’s energy infrastructure, making sure that the British workforce has the skills necessary to exploit the low-carbon opportunities that will emerge, and on introducing incentives that encourage consumers to make low-carbon choices.

In that spirit of pragmatism, let me give you an example of how this works in practice. For, although I’ve been a politician for the past five years, I come to these issues with the mindset of a businessman.

You’ll forgive me – given my earlier confession about motor racing – for singling out the automotive industry.

In the UK, we have domestic legislation committing us to reduce overall emissions by 34 per cent by 2020, as against 1990 levels. If, as we hope, a comprehensive global agreement is reached in Copenhagen this December, this commitment may rise to 42 per cent.

Before going further, let me say that I strongly endorse Prime Minister Hatoyama’s pledge to cut Japan’s greenhouse gas emissions by 25 per cent within the same timeframe and against the same baseline.

The “Hatoyama Initiative” – with its emphasis on green innovation and a pledge to provide financing for developing economies – is precisely the sort of brave undertaking we need to meet the G8 target of achieving an 80 per cent emissions reduction by 2050.

Japan’s targets are not only achievable, but will bring tangible social and economic benefits – cementing your position as Asia’s leading nation for technology.

Now, at home, we’ve calculated that our surface transport will have to produce zero carbon by 2050 in a majority of sectors. But we’ve also recognised that phasing out car travel is not an option. Economic growth is fundamentally linked to individual accessibility and mobility.

In the short term, car makers will continue to reduce vehicle weight and drag, improve engine and transmission performance, and push ahead with hybrid technology. That will be enough to meet a series of tighter European restrictions on CO2 per kilometre emissions. But there’s a limit to the efficiency of internal combustion engines, which waste considerable amounts of energy through heat loss via the exhaust and cooling systems. It’s unavoidable whenever we burn fuel.

Electric vehicles – EVs – by contrast don’t burn fuel, and are over 90 per cent efficient in taking stored electrical energy and converting it into useful motive power and torque.

EVs and plug-in hybrids, therefore, represent the zero-carbon future – providing, of course, that their energy efficiency is matched by that of the power generating companies.

So the UK Government sat down with scientists and engineers from the automotive industry to define the limits of existing technologies, and the potential of new ones.

Following that process, we created the Office for Low Emission Vehicles, bringing together senior figures from our departments for business, transport, energy, local government and finance to work with the automotive industry, power generators and infrastructure companies; with experts on pricing and systems design; with academics and creative thinkers.

We’ve proposed financial incentives for private individuals and commercial buyers looking to purchase electric or plug-in hybrid cars when they hit the showrooms from around 2011 onwards.

At the same time, we’re already running the world’s largest EV and plug-in hybrid demonstrator competition in which the public will try out a range of vehicles across Britain.

I’ve test-driven some of the demonstration vehicles – as well as several more already on the market. These aren’t poor imitations of petrol cars but examples of high-quality design, engineering and manufacture – including two-seater city cars, SUVs, minivans and sports cars. These models deliver the high performance that consumers will expect in order to change their driving habits.

Though a UK-based initiative, this focus on ultra low carbon vehicles has international input. It’s no secret that the UK has a long tradition of working with Japanese companies, in the automotive sector especially.

We welcomed Nissan to Sunderland in 1984 and its plant there went on to become the most productive in Europe. Honda and Toyota soon followed thereafter – all three making substantial investment in their UK operations, and making full use of the UK’s outstanding research base.

More recently, Nissan Toyota and Calsonic Kansei made a valuable contribution to the review of the UK automotive sector that I mentioned earlier. And this year, we’ve seen Toyota announce its intention to build the Auris hybrid at Burnaston, while Nissan are planning a new battery factory in Sunderland.

In addition, Mitsubishi have joined Toyota and Nissan in supplying vehicles to our ultra low-carbon demonstrator programme.

I hope this positive relationship continues – in other sectors as well as automotive – and I think it points to broader truths.

Both the UK and Japan recognise the critical importance of science and technology in developing a low-carbon, high growth economy. Our two governments invest heavily in both basic and applied research, with an emphasis on their commercial application, and I’m only too aware that Japan accounts for a staggering 20 per cent of global R&D effort.

Indeed, this has to be a multi-national exercise: business leaders and scientists collaborating across borders to devise and deliver the technical answers to climate change – your leading-edge tech companies; our research base, the most productive in the G8.

But that exercise must be replicated among national governments too – which brings me back to the UN climate change conference in Copenhagen, due to start in little more than six weeks.

I cannot overstress the importance of reaching a bold agreement in Denmark. These talks aren’t only about safeguarding the environment we share. They will have far-reaching implications for the security and prosperity of every one of us.

According to the 2006 Stern Report, unchecked global warming could cause as much as a 20 per cent fall in global GDP. An international consensus is essential to economic recovery right now, because the push to decarbonise will be a major driver of growth over the next decade.

We must find common ground on a carbon price that stimulates investment and innovation in fully-functioning carbon markets.

We must secure commitment on limiting the average global temperature rise to two degrees Celsius.

We must provide help to developing countries – which will produce around 90 per cent of future emissions increases – through financing and sharing technologies.

The preliminary discussions have to proven to be a hard slog. But the new Japanese government’s pledge on climate change has certainly boosted the negotiating position of those countries determined to achieve the kind of fair and effective deal that can put us on the path to a low-carbon future.

In conclusion then, I’m delighted to see Japan in the vanguard of the green revolution. As the Hatoyama government continues to develop its new fiscal policies, a stable regulatory environment and mechanisms for emissions trading, the UK government is happy to assist in working out the practicalities, based on our own recent experience.

In the international arena, I’m optimistic that – with Japan and the UK joining forces – a better outcome can be realised in Denmark.

And in the vital mission of driving economic growth, I’m convinced that our scientists, engineers and entrepreneurs – by becoming first movers – will achieve great things inside the next decade: making the key technological breakthroughs, introducing them across the planet, and building world-beating companies on the back of them.

The race to be green is on. I urge you to be at the front of the grid; it’s all too easy to be left behind.

Thank you for listening.

Mr Lammy spoke at an event hosted by the Association of Colleges to launch the new Safe Colleges website:

“Colleges are at the coal face, not just supporting young people, but often very vulnerable young people. This is work that goes unsung and requires immense expertise, which is why you are at the forefront of the battle against guns, gangs and knives.

“It’s my hope and belief that the website we’re launching today, the resources and the practical experience that it will allow colleges to share, will play its part in taking that work to a new level.”

The website features guidance drawn up by colleges and the Learning and Skills Improvement Service (LSIS), working with the Department for Business, Innovation and Skills, the Department for Children, Schools and Families and the Home Office.

The guidance suggests:

• Promoting the college as a ‘safe haven’ for learners;
• Developing a closer working relationship with local police to raise awareness of gang-related issues;
• Having a strong pastoral network and including learners on all committees;
• Making employment and careers aspirational, so that young people see them as a positive alternative lifestyle to gangs and crime;
• Recruiting staff, both teaching and support staff, including security, from the local community and reflecting its diversity;
• As appropriate for the local situation, having some or all of: passes, ID cards, turnstiles, “hoods down” policy, knife arches, metal detector wands, random testing/searching; and
• Ensuring staff training includes knife awareness, incident handling and conflict resolution.

Video

Speech
Read David Lammy’s full speech here

Website
The new Safe Colleges website can be viewed here

Press notice
Read the BIS press notice here

The project was financed by the Building Colleges for the Future programme, which since 2001 has funded more than 700 projects at nearly 300 colleges.

The new Wandsworth campus building includes industry-standard hair and beauty salons, a gymnasium, forensic science labs and music technology studios.

Speaking at the official launch of the building, Mr Brennan said:

“New college facilities improve the lives of learners, regenerate communities and inspire local people to learn and develop. This new modern campus will equip those in the Wandsworth area with the skills they need to get work and get on at work.”

Video

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View all images at the BIS Flickr album here. They are available for re-use by media and bloggers under Crown Copyright.

Press notice
South Thames College press notice

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Good morning everyone.

I’d like to begin by thanking Kate Anderson for inviting me to talk to you today.

I must also thank Kim Clifford and the staff of George Monoux College for hosting this seminar.

This institution has, in one form or another, been serving the people of this part of London, including some of my constituents, for many hundreds of years.

I’m delighted that it continues to do so in its current role as a 6th-form college with a commitment to excellence that has been recognised by Ofsted among others.

I know very well how valuable the work colleges are already doing is.

You are at the coal face, not just supporting young people, but often very vulnerable young people; supporting their parents and making second life chances a reality for newly arrived ethnic minorities, ex-offenders and those with special needs.

This is work that goes unsung, and requires immense expertise, which is absolutely why you are at the forefront of the battle against gangs, guns and knives.

It’s my hope and belief that the website that we’re launching today, the resources and the practical experience that it will allow colleges to share, will play its part in taking that work to a new level.

However, I have also to admit that it’s not only these things that bring me here this morning.

I’m here because I am a black man who grew up in Tottenham during the 1980s.

The Tottenham of 25% Unemployment; the Tottenham of the Broadwater Farm riots; the Tottenham of the racially profiled stop and search.

And today, I am speaking as the MP of that Tottenham.

The Tottenham where, despite improvements, unemployment remains higher than the UK average.

The Tottenham where in some wards, life expectancy is 7 years lower than wards that are only 2 miles away.

I am also here because I’m a husband and a father, and one day, my two boys may be passing through colleges like this one.

After all, what parent doesn’t stay awake at night worrying about their youngsters?

What parent doesn’t fret about the safety of the local neighbourhood? Or worry about their children’s peers and friends?

So yes, when I see police outside the school gates, I feel safer.

When I hear that the Met’ are placing metal detectors at bus stops and at school gates, yes, I feel more secure.

But I know that stronger and more active policing isn’t enough.

The problem of gangs, guns and knives is solved by asking questions bigger than how many police are on the beat.

It’s a bigger question than whether to increase police powers to stop and search.

It’s a bigger question than how long should mandatory firearm sentences should be.

It’s bigger than a poster campaign.

Because many young men who carry knives or guns do so not because they hope to use them, or even because they fear they might need to. They carry them as symbols of status and power.

This is an age where youths are now transfixed by the increasingly seductive language of gang culture.

A language of get rich or die trying.

A language of fast cars and faster lives.

A language of impulse and the instantaneous, and “now” over sacrifice, delayed gratification and self-discipline.

A language which replaces the social values that once knitted communities together with a destructive law of the street.

These issues raise profound questions that we are now asking about our age.

The repercussion of living,

The repercussions of relentless consumerism,

The burden of over-commercialisation,

The reality of whether choice truly exists for the vulnerable in society.

The reason that language appeals so much, and why that resonates so deeply, is because of what it means to grow up in the 21st century.

Young adulthood is tumultuous at the best of times. My own was so because my father left us at 12.

But when he did, I had a rich network of support that provided me with the role models and father figures that would guide me and mentor me through that period regardless.

But some of the networks and people that helped me through the most – youth workers, teachers and my local priest for example – are those most pressured, or rapidly eroding away, in the 21st century.

We no longer go to church in the numbers that we used to.

Our families are smaller, and far more dispersed that they have ever been in the past.

In this world of declining kinship, decaying traditional social structures, and less deference a vacuum emerges in the lives of vulnerable young men.

And it is in this vacuum in which the gangs and gang culture flourish.

For the 59% of Black Caribbean children in this country who are growing up fatherless, their understanding of masculinity is at risk of being defined by the street and its warped notions of power, status and respect.

If the prevailing culture that our youths encounter is one where displays of wealth and the cultivation of fear are the sole indicators of respect, it is no surprise that gang culture is as widespread as we fear it to be.

Gangs and criminality becomes a short cut to symbols of wealth and power that will otherwise take years of hard work to achieve.

Yes, part of the solution to our problems must lie in effective enforcement and the police have had some success.

Gun and knife amnesties in London and other cities have worked well.

And lessons about how to organise policing in ways that draw on the support of vulnerable communities rather than alienating them have been learned from the mistakes of the past.

But the problem of gangs, guns and knives is clearly a cultural problem.

It is a question of parenting, in particular fatherhood.

How do we provide the networks of support to young adults where one or both parents are absent?

It is a question of the quality and presence of role models in the lives of young men.

How can we change the aspirations of our young people to value decent ordinary people as opposed to the superficial glamour of the drug dealer?

It is a question of neighbourhood.

We know it takes a village to raise a child.

And colleges, schools, churches and civic society are in loco parentis alongside the grass-roots movements that have brought ordinary people onto the street to say “no” to guns and knives, like Mothers Against Guns, the Haringey Peace Alliance and Value Life

They are a powerful force for good in society and we shouldn’t underestimate what they are doing to change attitudes, especially among the young.

For example, I’m proud to have been involved in setting-up the Government’s Tackling Gangs Action Programme when I was Skills Minister two years ago.

The programme aimed to reduce serious violence, particularly the use of firearms, perpetrated by young people as part of gang-related activity in London, Liverpool, Manchester and Birmingham.

And I pay tribute to the response from colleges the AoC and LSIS, who have helped steer the programme.

That’s why we are giving our full support to our partners in the further education sector and the voluntary sector, to help them find ways in which they can contribute to tackling gun and knife crime.

And it’s also why your involvement in this event is so important in shaping the next steps that we must take together.

The website that I am launching today will further contribute to the effort of tackling the culture of gangs, knives and guns.

It is a website that allows the colleges on the front line to share the crucial information about best practices and services that ensures we are all united in fighting the causes of this problem.

It is no longer the case that there are just a handful of organisations committed to fighting gangs, there now exists a coherent and co-ordinated movement across the public and private sector, which I am proud to say that Further Education colleges are at the centre of.

I’d therefore like to thank those colleges and other parts of the sector who have contributed to the work of the steering group, who have provided case studies or who have simply shared their views and experiences through their responses to the consultation.

And I’d particularly like to thank the steering group itself, which includes representatives from across the sector, for taking the lead in making sure this work has been developed by colleges for colleges.

It’s time for every college to take its full place alongside other local agencies in the urgent work that must be done to build communities that are free from fear, whether that’s in Walthamstow or Tottenham, Erdington or Toxteth.

I know the willingness to do that is there, because colleges, their staff and students alike, have the same vested interest in building a safer and more civilised society as the rest of the community.

Safer Colleges is an important step towards achieving that and I thank you all once again for your part in turning it into a reality.

No one is in doubt about the damage such industrial action will cause. But those who advocate strike action have not been clear about why it is being threatened.

My Lords, the dispute at the Royal Mail is about modernisation which has been the subject of localised strikes, particularly in London, for many months.

We know from the Hooper Review on postal services about the company’s need to change and reform in the face of a postal market being transformed as people switch to text, e-mail and direct debit, and as the growing area of mail, which is parcels, has a variety of alternative operators from which to choose.

Royal Mail has to respond to the fact that ten million fewer letters are being posted each day than three years ago and total mail volumes have fallen by a further eight per cent in the first half of this year.

In other words, if it stands still, this company faces terminal decline.

Following a previous national strike two years ago in 2007, the union – the CWU – and management reached a national agreement on pay and modernisation.

That agreement set a framework of four phases for bringing essential change to Royal Mail.

The first three have been introduced throughout the country but are being resisted in some places, as I will come to shortly. The changes have involved the introduction of more walk sorting machines and new working practices, including employees being expected to do the full number of hours they are paid to work.

Phase Four, the next phase of modernisation, is yet to be agreed in substance, rather than outline, and will be about a new framework for improving industrial relations. This will include introducing walk sequencing machines to sort the postal delivery round and developing new business opportunities, along with a new system for rewarding employees.

In the majority of Royal Mail’s workplaces Phases One to Three of the national agreement have been implemented without any local industrial action being mounted. Outdated working practices have been replaced. And efficiency is being improved.

But in other parts of the country, most notably in London, there has been repeated non-cooperation and industrial action to frustrate the agreement’s implementation.

It is claimed by union representatives that in London, management is unilaterally imposing change that goes beyond the 2007 agreement’s first three phases. Management contests this, pointing out that all London is being asked to accept is what everyone else in the country is delivering under the first three phases.

It is these local disputes that have now escalated into the threatened national strike.

My Lords, I very much regret what is happening. Candidly, I think it is totally self-defeating for our postal services and those who work to deliver them.

Taking industrial action will not resolve this dispute.

It will only serve to drive more customers away from Royal Mail:

In the delivery of parcels – where there would otherwise be a prospect of growth – Royal Mail’s reputation for reliability could be irrevocably damaged.

And in letters, it will lead to a further twist in the downward spiral of mail volumes.

Business will be quick to recognise that while you can picket a delivery office to stop the service or refuse to deliver letters, you cannot picket the ever present internet.

Royal Mail’s small business customers will look on with anger and exasperation. Just as there are signs of the economy recovering and the prospects for their businesses are improving, strikes now will set them back and put their businesses in jeopardy.

Royal Mail’s finances will be plunged into the red. Last year the company, out of a 6.7 billion pound mail business turnover, made less than 1 per cent profit. One thing this company cannot afford is strikes and industrial action.

My Lords, change in a big organisation is never easy, but for the Royal Mail it is unavoidable.

Let me make clear that contrary to what some may say, the dispute is also not about pensions. The Trustees are engaged in their periodic assessment of the pensions deficit and lest there be any doubt let me make it clear – the Government’s policy on the pensions deficit will not be dictated by strike action.

The Government was prepared to take on the pension deficit as part of a package of modernising measures set out in the Postal Services Bill. Sadly the CWU did not support those proposals.

But when it comes to financing, the Government and the taxpayer have not held back. We have made available 1.2 billion pounds to finance a modernisation and investment programme and that remains on the table.

My Lords, we are, of course, in frequent contact with both management and the union and they have continued talking today. We strongly welcome this.

Our message to them has been clear: put your customers first. Strikes are not the way to resolve differences or safeguard the future of our postal services. The Royal Mail needs management and unions to have a relentless focus on turning it into an efficient, modern postal company, protecting as many jobs as possible and providing customers with the services they need. They should put behind them, once and for all, the endless cycle of disputes.

I will, of course, continue to encourage a settlement. But I cannot impose good industrial relations on the company or disinvent the internet.

An independent third party may well be needed to help the two sides resolve their differences. ACAS is engaged, but we have to be realistic: it will be far easier for ACAS to play an effective role if the threat of a national strike is lifted.

The Government is ensuring that vital services to the public, especially those who are most vulnerable, are maintained.

The Department for Work and Pensions will, if necessary, implement plans to ensure that the small minority of pensioners and others on benefits who still receive their cheques in the post will be able to pick them up from their nearest post office.

If there were prolonged disruptions the Department for Health and NHS Trusts will, if necessary, use alternative arrangements to transport appointment notifications, blood samples and test results.

My Lords, I urge both sides to make every effort to avoid damaging industrial action and resolve this dispute. That is what is in the interests of the Royal Mail, its employees and its customers.

I commend this statement to the House.

The conference, taking place between 26-28 October this year, will be bringing together creative businesses and leaders from around the globe to look at a number of key themes such as access to finance and securing creative content, along with developing talent and new business models.

The event will be streamed live at www.cabinetforum.org where you can also access the latest up to date agenda. Keynote speakers across the three days include some of the most influential people at the heart of the sector who will be ready to share their experiences such as Jean Bernard Lévy, Chairman of Vivendi, the media and communications group.

The conference will feature keynote speeches from Jean-Bernard Lévy, Rt Hon Lord Mandelson and Rt Hon David Lammy MP, as well as sessions on the creative economy, copyright and advertising on digital platforms.

