A new strategy to boost strong, sustainable, long-term economic growth in the UK has been announced today by Lord Mandelson.

The strategy, Going for Growth, outlines seven key areas where the Government will build on the foundations of New Industry New Jobs. They include:

• Supporting enterprise and entrepreneurial activity
• Fostering knowledge creation and its innovative application
• Helping people develop the skills and capabilities to reach their personal and economic potential
• Investing in the infrastructure to support a low carbon modern economy
• Ensuring open and competitive markets allowing business to grow
• Building on our industrial strengths in sectors where we have expertise and investing to foster new comparative advantage
• Understanding and employing the right strategic role for government in markets enabling us to capitalise on new opportunities.

Visit the Going for Growth page here to read the strategy and view related announcements, video and links.

News Releases:
Government sets out strategy to get Britain Going for Growth
£70m boost for UK Manufacturing

Lord Mandelson’s speech launching the strategy:

The investment will upgrade the UK’s digital infrastructure to bring super-fast broadband to 90% of the country, essential if the UK is to remain globally competitive as estimates suggest that private investment will only reach up to 70% of the population by 2017.

The Next Generation Fund will provide the UK with a world class communications network to bolster innovation and services in digital content.

The Government is now consulting on the most effective way to deploy the investment – read the consultation document.

The Treasury is also consulting on how the fund will be raised through a new Landline Duty.

Next Generation Fund objectives:

• To support Digital Britain’s objective to roll out next generation networks to at least 90% of the UK by 2017;
• To support economic growth by incentivising market investment in communications infrastructure to meet the needs of businesses and households;
• To maximise links with the Government’s Universal Service Commitment – a parallel broadband investment programme to ensure every community has access to 2Mbps broadband connection by 2012.

Lord Mandelson said:

“This investment is about bridging the gap between the current and future broadband networks. We cannot underestimate the opportunities this will bring for homes and businesses which is why we are taking action to make sure everyone benefits.

“By upgrading our networks we will put the UK at the fore of rapidly developing technologies which will bring jobs, boost business potential and grow our digital economy.”

Full press release – Next generation fund launched: UK to benefit from £1 billion investment in super-fast broadband

Speech by: Lord Mandelson
Work Foundation, London

This week marks the start of a new decade in which we know the economy will come under fiercer competitive challenge than ever before, as the world tilts further east towards China and the other emerging economies.

But we do not have to resign ourselves to relative economic decline. On the contrary.

In Britain we still have one of the best environments in the world for starting and growing a new business.

We are emerging from the financial crisis and the downturn with our key industrial strengths intact, unlike our experience in previous recessions.

The competitive value of the pound is helping exports and increasing the sourcing of manufactured goods in the UK. And the Government will maintain its support for the economy through existing public spending and investment until the recovery is firmly locked in.

But that’s not the end of the story. The recovery is only the beginning of how we are going to pay our way in the global economy and create the jobs of the future.

As the Government will explain in the strategy for economic growth we are publishing tomorrow, how we create future jobs won’t be the same as in the past. We will turn new technologies into jobs, like those in digital and biotechnologies. We will commercialise the output of our hugely successful science and research base. We will turn low carbon into business and employment opportunities.

None of this is going to happen with government simply standing on the sidelines. Other governments are actively investing in their industrial strength. We have to do the same.

And it won’t happen if we take the wrong turn in sorting out the national finances in the coming months.

Two plans

So a credible Deficit Reduction Plan has to be accompanied by an equally credible Growth Plan. Deficit reduction is a three-sided triangle: spending reductions, tax increases and economic growth, and, of the three, growth is the best antidote to debt both in short term and the long term.

December’s PBR has a clear objective – to halve the deficit by 2013-14. It is bold and tough: the equivalent of something approaching an £80 billion turnaround in the public finances. This is the sharpest reduction in the budget deficit for any G7 country. This is vital for credibility, vital for attracting inward investment.

Our social priorities in health, schools and policing are protected. But, as the Prime Minister and the Chancellor have both made clear, the impact on other services cannot be painless.

Our plans do not at this stage fix rigid limits for each department, for the good reason that future uncertainties remain. But the commitment to real reductions is clear.

The politics of growth

You can see the last thirty years as a series of steps and mis-steps towards this economic goal; shaped sometimes by ideology, sometimes by pragmatism, increasingly by the realities of globalization.

The 1980s saw the timely privatization of industries that were long overdue for return to the commercial sector. Industrial relations underwent a sea change. The quality of management in our best firms improved, and with it, corporate profitability.

But, there was also soaring unemployment and social divisions. And other long-standing weaknesses in UK economic performance were becoming chronic: an indifference to manufacturing; neglect of science, engineering, technology and skills; lack of a long-termist business culture; and an education system that paid scant attention to the needs of employment.

British business still suffers from too large a tail of poor management and low productivity and the financial crisis demonstrated that the long-termist business culture needs to be more firmly established. There is a debate within business on business models, especially the reliance on debt over equity.

We need a politics of long termism over short termism.

Of a smarter, more effective and affordable state.

Of a return to the values of hard work, enterprise, corporate stewardship and mutual commitment over those of dodging responsibility, making a fast buck, and putting self before others.

Of working together as a nation to address the shared challenges of the future, not social divisiveness or outdated ideological obsessions about the State or doing away with government.

We need a dynamic economy and society, but we also need to understand that while people want opportunity, they also want security for themselves and their families in a fast changing world.

There are significant strengths for Britain which give us a base that makes the new challenges easier to address.

The UK research base has benefited from a doubling of the Government’s investment in science.

Our universities are now fully part of the way we earn our living in the world: attracting 230,000 fee-paying overseas students and generating £59billion a year for the UK economy – more than 2% of GDP.

There has been a renaissance of major UK cities – a genuine end to the psychological cycle of decline that blighted the late eighties. This has been led by public-private investment in which the Regional Development Agencies have played a major role.

Although it has not grown at the rate of the rest of the economy, the British manufacturing sector did not in fact contract in absolute terms in the decade before the recession – its output in both value and volume has remained stable despite the fiercest imaginable competition.

The resilience and reinvention has been helped by flexible labour markets which in this period became culturally embedded in the private sector.

It is this factor, together with the scale of the fight-back mounted by the government and the strength of our welfare-to-work system, that has helped keep people in jobs and limit the effects of the global recession.

But it is also clear – and I want to be honest about this – that the global economic crisis has exposed structural problems in all developed economies, including the British economy that we did not entirely foresee or deal with in the years of uninterrupted growth.

No-one fully understood the risks in the model that destroyed Lehman Bros and crashed the banking system.

And let me say this quite bluntly. For the past decade we allowed ourselves to become over-dependent on the City and financial services for growth and our tax revenues. That is why, without wishing the financial sector to be smaller, we need other industrial strengths and sources of revenue to grow faster.