Via the c&binet website you’ll be able to comment on the sessions during the live streaming and feed in to the debate. You can also submit your comments and questions in advance and follow the ongoing debate through the blog and via the c&binet twitter feed.

Speaking at a CBI conference ahead of the publication of both the Higher Education Framework and the Government’s Skills Strategy he will argue that a system that is more targeted on delivering the specific and general skills that employers needed also came with a new responsibility for business to support it financially and strategically through greater collaboration with universities and colleges.

Read Lord Mandelson’s speech

Lord Mandelson will say: “Over the last decade or so our expectations of the HE system in delivering economic impact have risen sharply – and rightly. Universities have responded to that willingly and actively. But it is a partnership, in which business has to be central. After students themselves, employers are the key clients of the higher skills system…

“Business has to get better at communicating its needs, so that the system can respond and our universities are not left to make educated guesses about what business wants. Business can and should also contribute more financially for a system that will be more vocational and more targeted on generating economic impact than ever before.

“But that relationship should clearly be collaborative and mutually beneficial and preferably long term. It is not something for nothing. It’s greater business engagement and support in return for a system better equipped to produce the right skills at the right time”

Calling the huge expansion in UK apprenticeships “one of the great achievements of this government”, Lord Mandelson will also argue that the time has come to see higher and further education in Britain as a closely integrated single agenda: “For me, HE and FE are two systems, joined by one goal. There was a time – well within most of our lifetimes – when… universities provided elite education and a training in the mores of professional life and apprenticeships were for craftspeople – or rather craftsmen – who would go on to spend their lives in a particular trade.

“It was a division based on social prejudice as much as economic reality, and if it isn’t yet dead, it needs to be. Modern craftspeople…are the technicians, designers and engineers who are the foundation of the UK’s advanced manufacturing sector… Obviously universities and the further education system do not do the same job. But they have the same essential role which is building human capacity and higher skills”.

Lord Mandelson will defend the government’s target of 50% participation in Higher Education but say that the target “should never alone be the proxy for whether Britain has the high level skills needed to compete in a globalised world.

“We are right to insist on continuing to widen access to university education and we are right to invest heavily in making our university system and the research it does the best in the world. But we also need to see the alternative routes to higher skills provided by apprenticeships and further education as no less valuable”.

He will say that the new skill strategy will set out ways of ensuring “more apprenticeships at higher levels to help address shortages in areas like skilled technicians”.

Read Lord Mandelson’s speech

For UK plc, HE and FE are ‘capacity costs’ – they are the costs of being in business at all. The reality is that they are rising. Because we compete on people and skills, even in technology-intensive sectors like manufacturing. And the skills we need both at the generic and specialist ends of the spectrum are getting more and more complex.

It seems to me that in equipping the UK for a post-recession global economy, higher education and adult skills will be not just important but decisive. As you know, soon we are going to be setting out new frameworks for both areas.

I want to acknowledge and applaud the engagement of the CBI on this issue, including the taskforce behind the CBI’s recent report. Central to my remarks today is the argument that that engagement could not be more important.

I also want to acknowledge up front that I accept that employers have concerns about aspects of the education system in this country. I know that many of you believe that the key problems lie in early education.

I believe in a demand led system and hearing and responding to business expectations are of course critical to that. Is Terry Leahy here today? Perhaps I shouldn’t say this, but blunt contributions like that are an important part of driving this country to improve. Every little helps.

But I think it’s worth saying that education policy is a long game, and changes to the way we teach and train deliver benefits and improvements across a timeframe of many years. Often at a rate that is always going to seem slow in business terms.

And I want us to acknowledge progress over the last decade. Levels of attainment are rising. Huge investment in school infrastructure. We have an effective Academies system ready for expansion. Both HE and FE are more responsive to employer needs now than they have ever been.

We are investing £1billion a year in workplace training and Foundation degrees. We’ve helped nearly six million adults improve their literacy and numeracy skills, with over 2.8 million getting a first through the Skills for Life strategy over the last ten years.

We also have more joint business-HE and FE collaboration than we ever have. Including a large amount of business participation on Boards of Governors and in the Sector Skills Councils. It’s important that that continues to be seen not as a formality but as central to a working relationship.

I want to make three points today. 1) I want to argue that we need to see HE and FE as a closely integrated single agenda. 2) I want to sketch briefly what I see as the strategic ambitions and constraints in HE and FE policy for the next decade. 3) I want to set out why I think government and individuals can fairly expect business to be more engaged in delivering these strategic ambitions, and what business has to gain from doing so. If you like, I want to set out what I think the flipside for business of a more demand led system should be.

Two systems, one goal

For me, HE and FE are two systems, joined by one goal. There was a time – well within most of our lifetimes – when our university and vocational training systems were seen as having distinctly different functions. Universities provided elite education and a training in the mores of professional life for about one in twenty of the population. Apprenticeships were for craftspeople – or rather craftsmen – who would go on to spend their lives in a particular trade. These were regarded not as different ways of making a living, but as different universes.

It was a division based on social prejudice as much as economic reality, and if it isn’t yet dead, it needs to be. Obviously universities and the further education system do not do the same job, teach at the same level or specialize in the same ways. But they have the same essential role which is building human capacity and higher skills.

Modern craftspeople will play a critical role in our economic future and are increasingly doing some of the highest value-added jobs in the UK economy. They are the technicians, designers and engineers who are the foundation of the UK’s advanced manufacturing sector. Teaching the practical skills in process management, IT and numeracy that are increasingly needed at all levels of employment is something that the further education sector has pioneered.

The huge expansion in UK apprenticeships has been one of the great achievements of this government, even though we recognise that we need more apprenticeships at higher levels to help address shortages in areas like skilled technicians.

Although I disagree with the CBI on the suspension of the 50% target for HE, I agree that it should never alone be the proxy for whether Britain has the high level skills needed to compete in a globalised world. We are right to insist on continuing to widen access to university education and we are right to invest heavily in making our university system and the research it does the best in the world.

But we also need to see the alternative routes to higher skills provided by apprenticeships and further education as no less valuable. We need to work for that convergence between the wider goals of the two systems.

Strategic ambitions and constraints

Both systems face the same basic strategic landscape. They both have a central role in contributing to Britain’s economic recovery and equipping us for a global economy. That’s why higher and further education were merged into a single department with a range of key other growth policy levers to create BIS.

Obviously this is only one part of a university’s role. They are academic and cultural institutions as much as engines of the economy. But part of maintaining support for public investment in that role, is demonstrating their relevance to our economic life as well.

We want to address the single biggest concern for employers which is generic skills – employability, the skills everyone now needs at work, at almost all levels. Team working, business awareness, communication skills. Business demands of graduates here are pulling very rapidly ahead. The system needs to respond and we will address it directly in both the HE Framework and the Skills Strategy.

We will also put more emphasis on identifying the strategic skills that the British economy will need in the future and new incentives for universities and colleges to work with business and industry in filling these skills gaps.

It will create a system more capable of responding quickly with funding to fill niche gaps in the skills base in critical industries such as the civil nuclear supply chain or low carbon technologies.

That will mean clear incentives to increase and improve the provision of science, technology, engineering and mathematics courses, where UK employers continue to report shortages. We already do this implicitly through the HEFCE differential funding and vulnerable subjects systems. But we will go further.

Now of course the CBI is right that the target for more STEM graduates has implications for the whole UK education system, which is why we will ensure that the ablest young scientists have access to triple science GCSEs and why we have set the target of 80000 young people taking maths A level by 2014.

The challenge for manufacturing of course is also going to be making sure fewer of those graduates decide to take their advanced degrees into the City or elsewhere – which is why I can only encourage the kinds of graduate recruitment and sponsorship – and starting bonuses – that CBI taskforce members like Nissan, Centrica and Balfour Beatty now routinely offer.

Both HE and FE also have a critical role to play in increasing social mobility in Britain. There is no silver bullet on social mobility, but education and higher skills are as close as you get to one. That means keeping up the pressure to widen access to HE – both with respect to the time in your life when you can access HE, and with respect to your social background, which should be irrelevant. Access to all forms of training is a question of equity and social justice as well of competitiveness.

That’s why we are going to put a greater emphasis on routes to higher skills that can be built around work: flexible study, foundation degrees and apprenticeships. It’s also why, along with protecting excellence, the goal of widening participation for those from less privileged backgrounds will remain a leitmotif of UK HE policy.

As the CBI have argued, we do need a greater degree of competition between institutions that encourages them to improve and tailor courses. That can mean competing for collaboration with industry, but the key drivers of change should be students, and student expectations. The more information students have on courses and their outcomes the more their choices will drive universities to improve. This is something we will directly address in the new framework.

Finally of course both HE and FE will be subject to increasingly tight fiscal constraint for the foreseeable future. I don’t accept that that this must impact on quality – in fact it must not.

Expanding investment means universities will have to deepen and diversify their sources of non-public income through commercialization of their teaching or research expertise, through a more professional approach to endowments and through greater resource efficiency.

We will also have to look at the contribution that individuals make to the cost of HE, which we will do through the independent fees review that will be launched after the publication of the HE framework.

The role of business

Over the last decade or so our expectations of the HE system in delivering economic impact have risen sharply – and rightly. Universities have responded to that willingly and actively.

But it is a three way partnership, in which business has to be central. After students themselves, you are the key clients of the higher skills system. It has to be shaped by your demand, and that demand has to be expressed clearly, coherently and quickly, both for generic and specialist skills. Business has to get better at communicating its needs, so that the system can respond and our universities are not left to make educated guesses about what business wants.

Business can and should also contribute more financially for a system that will be more vocational and more targeted on generating economic impact than ever before. But that relationship should clearly be collaborative and mutually beneficial and preferably long term. It is not something for nothing. It’s greater business engagement and support in return for a system that produces the right skills at the right time and which supports product and concept development.

We already encourage this in a range of ways: R&D tax credits, innovation vouchers, the HE Innovation Fund, support for employer co-funding of training. Our support for the TSB also encourages these ties. But, we will do more to support it.

Conclusion

The knowledge economy may have become a cliché, but it expresses a genuine reality about Britain’s future. Skilled people are our basic asset. They command better wages, get more out of work and rise higher. They are more productive and create better businesses and organisations.

I was impressed by the frankness with which the CBI HE taskforce accepted that business had not done enough to reinforce the HE system – and by its commitment to doing a lot more. The higher skills system is probably your fundamental supplier, and there is no way that a supplier relationship that important would or should ever be left to chance. It needs nurturing, strengthening, caring for. And we need to do that together.

• the competitiveness of UK institutions
• the benefits of postgraduate study
• the needs of business and other employers for postgraduates
• the levels of participation and potential barriers

Comment on the postgraduate review

As agreed last year by the TUC and CBI, the changes will give agency workers the right to the same pay, holidays and basic conditions as permanent staff after 12 weeks on a given job.

Publishing a consultation on draft regulations to implement the EU Agency Workers Directive, Business Minister Pat McFadden said:

“As the Prime Minister has said, the Government is committed to getting this legislation on the Statute Book by the end of this Parliament. The law will come into force in the UK in October 2011, giving recruiters and their clients time to prepare and plan. We are also mindful of the need to avoid changing requirements on business until the economic recovery is more firmly established.”

Proposals include:

• Agency workers entitled to equal treatment on basic working and employment conditions, including pay and holidays, as if they had been recruited directly by the hirer after 12 weeks in a given job
• Information about vacancies in the hirer to give them the same opportunity as other workers to find permanent employment
• Equal access to on-site facilities such as child care and transport services
• Improved rights to protect the health and safety of new and expectant mothers including right to reasonable time off to attend ante-natal appointments and adjustments to working conditions and working hours.

View the consultation (runs until Friday, 11 December 2009)

View the press notice

“It will only serve to drive more customers away from Royal Mail. One thing this company cannot afford is strikes and industrial action.

“We are, of course, in frequent contact with both management and the union. Our message to them has been clear: put your customers first.

“The CWU should turn their backs on industrial action and sit down with the Royal Mail and resolve this dispute. That is what is in the interests of the Royal Mail, their members and the country.”

Publication of the Forward Programme is a key component of a series of reforms that the Government is introducing to strengthen the management of regulation.

It brings a new openness and clarity to the regulatory process and will enable decisions on new regulations to be taken in the context of the cumulative burden of the Government’s regulatory programme on business and the wider economy. This is more important than ever in the current economic environment.

Read The Government’s Forward Regulatory Programme (PDF, 651KB)

The Low Carbon Transition Plan sets out how the Government will meet the cut in emissions of 34% on 1990 levels by 2020.

The Low Carbon Industrial Strategy sets out how the Government will invest in areas such as tidal, wind and nuclear energy, as well as supporting electric vehicle infrastructure.

Low emission and electric vehicles offer new opportunities for UK manufacturers, but also new challenges for scientists and engineers. At the Low Carbon Vehicle 2009 event last month, Minister for Science and Innovation, Lord Drayson, said:

“What we have to do is use science and technology to offer cars with great performance but also great efficiency and low emissions.”

For more information on the Government’s low carbon policies, see the Low Carbon News hub, a resource for media, bloggers, stakeholders and the public.

Other Government departments are also participating in Blog Action Day. Read the Prime Minister’s blog on Number10.gov.uk here and Foreign Office Secretary of State David Miliband’s blog here.

For more information about what you can do to reduce your CO2 emissions and slow the effects of climate change, visit Directgov’s Act on CO2 website.

The event is being held at the BIS Conference Centre.

Further information on UK National Contact Point Event (PDF, 75KB)

Thank you all for coming. It’s great to see so many eminent faces. This is a conference that almost certainly wouldn’t have taken place two years ago. It is about questions that we weren’t really asking in government two years ago.

They are post-banking crisis questions about the roles of government and the market. About how we build a balanced recovery.

I think they are questions that the acceleration of globalization was starting to force us to take more seriously anyway – but the banking crisis has focused our minds. And that’s a good and necessary thing.

I wouldn’t go so far as to say that industrial policy is making a comeback – at least not in the way that some of us might remember it.

But the challenge of long term, low carbon recovery and growth have pushed us to look more carefully at the way in which government can drive growth. How government policy can equip our country and our companies and our people to compete in a global economy.

Our New Industry New Jobs paper removed a negative check on the subject that has been there for two decades or more. It sometimes seems as if there are only two positions in this debate – pro-market and interventionist. Especially in the financial media. Well, New Industry New Jobs was the first small step towards a synthesis.

In my view, building that synthesis could not be more important. It will shape how we see the recovery, how we respond to the challenge implied by the public deficit. It is fundamental to how we see Britain maintaining and developing comparative advantages in the global economy. That’s why we called it New Industry New Jobs. Because that’s what it is there to achieve.

I don’t think the arguments behind New Industry New Jobs are earth-shattering, but they do have some pretty big implications for government.

One is that the choices government makes and the actions it takes are a huge part of what actually defines the shape of the market, and the capabilities of our people and companies when they compete in it.

The more conscious we are of that, the better government will be at shaping the environment in which businesses are created and grow. In part this is about setting the right frameworks for the private sector to make its investment decisions. But it can also be more ‘activist’.

For example, it should be the strategic context of our approach to skills and higher education policy. Which is why we are publishing new frameworks in the next few weeks for higher education and adult skills policy in this country that explictly increase the focus of policy on producing the skills we need to maintain existing comparative advantages and build new ones in areas like low carbon.

We’ve also been piloting programmes that use our multi billion pound procurement budget as a way to incentivise innovation, by opening the tender process wider to smaller and more innovative companies and making government a lead user of innovative technologies. The successful pilots in the NHS in the East of England show that there is huge potential to expand this across government.

And it matters more than ever right now, because the better we are seeing the knock on effects of all policy in terms of growth, the better our return on any form of public investment or public spending is going to be.

The creation of the department of Business Innovation and Skills consciously puts a large number of these policy levers in a single department with a clear remit for investing in growth. And it’s the first time to my knowledge that that has been done.

But this is a challenge for all of government, at all levels, not just the department of business. That’s why we will be publishing a new framework later in the autumn which will set out more clearly than ever before how national, regional and local delivery partners should work together to deliver key national priorities.

So, my argument is that certain kinds of market interventions to shape our industrial capacities are a good and necessary thing. That doesn’t mean state direction of industry, it means strengthening our basic capacities. I know well from my time as EU Trade Commissioner, in development economics it is routine to assume a role for public policy in capacity building. Yet we rarely use that language for our own developed economies. I think that limits us as policymakers.

Capacity building simply means recognizing that while the market is irreplaceable as the ultimate arbiter of what is long-term viable in Britain, or anywhere else, industrial strength can be lost – or never built – for reasons that are totally avoidable and that have nothing to do with long term viability and competitiveness.

What might that mean? Well, it can be a lack of growth or start-up capital. It can be a lack of information about opportunities. It can be the lack of a workforce with niche skills. It can be a lack of the right partnership between researchers and industry.

A couple of examples from BIS’ work this year make the point.

We have a very strong biosciences sector in the UK, and most analysts agree that renewable chemicals is one of the key frontiers of this sector. Now, no small UK biotech firm can sensibly bear the cost of an industrial biotech demonstrator facility, but Britain will struggle to develop strengths in renewable chemicals without one. So in June we funded one, and will create a fund to help small companies use it.

We’ve committed to funding similar technology testing facilities for plastic electronics, low carbon wind and wave power. Just yesterday we committed to funding a pharmaceutical demonstrator facility at Stevenage alongside the Welcome Trust, the RDA and Glaxo Smith Klein.

We’ve also part-funded the world’s biggest demonstrator programme for ultra low carbon vehicles – which is an important step towards shifting consumer assumptions about what is viable in low carbon transport. We’re also going to support lead users of ultra low carbon cars from 2011 with a contribution to the cost of a vehicle. Because we can’t afford to cross our fingers and hope that these technologies get off the drawing board.

There are lots more examples in the report in your conference packs that sets out where we’re investing most of the £750million strategic investment fund created at the 2009 Budget.

We’ve also started to take a much more critical look at the way in which financial markets in the UK too often fail to provide long-term risk capital for innovative small firms – a structural problem that is going to be made worse by the banking crisis and the natural risk-aversion that will come with the first few years of recovery.

For this reason we are developing new solutions to address this – the Innovation Investment Fund and the National Investment Corporation. In both cases the aim is to use public seed capital to draw in private investment for investing in innovative small firms.

The goal of today’s conference is to continue a debate around the way we can take these ideas forward. It’s a chance to look at the way other developed economies have tackled these problems – where they have got it right and where they have gone wrong. To ask where and how the UK should be targeting limited resources to get the best outcomes in terms of sustainable strengths and growth. In what sectors and what markets? In what horizontal priorities?

Today’s unemployment figures are a reminder that a genuine recovery is marked not the return to growth alone, but by a return to sustained rising employment. While we don’t know exactly what those jobs are going to be, we do know that a disproportionate number of them are going to come from innovative firms. They are going to come from new market entrants pioneering new technologies and low carbon. They are going to come from new investment.

To argue that there is no role for active public policy in reinforcing this growth seems to me either dogmatic or complacent, or both. To argue that government is essentially the problem for competitiveness seems to me to make the same basic mistake.

We’ve started to make the counterargument, and we’ve put some serious resources behind it. The point of today’s conference is to widen and deepen our thinking and to ask where we might go from here to secure Britain’s economic success.

The IWF was founded by the internet industry in 1996 and works in partnership with the police, government, the wider online sector and the public to combat the availability of potentially illegal online content within its remit. As a result of this self-regulatory approach, less than 1% of online child sexual abuse content has apparently been hosted in the UK since 2003, down from 18% in 1997.