And finance will have to change – the insurance bill for saving the economy from the status quo was far too steep and it can never happen again. While putting the City in an iron cage of regulation is undesirable, just relying on a bit of nudge here and there will not suffice.

The document we will be releasing tomorrow sets out the Government’s plans for growth. It sets out what we have done since I launched the New Industry New Jobs agenda last spring and described the Government’s further work programme for the coming months. It is work in progress. We are in a marathon, not a sprint. But it defines an agenda for a very challenging future, and a new approach to investing in our basic capacities for growth.

Today I want to highlight some of the key themes of that work programme and say something about where we need to go with each.

Enterprise

First and foremost we need to foster a new climate for enterprise in Britain. There is no substitute for this – no substitute for the drive and ambition that it brings. It can sometimes be a touch ruthless and raw. But it is the single most important engine of economic progress. The recovery cannot be driven by consumer debt or public spending. It will be driven by private sector investment and private enterprise.

Enterprise and reward go hand in hand. Much as it shocked many of my friends when I said I was comfortable with people making themselves “filthy rich”, in the context I was speaking I was simply stating a simple truth: that enterprise and effort should be rewarded. It sets goals to spur people and brings gains to us all. And it is often forgotten that I added the important rider “as long as people pay their fair share of taxes”.

I would also add now that pay and performance must go together. That means long term sustainable performance. In this case, there is no need for government to intervene. We are not interested in capping salaries for the genuinely successful.

Where pay and performance do not correlate, the whole notion of value breaks down. And if remuneration is actively driving systemic risk, and that risk cannot be confined to a single institution, then we have a real problem.

Of course given the tax rises on the better off imposed in the past year, tax is inevitably once again a hot topic of debate in the business community. Setting tax rates for me has always been a matter of striking the right balance, not of ideology. In a difficult fiscal environment no credible government can rule out the need to raise taxes. And we haven’t shirked from taking those tough decisions over the past year.

But there is never a case for punitive taxation. There is never a case for rates of tax that remove the incentive to self-improvement or to build a business. Britain retains one of the most favourable tax regimes in the world for entrepreneurs who start a successful business and eventually sell part of their stake.

Our 18% capital gains tax rate is among the lowest in the world and our corporation tax rate among the lowest in the G7. A competitive tax environment is something we must preserve.

As for the new top income tax rate, I believe that is justified in the quite exceptional circumstances we face.

It is right that in taking the tough decisions on tax needed to combat the deficit those with the broadest shoulders will bear the greatest burden. I believe we have got this balance right.

But as a Government we will always be vigilant that this burden does not become so great that it damages our long-term competiveness or inhibits those whose efforts will help us build sustainable growth.

At the same time we need to accept that the current structure of most public companies is better at rewarding enterprise in senior management or owners than it is at giving the bulk of the workforce an incentive to innovate or commit to the business. The evidence is that companies that share rewards with their employees, like the John Lewis Partnership, are also very good at pursuing long term growth strategies.

Innovation

Second, we need to renew our focus on what makes us successful innovators. A decade of sustained investment by this government has rescued British science from its desperate straits in the 90s and secured its position of global excellence, second only to the United States. Our challenge is to transform more of that knowledge into economic gain. To get more D out of our R and D.

In productivity terms we spent the late twentieth century trying to catch up with the US. Now Asia is racing to catch up with us. We did well in the American century. We can take little for granted in the Asian century.

Our 21st century economic growth needs to be built on innovation at the knowledge frontier, addressing new challenges such as climate change and decarbonisation and exploiting new digital and materials technologies.

For this reason, it is vitally important to preserve our research capabilities even through a period of increased constraint on investment. Our universities must focus on research that offers the greatest economic potential, prioritise excellence, develop partnerships with industry, specialise around their core strengths and not be afraid to develop distinctive missions.

For each region of the country, I am asking the Chair of the Regional Development Agency to present me with a report by mid- March, prepared in conjunction with their Vice Chancellors, on how their universities, supported by RDAs, can drive economic growth in their area.

In the PBR, to boost innovation, the Government supported the concept of a “Patent Box” that ring fences commercial revenues from patents and secures favourable tax treatment for them. This complements the incentives we have for research in the UK through the R&D tax credit.

Since I launched our policy framework New Industry New Jobs, we have earmarked almost a billion pounds in the last year for investment in British capabilities in cutting edge technologies like plastic electronics, composites, wave energy and industrial biotechnology. We will be publishing the next stage of our plans for the further development of key sectors – including construction, business services and homeland security – by the end of March.

Over recent years we have built up the basic skeleton of an industrial innovation system in the UK. We have the rapidly growing outreach of our universities into business, RDA investment in innovation centres, the setting up and expansion of the Technology Strategy Board, and the recent decisions to establish industrial centres of excellence in a range of technologies including civil nuclear engineering and industrial biotechnology in Yorkshire, and plastic electronics in County Durham.

Our challenge now is to build and consolidate that innovation landscape into something like the Fraunhofer network in Germany which actively connects industry and the German research base. With this objective in mind I have asked technology entrepreneur Hermann Hauser to undertake an urgent but systematic evaluation of the UK’s existing Innovation network to see how Britain can best emulate the outcomes of the Fraunhofer model.

Finally, innovation depends on skilled people. We have set out plans for the creation of a new British technician class, in part through a dramatic expansion of Advanced Apprenticeships. This will fill a longstanding gap in the British skills market.

These proposals have been well received but we need to focus on implementation. I have asked Lord Sainsbury to report to me by the end of March on the development of the registration system for engineers and proposals to introduce a parallel scheme for science technicians that will make this new technician status a reality.

Finance for growth

My third theme concerns the way we finance this enterprise and innovation. Enterprising and innovative companies need investment to grow, but there is strong evidence that UK financial markets have for some time not served some growing British companies well. The credit crisis has exacerbated this problem by dramatically reducing the banking system’s appetite for risk. We need to keep up pressure on banks to lend, but we also need to look for wider solutions, both at the British and the European level.

For a decade we have tentatively been experimenting with public-private solutions to the growth capital problem. It is clear that Britain needs coherent solutions at a different scale. We need a new range of public- private financial instruments to step into the historical equity gap and the breach created by the banking system’s reduced appetite for commercial risk.

That is what the Innovation Investment Fund launched last year will in part do – it has already more than doubled its initial £150 million public investment with private funds and its professional independent fund managers will make their first investments this year.

At the same time the Rowlands Review has explored the issue of growth capital for business and the feasibility of re-creating a successful fund like the old ICFC or 3i. So we are working with banks to establish a new growth capital fund which will invest in established UK SMEs who are seeking between £2 and £10 million to develop their business.

In parallel the RDAs are establishing a number of new public private financial vehicles with the help of European funding and the EIB, which will invest in businesses seeking less than £2m.

These will sit alongside existing smaller venture capital funds established over the last 10 years.

I am therefore now asking Mervyn Davies to report to me urgently on what might be done to give this network maximum coherence and reach. My aim is to create an industrial investment network with a strong regional capacity.

Infrastructure

Fourth, over the next ten years Britain will need a transformative wave of private investment in digital, energy, transport and low carbon infrastructure, totalling hundreds of billions of pounds.

We have two challenges here. First, how we get these high cost, long term investments made. The public purse isn’t going to be able to fund them, so we need to get the conditions and incentives right for private sector investors. Second, we need to make sure that these massive programmes create opportunities for British-based industry. Britain’s supply chain only too often has a habit of missing these opportunities. This time has to be different.

We are implementing plans to stimulate investment in the infrastructure for digital communications. They will extend broadband access to every home and business in Britain in just a few years and extend next generation broadband beyond where the market alone will build it to serve 90% of the population.

And are developing strategies on renewable energy, rail electrification, low carbon vehicles and the charging infrastructure for electric cars, putting in place what only Government can – clear frameworks of policy within which the private sector can take commercial decisions

We have begun a shift in the basic remit of the regulatory agencies so that they focus on the need to renew our infrastructure and adapt it to a low carbon future.

In the transition to low carbon energy and transport, emissions trading and a carbon price potentially provide strong stable investment incentives. Initial experience though has been disappointing. The need now is to look urgently at the options for ensuring we have a carbon price that is more stable and truly reflects the environmental costs.

And we need to examine how the role of pension funds to be major investors in the long term infrastructure projects of the future.

Infrastructure UK has been tasked with producing a full assessment of the scale of the challenge, and to produce creative ideas for how to meet it. Getting this right will be one of the most important ways of securing the country’s future prosperity. We all need to engage with Paul Skinner as he draws up his report in the coming months.

We need equal vigour in tackling the parallel challenge of making sure that British-based firms are ready for the opportunities this wave of investment will create.

Government bodies like the Office for Nuclear Development and the Office for Renewable Energy Deployment need to work intensively with British-based companies to anticipate and compete for the supply chain opportunities from huge shifts to alternative energy or transport infrastructure.

By the time the call for tender arrives, these firms should understand the opportunities, understand the capacities they will require, and understand the help Government can provide in helping them develop those strengths.

That’s exactly what we are doing now for example in the civil nuclear sector through the Nuclear Advanced Manufacturing Centre and our work to develop the nuclear supply chain to serve the growing nuclear industry in the UK.

Long termism vs short-termism

Finally, we need to start a debate about how we build a stronger culture of long term commitment to sustainable company growth in this country, based on a strong compact between institutional shareholders and the corporate sector.

On one hand we need a system that enables shareholders to discipline poor management. But we also need to give management some scope to plan and build without the excessive demands for quick returns that characterise too much modern public company ownership.

I don’t have any easy answers. Our reforms of company law made clear the importance of directors taking a long term view. At the same time we have empowered shareholders. We are now evaluating whether this has changed behaviour in the board room – and among investors.

Chris Hogg has played a key role in this debate with his review of corporate governance, and it is time for Britain to take a long hard look at the questions he and others have raised. I attach the highest importance to the new Investor Code and will be meeting investors and companies next week in the run up to the further consultation by the Financial Reporting Council.

Takeovers provide a very clear test here – for all involved. Companies making acquisitions should set out transparently and publicly their long term plans for the assets they propose to acquire, including company headquarters, R&D sites and main plants. Although these remain commercial decisions, firms or investors should expect to brave the court of public opinion if they are motivated only by short term profit.

Surely investment managers should be judged on their long term growth and profitability, not their short term performance – and the same goes for CEOs. How many strategic and effective managers are being hobbled with the quarterly race to please the beauty contest of the markets?

Conclusion

Only by growing our economy can decent jobs be created, living standards protected, and the winners’ circle expanded outward to those on low and middle incomes.

We have learnt the right lessons from the downturn and will sustain the recovery. But the key question is how we can achieve a step-change in the growth rate of the British economy in the decade ahead.

This consultation seeks views on whether the maximum penalty should be increased, and if so whether the new maximum should be £250,000, £500,000, £1 million or £2 million.

Background to consultation

Ofcom published on 10 September 2008 a revised statement of policy on the persistent misuse of an electronic communications network or service, which can be found at http://webarchive.nationalarchives.gov.uk/20100107175034/http://www.ofcom.org.uk/consult/condocs/persistent_misuse/statement. The statement includes examples of behaviour which may lead Ofcom to take enforcement action. The previous penalty of £5,000 was increased to £50,000 in April 2006.

Ofcom has asked the Government to increase the maximum penalty, recommending that it be raised from £50,000 to £2 million. The Government believes in strengthing consumer protection whenever possible and feels on balance that an increase would be beneficial, despite Ofcoms’ research seeming to indicate that the general level of silent calls may be decreasing. Ofcom considers that the current maximum penalty is not a high enough figure to represent a real sanction or an effective deterrent to companies that continue to persistently misuse networks or services by making silent and abandoned calls.

The Government set out its objectives for mobile broadband in its Digital Britain report. An Independent Spectrum Broker was appointed and he has presented a set of proposals to enable the release of additional spectrum into the UK market. The Government sees the Independent Spectrum Broker’s proposals as a sound platform for further consultation and intends to Direct Ofcom to implement them.

Purpose of consultation

The Government has the power to Direct Ofcom, subject to approval from Parliament, but is required to consult on any Direction by statute. This consultation document therefore seeks views on the proposed Direction to Ofcom.

Following a query from a respondent, whilst we are not aware that others are in any doubt, we confirm that responses on all the proposals in the consultation document are welcome and will be taken into account when the Secretary of State considers his decision on the contents of a direction to Ofcom.

Supplement to consultation

This document is supplementary to the consultation document, A Consultation on a Direction to Ofcom to implement the Wireless Radio Spectrum Modernisation Programme, published by the Department on 16 October 2009.

That Consultation Document (see below for link) set out various directions which the Secretary of State proposes to give to Ofcom in accordance with his power to give directions under section 5 of the Wireless Telegraphy Act 2006. The directions proposed were set out at Annex G to that Consultation Document.

Since that consultation was commenced, one organisation that has received the Consultation Document has raised two matters concerning the contents of that document. So that the position is beyond any doubt, this Supplementary Document deals with each of them.

Please note that the Secretary of State has now extended the time within which all responses to this consultation exercise need to be received. The deadline for responses is now 5pm on Friday 5 February 2010.

If you want to discuss policy issues raised in the consultation, please contact Mark Swarbrick either by email or on 020 7215 2900.

The Government has been informed that test houses are using a test cover fabric for testing the flammability compliance of furniture fillings that does not fully meet the specification in the Regulations. The specified fabric is not currently available.

Purpose of consultation

The Government is consulting on the case for amending the specification in the Regulations to allow for available test cover fabrics to be used, while continuing to fully maintain the high levels of fire safety required by the Regulations.