Through the ‘Hotline’ reporting system, the IWF helps the online industry combat abuse of its services through a ‘notice and take-down’ initiative by alerting them to potentially illegal content within IWF’s remit on their systems and enabling the police to investigate those responsible. This partnership approach is recognised internationally and the IWF is committed to sharing its good practice, expertise and experience around the world, contributing to dialogue beyond the UK and Europe, to ensure greater awareness of global issues and responsibilities.

For more information or to report a website visit www.iwf.org.uk.

Innovation, a bit like enterprise, is one of those things that trips very easily off a politician’s tongue. We all want it, we all support it, we all think it matters, but I can go one further. In my department it is, quite literally, our middle name.

When BIS was created we put innovation on the front of the tin very deliberately. Because we believe that innovation runs across the whole remit of the new department. It is at the heart of the knowledge economy and our response to globalization. It is at the heart of the recovery. It is key to our future success.

I want to do two things today. First, to say something about why innovation matters so much and why we have to see it as more than a niche policy issue. It’s a systemic challenge. That’s why it’s in the name of the department.

Second I want to make this more concrete by setting out what we are doing to turn good research and science into innovative development. To turn innovative ideas into innovative companies. To turn employees into innovators. And to turn the government’s procurement budget into a force for innovation.

Why innovation matters

Why does any of this matter? It matters because innovation is a whole approach to technology and practice. It’s the assumption that we could be doing this better, differently, whatever ‘this’ might be. ‘This’ can be a piece of technology. But it can also be a way of doing things. That’s an important point, because in an economy in which retail and business and financial services play such a huge part, some of the most important innovations are in processes: marketing, design, communications and administration.

I talk a lot about an investment-led recovery. Well, innovation is at the heart of that. Not just because it drives commercial invention, but more fundamentally. Because innovation is what pushes up productivity, and every pound we save by doing something better is a pound we can invest somewhere else. Innovation is at the heart of growth.

I talk a lot about the green jobs revolution. Well, innovation is at the heart of that too. In part because we’re in a race to get green technologies off the drawing board. In part because low carbon is an innovation in our whole mode of life. It will change almost everything – simply because it will change how we generate and use energy.

Britain has a strong track record here. We are the original innovation nation. We enter the twenty first century with a set of strong national resources built up carefully by the government over the last decade. A world class science base – second only to the US. A skilled workforce; an open approach to FDI; and tax credits for R&D. We also have an open competition policy that is a driver of innovation. This has helped us attract and retain some of the world’s biggest corporate investors in R&D.

The innovation infrastructure

The challenge is to see all these things not as isolated policies, but as an innovation infrastructure. That infrastructure stretches from competition policy through education and skills policy, through the intellectual property system, through risk and growth finance to the way in which we bring researchers and companies together to generate new ideas.

Globalization will put tougher demands than ever before on our innovation infrastructure. Because the knowledge that drives innovation can now spread around the world in an instant. Because skill levels and investments in science and technology are rising in the emerging economies. Britain and its companies still invest less in R&D than many EU countries – even if this is not a perfect proxy for innovation. And of course the banking crisis and the recession create their own problems for innovation – especially how we fund it.

Think of it this way: the average lifespan of an S&P 500 company now is just 11 years, which means that complacency is essentially fatal. My argument today is that complacency includes thinking that all British companies need to succeed in this innovation race is a free market and no favour. They need that but also a lot more. I want to say something quickly about four critical parts of this challenge.

Science into innovation

The first is in the recognition that we need to do more in Britain to translate our record investments in our world leading science base into commercial innovations. This was one of the key planks of the New Industry New Jobs strategy that we launched in April.

UK universities are increasingly partnering with business to do this, and our job is to reinforce that trend. I also want research councils and the Regional Development Agencies to help deliver this. And a core task of the Advanced Manufacturing Research Centres will be to horizon-scan for new technologies and act as a proactive channel between the research base, industry and potential financial backers to further development in advanced manufacturing.

And of course the TSB was created to do all of these things and more across the economy. Over the last two years it has proved its worth. Which is why we backed it with an additional £50 million in this year’s budget. This year our £750million strategic investment fund has invested in – among other things – low carbon aircraft engine technology; fuel cells, and industrial biotech by investing in the TSB. The core funding we provide for TSB is enabling it to announce investments worth over £80m today.

I’m also happy to announce today a joint £37million investment between my Department’s Strategic Investment Fund, the TSB, the East of England Development Agency, the Wellcome Trust and Glaxo Smith Kline to create a unique drug development bio-incubator in Stevenage.

It will provide access to specialist equipment and services and knowledge sharing on drug development. In its first phase it will be home to around 25 companies with plans to expand the available space five-fold.

It is looking to attract inward investments, spinouts and start ups. It will provide access to specialist equipment and services and knowledge sharing on drug development. It is a strong new platform for the work of our Office for Life Sciences. Most important it is a huge investment in our biosciences future in this country.

Ideas into companies

Our second challenge is to recognize and get to grips with the unique challenge of financing innovation. All investment is risk, but investing in innovation carries its own kinds of risks. UK financial markets have long under-delivered on finance for start-ups and expanding firms. It’s partly the steep capital costs, partly the long lead times on proof of concept and product development, partly the high costs of due diligence for relatively small investments. It’s striking that private equity over the last decade has raised more and more money, and invested less and less of it in small firm growth and innovation.

We would expect a level of risk-aversion in the early stages of recovery. But if that risk-aversion stalls the growth of a new generation of innovative British firms, then the recovery itself is at risk. It’s time to start treating this not as a market failure problem that needs tweaking, but as a structural problem that needs serious public policy solutions.

As a country we do have to start putting more money where our mouth is on innovation. And that means using more public funds as a catalyst to back up and attract the business angels and venture capitalists and even the pension fund managers who intuitively should be interested in backing long term growth.

That’s why we created the Innovation Investment Fund in July with £150million in public seed capital. Managed by venture capital specialists, it will look to leverage in funds from the private sector with the aim of creating a £1 billion fund over 10 years. The Growth Capital Review, led by Christopher Rowlands will report its conclusions at the Pre-Budget Report and to bring forward proposals for a new national investment corporation.

Like our approach to improving the links between universities and industry, this is a model that sees a critical role for public investment, but which goes out of its way to avoid turning politicians or civil servants into investment managers or technology pickers. Which is a good thing, because it took me months to get the hang of my iPod and I am still discovering new uses for my Blackberry.

Employees into innovators

The third challenge for us as a country is to embed innovation into our higher education and skills systems. When we launch our new higher education framework and skills strategy over the next few weeks, they will directly address our capacity to drive innovation by educating and training innovators.

This is not just about creating entrepreneurs, but about creating employees with the confidence to challenge the ways their companies do things. And the bosses with the confidence to listen to them.

We certainly need to get past the idea that innovation comes chiefly from some cappuccino-drinking ‘creative class’ in our societies – it has to be something that we all have a claim to. That includes the working class kids whose expectations and initiative and drive will often be the key ingredient to creating new jobs in areas struggling with economic change.

Procuring services into procuring innovation

Finally, I do believe that we can do more to drive innovation through public procurement – above all by widening the access of innovative small firms to the procurement process – the firms with new ideas who shake up existing providers.

The Technology Strategy Board has run successful Small Business Research Initiative pilot schemes in partnership with the Ministry of Defence and the Department of Health. The SBRI scheme has now been expanded to include other public sector bodies. For example, the East of England Strategic Health Authority and regional partners have recently completed a competition with TSB backing calling for innovative new approaches to home treatment and long-term patient health.

The level of interest is very high, with 11 SMEs awarded phase one contracts. The proposed solutions were in many cases new and genuinely innovative. And all the more important in the current environment is that the potential savings to the NHS run into the hundreds of millions.

The concept is very simple. The mechanism is commercial: demand and supply. It is about recognizing that the tens of billions of pounds that the government spends every year on goods and services is a major market-shaper.

By being a lead user government not only encourages innovation, it also indirectly finances it. If we demand innovation, and we make sure that innovative SMEs can compete for contracts, then we will get it. The benefits across government are clear enough. Innovation is how we get more for less. I will be pushing hard to see the SBRI concept extended and protected even through a period of fiscal constraint.

Conclusion: an innovation-led recovery

I started by saying that innovation would be decisive in Britain’s recovery. I don’t think that’s an overstatement. We are a knowledge economy. Innovation is how you actually turn knowledge into rising productivity, new solutions and new growth. Knowledge is the raw material. Innovation is the refinement process.

I’ve defined our challenge today not as pursuing a set of isolated innovation policies, but in building an innovation infrastructure for Britain today. My point in doing that was to remind us that what government does on skills, finance, science – these will decisively shape our capacity as an innovation nation. That is why we have put innovation in the name of the Department and innovation at the heart of the government’s plan for growth.

The TSB has done an exceptional job of building those capacities and my Department is committed to building on this. I want to finish by congratulating Graham, Iain and their team and their thousands of collaborators for playing such a vital part in building Britain’s future. The Government is right behind all that you are doing and helping to pioneer.

People attending an innovation event

The Strategic Investment Fund (SIF) was announced in Budget 2009.  It is a £750 million fund for the UK government to support a range of targeted investments across the UK economy to support growth.  Since the creation of the SIF, the Government has committed funding to a range of investments. 

The UK Strategic Investment Fund – Interim Report (PDF, 490KB) sets out the principles behind the SIF and the investment commitments that have been made so far.

See the ECO Academy webpages for more information.

Venue: Tokyo, Japan

As always, I am glad to be back in Japan. I’ve always been an Asia-minded person but I am especially glad to have served as the UK Chair of the UK-Japan twenty first century group and to have championed Japanese commercial links with Europe as Trade Commissioner.

I am also pleased to say I still treasure the pen used to sign the post-war treaty between Britain and Japan: my grandfather was Britain’s signatory as Foreign Secretary at the time!

If we look beyond the current downturn, it’s certain that this edge of the Pacific will be the most important driver of change in the global economy and global politics. Not least because, like Europe and the US, you are having to define and manage relationships with a transforming China and a growing India.

But while change in this region is exciting, it needs to be seen in the context of Japan’s continuing relationship with its strongest economic partners, and Europe is chief amongst these.

It’s too easy and too common, in my view, for Europeans and Americans to misunderstand just how subtle and complex these regional relationships are and what they will mean for Asia’s future. We, too, need to adjust to the new influences on Japan’s future.

Today, I want to talk about two specific aspects of that future and what they mean for Japan and Britain: trade and the international economy and climate change.

It’s been an interesting few months for Japan-watchers like me in Britain and Europe. I want to congratulate Prime Minister Hatoyama on a campaign and a victory that is seen by many to mark a sea change in Japanese politics. I am officially flattered to hear that many of the reformers in Japan’s new government are looking to the UK system and Civil Service as a model for change in Japan. This is not the traditional kind of UK export – but it’s one we are pleased to supply, and will do all we can.

So, my first question is how we might capture some of that sense of change to reshape commercial ties between Britain, Europe and Japan.

In both the short and medium term, Japan and Britain face similar domestic challenges. We need to strengthen our banking sectors and invest in economic recovery. We need to convert carbon intensive industrial economies to low carbon in the space of a generation. As mature industrial democracies we all have ageing populations whose expectations of healthcare and support in old age will test our post-second war social settlements.

These are huge – even daunting – challenges. They are shared risks and somehow we have to resolve all of them as internationalists, capable of seeing both our national and collective global interests.

Copenhagen and climate change in December will be the first big test of this new political reality: a test which over the last few weeks we have sometimes seemed dangerously close to failing.

I have to say that in this area I think the new Government has made an impressive start. Its pledge to cut CO2 emissions by 25% from 1990 levels has already played an important part in bidding up ambition ahead of an eventual agreement at the Copenhagen summit. That is badly needed. It is holding firm even in the face of domestic opposition. I welcome this.

But beyond that: governing global finance and making the G20 a credible force; correcting over time the trade imbalances that have defined the global economy for the last decade; adapting to China’s new status and strength; managing the threat too often posed by North Korea. The list is not a short one.

The messages that Japan is sending – its high profile rejection of economic nationalism, its commitment to openness – could not be more important against the backdrop of global recession.

Preserving openness through the downturn

With the downturn, the question of global economic interdependence has become a question of national economic survival. Especially for a huge net exporter like Japan whose manufacturing sector has been hit extremely hard by the collapse in demand, just as many British exporters have.

So the internationalist stance of the Hatoyama government is welcome and timely and right. The joint commitment to a global recovery driven by a sustained and sustainable return to global growth and demand is something on which the UK and Japan agree closely.

Our challenge now is to continue to translate that agreement into joint advocacy for a Doha world trade deal, a G20 settlement on global financial governance and a global economy that comes out of this crisis as open as the one that went into it.

Britain rebounds

We also have to make sure that commercial ties between Japan and Britain emerge from the downturn without any permanent damage. I know that over the last year the Japanese media – often taking their cue from their British colleagues – have painted a negative picture of the prospects of the UK economy.

This is easily explained by the natural gloom of British journalists but, as a globalised economy, Britain has felt the effects of the downturn as much as most. Our large financial services sector was directly exposed to the banking crisis. But Britain’s open economy and flexible labour markets have proven strikingly resilient through this crisis, with high rates of re-employment for those unlucky enough to have lost their jobs. There are strong signs that the economy will have returned to growth by the first quarter of next year.

There have been a few important corporate testimonials to this over the last few months. Nissan and Toyota have renewed their commitment to the UK as a venue for low carbon automotive development. They and other major Japanese companies are responding not just to the very positive environment for doing business in the UK, but to the strength of our science base, our record in bioscience and manufacturing innovation, our skilled workforce, our central position in the massive European single market.

It’s a common caricature about the UK that our economy is based largely on the sharp suits in the City of London. But even the super-powered financial services sector of the last decade never eclipsed British manufacturing as a share of UK GDP.

If anything, the banking crisis has deepened the resolve of the British government to ensure that the UK remains one of the best – if not the best – place in Europe to do advanced manufacturing, especially in low carbon.

The low carbon sector in the UK will employ a million people by the middle of the next decade. It’s already worth more than a hundred billion pounds a year and has maintained positive growth rates even through the recession. The British government is investing strong support in low carbon technological innovation such as wave and wind power and the kinds of strategic skills these industries and their supply chains need.

Which country, for example, is already a pioneer in wave and tidal energy with government support? Britain. Which country is committed to having one of the world’s few heavy forging capacities for the nuclear supply chain outside of Japan? Britain. Where is the world’s biggest demonstrator programme for low carbon vehicles? Well, it’s in Britain, and its part-funded by the British government.

This has to be an area where there is scope for closer ties between the UK and Japan both in research and production. To be sure, it’s an agenda where business is often as concerned about competitiveness and costs as it is ready to focus on commercial opportunities. But that needs to change, and change quickly. Governments both here and in Britain need to insist on that. The scope for collaboration is immense. Britain and Japan are both industrial innovators who need to be confident of their capacity to benefit from even radical change. The low carbon economy isn’t a threat to recovery. It’s the key to sustainable recovery, where the earliest movers will be the biggest beneficiaries.

Open investment

There is no question that getting the best out of a low carbon partnership, or any kind of deep commercial ties, means an open investment relationship between Britain and Japan.

I made a bit of a stir here last year by strongly defending the value of foreign inward investment into Japan- even where it means foreign ownership. Yes, we should always ask tough questions of inward investment – as I said in the Wall Street Journal two weeks ago. But that’s not the same as questioning its potential value.

Japanese investment in the UK proves this. Nissan has been part of the industrial landscape of the North of England for 25 years. Honda and Toyota and hundreds of other Japanese firms like Komatsu, Panasonic, Sharp and Eisai are now an integral part of corporate Britain. These companies bring more than capital – over the last two decades they have raised standards for UK manufacturing and business as a whole. They are part of the reason why the UK remains the world’s sixth largest manufacturer.

My point is that what ultimately matters is not the colour of these companies’ passports, but their commitment to their local workforce. Their respect for the industrial heritage and local productive base.

There isn’t yet a British equivalent of Nissan or Toyota in Japan – as I was at pains to point out last year. British presence here is hardly weak – but it’s not what you’d expect in the world’s second largest economy. But the more Japan opens up, the more certain I am that a British aerospace leader; or ICT firm, or bank, or retailer, or pharmaceutical or healthcare investor could step into that role. I believe that we will both benefit when finally they do.

So, as I say, I welcome very strongly the Hatoyama government’s willingness to challenge some of the older negative assumptions about what is good for Japanese business and industry with respect to foreign influences.

And I welcome the recognition of the benefits of regulatory reform in Japan. Creating a wider and fairer field for government procurement is an example. This is the way to create public sector savings as well as a spur to innovation.

This change can have a very real effect in EU-Japan relations. If we’re serious about a credible Economic Integration Agreement between the EU and Japan then we’re going to have to tackle these tough issues.

For too long, the growth of our trade has been hampered by regulatory restrictions. We really need to lift our eyes and look beyond the obstacles remaining in the way, and commit to a new EU-Japan vision.

The fact is, it’s easy to cut a tariff. (Actually, as a former WTO negotiator with four years of Doha Round negotiations under my belt I can’t believe I just said that!). Let’s just say in principle it’s easy to cut a tariff.

It’s much tougher to identify and tackle the prejudices, the legal obstacles, the non-tariff barriers and the inter-Ministerial politics that can stand in the way of real regulatory reform. But this is what Japan needs to do. Addressing these will require real leadership and tough decisions to be made. To be totally frank, during my tenure as EU Trade Commissioner, I often felt the EU and Japan would find it too difficult to resolve these questions. I do worry that in the year and a half since I was last here we have not made a lot of material progress in improving conditions for foreign investors here. That’s the candid truth. So both sides have to try a whole lot harder and make it more of a priority. I was encouraged that Prime Minister Hatoyama recognised this when I saw him yesterday.

Conclusion: necessary internationalism

So I want to repeat the challenge I made when I visited Japan last year as EU Trade Commissioner. How can we not just maintain but strengthen an open trade and investment relationship? Then I was concerned about ensuring that the benefits of global economic integration were extended. Now I am concerned about preventing them going into reverse.

And that means tackling those areas where we have yet to see real change on the Japanese side. Recognising that just as Japan’s prosperity depends upon its trade with other countries, its competitiveness in a rapidly changing world depends on opening its markets even more to the benefits of foreign trade and investment. The new Government has made an impressive start in setting a new, internationally-minded, tone to the political debate. It has identified the values, interests and goals that Japan shares with its allies. Let’s work harder to give them real expression. We need to do this if the relationship is to grow and prosper.

The worst thing that we could do would be to take each other for granted. That’s no way to preserve a good marriage. I have confidence that the new Japanese Government will not allow that to happen.

Kevin Brennan joins a huge range of key informal adult learning stakeholders today for the launch of The Learning Revolution Festival, a month-long celebration of informal adult learning and the benefits it brings for individuals, families, businesses and communities.

Throughout The Learning Revolution Festival hundreds of events, such as taster sessions, workshops, demonstrations, performances, competitions and classes, will take place across England giving current learners the chance to celebrate what they enjoy and others the opportunity to try something completely new. By highlighting the richness and sheer diversity of what’s available, The Learning Revolution Festival will encourage people of all ages and backgrounds to get involved in learning.

Find more videos like this on The Learning Revolution

Today’s launch Expo will give stakeholders the opportunity to network and form partnerships to help improve and promote their services to their local communities and the wider public. Learning activities will be taking place throughout the day and all attendees will be encouraged to get involved and learn something new. Kevin Brennan will be making a formal address to those attending.