Areas for consultation

The views of stakeholders are being sought on

• the necessary level of detail of the proposed specification
• whether the proposed specification will meet the requirements of the Regulations
• the purposes of the specified test cover fabric
• any savings or costs that the Government has not taken into account in making this amendment

This consultation seeks views on whether the maximum penalty should be increased, and if so whether the new maximum should be £250,000, £500,000, £1 million or £2 million.

The Guidelines on Scientific Analysis in Policy Making provide a high-level framework for addressing the way in which government departments obtain and use science and engineering advice. In October 2009, the government response to “Putting science and engineering at the heart of government policy” was published. One of the commitments made in the response was to update the Guidelines on Scientific Analysis in Policy-Making.

Purpose of consultation

This is a consultation by the Government Chief Scientific Adviser which seeks views on the update of the Government Chief Scientific Adviser’s Guidelines on scientific analysis in policy making.

The Guidelines were last revised in October 2005. This updating allows for developments in policy making best practice to be reflected.

Update to consultation

On 15 December 2009, the Government published the Principles of scientific advice to government. The purpose of the high level Principles is to ensure continued effective engagement between the Government and those who provide independent science and engineering advice. They cover three key areas: trust and respect; independence; and transparency and openness.

Areas for consultation

This consultation seeks views on the update of the Guidelines on scientific analysis in policy making. Views on the Principles of scientific advice to Government are also welcomed.

The main aims of the consultation process in the UK is to collect the views of UK stakeholders on the priority areas for an update of the OECD Guidelines for multinational enterprises based on (but not limited to) the potential terms of reference listed in this document. This should assist the UK Government in identifying options for possible technical or more substantive updates of the text of the OECD Guidelines and Commentaries leading to the UK Government developing a position on the update of the Guidelines.

Stakeholders are therefore invited to provide comments by 25 January 2010, however, views received by 30 November 2009 would be particularly valuable in view of the next OECD meeting in early December. This meeting represents a major opportunity for the UK to influence the terms of reference of the update.

To ensure the consultation is as effective as possible, a UK NCP stakeholder event has been arranged on 9 November 2009, where we will also gather stakeholder views.

The last tranche of provisions of the Companies Act 2006 was commenced on 1 October 2009. Among the changes introduced then was a new “statement of capital” – a snapshot of a company’s share capital that must be produced at various stages in a company’s life-cycle, including each year in its annual return.

In the summer of 2009, it became clear that for certain companies, it could be difficult to comply with one of the requirements of the Act for financial information in the statement of capital. We published an FAQ on our website acknowledging the problem, and undertaking to consider and consult on how to resolve it.

Purpose of consultation

This consultation sets out proposals for amending the requirements that balance the interest of third parties in obtaining information with the cost to the company of supplying it.

The purpose of the consultation is to seek input on whether our assessments of the availability and value of information are accurate, and on our proposed options for changes in the information to be required.

In 2008 the Government commissioned Durham University to look at the way that licensing and enforcement practices were applied. On publication of the research in 2009, the Consumer Minister announced that the Government will launch a full public consultation on national guidance and options for possible legislative change to street trading and pedlary laws.

Purpose of consultation

The UK and Scottish Governments are consulting on the case for amending and modernising the law as it applies to the control of street trading and the certification of pedlars. We are also seeking stakeholder views on the draft guidance for pedlars, street traders and enforcers in England and Wales has been produced on the current regime.

Areas for consultation

The views of the public are being sought on options to

- Ways of making the street trading and pedlary regulatory regime more proportionate and effective.

- Providing local authorities with additional enforcement options in respect of illegal street trading.

- Updating the Pedlars Act 1871 to modernise the certification scheme and the definition of a pedlar, .

- Consider introducing a means by which, local authorities might exert proportionate limits on certified pedlar activity in designated areas.

- Options for revoking the Pedlars Acts and providing for adequate regulation of itinerant traders within the street trading regime.

- Draft guidance on the application of the current regime in England and Wales for enforcement officers, street traders and pedlars looking at what constitutes acceptable street trading and pedlary practice.

There is some evidence that companies may incorrectly use, as their registered office address, the address of another business or private individual with whom they have no connection. While it appears that the scale of the problem is small, the impact on an individual or business who finds that their address is being misused can be significant and distressing.

Purpose of consultation

This consultation seeks your views on whether and how we should change the law to reduce the risk of companies incorrectly using the addresses of other businesses or private individuals as their registered office address and sets out a process for third parties to challenge the information on the register.

Consultation invites comments on the options for simplifying the arrangements for the provision of information to shareholders, creditors, the audit and accounting authorities and Companies House when auditors leave office.

Background to consultation

The present arrangements are a combination of measures put in place under the successive Companies Acts to provide information to shareholders and Companies House, and measures introduced in 2006 to meet the requirements of the EU Audit Directive for the provision of similar information to the audit regulatory bodies.

In the Government’s view, after 18 months of operation of the current system, the arrangements may be more complex than necessary and are potentially duplicatory. This document identifies areas for possible simplification and streamlining while still meeting the UK’s obligations under the Directive and the underlying policy goals.

Discuss the issues raised by this consultation

Please contact Paul Smith at the contact details above.

In July 2009, the Government published its Consumer White Paper “A Better Deal for Consumers: Delivering Real Help Now and Change for the Future”. This White Paper announced that a Consumer Advocate would be appointed in 2010 to co-ordinate work to educate consumers and be a champion for groups of consumers who have suffered a loss at the hands of a business. One of the commitments we made in the White Paper was to consult on equipping the Advocate with some specific powers.

Purpose of consultation

We want your views on how the Consumer Advocate can successfully deliver real benefits to consumers. We also want to ensure that when the Consumer Advocate is equipped with new powers that he/she will have the ability to do all that we are asking. In particular that the Advocate has an effective power to obtain, as a last resort, compensation for groups of consumers through collective court actions.

Areas for consultation

The consultation seeks views on the initial role of the Consumer Advocate, for example how the Advocate can best improve consumer education and champion the provision of consumer compensation. The consultation then focuses on the key proposal that the Consumer Advocate be granted the power to take, as a last resort, collective actions on behalf of consumers.

In particular it seeks views on:

• the scope of the proposed collective action power,
• the right option in terms of the type of collective action, and
• what conditions should be met before a collective action can be taken.

Finally, the consultation seeks views on the Consumer Advocate having the power to facilitate the return of funds that have been identified as belonging to or due to UK consumers which have been secured by overseas enforcement agencies. And, it also seeks views on whether the Advocate needs to be given a specific power to tackle unfairness in consumer credit agreements.

In July 2009, the Government published its Consumer White Paper “A Better Deal for Consumers: Delivering Real Help Now and Change for the Future”. One of the commitments we made in the White Paper was to consult on banning the use of bills of sale for consumer lending.

Purpose of consultation

Bills of sale are being use to support “log book” lending, namely lending using a consumer’s car as security. This practice has been the subject of relatively high levels of complaints to consumer groups and the OFT. Complaints relate to the lack of consumer protections available to people if they fall into arrears, unfair collection practices, the complex and confusing nature of the language used in agreements and the high cost of the loans. Consumers may have their assets – typically their cars – repossessed without the need for the lender to obtain a court order. Bill of sale loans may also encourage vulnerable consumers to slip even further into debt. This consultation seeks to address concerns about adverse outcomes for consumers where borrowing is secured under a bill of sale.

Areas for consultation

We want a better deal for consumers who have been using this form of subprime loan and to tackle any areas of emerging bad practice, while ensuring that any intervention is proportionate, transparent and targeted. We believe that a ban on using bills of sale for consumer lending is likely to be necessary to achieve this. We have yet to take a final decision on whether to proceed with a ban or whether alternative options would achieve a better result. We specifically seek your views on the proposals set out in this consultation document to help determine the most appropriate next steps.

In particular, the consultation seeks views on the following options:
- whether current measures underway will provide sufficient additional consumer protection or if not, what other measures are needed;
- whether a voluntary code of practice or self-regulation would provide sufficient additional protections for consumers;
- whether targeted reform to bills of sale legislation would rectify the problems identified in relation to bills of sale;
- whether a ban on the use of bills of sale for consumer lending would achieve the best outcomes for consumers while promoting an open, competitive and innovative credit market.

We also seek further evidence about the use of bill of sale loans, in particular: by the vulnerable with no access to mainstream credit; and for business purposes by the self-employed and owners of small firms.

HM Revenue and Customs’ (HMRC) new Dynamic Response Team will work on the most high profile and complicated National Minimum Wage cases faced by HMRC, particularly in areas where employers are using migrant labour to undercut competitors by paying below the minimum wage.

The team is funded from a £70 million Government fund, paid for by a levy on migrant workers, to support those communities that are feeling the impact of migration most strongly.

The team will be made-up of highly-trained specialist officers who are committed to providing a rapid response to cases across the UK ensuring that everyone who is entitled to the minimum wage receives it.

Business minister Pat McFadden said:

“The Government and HMRC are doing more than ever to make sure that those entitled to the Minimum Wage are receiving it. Evasion hurts both workers and responsible employers who play by the rules, so we are stepping up our fight against non payment of the minimum wage.

“The Minimum Wage is a key part of the Government’s strategy to establish fairness in the workplace and the benefits of the minimum wage are felt by about one million workers every year, especially women and part-time workers.

Financial Secretary to the Treasury, Stephen Timms, said:

“The Government’s priority is to ensure that all workers are paid at least the National Minimum Wage, and HMRC enforce this robustly.

“This new Dynamic Response Team will respond quickly and effectively to National Minimum Wage non-compliance, making sure that employees are paid what they are legally entitled to.”

Communities Secretary John Denham said:

“Tackling the abuse of migrant workers is an important part of building a fair society.  Employers undercutting the wages of local workers put unfair pressure on businesses struggling to compete and cause resentment in the community.”

The new team will work with other Government departments and Local Authorities to ensure the most effective action is taken to deal with non-compliant employers, including civil and criminal prosecutions where appropriate.

There are around 1 million low paid workers who benefit from the minimum wage and since April HMRC have helped around 14,000 workers re-coup over £3.5 million of wage arrears. This included more than £640,000 alone in the hospitality sector, a sector noted for low levels of pay.

HMRC already tackle serious breaches of minimum wage law, such as the Jacksons Butchers case in Sheffield, which was closed in 2009. Pauline Smout and David Jackson were prosecuted for wilfully neglecting to pay the National Minimum Wage and were both fined and ordered to pay compensation because they could not pay staff the arrears they were entitled to.

Read the full BIS press notice here.

Download the guide

With the New Year approaching, many graduates will refocus efforts on their job search and the Government-backed Graduate Talent Pool website is a great place to start.

With around 6578 vacancies and two thirds offering payment, the site matches talented graduates to internship opportunities. Internships allow graduates the opportunity to develop their knowledge, skills and experience in a real working environment and give an insight into what a particular career has to offer as well as being one of the best ways for graduates to improve their employability.

Denise, author of How to Get a Job in a Recession, says: “Now six months on from their graduation, many graduates may be in need of some family support in their job search. Despite their children being grown up, many parents of graduates are still naturally concerned about their prospects and want to be able to help.”

Minister of State for Higher Education David Lammy said:

“Internships can help graduates kick-start their careers and are part of a package of measures to support them and improve their chances of getting a long term and well paid career.

“The guide explains all of the opportunities available so that parents and graduates can discuss the options together.

“Higher education is a long term investment that pays back big dividends over a working lifetime and even in these difficult times graduates do better than those with lower qualifications.”

The ‘Parent Motivators’ guide is available to download for free at www.direct.gov.uk/graduates.

The Know Your Consumer Rights website has useful information to help you. It sets out the key rules that you should know, when looking for a bargain or taking something back, such as:

• Anything you buy must be accurately described
• Products must be of satisfactory quality
• Anything you buy must be fit for purpose, and if goods are faulty it is the retailer’s responsibility not the manufacturers
• If you buy something off the internet, in most cases, you have a cooling-off period when you can cancel your order without giving a reason and receive a full refund

The campaign is part of a major initiative by the Government to make sure that you know how to get a fair deal when you’re shopping and to make sure that you know what to do if things go wrong.

Consumer minister Kevin Brennan said:

“Just because you’ve bought something in a sale, it doesn’t mean that you don’t have the same rights as someone who paid full price.

“About a third of people have said that they felt their consumer rights had been ignored at some point, and I want to do everything possible to make sure this doesn’t happen in the future. Consumers deserve better.

“If you know your rights, and are confident in what you can ask for, you’re much more likely to get the right result when things go wrong.”

Visit the ‘Know Your Consumer Rights’ website

This is BIS’s first SDAP, previous Plans having been published for BERR and DIUS prior to their merger in June 2009. The new SDAP reflects the linkages between the work of the former BERR and former DIUS and how BIS’s activities contribute to sustainable development.

The SDAP not only brings into one document the Department’s work on innovation, science, universities, skills and businesses in relation to sustainable development, but also addresses how it will improve sustainability across its operations on its own estate.

• Creating a more diverse higher education landscape, by increasing the range of alternatives to the full-time three year degree;
• Maximising the impact that higher education makes to the economy by supporting the programmes with highest economic and social value;
• Supporting research concentration to underpin our world class ranking, while continuing to support excellence in research;
• Developing a standard set of information about higher education, so that all students can exercise informed choice about courses and institutions.