Kevin Brennan, Minister for Further Education, Apprenticeships, Skills and Consumer Affairs, said:

“Informal learning brings proven mental, physical and social benefits and the Learning Revolution Festival is all about highlighting these benefits. Through our commitments in the Learning Revolution White Paper, the Government is doing its best to encourage organisations, groups and individuals to get involved and get learning.

“Today’s Expo is the perfect opportunity for partners to share ideas and combine resources, ensuring adults across the country can benefit from even more learning opportunities.”

The Festival is part of The Learning Revolution movement kickstarted by the Government White Paper published in March 2009. The Government already spends £210 million each year on informal adult learning and the White Paper committed an additional £30million for 2009-10 to strengthen the infrastructure for informal learning across England. Of this, the £20m Transformation Fund recently awarded grants to 231 informal learning initiatives and a new £3m support package for community learning champions will be launched 8th October.

People wanting to join the Festival and try something new should visit www.direct.gov.uk/learningrevolution where they can find details of hundreds of events taking place up and down the country.

Find more videos like this on The Learning Revolution

Organisations wishing to support The Learning Revolution Festival and access materials available should visit thelearningrevolution.ning.com.

Watch Lord Mandelson’s video on the Government’s Learning Revolution initiative.

To save business time and money Government departments now issue all their changes to business regulations on two dates per year – 6 April and 1 October. This is part of the Government’s commitment to promote better regulation, regulating only where necessary, doing so in a proportionate and targeted way, and reducing bureaucracy wherever possible.

From today, new businesses will be able to save valuable time and money with simpler model articles, making it easier to start up and run companies. Other measures will help shareholders and investors by encouraging disclosure of strategic, forward looking information through enhanced business review [not new – commenced 1 October 2007].

Key provisions of the Companies Act 2006 include:

• Creating separate and simpler model Articles of Association for small companies, reflecting how they operate
• Enabling greater use of electronic communications with shareholders therefore avoiding unnecessary cost and time consuming administratio
• Making it an offence to carry on business in the UK under a name that gives so misleading an indication of the nature of the activities of the business as to be likely to cause harm to the public.

Business Minister Ian Lucas said:

“We are working hard to create the best environment for businesses to thrive and it is paying off, with the UK recognised by the World Bank as the best place in Europe to do business.

“Common Commencement Dates help companies to plan ahead, saving them time and money. The changes under the Companies Act will help 2.5 million British companies and deliver benefits to business of around £300M a year.”

The changes have been widely welcomed by businesses because many of the measures have been introduced to reflect how companies already operate, minimising the burden on business to adapt to new regulation.

The following regulations are also coming into force:

Department for Business – National Minimum Wage and Tipping

Department for Transport – Local Transport Act

Credit Rating Agencies

Notes:

1. The Better Regulation Executive is taking forward the Government’s better regulation agenda. 

2. Examples of how individuals and businesses are benefiting from changes to regulation can be found on http://webarchive.nationalarchives.gov.uk/20091026112816/http://www.betterregulation.gov.uk. The site also invites suggestions for what else can be done to reduce red tape.

The automotive sector supports R&D, technological innovation and skills and a manufacturing supply chain that are a mainstay of the wider manufacturing sector in the UK. Industry figures have reflected the positive impacts of the scheme both within and beyond the automotive sector, with manufacturing benefitting and the whole supply chain, from plastics and steel, to individual component manufacturers receiving a boost.

So far 227,750 orders have been placed through the scheme. The increased funding enables the scheme to fund a further 100,000 vehicles, bringing total budget to £400 million and covering up to 400,000 vehicles in total. The extension continues as a Government and manufacturer partnership, with matched funding providing the £2,000 discount for each scrappage order.

Alongside the increased funding the Government will work with manufacturers to extend the benefits to van owners with vehicles over 8 years old rather than the current 10 year requirement. Car owners will also get a boost, with the age qualification changed by 6 months to extend the benefits to cars registered on or before 29 Feb 2000 (V registration). The scheme will come to an end in February 2010 or when the funding runs out, which ever is sooner.

Business Secretary Lord Mandelson said:

“The sector has been strongly affected by the recession, but the scrappage scheme has delivered a boost to manufacturers and the supply chain. We have listened to the concerns of manufacturers and are increasing the funding of the scheme to £400m.

“But we must make sure that the help we do offer is targeted, limited and proportionate. This is not a blank cheque to the auto manufacturers but recognition that there is still a short term challenge to boost demand and confidence in the sector.”

Notes

Because of additional funding by the Government and manufacturers, the Scheme will now cover up to 400,000 transactions. It will still come to an end on 28th February 2010 or when the funding runs out, whichever is the sooner

To ensure all 10 year old cars will qualify for the scheme, the date by which vehicles must have been registered in the UK to qualify for the scheme will be changed to 28 February 2000 (V registration) except in the case of vans where the date will be changed to 28 February 2002 (Y registration or earlier, or new style number plates where the 3rd and 4th digits of the registration number are 51)

Government will work with manufacturers to implement these changes, and these will come into effect as soon as possible.

The Government scrappage subsidy is matched by equal funding from manufacturers.

The scrappage scheme figures are updated on a weekly basis on the BIS website, where you can also find more information about the changes to the scheme: http://www.berr.gov.uk/whatwedo/sectors/automotive/scrappage/page51068.html

The £2,000 grant is made up of £1,000 from government with matched funding from vehicle manufacturers.

How to apply

The dealers will do all the paperwork for motorists participating in the scheme and arrange for the old vehicle to be scrapped. The dealer will check that the vehicle being traded in and the new one being bought qualify under the scheme:-

OLD VEHICLE

• Passenger car or small van not exceeding 3.5 tonnes
• Registered in United Kingdom on or before 31 August 1999 [NB - expected to change shortly in line with today’s announcement]
• Currently registered with DVLA or DVA to the registered keeper making the application
• Vehicle has been registered to the customer continuously for 12 calendar months before the order date of the new vehicle
• Vehicle has a UK address on the registration certificate (V5C)
• Vehicle has a current MOT test certificate before the date of order for the new vehicle, or one that has expired no more than 14 days before the order for a new vehicle was placed
• Vehicle is taxed, or has a tax disc that has expired within 14 days of the order and insured

NEW VEHICLE

• Passenger car or small van up to 3.5 tonnes
• First registered in the UK on or after the date the scrappage scheme is launched and declared new at first registration in the UK with no former keepers
• UK specification vehicle (can include left-hand drive vehicles that meet UK specifications)
• Registered to the same registered keeper as the registered keeper of the eligible vehicle to be scrapped

Visiting the BRIT School in Croydon, Business Secretary Lord Mandelson said it was vital for jobs and growth that Britain’s world-renowned creative industries are given the chance to flourish. He said the Government welcomes the current debate on digital piracy, including views put forward by the music and film industries, consumer groups, unions, ISPs and musicians themselves.

Lord Mandelson said:

“Downloading somebody’s work without paying for it – whether it be music, film or computer games – is not a victimless act. It poses a genuine threat to our creative industries and to the livelihoods of talented, hard-working people striving to get a foothold in them. It’s essential that the voice of young artists is also heard.

“In the end this problem will be solved not simply by new laws but by new approaches to doing business. We believe that temporary account suspension as a last resort, in the most serious cases, is worth considering to allow these new business models to develop.”

He added that the Government welcomed new commercial offers like Spotify or Vodafone’s DRM-free music deal that give consumers a range of legal choices.

Culture Secretary Ben Bradshaw said:

“Britain’s got talent – and the BRIT School is a shining example of that. But if we want the next generation of musicians, filmmakers, developers or designers to succeed, we need to address urgently this threat to the sustainability of our creative industries. Unlawful file sharing costs businesses that invest in new talent millions each year.

“Tomorrow’s stars are born digital. We need the industry to match their ingenuity and devise new business models that work in the digital age. It is right that artists are rewarded for the time, energy and creativity they invest in producing something the public wants. And if we are to retain our creative edge in the long term and enjoy the cultural benefits that brings, we need innovation to allow that talent to shine.”

Lord Mandelson and Mr Bradshaw praised the work of the BRIT School providing young people with the grounding and skills they will need to look for careers in the creative industries.

Video

Press notice
Read the full press notice here.

Images
To view images of the visit to BRIT School (and for online journalists to download and re-use), see the Flickr album here.

Blog
For more on the development of our policies on Digital Britain, including a discussion of the government’s approach to the file-sharing issue, visit the Digital Britain Forum blog.

Consultation
To have your say on proposed filesharing legislation, see the Consulation on Legislation to Address Illicit P2P File-Sharing. It closes on 29 September 2009.

Speech
Minister for Digital Britain, Stephen Timms, spoke about the importance of Information and Communications Technologies (ICT) earlier.  Read the full speech here.

Baroness Vadera

The Prime Minister has today announced that he has appointed Baroness Shriti Vadera as adviser to next chair of G20, the Republic of Korea, following a request from President Lee.

Her new role, which she will take up from mid October 2009, will be to help manage the transition from the UK to the South Korean Presidency and reflects the growing importance of the G20 group and the UK’s engagement with it.

Baroness Vadera is currently the Minister for Economic Competitiveness, Small Business and Enterprise.

Lord Davies of Abersoch, the Minister for Trade Investment and Business, will assume her BIS ministerial responsibilities. She will not be replaced in her role as joint Cabinet Office minister.

The Prime Minister said:

“The G20 is an increasingly important global group. The previous year has shown the vital importance of working together to deliver jobs, growth, and stability. In her new role Shriti will significantly strengthen the UK’s engagement with the G20, including working with the Republic of Korea as the next chair. I thank her for her dedicated work as a Government minister.”

Business Secretary Lord Mandelson said:

“Shriti has made a tremendous contribution to the Department for Business. She has worked tirelessly to ensure businesses, especially small businesses, are supported through the Recession and emerge stronger at the other side.

Shriti has real passion for the G20 and has done excellent work already promoting international action to tackle the financial crisis. So this is a logical move for her and us.

And I know Mervyn Davies is looking forward to taking on her departmental responsibilities. He will do a great job for small business.”

Notes

1. Shriti Vadera will take up her new role from mid October 2009, for which she will not be paid a ministerial salary.

2. Shriti joined the Department for Business as Parliamentary Under-Secretary of State for Business and Competitiveness in January 2008. In October she was appointed Parliamentary Under-Secretary of State for Economic Competitiveness, Small Business and Enterprise, jointly with the Cabinet Office and Department for Business Innovation and Skills.

Prior to that she spent 8 years on the Council of Economic Advisers, HM Treasury and was advisor to Gordon Brown when he was Chancellor of the Exchequer.

She was responsible for advising on business and city issues, productivity, enterprise, PPPs, public enterprises and amongst other things, was responsible for the creation of the Shareholder Executive, the Better Regulation Executive and initiating the Hampton, Barker, Eddington, Higgs, Myners and other Reviews.

She served as Parliamentary Under-Secretary of State for DfID from June 2007 to January 2008. She has 14 years’ experience as an investment banker, advising on banking, capital markets, project finance and corporate finance internationally.

Introduction

It is of course a serious time for Britain. Over the last two years, we’ve been through some of the toughest retail trading conditions for decades and lost some familiar names from the British high street.

The Government has backed you up in some important ways, and, when we look back our policies will have been seen to have helped make the recession shorter and shallower. The VAT cut has helped support demand and I know you’ve made representations to the Government about the timing of when the cut should end.

Through the Enterprise Finance Guarantee, just under £120 million has been lent to retail companies who would otherwise not have received bank funding.

As the CBI has just argued, at a time when our economic prospects are improving, this is not the moment to pull the Government’s support away from the economy. Given the lingering impact of the financial crisis and the continuing tight credit conditions the CBI is right to say that the fiscal and monetary stimulus are both still needed. They are in good company: across the G20 economies there is unanimity that early exit from the stimulus measures would put the recovery at risk. Our big immediate challenge is locking in the recovery, not wrecking it.

Luke is of course right that we need a long term policy for rebalancing the public finances. But growth is the best counter to recession and the best antidote to debt. And that means maintaining the present course: underpinning demand in the economy, sorting out the banks, stopping unemployment becoming long term joblessness, especially among the young, and coordinating these policies internationally and in the EU. The Government needs to support investment in our future skills, technologies and growth markets and sectors from where many future jobs will come.

Reducing the financial deficit is not a question of if, but when and how. We all know that. But an approach to rebalancing the public finances that is too early, too hasty, or too indiscriminate would undermine the very growth on which locking in the recovery depends. It would send unemployment and its costs soaring, thus causing the deficit to spiral, rather than cut in half in four years, as we have announced our intention to do. Professor David Blanchflower, the recent member of the Bank of England Monetary Policy Committee, has warned of the acute dangers to employment that would arise if spending – public spending – cuts are made too early and if the fiscal stimulus is withdrawn straight away. Frankly, those who advocate this course are either economically illiterate, or irresponsible, or both.

We all recognise that the next few years are going to bring real constraints. I have no more time than you do for airy-fairy wish-list politics. But neither do I have any time for shallow analysis or short term headline grabbing.

And as a frontline sector that depends on demand and growth more than most – retail is right to challenge government to get this right. I accept that challenge. Tonight I want to recognise the role of this critical sector and lay down some challenges of my own to you, on low carbon and skills.

The Retail Revolution:

I got pretty used to hearing from the BRC when I was EU Trade Commissioner. Because this is an industry that is built on trade, and global trade in particular. Globalisation has transformed your supply chains and the expectations of your customers.

The best British retailers have seized on that change as a driver for diversity and growth. They’ve built strong national brands, then exported those brands around the world. You now employ one in ten British workers.

I know that you spend a lot of time and money working out what your customers want and think. And it’s worth looking at the next decade through their eyes for a minute.

They’re going to put a greater emphasis on paying down personal debt and thus value for money. Their whole idea of personal service and convenience is changing driven in part, but not totally, by the internet. They’re bringing all kinds of other factors into their choices as customers: the environment, ethical sourcing and animal rights standards.

And in part because retail is often being done in ways other than over an old-fashioned counter, they’ll want high standards of service and client care. It does seem to me that for all the scale of big retail in the UK, the customer remains firmly in the driving seat. And that’s exactly as it should be.

Our basic challenge in government is to make sure that you have the flexibility to respond to that demand, and to keep on innovating. And yes Luke, I agree with you not to place an intolerable level of regulation on you that is not sufficiently tested and justified.

A big part of that is just working to keep markets open and competitive, so you can source goods and trade effectively; and on establishing a modern, digital infrastructure you and your customers rely on. I feel very passionate about that not only in my Department, but in the Government as a whole.

It also means a consumer law framework that is modern and transparent, as we argued in our recent Consumer White Paper. We’re working with you on making sure that you don’t have to be a lawyer to understand your consumer rights in this country.

And while I obviously hear Luke’s messages on the retail environment, it is worth remembering that the UK has probably the most open and competitive High Street in Europe, backed up by a flexible labour market and some of the lowest business tax rates in Europe too and that’s how we want these conditions to remain.

Growth through a low carbon future:

Of these customer expectations the low carbon transition is perhaps the most far reaching. Because it is more than just a customer preference – it’s a social imperative. We don’t just need to tap into green consumerism, we need to create and encourage and nurture it. Retailers have a major part to play both as adopters and advocates of low carbon processes and behaviours.

Initiatives like the BRC’s Better Retailing Climate are making a difference, and I welcome that. I want to harness that energy and experience as much as we can.

The 1 in 4 of our working population, who have retail experience add up to a huge store of low-carbon literacy that we can inject into our wider economy.

That’s why we’re going to work on a Low Carbon Action Plan for Retail. And I’ve tasked BIS officials to work quickly with you and our colleagues at DEFRA to develop this plan.

Investing in our people

Finally, I want to say a word about your other key constituency. Your workforce. It’s not really an exaggeration to say that the prosperity of the UK is built on productivity. With margins like yours, that is hardly news to any of you.

But we need to look at these issues from more than just the bottom line. Productivity is ultimately about skills.
Skilled workers are more motivated, upwardly mobile and loyal. And with almost 3 million employees, the UK retail sector is one of the most successful in creating employment opportunities for the long-term unemployed, older people and flexible workers. I commend the way you have tapped into these forces in our workforce.

It’s got a long, impressive history of people working their way from shop floor to boardroom, from market stall to multinational. Probably no other industry in the UK can match that record.

Over the last few years, we’ve had bankers without banking qualifications. But I find it hard to imagine a retail CEO who didn’t know their way round a shop floor.

So I want to lay down my second challenge of the night: that you work with us to enable more people to progress through a career in your industry. And you ensure that, across this sector, a job in retail is a ladder up.

I know there’s already a lot of good stuff happening such as through apprenticeships and the new retail qualifications framework.

But we need more businesses, big and small ones, to get involved – to recognise that there are no diminishing returns on investment in staff skills.

And in the coming months, Government will be launching our new Skills Strategy, setting out how we aim to meet the skills needs of this and other sectors in the future. The skills that underpin the retail sector are of course part of that.

Conclusion:

Retail is on the frontline of this recession. Thousands of businesses are working hard to respond and survive, drawing on the innovation and flexibility that’s helped them to succeed in a tough, changing retail environment.

Together, we’ve got to build on that strength for future success – increasing skills, developing a lead in low carbon and maintaining a business environment that supports the creation of wealth and jobs. And I look forward to realising this sustainable future with you in the months and years to come.

Thank you.

Vulnerable workers will be able to seek advice about their workplace rights and report abuses of those rights through a new helpline launched by Business Minister Pat McFadden today.

The new Pay and Work Rights helpline is part of a wider campaign to raise awareness of workplace rights enforced by Government. It provides a unified point of contact for both employers and workers.

The helpline telephone number is 0800 917 2368.

It has been developed in cooperation with employers, trade unions and the different enforcement agencies across Government.

The employment rights in question are:

• National Minimum Wage
• Agricultural Minimum Wage
• Working Time (48 hour average working week)
• Employment agency standards
• Gangmaster licensing

Previously calls on each of these rights were taken by five separate Government bodies. Workers can now report abuses of these rights to one point of contact that can address multiple complaints.

The launch of the single helpline comes as a new poll showed that nearly half of people (48 per cent) wrongly thought employment agencies can charge workers a fee for finding them a job.

Business Minister, Pat McFadden said:

“This Government has done a lot to improve rights at work but it’s also essential to make sure these rights are properly enforced. A simple system for reporting abuses and giving advice and information to employers and workers is a critical part of that.

“By consolidating the current complex system of different helplines for different issues into one single number we are making it easier for workers to report abuses and for Government to respond. We want to transfer the burden of navigating the system from the worker to the Government. This is an important step and we are determined that the recession does not become an excuse to deny people their basic rights at work”.

The helpline is based in Manchester and staffed by specialist, trained advisors able to offer help and advice. Information is then passed to the relevant enforcement body to take further action where appropriate.

Video
A video has been produced to explain how the line will work and allows the specialist, trained advisors that staff the line explain how they can help:

Photos
The below photos are available for download and reuse from the BIS Flickr site.

Mr Lucas made the comments as he published the Department for Business, Innovation and Skills’ (BIS) response to the Business & Enterprise Select Committee’s report, The Automotive Industry in the UK.

Government has already taken substantial action to support the UK car industry and last week made the first loan from the Automotive Assistance Programme (AAP). Tata Motors European Technical Centre plc (TMETC) has been given a £10 million loan to support the production of electric vehicles in Coventry.

Business Minister Ian Lucas said:

“These are tough times for the car industry, and because it is one of the key sectors of our economy we must support it now and in the future.

“We have acted to support it in the short term through £300 million support through the scrappage scheme, helping over 200,000 people to order a car now instead of waiting, and I have heard direct from the industry that it has benefitted enormously from the scheme.

“Our assistance does not stop there. It’s not just about what we can do in the short term. We must invest in the future. That’s why, in addition to AAP, we are helping the car industry to take advantage of the opportunities that moving to low carbon represents. We have already set aside £250 million for consumer incentives and infrastructure, and we will continue to support low carbon car development.”

Ministers continue to consider a number of other bids for assistance from the programme’s budget to help the industry meet consumer demand, protect it from the downturn and help it become a world leader in low carbon cars. There are already ongoing negotiations with companies on more than £1 billion of applications with a total project  value of some £2 billion. The Government is also considering applications to the scheme that are below the £5 million project limit in order to extend support to smaller companies in the supply chain.

Notes

1. View a copy of the Government’s response to the BERR Select Committee’s report The Automotive Industry in the UK.
2. The Automotive Assistance Programme (AAP) is the Government’s long-term reinvestment of the automotive industry through a support package. It provides loan guarantees (or, exceptionally, loans) to the UK automotive sector.
3. The AAP aims to unlock a total bank and EIB support package of up to £2.3 billion to provide support for automotive companies as they invest to create or sustain jobs, develop cutting-edge technology, bring special value to the UK, maintain R&D in UK vehicle manufacturing and support the development of green technologies.
4. To be eligible, vehicle manufacturers and/or suppliers need be viable as at 1 July 2008, with turnovers in excess of £25 million, who wish to undertake a project valued at £5 million or more. The projects could not otherwise be undertaken without government support.
5. The scheme was announced by the Secretary of State on 27 January 2009, and received state aid clearance on 27 February.
6. The Business & Enterprise Select Committee launched their inquiry into AAP on 25 March, and published their recommendations on 17 July.

The event, titled “Science reporting: is it good for you?”, was chaired by Radio 5 Live presenter Simon Mayo.  Scientists, science communicators and journalists also took part in the debate, both live at the event and online via Twitter.

Free tickets to the event sold out in just 90 minutes after they were announced on Twitter. If you missed the debate you can watch it on demand at the Times Higher Education website here.

To follow the discussion on Twitter, use the hashtag  #scidebate

For photos of the event, visit the BIS Flickr album. Images are available for re-use by media and bloggers under the creative commons license.

A total of £2.46 million will be made available to help unions improve their ability to meet the needs of hard-to-reach groups of vulnerable workers. It will be matched with at least an equivalent union contribution.

The money will be distributed under Round Three of the Union Modernisation Fund which provides financial assistance to trade unions and their federations for innovative projects with the potential to transform their effectiveness. Bids are assessed by an independent Supervisory Board comprising individuals from union, academic and industry backgrounds.

Speaking at the TUC Annual Congress, Minister for Employment Relations, Lord Young said:

”The latest round of the UMF focuses on protecting some of the most vulnerable people in the working population. Unions have demonstrated genuine enthusiasm for helping vulnerable workers and working with community and voluntary organisations.

“The overall quality of the applications was very high but the bids selected for funding are those which are the most forward-looking and offer the most transformational potential.

“I’ll be following all the projects with interest as they go on to develop new services and design innovative mechanisms for accessing hard-to-reach groups of vulnerable workers”.

A total of 23 applications were received with successful bids including projects from the TUC, GMB, Unison and a range of other unions.

The full list of projects is here

The report shows that a number of significant achievements have been made in the last year, with the passing of the Climate Change Act, developments under New Industry New Jobs, publication of the Low Carbon Industrial Strategy, and the UK Low Carbon Transition Plan.

One example of these steps towards a greener construction industry is the commitment, by construction organisations representing more than a quarter of the industry by value, to the Strategy’s Halving Waste to Landfill target.

The Strategy is also supporting the work of the UK Low Carbon Transition Plan, which is on target to achieve a 34% reduction in greenhouse gas emissions in the UK by 2020.

Ian Lucas, Business Minister with responsibility for construction said:

“This progress report demonstrates the Government’s commitment to put in place measures to drive forward the sustainability agenda and support industry with these aims.

“I am pleased to see we are making steps towards reaching these targets, but there is further work to be done to build on these achievements and reach the overarching goals of the Strategy.”

Ian Pearson, Economic Secretary to the Treasury, the minister responsible for improving the sustainability of operations and procurement across Government said:

“We’ve made great strides to develop an effective working relationship with industry to deliver our sustainability objectives, in particular the work led by the Office of Government Commerce on improving the sustainability of the Government’s estate.

“Now our challenge is to maintain this momentum in the face of the current economic climate to ensure we continue to improve the estate and meet our Climate Change Act targets for 2020 and 2050.”

Graham Watts, Chief Executive Construction Industry Council said:

“The first annual progress report from the Delivery Board responsible for rolling out the Strategy for Sustainable Construction shows that much very good work has been done since the strategy was launched in July 2008 but that there remains a great deal yet to do.  The industry – in its broadest sense – is certainly alive to the need for sustainable construction and to the importance of the Construction Commitments and the progress report serves as a very concise point of reference with which to assess progress and exert more combined effort from government and industry”

The construction programme of the London 2012 venues and infrastructure is an example of sustainable construction in action, with the Olympic Park being built to the most comprehensive range of sustainability criteria ever adopted by a large scale project in the UK.  Recycled materials have been used to build the site, and more than half of these have been transported to the site by low carbon transport.

Moving forward, the delivery of the Strategy will be overseen by the newly announced Chief Construction Adviser who will be chairing an enhanced Delivery Board for the Strategy.  This will ensure a higher level of cooperation and accountability between Government and industry in the delivery of its sustainable construction agenda.

Read the Progress Report on the Sustainable Construction Strategy here

Speech by: Lord Drayson
Venue: Saïd Business School, Oxford

CHECK AGAINST DELIVERY

Good afternoon, everyone.

This forum takes place almost exactly a year since barely credible events on Wall Street signalled a dramatic turn for the worse in terms of this global recession. And it’s almost a year since I returned to the Government with responsibility for science and innovation. No connection, I assure you!

Today, I want to reflect briefly on where we are now – and where we are going.

But first, let me simply point out that although I stand here as a minister, I have 20 years’ experience as a science entrepreneur. I’ve been through the stresses of building companies during previous recessions: the bank manager threatening to put my company into receivership; the horrible job of making colleagues redundant; learning the hard way that, in a downturn, an entrepreneur has two jobs – first, survive, and second, plan for the upturn.

I have also served as a member of Oxford’s technology transfer board and on the university’s VC fund board, so I witnessed first-hand the transformation of our top institutions – their growing success at translating IP into profits, their improved attitude to academics pursuing commercial possibilities arising from their own research.

So I know all about the quality of our university spinouts – and the opportunities available for smart investors, especially at a time when asset prices are cheaper and potential returns that much greater.

A year ago, we needed to provide businesses with immediate practical help so they could ride out the downturn and emerge ready to exploit the upswing. The UK needed a strong industrial strategy, focusing on what we do best and fighting hard to keep it on these shores. And we had to get to grips with the problem of scale in early-stage VC, because good quality start-ups with promising intellectual property were withering on the vine.

I believe that we’ve made definite progress on these three fronts.

In terms of tangible help for companies, almost 5,000 businesses have been offered loans worth around £500 million under the Enterprise Finance Guarantee. Almost 200,000 agreements have been reached with companies to spread more than £3.4 billion in business taxes.

“New Industry, New Jobs”, meanwhile – launched this Spring – sets out the Government’s strategy for creating the best possible conditions in which UK businesses can thrive in those industries most likely to drive economic growth and create high value jobs. It explains what we will do to improve Government’s role as both customer and regulator, and in areas like skills development and support for small businesses. The Department for Business, Innovation and Skills has been charged with making it happen.

Here’s what that means in practice.

I’ve been heavily involved, for example, in establishing ways to transform the operating environment for one of the key growth sectors: life sciences.

The Office for Life Sciences, created in January, gave itself six months to produce a strategy to that end – driving innovation within the NHS, stimulating investment, making the industry more integrated and marketing it more effectively.

We were true to our word. In July, we announced a range of policies, including the Innovation Pass – a 3-year initiative allowing patients faster access to innovative medicines – and a regenerative medicine investment programme to commercialise R&D.

For me, the Office for Life Sciences has set an important precedent for how we implement industrial activism. It means business coming together with the research base and representatives from across Whitehall to agree the way forward. It means timetabled actions, not vision statements, to establish a global lead in areas where demand is clear and growing – ie focusing on growth to rebalance the economy.

Healthcare is one such area. Ultra low-carbon vehicles is another, where we’re applying the same model.

The new Office of Low Emission Vehicles also has cross-Whitehall participation, and it’s working with the automotive industry, power generating companies and others to exploit commercial opportunities and address the drivers of change. That will involve continued vehicle design and production, infrastructure development and devising the right incentives to affect consumer behaviour.

OLEV is part of a £250 million scheme to deliver a green motoring transformation, as the UK seeks to be first to electrify personal transport.

But let me devote the bulk of my attention to the VC space.

While we’ve taken steps to provide certainty about the future of the Enterprise Investment Scheme and Venture Capital Trusts – so that higher-risk SMEs can continue to secure finance – the key recent development is the new UK Innovation Investment Fund.

Many tech-based businesses are currently fighting for survival in a climate where it’s extremely hard to attract capital for investment and where it’s difficult for investors to sell or go public with other investments as a means to raise capital.

The UKIIF provides hope for many of the 1,100 tech-based businesses dependent on equity finance in the UK: in digital and life sciences, in clean tech and advanced manufacturing – the growth areas of the future.

It will be a 10-year fund of funds with a cornerstone investment from the Government of £150 million to leverage private investments up to a total of £1 billion. Three departments – Business, Energy and Health – have invested, from the conviction that supporting VC-backed companies is an essential way of driving innovation.

We’re currently recruiting a professional and experienced fund-of-funds manager, with a view to the fund being operational by the end of this year.

At that point, it will invest in a limited number of top-tier technology funds, with proven ability to generate returns. The Government will not be involved in investment decisions whatsoever. There is no political agenda.

This is about helping UK venture capital to reach the next level, through a large fund that replicates what the best of US funds already do – making investments at all stages, with the kind of scale that can build companies with global reach.

We have the technology. We have the management. We will have the capital.

That’s why we’re keen to bring in as much private sector investment as possible, and will be marketing the fund both in the UK and globally.

UKIIF represents a great opportunity. The timing is right. The capital commitment from the Government means a significant fund. We can exploit the fruits of our record investment in UK science over the past decade – which has made the research base stronger now than it’s ever been. And we will appoint a manager with the necessary expertise to generate a top-quartile return for us and other investors.

Between real help for business and concrete actions to implement a new industrial activism, I believe we have a good plan to build Britain’s future on the back of our leading position in science.

We are on the verge of getting out of this global recession, and there are some encouraging signs that recovery is underway.

What’s critical now is that we do the right things to drive that recovery on.

Like spending wisely on the programmes that are working, cutting the ones that aren’t, and insisting upon value for money in public services.

Like never losing sight of the fact that the best antidote to public debt is growth: growth that’s generated by science entrepreneurs and engineers taking calculated risks to build fantastic businesses, create jobs and get rich – for themselves, their families and their employees.

One year on from Lehman Brothers, and there’s still a great deal of soul-searching about City bonuses and ill-conceived incentive schemes that encouraged the wrong kind of risk taking.

Reforming the culture of the City clearly remains a priority, but my concern today is that we must not allow that agenda to obscure the need to encourage wealth creation. Our economic future depends on it

The bankers aren’t the issue right now. Science entrepreneurs – and the people who back them – are the ones who count now. People like you.

As we emerge from the downturn, the baton passes to you.

Now is the time to back our high-growth, science-based companies. At this stage in the economic cycle, my entrepreneurial experience tells me that this is the time to invest.

This Government is right beside you. We’re determined to support an economy that enables sustainable wealth creation and entrepreneurship. That removes the barriers and celebrates the successes of our science entrepreneurs – like those competing for the new iAwards this November.

Britain is already the best place in the world to do scientific research. We need to make it the best place in the world to build a science-based business too, and the best place to be a science entrepreneur.

I’d like us to spend the rest of our time today talking about how we do that.

Thanks for listening.

Ladies and gentlemen. Thank you Ron.

I am very pleased to be here today to help launch this year’s National Consumer Week.

This is an important event in the Trading Standards calendar – and I want to thank you all for the work you do in safeguarding communities and tackling the rogues and criminals who blight our society.

This year’s theme – Know Your Consumer Rights – is an important one.

The last year has been very difficult for everyone, with tough economic conditions putting real pressure on consumers.

It is, therefore, as important as ever that consumers are able to shop with confidence and know their rights in all situations.

As the Department for Business, we remain committed to being the voice for consumers. Committed to creating a consumer and competition regime that puts consumers at the heart of our economic prosperity.

Earlier this year we published our Consumer White Paper, which set out how we will deliver real help for consumers now and make changes to empower and protect consumers in the future.

This includes providing:

• Self-help debt advice to help people take control of their finances;
• Tougher powers for dealing with rogue traders;
• A review of the regulation of credit and store cards; and
• A ban on unsolicited credit card cheques.

We will also be introducing a new consumer advocate, whose role will include improving the co-ordination of consumer education and information campaigns.

And we will set up a new national specialist team for internet enforcement to tackle scams which rip off consumers and deter many from buying goods and services over the internet.

All this builds on much of the work we have already done to help consumers in the last year, including more funding for debt advisers, tackling rogues through the Scambusters initiative and cracking down on loan sharks.

The Know Your Rights Campaign

A big part of the new strategy is about improving consumers understanding of their rights. Empowered consumers who know their rights are confident consumers – and confident consumers spend the cash which helps business grow. So everybody wins.

And there’s a strong case for improving awareness.

My department receives many letters from consumers who have to fight for their rights. They may not always make the headlines, but their stories will be familiar to us all.

For example, how often have you taken a faulty product back to the supplier, only to be told that it’s outside the warranty period so you’d have to pay for any repairs or replacement yourself?

That happened to a lady from Cumbria, who bought an engagement ring, only for two of the diamonds to fall out of their setting. It was outside the guarantee period and the shop refused to pay for repairs.

Unsure of her rights, she sought advice from Consumer Direct and was told that under the Sale of Goods Act a product should be of satisfactory quality. The expiry of a warranty cannot take away from that.

Armed with this knowledge, and a template letter downloaded from the Consumer Direct website, she wrote to the store and received an immediate response and a full refund for the entire cost of the ring.

It’s one of many stories – but they don’t always have a happy ending.

In research carried out by BIS recently, we found that more than a quarter of shoppers are more likely to complain about goods they have bought during the recession.

According to Consumer Direct, the top ten most complained about goods so far this year include TVs, laptops and women’s clothing. And top of the list (surprise surprise) was second hand cars.

While many people say they are confident in using their rights, we have found that large numbers of shoppers – mostly those from poorer backgrounds and young people especially – have little knowledge about these rights.

And evidence suggests some businesses still need to improve their attitude to consumer rights. Our research showed around a third of shoppers felt retail staff had tried to ignore their consumer rights when they tried to return goods or get a refund.

But it’s not just about shopping in the High Street. Consumers are now just as likely to buy their goods on-line – and feel just as likely to be ripped off.

The on-line shopping market has grown rapidly in the last few years – worth more than £21 billion a year in the UK alone. More than 20 million people shopped on-line last year. And this figure will continue to grow.

So today I am pleased to be able to launch the ‘Know Your Consumer Rights Campaign’ (also a White Paper pledge) – a joint initiative led by BIS with Consumer Focus, OFT, Consumer Direct and the Trading Standards Institute.

The message at the heart of our campaign is simple – know your basic consumer rights. Remember, all goods must:

• Fit the description given
• Be of satisfactory quality, and
• Be suitable for purpose

And we say to people – if you want to find out more about your rights, contact Consumer Direct, the national advice body for information about consumer rights.

Consumer Direct has been a big success since it was launched by my department in 2004. Now managed by the OFT, it answered almost 1.6 million calls and e-mails in the last year. These include more than 870,000 complaint cases – a year-on-year increase of almost five per cent.

The OFT estimates Consumer Direct generated £127m in savings for consumers.

Our campaign will involve working in partnership with retailers in-store and online to convey these messages.

The campaign already has the support of business as well as consumers. Companies we spoke to as part of our Consumer Law Review last year said good business has nothing to fear from consumers knowing their rights.

In fact, those that do best are those who understand their consumers and are quick to fix problems when they occur.

That’s why I’m pleased that so many big name retailers have already signed up to support our campaign, including Tesco, Asda and the DIY retailers B&Q and Wickes.

We also have on-line partnerships with clothing outlets Asos.com and Figleaves.com as well as Whatafind.com.

A big thanks to all of those retailers. I see that many of them have representatives here in the audience today.

But this is just a start and we want to encourage more firms to come on board and help us promote consumer rights.

Conclusion

Today consumers will be able to speak to advisers about their consumer rights on this special exhibition stand.

The TSI will also be holding sessions at Bluewater for businesses who want to know more about improving training for staff to better understand consumer rights.

The campaign will continue over the months ahead. Our goal is to create better informed consumers. Consumers who know they have rights and know they have the full protection of the law when they need it.

It is these consumers who can best contribute to the economy, spending with confidence and helping UK business prosper and grow in the global marketplace.

Thank you

The Know Your Consumer Rights campaign begins as a new BIS-commissioned survey shows that one in three people feel their consumer rights have been ignored. And more than a quarter of people (28%) say they are more likely to complain about goods they have bought during the economic downturn.

Consumer Minister Kevin Brennan said: “Robust protections are in place to support consumers. But we want to see a dramatic improvement in awareness of those protections and rights.

“Knowledgeable, confident consumers are much more likely to get a fair deal, save money and get the right result when things go wrong. This is especially important in the current economic climate, when every penny is even more precious than usual.”

The survey of 2,000 people found that 58% have complained to a store about goods, asked for a refund or an exchange between one and three times in the past three years. A third of respondents have done so more than three times in the past three years.

Know Your Consumer Rights is focused on making sure consumers know they are protected and are confident using, the key legal rights if something goes wrong:

• Goods must fit the description given.
• Goods must be of satisfactory quality.
• Goods must be suitable for purpose.

The campaign is signposting people through to the Consumer Direct website for more detailed advice on their rights.

BIS is working with the Office of Fair Trading, the Trading Standards Institute, Consumer Direct and Consumer Focus to deliver the campaign, which will run until 2010.

Vivienne Dews of the Office of Fair Trading said: “When people are aware of their rights and businesses respect their obligations, consumers can shop with confidence, which is good for them and good for business.”

Read more on the Consumer Direct website

The Know Your Consumer Rights campaign also aims to provide best practice advice and training to businesses.

Visit BusinessLink for free online training and information

The 2008 Fair Treatment at Work Survey (FTWS) also shows that problems with specific employment rights have fallen with more people prepared to seek information and advice on problems that do arise. In particular, problems with pay and working time (including annual leave) have more than halved since 2005.

Minister for Employment Relations, Lord Young, said:

“The results of the Fair Treatment at Work Survey are very positive. They show the real progress we have made in raising awareness of workplace rights amongst employees and employers”.

“But whilst these are good results, there are a number of vulnerable groups who are still more likely to have problems at work and be less aware and knowledgeable about their rights than the general population. That is why the Government will be announcing further help for vulnerable workers later this month”.