Download the letter 280KB

Higher Education Minister David Lammy said:

“Over the past decade, the Government has invested record amounts in Higher Education – around 25% more than 1997 – and there are now more students than ever before in our history attending university.

“It is right that universities, in common with all other areas of public spending, play a part in helping manage the pressures on public finances brought about by the impact of the financial downturn. Tough choices are inevitable but we are minimising the effect on the frontline by making savings on capital budgets, asking the sector for further efficiency savings and by asking HEFCE to look to reduce funding which will not impact on teaching.

“We are absolutely clear that a high quality student experience with excellent teaching is vital to maintaining the world class Higher Education we enjoy in this country today.”

Download the plan 4.8MB

It contains good news for the UK as we are already meeting key elements of European best practice in the four areas covered by the National Action Plan on Researcher Mobility and Careers (NAP): open recruitment, pensions and social security, attractive working conditions and skills.

Compared with most of our EU partners, the UK has built a very open research environment. Approximately 20 percent of our academics come from abroad, roughly evenly split between EU and non EU in origin. At researcher level, the percentage is even higher – up to 50 percent in some disciplines.

As a result, the NAP restates current UK practice along with a number of case studies showcasing national and local initiatives.

It also identifies future actions so that we can continue to build on our good practice and remain an important destination for top quality research.

These include developing and strengthening the implementation of the UK Researchers’ Concordat. This Concordat, developed by the research community, aims to increase the attractiveness and sustainability of UK research careers and to improve the quantity, quality and impact of research for the benefit of UK society and the economy.

Minister for Science and Innovation Lord Drayson said:

“We are investing record amounts into research. This investment is vital to make sure that the UK, and Europe, is to fulfil our economic potential and address the great challenges ahead. That includes creating an environment which encourages the brightest young people to choose research careers.”

The NAP highlights how the UK is the most popular destination for researchers supported by various elements of the European Framework programme for funding research. These include:

• The Marie Curie programmes which explicitly set out to fund mobile researchers
• The European Research Council which fund the best researchers throughout the continent so that they can take their research outside their home country.

It also highlights several other initiatives which demonstrate UK good practice including a scheme run by the Wellcome Trust – a major UK research funder – to support outstanding medical or science researchers as they establish their academic careers in selected Eastern European countries, i.e. Croatia, Hungry or Poland.

Download the plan 4.8MB

(Image: Creative Commons)

A Consultation on a Direction to Ofcom to implement the Wireless Radio Spectrum Modernisation Programme

That Consultation Document set out various directions which the Secretary of State proposes to  give to Ofcom in accordance with his power to give directions under section 5 of the Wireless Telegraphy Act 2006. The directions proposed were set out at Annex G to that Consultation Document.

Since that consultation was commenced, one organisation that has received the Consultation Document has raised two matters concerning the contents of that document. So that the position is beyond any doubt, a Supplementary Document has been published which deals with each of them.

Please note that the Secretary of State has now extended the time within which all responses to this consultation exercise need to be received. The deadline for responses is now 5pm on Friday 5 February 2010.

Speech by: Lord Mandelson
Venue: IISC – UK Lecture Series, Indian Institute of Science, Bangalore

 I’m very honoured to launch this lecture series. Over the next few months the series will cover a wide range of topics from prime numbers to the economics of climate change. The very distinguished Professor Alison Richard, Vice Chancellor of Cambridge will be first up here on January 12 to speak about how universities can help drive innovation.

Of course it’s also a huge privilege just to be at this podium in Faculty Hall, which in its illustrious history has hosted Nobel Laureates, and minds a lot sharper than mine. I’ll just have to do my best.

The aspiration and inspiration for this series is that it should give us a chance to reflect on the evolving relationship between India and Britain in the field of science and innovation.

So obviously, for the last couple of weeks I have been casting about for symbolic new projects to launch this week. And I knew I might be onto one when someone mentioned to me that the Indian space programme has charged Indian scientists with developing a curry suitable for astronauts.

Now, given that Indian cooking has transformed British tastes over the last twenty years, I’m wondering if this is an avenue for joint research? Perhaps British scientists can work with MTR to develop some sort of zero-gravity dosa? India and Britain: going where no paan has gone before.

Coming back to earth, I want to provide a sort of preface to the lectures to come by talking the general value of internationalism in innovation and science. Both between India and Britain, but also more widely. Both India and Britain are investing heavily in their national innovation systems. Today I want to argue that while the capacity to innovate is clearly central to national growth, it does not follow that innovation is something we should see solely in national terms.

Races we can all win?

If science and innovation are so central to competitiveness, why should we see them as something that should be built on international collaboration? This question goes to the heart of what ultimately makes globalization ultimately a good thing. Trade in goods and services, just like collaboration in science and innovation, has an important role in raising productivity, which benefits both sides. Rising productivity is, generally speaking, a race we can all win.

No less importantly, many of the big challenges of this century, such as food security and climate change, are ones in which we can all potentially lose – some worse than others and the world’s poor worst of all. We are in a race to develop green technology. But ultimately the race is not between  countries but between humanity and an advancing ecological crisis.

If the twentieth century sometimes seems like a calamitous  exercise in applied ideology, the next century needs to the century of applied science. How will we address poverty and eradicate treatable disease? How will we engineer the low carbon, and eventually the no-carbon, solutions on which a sustainable and equitable human future depends?

What this suggests to me is that the next generation of engineers scientists and innovators that the world produces will be among the most important in our shared history. Faced with these kinds of challenges there is a clear incentive to make the best use of our collective scientific and technological resources.

To put it more positively, the incredible process of cross-fertilization of ideas is one of the defining benefits of globalization. It has never been possible to separate trade in goods and services from the transfer of knowledge.

Innovation spills over from researcher to researcher and company to company. The art of paper-making came down the silk road with the silks and the spices. Indian mathematics made its way into Europe by way of Arab and Persian traders. A lot of the technologies of the later industrial revolutions flowed back the other way. East to west, west to east.

This institute is a good reflection of that. JN Tata had a clear conviction that India needed to develop its own indigenous industrial strengths. And like most great industrial pioneers, he was utterly pragmatic about the need to draw in expertise from outside India, including the budding steel industry of Pennsylvania and the United States. The first Director of this Institute was Morris Travers from Bristol.

Kamal Nath has set the same challenge for India’s infrastructure revolution, which he has openly said will require India to pull in the skills and investment of the best in the world. I know Kamal well enough to know that he is far too smart to see this as a sign of weakness. He’ll rightly see it as the fastest route to Indian strength.

Education, research and industrial competitiveness

There is another real innovation that this Institute represented, and represents, and it put J N Tata well ahead of his time. This was the recognition that you can’t separate industrial competitiveness from education and research and that you have to invest strategically in these strengths. 

The way in which this commitment to first class training and research has powered the development of an Indian technical and scientific class is of course one of the things that defines India’s recent economic rise for many non-Indians.