Key findings include:

78 per cent of the working population feel well or very well informed about their rights generally compared with 65 per cent in 2005

85 per cent claim to know where to find information on their rights if they need it compared to 76 per cent in 2005

Specific employment problems affect around 27 per cent of the working population compared with 41 per cent in 2005

In particular problems fell significantly with; pay (22 per cent in 2005 to 10 per cent in 2008), hours/days required to work (12 per cent to 6 per cent); rest breaks (13 per cent to 5 per cent) and annual leave (13 per cent to 5 per cent).

More people with problems are prepared to seek advice or information for their problem (72 per cent) compared with 2005 (53 per cent)

The Government is currently in the second year of a three year campaign to raise awareness of the workplace rights they enforce. The first year targeted agency workers, and led to an increase of 300 per cent in calls to the Employment Agency Standards Inspectorate helpline. The next stage of the campaign will be announced later this month.

Gervase MacGregor FCA and Guy Newey QC were appointed as inspectors under section 432 of the Companies Act 1985 and instructed to investigate the affairs of MGRG, its parent company Phoenix Venture Holdings (PVH) and MGR Capital Limited between the purchase of MGRG from BMW in May 2000 and the date of it entering administration.

The inspectors investigated the actions of the directors of PVH throughout their 5 year ownership – particularly Peter Beale, John Edwards, Nick Stephenson and John Towers, known as the Phoenix Consortium.

They also investigated restructuring changes within the Group which led to the creation of 33 separate companies throughout that period; the scale of financial rewards made to the directors and the events which led to administration itself. This included the role of Government to secure bridge finance while take-over discussions took place with Chinese car manufacturers Shanghai Automotive (SAIC).

The inquiry studies the role played by professional advisors including auditors and corporate finance advisers Deloitte and lawyers Eversheds; aspects of corporate governance; and financial statements and audit arrangements including the transfer of assets.

Report on the affairs of Phoenix Venture Holdings Limited, MG Rover Group Limited and 33 other companies – Volume I – size 3.5 MB

Report on the affairs of Phoenix Venture Holdings Limited, MG Rover Group Limited and 33 other companies – Volume II – size 3.0 MB

Good morning everyone. It’s a great pleasure for me to be able to join you this year.

It is great to be in Edinburgh, and to see an example of the breath of higher educations intuitions – ancient and modern, generalist and specialist. Their contrasting histories, strengths and plans for the future illustrate not only what makes Scottish higher education such a vibrant place, but also the reasons why I feel such excitement when I look around British universities as a whole.

Your President said earlier that it’s wrong to see our university system as a hierarchy rather than as a series of institutions with overlapping and contrasting missions. That is a view with which I associate myself fully.

Yesterday evening over dinner I was glad to renew some of the acquaintances I’ve made in the English university system. But I was also especially pleased to have the chance to meet university leaders from Scotland, Wales and Northern Ireland.

And it was, of course, a special pleasure to be able to congratulate Tim O’Shea on his appointment as chairman of JISC.

Last year in Cambridge, I know that John Denham spoke to you about how many new developments there had been for the sector in England in the first year of the Department for Innovation, Universities and Skills.

As if to prove John’s point, the world has now moved on and DIUS itself is now a part of history. But change continues. Not least here at UUK with the arrival of Steve Smith and, only last week, Nicola Dandridge. I wish them both well in their new posts.

Of course, Steve has already made a significant contribution to the debate on higher education – whose progress was the theme of John’s speech. The debate has carried on since the creation of the new Department and is now moving towards its conclusion.

Autumn will be busy, and this year feels busier than last. A new framework for higher education in England will be presented by Peter Mandelson.

We’ve made clear that we want the Framework to describe the vision of how Government will support universities and employers in working together to balance the supply and demand of high-level skills and the many other economically valuable things that our universities deliver.

My colleagues and I see universities as being central to our efforts to build a strong economy. My Department’s expenditure on higher education in England this year will be over £10 billion. And that’s not including more than £3 billion of the UK science budget, a large part of which of course goes to universities. One of the ways the taxpayer’s investment in the system is repaid is in the stimulus for economic growth that it delivers back.

The economic focus of the Framework will be of particular benefit to the key growth sectors we identified in the New Industry, New Jobs strategy paper. We are also working with HEFCE to look at how we can develop the funding model to help the sector further increase its economic contribution. That may mean making a larger proportion of funding contestable. But that raises important and complex questions, and our thinking on it is still developing.

That’s why the Framework is likely to ask you to move further and faster down the path you’re already on towards greater emphasis on economic outcomes. But it does not mean that we intend to take an instrumentalist approach to higher education, nor to abandon the belief that the pursuit of knowledge is a valuable end in itself.

The recession is producing challenging times for universities, just as it is for other sorts of businesses. And those of us in Government face real challenges ahead, too.

I don’t pretend the current position is easy and that we don’t have a huge task before us. But it’s a task we are determined to carry out successfully. And I know it’s one in which we have the full support of the university sector.

Let me quote just a few examples of what you’re already doing to help.

This year, there will be more students going to university than ever before, taking advantage of the record number of funded places on offer. We expect 50,000 more accepted applicants than just three years ago. And we announced in July an extra 10,000 places to support the new industries new jobs initiative. This will help to absorb the extra demand for places we have seen this year and the pressures your institutions have faced during clearing.

I must pause here to say a special thank-you to those institutions that have taken up the challenge of making these new places available at short notice.

We have also continued to expand Foundation Degrees and look likely to achieve our target of 100,000 participants next year. Likewise, the signs are that we hit our target of 5,000 employer co-funded higher education places this year.

Not only are we working to increase the vocational impact of higher education itself. We’re also trying to create more routes into higher education for people who hold vocational qualifications. Already, over 100,000 of them enter university every year. We need to grow that number, and grow it rapidly.

The interim findings of a study led by Professor Joy Carter raised a number of issues around progression to higher education through vocational routes that are helping to inform our thinking around the new Framework. I look forward to receiving her final report this autumn.

Clearly, there remain longstanding difficulties associated with any effort to promote parity of esteem between vocational and academic pathways. Many of these seem to stem from some people’s scepticism about the value of vocational qualifications and limited – albeit growing – exposure to them.

That’s why I warmly welcome the work that’s being done to improve the position. I want to especially welcome the progress that has been made towards a tariff rating of apprenticeship frameworks.

We have brought the worlds of higher education and of work closer together in other ways, too.

We have created the Economic Challenges Investment Fund in which HEFCE and the sector jointly fund initiatives to help economic recovery and which will benefit over 11,000 business and 50,000 individuals. Without your sense of initiative and willingness to roll your sleeves up that just wouldn’t be happening.

And we have introduced many graduate internships. There has been strong progress on these. We have hit our initial target of 5,000 places early, and are now moving well beyond it.

So I’m very pleased to be able to announce today the creation of up to 1,500 more placement opportunities in a new Graduate Low Carbon Future Leaders scheme.

Initially, these will help support the low-carbon marine energy industry in the South West of England and the low carbon vehicle industry in the North East. The scheme will benefit graduates by giving them hands on experience and improving their job readiness in an emerging sector of the economy where future jobs growth is predicted. Your universities will be key partners in delivering this scheme.

While I’m on the subject of the importance of giving young people practical experience of work, I want to say a special word about apprenticeships, which were a subject close to my heart even before I became Skills Minister back in 2007.

Apprenticeships have always laid a firm foundation for careers in manual trades. But we’ve proved that these days there’s no reason why the same model shouldn’t be used to open up routes into less traditional areas – like the professions and the public services. That includes the university sector. Some institutions are already to offering apprenticeships, but many others aren’t. And that’s why I want to encourage those of you whose institutions aren’t yet involved to take advantage of the work UUK and GuildHE doing to help institutions which have offered apprenticeships to share their experience with others.

UUK’s publication From Recession to Recovery showed very clearly that our universities are standing by Britain at a time when what universities produce has never been more necessary. And in its turn the Government has stood by them. In funding terms, universities have had it good for more than a decade.

Nevertheless, it’s no secret that current levels of public investment are unlikely to be sustainable in future. And indeed, I know that you’re already feeling the pressure that comes with the need to make more efficiencies.

The sector’s future prospects depend on how you face up to the financial challenges that are coming. Not least, that includes by taking a disciplined approach to pay and pensions.

But there are also more positive steps you can take, like continuing to diversify your sources of income by encouraging endowments or providing bespoke training. And by making the most of the knowledge that you produce.

Even in a tight spending environment, there’s no reason why your income can’t increase. Steve Smith spoke earlier about the proportion of GDP that this country spends on higher education being half that spent by the USA. And he’s right. But spending relative to GDP isn’t just about the Government. Private investment in universities has not kept pace with the huge increases in public spending that the last decade has brought. Any sensible analysis can only conclude that you need to find new ways to leverage more private money into the system.

And you need to make sure you take advantage of opportunities – international as well as domestic – whenever they arise.

I’ve just got back from a trip to the USA. There, President Obama recently announced a new billion dollar investment in science and research as part of its stimulus programme. That means a lot of money going into US universities and a lot of US universities looking for research partners abroad. Officials in the Department of Commerce, the White House, and in universities confirmed the importance of this investment.

While many British institutions are able to make some use of partnerships individually, the British Ambassador to the US was clear that corporately and collaboratively there is more to do.

That is why I have set up a new advisory forum under my chairmanship – the International Education and Research Advisory Forum – to bring together representatives from across Government and the higher education sector, including the British Council, to develop a more strategic and joined-up focus to our international work. The Forum had its first meeting earlier in the summer and will meet again in November.

Benefiting from knowledge transfer and the intellectual property that flows from it depends on a strong research base, a strength that was confirmed by the results of last year’s Research Assessment Exercise. A large part of the value of the RAE was that it was a UK-wide exercise that allowed the benchmarking of all our institutions. And that is why I welcome the involvement of the authorities in Scotland, Wales and Northern Ireland in the development of the new Research Excellence Framework.

In a few weeks time HEFCE will be consulting on proposals for the REF. For the first time, the REF will explicitly assess the impact that this excellent research has on the economy and society.

And since these impacts are things that happen outside of the academic realm, the consultation will propose that the panels assessing impacts will include a large proportion of the end-users of the research – businesses, public services, policymakers and so on – rather than just academics commenting on each others’ work.

I want the REF to send a strong signal and give a strong financial incentive for departments to not only do excellent research but find ways of helping turn that into impacts that benefit the economy and society as a whole.

Despite some people’s fears, we will not be solely asking panels to count the number of spinout companies or income from business. We will want panels to assess a whole range of impacts. Improved products and services for business are important, but so are things like improved quality of life, and better evidence-based Government policy-making.

Of course, the benefits to universities of producing research with impact aren’t only found in public funding. So it’s in everyone’s interests that we help you manage your institutions’ intellectual property effectively. That’s an area in which the new Department can help all UK universities. So we’re currently working with the Intellectual Property Office and UUK to update the handbook on intellectual property that they published in 2003.

Despite all I’ve said so far, I know some people don’t think our universities are doing a good job.

Last month, the chairman of the Innovation, Universities, Science and Skills Select Committee criticised you for failing to safeguard standards.

Personally, I regard Phil Willis’ comments – intentionally made on a Saturday morning to get maximum media coverage – as a piece of political grandstanding rather than a serious contribution to the debate. And I think the facts contradict him at every point.

I don’t recognise the picture he painted. I don’t think we need what amounts to a national curriculum for higher education and we certainly don’t need the ossification of the university system that would inevitably follow. And I don’t believe that diversity in the system is the same thing as inconsistency.

But having said that, I think there does remain a real challenge for you on quality in a consumer-driven 21st century.

Even if you aren’t complacent about quality, you sometimes appear to be. I think you have to recognise that and deal with it. This is indeed another area in which you have to get better at telling your story.

For English and Northern Irish institutions there will be an excellent opportunity to do just that over the coming months as you contribute to the development of the quality assurance system that will follow the current audit cycle. I know that the sector bodies are committed to developing a quality assurance system that is flexible and transparent as well as rigorous.
Clear and accurate information must be a big part of that. Learners need to know up front what their courses will involve, how much teaching they’ll get, how much independent learning is expected, and how they’ll be assessed. They should also know what happens to students when they graduate.

That’s why I’m very pleased to announce that HEFCE will be sponsoring research to find out just what information potential students want, so that they go to university understanding what to expect of their student experience.

Again, I’m not advocating a one-size-fits-all approach to things like contact hours and assessment methods. University teachers, like good teachers everywhere, need the space to express themselves and inspire their students. But I see no reason why, in any properly-planned course of study, it should not be possible to give prospective students a very clear idea of what they should expect. Quite apart from anything else, it’s more fun to teach well-prepared and motivated learners than students to whom everything comes as a surprise.

And I’m sure it won’t surprise you that this is a subject on which the Higher Education Framework will have more to say.

Quality is one of the main factors that attracts overseas students here. And the growing internationalisation of university curricula can only improve the quality of our own students’ experience.

And as we saw earlier this week, the most recent Education at a Glance figures from the OECD continue to provide evidence of our strong performance.

I know that many of you have been very concerned about the ability of the new points-based visa system to cope with the traditional August spike in applications from international students. I have been working closely with my Home Office colleague Phil Woolas to ensure that we get the balance right between maintaining robust visa arrangements whilst at the same time ensuring that institutions are able to recruit genuine international students simply and efficiently.

I was pleased to be able to host a meeting with Phil and vice chancellors towards the end of July to thrash out what were a few outstanding issues. And the latest information I have from the UK Borders Agency suggests that the teething problems that were experienced earlier in the year have by and large been resolved.

But internationalisation is not simply about numbers of international students choosing to come to the UK. The international activities of our institutions are as diverse as the sector itself. And increasingly we are seeing a greater emphasis on partnership-building and collaboration.

This is very welcome. But, as I said earlier, I also believe there is scope for this to be taken to a higher level as we look ahead. And here I think we in Government can help by providing a more strategic and clearer context within which institutions carry out their international education and research activities.

I know you have chosen European higher education as one of the themes of this conference and that is welcome. I attended the meeting of Ministers responsible for the Bologna process in April. One of the main issues we discussed was the importance of student mobility. And that’s a big challenge for you. We know from experience that compared to countries like France and Germany, significantly fewer of our students choose to spend time abroad.

I take that seriously. And it won’t come as a surprise to you that Peter Mandelson does as well. From our discussions I can tell you that his current responsibilities for trade as well as his experience as EU Trade Commissioner means he sees great value of initiatives like Bologna and the various European mobility programmes.

Employers tell us that they value the kinds of skills and experience acquired through periods of study abroad. And I have no hesitation in saying that is an area where we need to raise our game. So I urge all of you to look at ways in which course curricula can be adapted and made more flexible to include the possibility of short periods spent abroad . And I am not just talking Europe here – we should also think further afield in the big developing economies such as China and India.

I remain of the view that stepping up our efforts to “internationalise” university curricula can only improve the quality of our students’ experience.

I firmly believe that our university system and the values that it stands for must remain one of the forces that brings our society together and keeps it together. It has shown itself time and again one of the most powerful forces for social and economic progress that we have.

And that’s why it’s a pity that the general public doesn’t know enough about the contribution made by higher education to national life. Some universities have become very adept at marketing themselves internationally. But nationally, public perceptions of the social and economic successes of higher education throughout the UK often remain outdated.

About a year ago, I gave a speech in which I said that the contribution of British universities to their communities is every bit as strong as that of their US counterparts. That has been borne out by all you’ve done since then to help your communities in what is a difficult time.

But when I spoke last year I also pointed out the contrast between how much American universities make of their economic and social contribution and how little many of our own institutions do. Visit the website of any US State university and you’ll see what I mean. The payback that taxpayers get for their investment will be right up front – in words, in figures and in case studies.

I called on you then to emulate that example. For you not only to be proud of what you do, but to make the most of communicating it.

I repeat that call today. And in the current spending climate, I hope its importance will not be lost on you.

That’s why I’ve asked the Design Council to convene a workshop discussion of how the university sector can communicate its value better to a broader public. I welcome both UUK’s involvement in this work and Steve Smith’s acknowledgement of its importance in his speech earlier on.

I don’t want the outcomes of the workshop to be either soft soap or hard sell. But I do want us all to emerge with a better strategy for showing, not just stakeholder and those with an informed interest in higher education but also the people who pay for so much of higher education, the scale of the return that modern universities give on their investment.

20 years ago, a policy document called “Meet the challenge, make the change” was published by the Labour Party. In many ways, it marked the start of the process that brought us into government in 1997. The final thing I want to do today is to urge you to be equal to the challenges that change now poses for you. To be flexible enough to do what has to be done to keep pace with a changing world, yet strong enough to uphold the great values for which our universities have always stood.

How well you do that today will determine whether you’re able to deliver everything Britain asks of its universities tomorrow.

Thank you.

Many of these new business partnerships demonstrate UK capacity in low carbon business solutions, which will benefit British businesses while helping China meet its tough environment and energy efficiency targets.

Addressing a low carbon business solutions forum organised by UK Trade & Investment in Beijing on 8 September, Lord Mandelson said:

“Across the board, the UK can offer the knowledge, technology and experience to help our two economies de-carbonise. The UK has world-class climate change research institutions and consultancy services in carbon measurement and management. Our architects and engineers are creating designs for the low-carbon cities of the future”.

He later added:

“Pilkington, Greens Power, Zed Factory and The Carbon Trust are examples of outstanding UK companies working with advanced and low carbon technology. These new contracts not only demonstrate the strength of economic ties between the UK China, but also our shared commitment for developing a low carbon economy”.

As well as emphasising business to business collaboration, Lord Mandelson signed with the Mayor of Changsha, home to six million people in China’s Hunan province, a bilateral governmental agreement establishing Changsha as the third “Sustainable City”, alongside Wuhan and Chongqing. UK companies are well positioned to win business opportunities arising from the launch of the Changsha-Zhuzhou-Xiangtan city cluster project by Hunan government with an initial investment of 70bn RMB (£5.5bn) on 134 key projects.

In Beijing Lord Mandelson also argued for greater access for UK goods and services suppliers to China’s rapidly developing domestic markets. He was delighted to receive confirmation from the Chinese government that regulators are in the final process of approving a new business combination of Bank of China, Standard Life and Tianjin Economic & Development Area.

In Shanghai Lord Mandelson also attended the groundbreaking ceremony for AstraZeneca’s new US$100m Innovation Centre China in Zhangjang Hi-Tech Park – one of three flagship R&D projects by major UK companies in Shanghai, along with GSK and Unilever.

Premier Wen praised “the tremendous contribution made by Lord Mandelson in strengthening and deepening EU-China and UK-China relations over many years.”

The meeting was very friendly and warm and focused on a number of areas including strengthening co-ordination between the UK and China ahead of the forthcoming G20 Summit in Pittsburgh.

Both sides agreed on the need to keep markets open and resist any temptation to erect barriers to free trade. They were very clear that protectionism was not in the world’s interest and agreed on the enormous importance of concluding the Doha world trade talks as soon as possible.

Lord Mandelson, who was accompanied to the meeting by a British business delegation which has been with him throughout his visit to China, also stressed the importance of further work to allow companies to list and invest on each other’s Stock Exchanges.

Lord Mandelson and Premier Wen were united on deepening and strengthening co-operation between their two countries, Premier Wen recognising that China now invested more in the UK than in any other European economy and that Britain invested more in China than any other European country.

On climate change Lord Mandelson urged greater co-operation given the importance of December’s Copenhagen Climate Change Summit and the business opportunities which flow from the production of green technologies and goods. He also urged China to agree a carbon emissions target. Premier Wen said China would work hard for success at Copenhagen.

In the context of EU-China relations both regretted the lack of progress in relation to Market Economy Status (MES).

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Good morning.

As you may know, I’m rather keen on cars. It goes back to my boyhood growing up near Brands Hatch, and it has stayed with me throughout my life. It got me my first job at British Leyland as a sponsored engineer in 1978 ,and fuelled my passion for motor sport, which took me racing at Le Mans in the 24-hour race this June.

I tend not to count the race and road cars that I own, so as not to alarm my wife – but it’s certainly into double figures and includes some of the iconic great British cars of the last 40 years, including the Low Drag E-Type, the DB4GT, the March 712, the Vanquish and Lotus 24, the Mini Cooper (the new one).

I say that to stress to you how much of an enthusiast I am for cars and for the British car industry – and how important I believe it is for our country and for our economic prosperity that we have a successful car industry in the UK.

However, we all know how tough the last 12 months have been since I last came to this very same event.

I believe the global credit crunch, following as it did the spike in oil prices, has cruelly exposed the global overcapacity in the car industry, and accelerated the radical shift that is taking place in consumer attitudes to cars – and low-carbon cars in particular.

Our job, together, here in the UK, is to embrace this new reality and seek out the opportunities that this very difficult environment presents for the renaissance of a British car industry. Because I believe it does present such opportunities, and the very fact that this audience is so much bigger this year than last shows that you do too.

We have seen a hollowing out of our industry over past decades as much of the automotive R&D and major supply chains of the industry have gone offshore – and we have an industry that does lots of final assembly but not enough of the high added value, top-tier original equipment manufacturing.

The switch to low-carbon is our opportunity in the UK to use the tremendous expertise we still have in our automotive science and engineering base, and team it up with other expertise from clean-tech, defence and motorsport to create, here in Britain, the next generation of low-carbon cars that global consumers are desperate to buy.

We need radical new approaches that challenge the orthodoxy of vehicle design, manufacture, performance, maintenance and disposal. The complete life cycle. We need to ask difficult questions – and find better answers. Because the pace of change and technological innovation to drive performance with low-carbon impact is pushing hard on the industry

If we in the UK come up with the answers faster than the competition – and if we implement them with real drive – then we will recapture some of the market share we have lost.

That is our opportunity – and we must grab it.

This Government is right beside you to bring more power to your elbow. Not to bail out the past. But to create and capture the future.

So my message at this second Low Carbon Vehicle event is more focused and more emphatic than my message at the first one last year. Indeed, “focus” has become a theme for me as science minister – in urging the research community and business to actively prepare for an economy in which we concentrate on industries where growth is strongest; where the UK has a realistic prospect of being a global leader; and where we possess real competitive advantage.

In the car industry, I believe that means making a distinction between low-carbon and ultra low-carbon vehicles. That’s the area of greatest technical challenge but, as so often in life, it’s the area of greatest opportunity too. Our priority must be to make the world’s leading ultra-low carbon car industry in the UK.

We need to build on our domestic strengths and know-how in light-weighting, aerodynamics, powertrains, chassis engineering and styling. These are fields of British expertise.

But, we must take a strategic view of where the greatest opportunity lies for the UK, and low-carbon is an area of stiff international competition already.

By contrast, ultra-low carbon is a much more promising area, where our potential to compete with the likes of Japan, Germany, France and the US – California, in particular – is that much greater. Its also an area where our science base and inventiveness can be leveraged to a greater extent.

What’s more, we’re dealing here with a set of challenges on an entirely different scale.

There’s the R&D aspect, of course, necessary to produce plug-in hybrids and all-electric vehicles. The race is on to be early to market with viable cars, and then to build brands with global reach. But let’s face it, electric cars are not new. Recently I saw a collection of low carbon vehicles, some of which were over 100 years old. One, built in 1907, had in-hub electric motors!

Then there’s the critical matter of consumer behaviour.

Let’s be honest – there’s little public appetite for strange looking and poor performing cars, whether they are environmentally friendly or not. People want performance and efficiency.

For this to work, we must present consumers with vehicles that contain the “wow” factor – a full range of vehicle classes, not just underpowered city cars whose handling leaves many people cold. (There can be no cynical manipulation of emissions regs by trying to sell re-branded low-emission city cars packaged alongside high-emission luxury cars to average down emissions across the range.)

We must also offer people elegant systems engineering to shape consumer behaviour. I’m thinking of Oyster cards, which have made travelling around the capital so much easier, and mobile phone services, where customers don’t pay for expensive handsets and aren’t bothered by the complexities of cross-network costs. In fact, given that advanced batteries will be expensive, rental models and a variety of tariff options are likely to come into play. We’ll need to allow consumers to dip into the market and try out these vehicles without significant financial commitments.

That’s just a handful of the problems we need to solve. “Disruptive technology” is an over-used label these days, but when applied to ultra-low carbon electric vehicles, it is entirely appropriate.

I’ve joined you this morning because – self-evidently – these sizeable, interrelated challenges cannot be tackled in an uncoordinated way. There is a clear role for Government here in terms of legislation and subsidies, in creating market certainty for nascent technologies, in building a consensus around long-term goals.

To accelerate this agenda and give it a clear focus and direction the Government is creating the new Office of Low Emission Vehicles, or OLEV. It will bring together all the key Whitehall players – Business, Treasury, Transport, Energy, Local Government – to ensure that we move forward decisively in concert with industry.

We’ve no intention of OLEV being a mere talking shop. It will have a clear programme that encourages demand, supports supply and enables places where people can use these vehicles day to day.

It will have a clear timetable that builds on the successes of the last year. We’ve already allocated around £140 million to the Technology Strategy Board’s “Low Carbon Vehicle Innovation Platform” to help accelerate industry investment and facilitate new partnerships to address technical challenges.

And, back in June, the Technology Strategy Board announced the winners of its £25 million ultra-low carbon vehicles competition. Over the next 18 months more than 340 electric-drive vehicles will be trialled across the UK.

As part of a £250 million scheme to deliver a green motoring transformation, the Government has proposed help worth between £2,000 and £5,000 for private individuals and commercial buyers looking to purchase electric or plug-in hybrid cars when they hit the showrooms – which we expect from 2011 onwards.

We are also using procurement and the purchasing power of the public sector to encourage the development and take up of the latest generation of vehicles.

Through our £20 million Low Carbon Vehicle Procurement Programme. four British companies have been selected to supply all-electric vans to selected public sector organisations within months.

To help make the transition to cleaner, greener motoring we also have to look at how we can support the initial infrastructure needed to make travelling by ultra-low carbon vehicles a real and viable option.

That’s the reason the Government has allocated up to £30 million as seed money to the “Plugged In Places” electric vehicle infrastructure scheme.

I believe that this scheme has the potential to make a real difference and so I’m pleased to announce that it will go live for applications in November, with decisions on the first successful bids expected to be announced in Spring 2010.

I think it makes absolute sense to focus in the short- to mid-term on the electrification of personal transport.

The private car isn’t going away, and our economic growth is inextricably linked to people’s mobility. In big cities, public transport obviously has a major role, but so do taxis and car clubs. And beyond cities, where public transport offers no real “per passenger per kilometre” CO2 reduction versus the private car, we must ultimately replace them with ultra low carbon alternatives.

At the simplest level, then, that’s what OLEV will be working on. If it really delivers, then it will be helping to put the private car at the heart of the ultra low carbon revolution.

But let’s be clear: OLEV’s direction has not been determined from within Government.

It is industry that has set the priorities. Through the New Automotive Innovation and Growth Team, industry has worked with the Government to identify business opportunities and the necessary drivers of change.

Several of the key individuals involved in that process are speaking at this Government-sponsored conference – a conference which is unusual in that the audience is much broader than the car industry alone. The research councils, the Energy Technologies Institute, the Technology Strategy Board and various government departments are here. So are energy companies, local authorities, regional development agencies and others.

I’d like this gathering to become a major fixture in the international automotive calendar. In the meantime, our purpose over these two days is to figure out how – by developing new collaborations and sharing research – the UK can make the transformative shift to ultra low carbon vehicles. A shift by which we go a long way to displacing liquid fossil fuel, improving our energy security and establishing strength in technologies with vast commercial and social potential.

We’re on our way with this. I’ve been lucky enough to test-drive some of the demonstration vehicles. These aren’t poor imitations of petrol cars but examples of high-quality design, engineering and manufacture, including two-seater city cars, SUVs, minivans and sports cars offering bucket loads of torque and fantastic chassis dynamics.

But let me stress, technology is not the biggest challenge we face. The problem – both fascinating and daunting – is to combine innovation and know-how in a whole range of areas to produce a radical new customer experience that can fundamentally change how we get from A to B.

We’re on our way – we just need to speed it up a bit.

Thanks for listening. Now let’s have some questions and comments.

The £20 million Transformation Fund, launched by Government to offer grants for more than 213 innovative informal adult learning projects in England, will bring to life The Learning Revolution, a White Paper presented to Parliament in March 2009.

The projects, many spearheaded by partnerships between public, private and third sector organisations, will help improve mental health, physical well-being, active citizenship and community cohesion, as well as providing a stepping stone towards further learning, qualifications and employment for many people.

Projects include:

• An initiative to engage more than 2,000 adults who are not currently in training, employment or education, through celebrity-led creative music and media tasters, master classes and workshops, led by a partnership which includes Global Radio, the parent group of Heart FM, LBC and Galaxy stations.
• A partnership between Greater Manchester Passenger Transport Executive, Merseytravel, Urbis and a National Trust property which will create ‘learning journeys’ for young people 19-25, older people living in isolation and people recovering from substance abuse. Each learner will use a free bus pass to take journeys around travel ‘lines’, including the Engineering Line, the Football Line and the Mersey Beat Line.
• A project at Tyneside Cinema, in partnership with Newcastle University, to use the cinema’s new spaces and facilities to deliver digital technology, moving image, communications and IT learning to a wide range of people from different social backgrounds and develop online learning tools for others to share.
• A massive campaign, led by Booktrust and delivered through GP surgeries, libraries and Adult Education centres, to inspire thousands of over-60s to take up reading or writing for pleasure.

Kevin Brennan, Minister for Further Education, Skills and Consumer Affairs, said:

“We’re happy to announce 213 successful recipients of our Transformation Fund grants, awarded in the face of stiff competition from a field of 1,400 applications. With projects ranging from creative writing and music to reading and art, it’s encouraging to see so many imaginative ideas for giving adults more opportunities to learn for the love of it.”

“The benefits of learning for pleasure in an informal setting are wide-ranging, and they benefit the community as well as the individual. I hope that many people will develop the confidence and the local connections to take a big step towards a brighter future.”

The announcement about the latest Transformation Fund grants follows the award of £1 million worth of ‘early bird’ funding in July.

Alan Tuckett, Chief Executive of NIACE, added:

“NIACE is proud to have the role of supporting the Department for Business, Innovation and Skills in managing the Transformation Fund. We argued in our response to the Informal Adult Learning consultation that there is no better stimulus for local adult learning providers than the creation of a fund to trigger innovation and new partnerships.”

“There’s already evidence from the ‘early bird’ bids of how creative and imaginative community-based adult learning can be when given the funding to put ideas into practice.”

Informal adult learning encompasses a wide variety of activities and can range from a self-organised reading group in a village hall to a guided visit to nature reserve or stately home. Other Learning Revolution activities include The Learning Revolution Festival: a month-long celebration of informal adult learning that kicks off in October 2009.

To find out more about The Learning Revolution, visit: www.bis.gov.uk/learningrevolution

Thank you for your welcome. It is nice to be back. I first came here when the school was much smaller and the audience far fewer in number.

It is nice to be back in the place where you work to get “the truth from facts” in Deng’s words. It is very apposite for what I have to say this morning.

And also it’s nice to come now, just as you approach the 60th anniversary of the founding of the People’s Republic. China’s achievements are a cause of celebration for all of us. And I also celebrate the fact that relations between Britain and China have never been stronger. We have fifteen British government departments represented in our Beijing embassy which I think is testimony to the extent and depth of our bilateral relationship

I last spoke here as EU Trade Commissioner. It was during my time in that job that I really became convinced that China’s reemergence as a global power would redefine not only Asia but the whole landscape of international economics and politics.

All this would be difficult and complex enough – but added to that challenge is the task of governing China itself through a period of immense social, economic and environmental change.

Regional imbalances, income disparities, ethnic tensions, provision of education, health, and pensions: these are familiar challenges for most governments. But in China, the scale of these challenges and necessary speed of change is unique in the world.

All of you here this morning are the policymakers of China’s future. And politicians and leaders of my generation – in China, in Europe, in America – need to be acutely aware that the decisions that we are making now, and the decisions that we face over the next few years, will profoundly shape the world that you will face the challenge of governing in decades to come.

You will need to be the most internationalist generation of leaders in China’s history. Although we are slow to recognise it, some of the biggest problems in world politics are no longer questions of how we position our states for national advantage, but how we deploy national action to solve international problems. There is no contradiction between patriotism and internationalism.

The banking and financial crisis is an obvious example, and with it the bigger questions of how we manage a globalised economy. The challenge of development, above all in Africa as well as in Asia. But it is climate change that is perhaps the most pressing and most fundamental. This is a problem that has no solely national dimension – there are no borders in the atmosphere. It has only an international solution by definition, and I want to come back to that later in my remarks.

As someone who has spent a lot of time in international negotiating rooms this should worry me. I have seen some good and necessary global agendas stalled by parochial national politics. The Doha world trade negotiation is one obvious example. I think we are entering a new, pressured phase of globalization – one that will be defined much more by the competition for resources, an urgency to make painful compromises, the demand to change the way we govern the global economy. From policymakers and politicians this will require much more than the usual measure of flexibility. It should force us to aim for much more than the lowest common denominator of agreement because there is so much at stake, with so much more riding on the decisions we take, for so many people.

I want to say a few things about this next phase of globalization today. I will argue that our national responses to the banking crisis and the international recession will be critical to the health of the global economy for a long time to come. If we get this wrong, the consequences could be very far reaching. And China is central to this.

I will argue that climate change confronts us with an even more compelling problem of international cooperation. China is central to this too.

Finally I want to say a little about Britain and Europe and how we can continue to strengthen our relationship with China.

After the financial crisis

The last two decades have been a relatively optimistic time for the global economy – certainly a time of powerful positive economic change in China. If you traveled back in time to, say, 1979, you would find it difficult to find an economist who would predict that the Pacific Rim of Asia was about to experience the biggest and most sustained growth boom in global history. Or that Brazil and Latin America would have their own version of that export-led economic takeoff.

And this economic history didn’t happen by chance. It happened by choice. The choice to open our markets to international trade. The choice to accept a model of production based on global supply chains and the exercise of comparative advantage. The choice of economic internationalism over economic nationalism. The choice of free markets over state capitalism.

Some would argue that the banking crisis has discredited these choices, that they have somehow undermined their validity. I hear those voices both in China and back at home, in the UK and in Europe. I do not agree. I reject that view. The banking crisis was, yes, a warning: but against failing properly to regulate the financial sector and those who operate its standards. A warning about the need to globalize some of the governance of the global economy to take account of the way that the global economy now works in the twenty-first century.

But if this is the first crisis of the global economic age, it is not a crisis of globalization. Of course globalization spread the negative effects of this crisis around the world, but only just as much as it has transmitted the benefits of economic integration across all continents.

It is true, however, that the global banking crisis and the downturn have revealed weaknesses in all of our economies. Many parts of the Western mortgage and investment banking industries suffered what can only be described as a crisis of professional and regulatory competence. Britain’s households carried too much debt and its large financial services sector made it vulnerable to failures in financial markets. Collapsing global demand impacted heavily on export-led powerhouses like Germany and China – which drove home the fact that they need to balance their successful growth models with greater domestic demand.

More fundamentally, there is an imbalance at the centre of the global economy that must ultimately be righted. This is symbolised by America’s massive deficit and China’s massive surplus. It is simply not in the interests of China’s own people that their high savings are used to finance the excessive spending habits of rich countries.

In this picture of the global economy there are three salient points to make in my view. The first, as Premier Wen said back in March, is that this crisis has not undermined the basic case for open economies, in which resources are allocated in the main by markets rather than governments. We need effective governments to define the reach and limits of markets, but companies and industries, including banking, ultimately need the stimulus and the discipline of market competition to drive growth and innovation. It is the private sector in China, it is worth noting, that has produced the most additional jobs in your economy in recent years.

We have learnt some important and painful lessons about relying too heavily on the self-regulating nature of markets. But that does not discredit the case for liberal economics, it does not discredit private enterprise and markets as a whole and we need to argue back against those who see the financial crisis as an opportunity to restore the power of traditional State Control and state ownership.

This will become even more important when the global economy returns to growth and demand starts to put pressure on the supply of basic commodities. We will need global markets and the forces of supply and demand to send the necessary signals to producers to raise their productivity and keep prices down. The alternative is a race to capture supply, forcing prices up, that we will all lose from in the long run.

Of course, in Britain, the Government also places strong emphasis on social protection and personal opportunity along with our commitment to markets and private enterprise. We believe economic efficiency must go hand in hand with social justice. In this model, China has nothing to fear and much to gain from further opening. This will help rebalance the economy, and stimulate moves to high-technology, high-value added products. Resisting protectionism is essential, but not enough. China has more to lose than most from protectionism’s rise. But it also has more to gain through greater openness and greater reform.

The second point to make is that, we face the difficult reality that what happens in the global economy is the result of sovereign decisions by national governments. It is simply not possible for economies the size of China, Japan, the United States or Europe to ignore the fact that their economic policies have an international dimension and a global impact. That means we all have a legitimate interest in the good governance of all economies. That is part of what David Miliband, our Foreign Secretary in Britain, said in a speech at Peking University last year, and described as “responsible sovereignty”.

So while I would not argue that these decisions can or should be simply internationalized – of course, they cannot simply in this way – there is clearly a need for a much greater awareness of this dimension and this need for international coordination and cooperation of our policies. We need a completely renovated machinery of international economic governance, where the implications of national policy can be assessed and the global dimension debated. The G8 alone is not enough. And we are all agreed that the IFIs, like the IMF and the World Bank, need to be stronger and more representative, indeed as Britain has argued in China’s case in those institutions.

The British government believes that, finally, China is completely central to this process. It accounts for almost 10% of global trade and holds the world’s largest store of forex reserves. It is one of the great engines of global demand and may be the largest economy in the world by the middle of this century if the right decisions are taken. China is at great pains to tread lightly as it grows. But there is now no alternative to the full leadership role, that its economic status deserves.

So we might ask: how well has our response to the banking crisis and the downturn so far reflected these three arguments that I have made to you? I think the answer is broadly positive. We have seen relatively little protectionist economic policy, although this clearly remains one of the key potential risks to recovery.

And completing the Doha Round will be very important to limiting protectionism in the future. It is our insurance policy against isolationism. This is an area where Chinese leadership can really help turn things around, if others are prepared to reciprocate.

The coordination of national fiscal stimuli at the London Summit in April of the G20 also gave a significant boost to international demand – not least through the four trillion yuan package and the planned healthcare reforms here in China.

China and the other emerging economies have become absolutely central to the G20 process. Which is why it is so important that we have empowered bodies like the Financial Stability Board, and that we accelerate reforms that will make the IFIs more representative of the global economy they are monitoring and overseeing. Britain is determined to continue to drive forward this agenda when the G20 meets again in Pittsburgh later this month.