One extraordinary spillover from this commitment is the fact that for the last decade more than a quarter of America’s IT and software companies have been founded by Indian emigrants. In fact a troublemaker might say that the modern US economy is built on Chinese money and Indian brains. Although, I, of course, am not that troublemaker.

Britain’s hasn’t always got this balance right. An ideological distaste for public investment of almost any kind under Margaret Thatcher had left Britain hemorrhaging scientists and with a chronic underinvestment in higher education.

But over the last decade that situation has been reversed through massive investment. Britain now ranks first or second only to the US in almost every discipline. It has one of the strongest science bases in the world, way out of any proportion to our size. It’s paid off hugely in British international leadership in the biosciences and advanced technologies.

The challenge for Britain is of course to make sure that these elite institutions and specialist strengths are not a like a ladder with strong rungs at the top and weak rungs at the bottom. We have invested heavily in generic skills and in primary and secondary education and have dramatically opened up alternative vocational routes to higher skills like apprenticeships.

Obviously India’s experience is very much sui generis.  But India also faces a huge challenge of general and specialist education. And there are parallels for the simple reason that both Britain and India’s higher education systems emerged from the same nineteenth century model focused on turning out highly civilized civil servants. 

I know that Indian commentators like Nandan Nilekani have devoted a lot of time to thinking about how you transform this model into one equipped for a globalizing India. To an outside observer, this debate is yet another sign that India is at a critical point in its dramatic transformation. While its initial breakaway growth might have been driven by low cost and low value service provision, its future will increasingly be tied to driving up the value added in India. India is moving from the generic, to the genuinely innovative.

Implicit in this ambition, as writers like Nandan Nilekani are surely right to insist, is a huge education and innovation challenge. Britain is having a version of the same debate. Both of us are focused on making higher education more relevant, more vocational, more accessible and more of a driver of economic growth and innovation, without losing its civilising character.  

Britain and India

My hope is that Britain and India can ultimately build a deep, durable and mutually beneficial partnership in pursuing this. We certainly want to make sure that the UK is as open as possible to Indian who want to study in the UK.  Over 30000 Indian students studied in the UK last year – a rise of almost 40% on the previous year.

We are encouraging British universities to internationalise Higher Education and seek out Indian partners for student and faculty exchanges and developing joint and complimentary curricula. And this must be a two-way flow, with UK students and faculty coming here to experience modern India.

We need to continue to transform our research relationship from one in which we procure teaching or research from each other into one that is genuinely collaborative. India is a cost-effective place to do joint research and it has obvious strengths across the spectrum- from ICT, pharmaceuticals and green energy to public policy problems around poverty reduction and public health. Indian companies and researchers can only benefit from collaboration with knowledge brands like the best UK universities. There are a lot of good examples of how this can work in practice.

The UK and India jointly funded three Science Bridges last year, worth up to £6million, to strengthen our research and innovation relationship. One of these Bridges is between IIS, the University of Leeds and ICRISAT, focusing on sustainable agriculture. Another is between IIM Bangalore, Nottingham University and IIT Kanpur. This will see Nottingham students studying here, including at AstraZeneca’s Bangalore research lab.

The multi-million pound joint investment in the India-UK Advanced Technology Centre is working on applying technologies in rural education and healthcare and has brought together academic institutions with leading corporations in India and the UK, including Infosys and British Telecom.

Imperial Innovations, which is the research commercialisation arm of Imperial College, now has a venture here in Bangalore and has raised about $10 million for research spinouts. On an even larger scale, the Welcome Trust has now been working with the Indian government for a year on a £80million programme of biomedical research.

The UK is also increasingly keen to partner with India on publicly funded development research. The UK’s research budget for international development over the next few years will be bigger than that of the World Bank – around £220 million. In the past this is the kind of funding that has helped lead to the production of treated bednets to defend against malaria and to simple oral treatments against dehydration, which is still the second biggest cause of infant mortality in the world after pneumonia.

What we must not do is let practical obstacles get in the way. Of course we have different models for funding and defining our research agendas. We need to use the experience of existing collaborators and bodies like the India-UK Science and Innovation Council and the UK-India Education and Research Initiative as a kind of adaptor plug to fit UK institutions and research councils and Indian decision-makers together.

One endpoint of this process will be the growth of a base of innovative Indian firms to follow the first global generation of Indian companies that have emerged in recent years. We obviously want to make sure that Britain is the country of choice for these firms when they position themselves for the European market or establish a European research and development presence. All of the major Indian IT players now operate in the UK. I have just come from a fascinating visit to Wipro, where Azim Premji outlined Wipro’s impressive plans for developing low carbon business in the UK.

I know that there are concerns among some in India that changes to the UK’s migration system might put this at risk. But I can guarantee you that while we do have to guard the system against abuse, the route into Britain for skilled and qualified Indian workers and investors will remain open.

Conclusion

In making this case for an international view of innovation I don’t mean to sound overly idealistic or blind to the challenges. At the business end of the knowledge economy there will always be hardheaded debates about intellectual property and licensing. That’s a necessary reality and part of the mix of incentives that drive innovation.

It’s also the case that tough commercial competition will always be an integral part of what makes us innovative. It’s when we are under pressure that we challenge established ways of doing things and do them better. We don’t protect innovators by cutting them of from competition: often that just takes away a spur to innovation.

But this doesn’t negate the argument that science and innovation should be something that are driven at their core by international openness and collaboration.

Scientific discovery is something that India and the UK have always done well together.  Sir Roland Ross won the Nobel prize for medicine for research into malaria he did during his time in Bangalore. The most recent Nobel Laureate, Venkatraman Ramakrishnan, who this year won the Chemistry prize, is based in Cambridge.

Their experience is a reminder that in the expanding global single market for ideas, international collaboration in science and innovation is good for India. It’s good for the UK. And it’s good for our human future.

This increase of 27.4 per cent compared to 2007/08 means the Government has met its target to increase the number of apprenticeship completions two years early.

The overall success rate for apprenticeships was 70.9 per cent in 2008/09, significantly higher than the target success rate of 65 per cent, and the 37 per cent pass rate in 2004/05.

Apprenticeships Minister Kevin Brennan said:

“It’s great news that we’re seeing the highest ever number of people completing an apprenticeship, and that the success rates have jumped to over 70 per cent. I’d like to congratulate all the people who have successfully completed an apprenticeship, and all the businesses who continue to offer apprenticeships, even in difficult economic times.

“We know that business values the apprenticeship highly because this training is providing the skilled workers British businesses need for the future and Government remains committed to making it easier for businesses to offer them.”

Other figures show that in the academic year 2008/09:

• People started 817,400 qualifications through Train to Gain, and successfully completed 543,100 qualifications;
• Overall, over 1.4 million Train to Gain courses have been started since the scheme was launched in April 2006 and over 850,000 people so far have gained a qualification; Train to Gain is the Government’s flagship service to help employers improve the skills of their employees and the productivity of their businesses.