The Climate crisis

Alongside the financial crisis and the management of the global economy we now face the huge challenge of acting to limit the damaging effects of climate change, and, in the process of doing so, unleash much ‘green’ economic activity and new jobs during this century. This is a challenge that is central to the development of modern China because of the costs of dangerous climate change in your country and is critical, at the same time, for all of us. The only sustainable route to economic development is based on low carbon, energy efficient technology coupled with open markets.

Unlike in Europe, most of the homes, the offices, the power stations and infrastructure that will exist in the China of 2030 have not yet been built. That great programme, that future, is ahead of you, and it provides a great opportunity for your planning now for a low carbon future. This means that China’s capacity for green growth and innovation is potentially massive. As Europe’s leader in setting low carbon targets, Britain is an obvious partner in this work and a potential source of expertise and investment.

But a key prerequisite for the kind of green revolution that this implies is a global climate change deal at Copenhagen in December. Nobody doubts the importance of issues of equity involved in a deal that seeks to limit the carbon emissions of both the developed and the developing world. Equity is a core value, a principle that needs to be at the heart of these negotiations and of any emerging deal. Nobody would disagree that the rich world carries a unique and additional burden. But rapidly industrializing countries like China, India and Brazil clearly have an important role to play, if there is to be a deal that meets the challenge we face.

If we allow these problems to become intractable, Copenhagen risks becoming an early and defining failure for the global era. A weak deal would also be a more expensive option: expensive not in the costs of compromise and action, but in the environmental and economic costs of inaction. And by an accident of geography that’s a cost that will fall disproportionately on the poor.

Britain, Europe and China

Let me finally make a couple of points about Britain’s relationship with China, which inevitably also involves the European Union’s relationship with China. In this multi-polar world, the challenge for the EU and China is to create a strategic vision of the kind of partnership we want together to build to benefit us both. One that matches the scale of our economic relationship and the importance of our cooperation in the world. One that is based above all on constructive engagement between us.

It also needs to be durable enough to handle the frictions and to allow us to speak frankly to each other. This matters on political issues like freedom of expression, rule of law and civic freedoms.

These matter to us in their own right, but also because they underpin long-term economic development; it is, for example, confidence in the rule of law that has made Hong Kong a successful international financial centre, and why it continues to flourish.

But the need for durable relationships also matters because Britain and the European Union will continue to argue for the improvement of trading conditions for their companies here; better protection of intellectual property rights, wider access to China’s markets and for our foreign direct investment.

We will continue to test some of China’s trade practices in the WTO – just as I am sure China will test ours, as it is China’s right to do so. These things are an inevitable part of one of the largest trading relationships in the world. In the context of a durable relationship they should not cause excessive political volatility.

I recognise from my time as EU Trade Commissioner that the EU itself has an important role to play in making this relationship a success. The European Union – and I know this from my own experience – can be a complex and sometimes contradictory partner. Senior Chinese negotiators often want and need greater coherence from the European Commission, and a clearer sense of who they should be negotiating with. I believe this is one of the key foreign policy challenges for the EU and the next European Commission that will take office in a few months time. We need to develop a clearer and consistent channel for communicating with China, especially on trade and climate change issues, and other key foreign policy subjects.

But getting this relationship right is also a challenge for China itself. The EU is a willing partner. It is not an aggressive power. It is an essential component of a multipolar world and we want to do business, in every sense, with China.

Conclusion: ‘the larger trend”

There has been some talk lately about the age of the ‘G2’ – America and China setting the global agenda together. To my mind this is an attempt to simplify the world in a way that is actually quite unhelpful. In May Premier Wen said in a speech in Prague that ‘the larger trend’ in world politics is towards multipolarity and multilateralism. And I agree

Europe is China’s largest trading partner; Japan and India two of its most complex and subtle relationships; Africa one of its biggest development policy challenges. There is no simple , bipolar template that reflects this world.

If my remarks today have a simple message – and I say this in conclusion too – it is to reinforce Premier Wen’s argument about the larger trend. In global economic governance; on climate change, in geopolitics in general we are entering the era of necessary internationalism.

The choices that we will make in the next few years will be fundamental to our long term prosperity and security. If we are to preserve the open global economy that has underwritten two decades of growth then we will need to draw the right lessons from the banking crisis and keep our markets open and the state playing an appropriate but not dominant role in business and enterprise. If we are to rise to the challenge of addressing climate change then we will need to be both pragmatic and ambitious. Our task as Chinese or Europeans is to be hopeful, to be flexible, to be committed. And above all to see many of China and Europe’s biggest challenges as common problems, in need of shared solutions.

Thank you very much indeed.

The team – who were up against 900 competitors from 46 nations – won an impressive three gold and six bronze medals in skills ranging from painting and decorating to floristry and autobody repair. The UK also won 14 Medallions of Excellence – awards given to competitors who achieve more than the world-class standard of 500 points.

Mark Nevin, 22, (pictured) who won a gold medal and Best of Nation for painting and decorating, said: “This is the most fantastic feeling. I really do feel on top of the world!

“The last year has been absolutely brilliant. To have been given the chance to learn what I’m capable of, to train with some of the best in the industry and to be part of such a great team has been unbelievable.”

Simon Bartley, chief executive of UK Skills which manages Team UK, said: “It’s a tremendous result not just for the competitors, but for their employers, trainers and colleges. We hope to build on this success as we move towards the next WorldSkills Competition, which London will be hosting, where we hope to do even better.”

Skills Minister Kevin Brennan said: “These inspiring young people have demonstrated to the rest of the world just how able and highly skilled the UK is.

“The world-class skills this team have demonstrated are vital to the future success of our economy in key industries such as construction, manufacturing and engineering. It’s more important than ever that we continue to support and invest in the skills of our workforce, helping individuals get into and stay on at work as well as helping businesses stay competitive and prepare for the upturn.”

Read more and see the full list of winners on the UK Skills website.

UK Skills is a not-for-profit organisation and a BIS delivery partner.

Hello everyone.

I’m David Lammy, the Secretary for Intellectual Property in the UK Government and I’m very pleased to have this chance to talk to you.

An Englishman, Harold Evans, called the 20th century “The American Century”. There’s a lot of truth in that. But it was also a century marked by close partnership between the USA and Britain. It was a century in which we made war together when we had to and peace together whenever we could, in which together we laid the foundation of the world’s great international institutions, and in which we together established the global financial system.

It was a century whose culture was dominated by our shared English language, too, in which the way the world viewed itself was defined by Hemingway and Lawrence, Steinbeck and Orwell, Chandler and Christie, Wolfe and Amis. All of whose works have featured in the movies, what is beyond doubt the century’s greatest cultural phenomenon.

British people played their part with you in building that, too. Right from the time Charlie Chaplin and Stan Laurel, who had come to the USA with Fred Karno’s vaudeville show, first rode the train West.

Our partnership continues today in all of the fields I’ve mentioned, and it remains strong because we continue to share substantially the same interests and values.

And the movie industry remains a symbol of those links. Through it we project on a worldwide screen not just our talent, but our beliefs as well.

In the 21st century, there will be even more consumers, more access and more desire for movies than we saw in the 20th. That’s good for your industry and for my country.

The USA leads the world economically, and in the relative importance of its creative industries. Exports of creative services from the US grossed $71 billion1 in 2008.

But UK creative exports were worth $19 billion, despite our much smaller economy. Our creative sector has grown steadily over the last ten years and currently contributes 6.4% to our economy. Like you, I want to see that growth continue, recession or no recession.

But that brings me to an important point. The challenge of the 21st century isn’t persuading people to watch movies. That demand is there already. It’s making sure those who do watch movies are paying customers rather than pirates.

The experience of sitting in a movie theatre is still something special that people expect to pay for. But piracy – especially through downloads – is a problem that will probably get worse despite our efforts.

New generation broadband access can deliver a DVD’s content in three minutes.

Unless we face up to that we risk losing the strong position we held at the end of the last century. The way people we publish and consume works has changed. Consumers eagerly reached out to grab the potential of 21st-century technology while business and governments sleepwalked into it. They built a digital culture based on access, even if it cuts across the law.

Although creative industries and governments have moved to catch up with the digital world, we still aren’t ahead of the game. And now we must decide whether. what we want balance between anarchy and authoritarianism to be in the digital world of the future.

For me, the balance must always tilt strongly in favour of freedom. But freedom to access material is not the same thing as access for free. If the world wants to continue to enjoy the wonderful dreams that the movie industry creates for it, then the world must be a paying customer to keep the whole exercise financially viable and to allow the investment it needs to grow still more.

That means more effective law enforcement. UK Film Industry research in 2007 indicated that almost a billion dollars were lost to the film and TV industries through piracy. And that’s just not sustainable.

I’m an unlikely candidate for the title role in a remake of The Enforcer. I haven’t got a .44 magnum and I don’t want anyone to “make my day”. But I have no problem about getting tough with the organised gangs who operate multi-million dollar piracy operations, often linked to wider drug and people trafficking rackets.

I went on a police raid myself last year. In one small house we seized over sixty thousand counterfeit DVDs – including pre-release titles – at a street value of over $300,000.

But in spite of everything our law enforcers do, there will be people on the street in my part of London tonight selling illegal copies of virtually any film you might want to see. Especially the ones youngsters like and including films currently on the screens, from big-budget movies like Watchmen to low-budget hits like Mega Shark Versus Giant Octopus.

So tackling supply isn’t enough. We need to tackle demand as well. Many otherwise law-abiding ordinary people believe they are causing no harm when they buy or download illegal copyright goods. They think that creators and business have already been well paid for their work.

I want us to reach out to those people. To take to them the message that what they’re doing is wrong.

We can’t afford to underestimate the challenge. A recent report found that on one P2P network at midday on a week day, there were 1.3 million users sharing content – including films. If each downloaded one file per day, this would involve almost half a billion downloads a year.

There’s no single answer to dealing with that. We need solutions tailored to the different challenges. And government, industry and the law enforcement community absolutely must work together on this. By the right combination of enforcement, education and forward-looking policy, we can make sure we build a culture of access that is also legitimate.

But above all, we must protect the livelihoods of actors, screenwriters, animators and the whole vast industry that enables a blockbuster movie to get to the public. The film business matters. The hard work of creators and industry needs to be recognised and rewarded.

The UK film industry under the umbrella of the Federation Against Copyright Theft, supported by many in this room, is one of the biggest contributors to this work. I want to thank them for the work they have done with us.

And we are getting results: we have more than tripled the number of convictions for IP offences from 400 in 2002 to almost 1,300 in 2007. And seizures of products affecting the film industry have increased by nearly 2,000% between 2000 and 2007.

We are securing longer sentences for IP criminals and recovering their assets. Recently the courts handed out an 18-year jail sentence to a criminal involved in a multi-million dollar film piracy network. And prosecuting a criminal gang selling counterfeit goods on the internet, including films, resulted in a confiscation order of over $4 billion.

And we’re not standing still. New work against illicit P2P file sharing, including possible suspension of internet access for persistent infringers, and increased penalties for IP infringement, online and offline. We are sending a clear message: when it comes to piracy and infringement, ‘digital is not different’.

But, as I’ve already said, enforcement is not enough. It is only one part of the story. Consumers, and that means anyone with access to a computer or a cell phone, have taken a look at copyright and don’t like what they see. That creates challenges for you in the film industry and for government.

A question I sometimes ask myself as I look at my own children. Does it make sense to expect a 12 year old surfing the Internet to know what they can and can’t do with the content they find – not just in their own country, but internationally? Yes, we must teach them to respect the law. But can we really expect them to master it before they go online?

And I think most ordinary people just aren’t sure what they can and can’t do – or why they shouldn’t do it.

The teenager on a download site. If there isn’t a way to explain to them in plain English that they’re doing wrong, how can we expect them to understand that they are?

The CD owner who wants a copy on his MP3 player. Is he breaking the rules or just refusing to be ripped off?

The amateur animator who wants to mash up some content she found on the internet. Is she infringing copyright or just exercising her right to free speech?

Some people don’t understand the rules. But others do, and feel strongly that they don’t make sense.

I have some sympathy with that view. Something isn’t right with copyright. Not just in the UK but as a whole. And I want to do something about that.

Since the end of last year I’ve been consulting people on the hard questions. Does copyright work in the Digital Age? Do we need to edit it for a new audience? Is the existence of infringement on a massive scale really is a wake-up call to business and the creative industries as well as governments?

Some people tell me the Internet spells the end for intellectual property. I say they’re wrong. An effective IP regime has an important part to play. I’ve spoken to established rights holders like Universal. I’ve spoken to the newer players like Amazon, Apple and Google. I’ve involved the hardware and telecommunications companies in the debate. These businesses basically want to serve their customers.

But more than 6 months of consultation showed me the critics are right about one thing. The mechanisms by which copyright operates are too complex. Licensing, rights clearance, getting permission to use works… these are all being challenged by the Internet and consumer expectations.

The systems need to keep evolving in the digital age. I don’t want to see copyright, in England, in the USA, or anywhere in the world, lagging so far behind technology that it loses relevance. Some people tell me that content is national. They tell me the solutions lie in my backyard. But content is also global.

That’s true particularly of film. For a century, film has proved itself to be a truly global medium. And technology too is global. So we need to look to global action to solve our problems.

Everyone involved in rights clearance tells me how lengthy, difficult, and expensive it can be for everyone. A computer game developer who wants to use a music clip; a television company that wants to broadcast a classic from its archive with tens or hundreds of permissions to clear; or a film company that wants to produce a DVD remaster of a cult classic. And time is money – they need quick decisions.

The conclusion is obvious – clear and simple systems for rights clearance and permission will benefit everyone.

I want us to tackle this problem if the system isn’t going to collapse under its own weight. But it’s no good individual countries operating on their own. And getting international agreement to change could take a generation. Partnership and innovation by businesses are the way forward, not a rearguard defence of systems that aren’t delivering. We need smart laws, and smart enforcement.

If there’s one battle governments and industry both need to win, it’s the battle to keep the hearts and the minds of the people who pay our salaries. I want to see people wanting more product, buying more, not frightened out of the online store or frustrated because illegal sites are simply better. I don’t want them to be scared of watching a film or making a fan-site because they don’t understand the legal risks. I want confident consumers who choose legitimate content and use it appropriately without the need for special information or technical skills.

I have said that these are industry problems which need industry solutions. I want to see businesses reaching out to form new partnerships. I’m talking about creative companies working with Internet Service Providers to build a web where rights holders are paid, and users get easy access at a reasonable price.

I’m talking about film studios working with technology companies to educate youngsters in the links between innovation, copyright and creative works on the internet.

That’s how we can get to a world where consumers will want to support those that create the content they want while getting the access and services that the new technologies make possible.

That’s how we can begin, to adapt the words of a former US President who knew more than a little about motion pictures, to tear down this firewall.

So this is about striking a balance. I think the UK, increasingly, is getting this balance right. The UK government is acting. And we will continue to put policies in place that make IP infringement easier to detect and sanctions harder to avoid.

But we need to forge a world where there is a consensus – a common sense of fairness and respect. We need people to respect artists and their works because of what they are, not because of the law they fear, or the law they don’t know about.

We need to take them with us on a journey into the unknown. A journey that will be easier and better if we all travel together.

Thank you.

[CHECK AGAINST DELIVERY]

The Prime Minister, Work and Pensions Secretary Yvette Cooper and top employers signed up to Backing Young Britain met 250 young people at a Youth Summit at Birmingham City Football Club today.

The Government pledged 85,000 new opportunities for young people. These include:

• Morrisons pledging new training for every one of its 36,000 employees under the age of 25
• Government providing help to get 45,000 young people into jobs in retail, tourism, leisure and hospitality
• 5000 new apprenticeships from companies including Centrica, Carillion and Royal Mail
• Other companies backing the campaign include Microsoft, Bovis Lendlease, Pfizer and Phones4U.

For full details of today’s Backing Young Britain announcement, see the latest press notice.

Read the Jobs of the Future document (pdf) here.

If you are an employer and want to get involved, see the Backing Young Britain website.

If you are a young person and require more information on your options and the support available to you, see Directgov’s What’s Next campaign.

The new survey questioned business leaders from across eight sectors and found that nearly half (43 per cent) of those questioned believe that cleantech will grow at the fastest pace by 2020, followed by science and technology (20 per cent) and media and entertainment (15 per cent).

The survey highlights how the current economic climate presents new opportunities for new areas of the economy to thrive.

Combined with a growing awareness to find solutions for some of society’s greatest challenges – from tackling climate change to supporting an ageing population – investing now in innovative, high-growth areas will be essential for bolstering the UK economy once recovery kicks in.

Driving the awareness, investment and skills required to power these high-growth markets is essential for Britain’s future. Britain’s chance to showcase our strength to the rest of the world, including our cleantech innovations in the run up to Copenhagen 15, and how our digital strength will enable the first digital games in 2012, is essential for the UK’s ability to meaningfully contribute to the global economy. It is therefore essential for both government and business to properly recognise and promote the importance of these sectors.

As part of meeting this need for recognition; Science and Innovation Minister Lord Drayson and entrepreneur James Caan recently launched the iawards – the first ever Government backed-awards to celebrate achievements in science, innovation and technology.

Science and Innovation Minister Lord Drayson said:

“Cleantech and renewables will play a huge part in helping the UK economy to grow sustainably, but we need to do more to encourage innovation in these and other high tech sectors.

“And that means recognising our best innovators, those who are creating the household names of tomorrow. The iawards will do just that, this inaugural year and in years to come. Make sure to get your entries in by 16 September!”

James Caan said:

“The UK is home to some of the most innovative minds in the world and we must continue to recognise and celebrate the work of these talented individuals. The iawards are all about recognising British achievements, the visionaries behind them and showcasing new the latest developments that will make the UK a better place to live and work. In doing so, we will continue to draw investment, energy and skills to the high-growth industries that will drive our economy forward.”

Further findings:

- 73 per cent of those polled believe that business and government must work together to promote the development of skills needed to bring the UK out of recession

- One in five of those surveyed chose web 2.0 as the best technological development of the last ten years

The iawards in association with QinetiQ includes 13 categories which are open to all organisations, but all entrants must specify the British involvement in any innovation – demonstrating that innovative thinking and development came from a British organisation or team. Siemens sponsor the ‘Next Big Thing’ category and Microsoft Bizspark sponsor the best technology start up category.

The awards categories reflect the greatest challenges we face as a country where science and innovation offer the best chance of developing viable solutions. Each entry must demonstrate how its innovative qualities relate to at least one of the following challenges:

• Addressing the healthcare needs of an ageing society;
• Increasing international security from tackling global poverty to minimising the threat of terrorism;
• Preserving finite natural resources in the face of population growth and climate change; and
• Delivering public services which make best use of new technologies.

They must also demonstrate that the innovation has an impact on one of the Government’s grand challenges for science.

Winners of the awards will be helped by UK Trade & Investment (UKTI) to meet potential business partners at key industry events such as the giant Medica trade fair in Germany and Technology World in Coventry this autumn. They will also receive public relations support from the iawards team. All shortlisted entries and the winners will also have exclusive access to the iawards logo.

Science and technology has been a driving force behind Britain’s export success. Exports for life sciences, for example, rose 19 per cent in 2008. Innovation is also important in keeping the UK as the number one destination for inward investment in Europe. UKTI statistics show that the number of investment projects in creative industries increased by 65 per cent in 2008/9 and in software and computer services by 36 per cent.

James Caan will be hosting a live Web TV show to discuss the findings of the survey on Thursday 27 August, 13:00.

For more information, and to enter, visit www.iawards.org.uk. The closing date for entries is 16 September. The iawards gala dinner will take place at the Science Museum, 16 November, 2009.