Press release: Record numbers of people successfully completing apprenticeships

Read about ‘Skills for Growth’ – a strategy that includes creating a modern class of technicians through a dramatic expansion of advanced apprenticeships, creating 35,000 new places over the next two years.

 In this Westminster Hall debate on the future of the steel industry in Teesside, Pat McFadden talks about the three factors that served as the backdrop for Corus’s decision to mothball its Teesside plant: fall in demand, fall in price and the collapse of the off-take agreement to buy the steel produced there. He then sets out the Government’s response – a £60 million package of support to help the people of the area.

 Read the full debate (external link)

- Launch date: 15th December 2009
- Closing date: 10th February 2010
- Response:     Spring 2010

A new review and a call for evidence to identify and address barriers to investment created by consents for development, other than planning permission, was announced on 15 December by Business Minister, Ian Lucas. The Penfold review, headed by Adrian Penfold – the current head of Planning and Environment at British Land and board member of British Land Corporation Ltd, will look at consents for development made alongside or after planning permission for all sizes of projects.

A well functioning planning and consents environment is an essential component in encouraging and facilitating investment in development. Striving for a regime that seeks to minimise the cost, time, bureaucracy and uncertainty attached to planning and consent applications has been, and continues to be, a key priority for government.

Submissions should be sent to penfoldreview@bis.gsi.gov.uk by 10 February 2010, though earlier responses would be helpful.

Full details

• The Penfold Review of Non-Planning Consents: Call for Evidence (Word, 69KB)
• Penfold Review – Terms of Reference (Word, 47KB)

Questions

1. How important do you consider non-planning consents are in making decisions about whether to invest in development proposals?
2. When applying for non-planning consents, what obstacles do developers encounter in terms of a) administrative burdens; b) costs; c) uncertainty and risk in applying for; and d) the length of time associated with obtaining such consents? Do any obstacles encountered have a particular impact on a specific sector, type of development or size of business? Which obstacles cause most difficulty and why?
3. How do those seeking consents go about identifying what additional consents are needed alongside or after planning permission? What difficulties do they encounter in doing so?
4. Can you give examples of investment options which have not been pursued, have been delayed or have otherwise significantly changed because of non-planning consents? Which consents were integral to the decision to stop, delay or change the development? Can you quantify the impact of the changes for the business affected?
5. What opportunities do you see for reducing a) the administrative burden; b) the cost; c) the uncertainty and risk in applying for; and d) the length of time associated with obtaining non-planning consents? What action can regulators take to improve the service they give to developers when dealing with non-planning consents? Which actions would bring greatest benefit and why?
6. Are there other relevant issues that the review should take into account?

Transcript of Podcast: Federation of Small Businesses’ John Wright

The summary report, published by the Better Regulation Executive, detailed how more than 280 changes to regulations have helped save UK businesses around £2.9 billion a year so far.  Read the full summary report here: Summary of Simplification Plans 2009 (PDF, 825KB) 

Ian Lucas, Minister for Business and Regulatory Reform, said:

“Simplification is making a real difference to the everyday lives of businesses, helping to make things as simple as possible, saving more than £8 million a day, every day.

“Individual measures may look small but it is overall impact that adds up to real savings. And support from the business community has helped make sure that savings to businesses are felt on the ground.

“But the programme also shows real change across government in its attitude towards regulation. Delivering the right business environment to promote growth relies on creating a flexible regulatory framework that minimises costs to business but ensures essential protections and rights are in place. Better regulation, with simplification at its core, is making that possible.”

An independent panel including representatives from the business community has tested whether simplification measures were effectively communicated to businesses and were felt in the ground.  In May this year, this Panel again scrutinised the Government’s delivery and validates 77.5% of the Programme’s gross savings.  

The Government is on track to meet its target of cutting the administrative burden on businesses by 25% by May 2010 that will deliver an expected £3.3 billion in annual net savings.

The report also details how government has delivered more than 30 per cent net reduction of the amount of information requests from central government on front-line public sector workers, such as nurses and police, and how it has cut more than £1.3 billion in wider costs of complying with regulation.

The Government recently announced a new commitment to cut the costs of regulation further, by £6.5 billion by 2015. This was part of a package of measures to strengthen the management of regulation with the publication of the Government’s regulatory programme until April 2011 and the creation and set up of a new independent scrutiny body to advise on the costs and benefits of new regulation. 

The Government announced in the Pre-Budget Report that it has already identified potential savings of over £1 billion towards the new target.  Recognising the importance of ensuring that the programme focuses its attention on the areas which are of greatest concern for business, the Government is today launching a call for evidence, to enable business and other interested parties to feed in suggestions of which regulatory activities place disproportionate costs on business, compared to the benefits delivered, and to propose action that will reduce or remove these costs.

PLEASE CHECK AGAINST DELIVERY

Good afternoon.

I have an announcement to make.

The UK is going to have an executive space agency – a single, coherent organisation to support an industry and a research base that are one of the best advertisements for the UK.

Space directly employs 20,000 people in this country.

It contributes £6.8 billion to the UK economy.

And here’s perhaps the most impressive achievement: our space sector has been recession proof.

Astrium recently won a €500 million contract to manufacture four Eurostar 3000 telecommunications satellites. Facilities in Stevenage and Portsmouth will be handling much of the build.

Surrey Satellites has signed an agreement to build Sri Lanka’s first Earth observation satellite, and has already started work on that country’s first communications satellite.

Systems Engineering and Assessment has sealed a deal to provide the remote interface units being used on the BepiColombo mission to explore Mercury.

The space industry has grown in real terms by around nine per cent per annum since 1999/2000 – more than three times faster than the economy as a whole.

Going forwards, it’s forecast to maintain average annual growth of five per cent until 2020 – and, on their own, commitments made at last year’s ESA ministerial meeting have provided work for UK space companies for at least the next five years.

In fact, space provides the strongest rebuttal to all those people who knock the UK and argue that we no longer have the right stuff when it comes to manufacturing.

Think about it. Space is the toughest environment of all, where systems and components are subjected to the ultimate workout – instruments required to function at just a tenth of a degree above absolute zero. When you send multi-million pound kit into orbit, there are no second chances.

We compete in this environment – and we win.

A fundamental reason for that is that you’d be hard placed to find another sector where industry and the research base are so wedded together.

The knowledge transfer relationships are long established here – and the basic story of UK space is outstanding science delivering strong commercial returns.

As we rebalance the economy, this is precisely the high-value, highly-skilled, technologically advanced area we must focus on: for jobs, for growth, for prosperity.

Hence the agency.

The recent public consultation on the funding and management of our civil space activities found that the current partnership structure has served a useful purpose.

Through the existing system – and in the past year alone – the Herschel and Planck satellites are gathering the most detailed information we have about the birth and evolution of our Universe.

The European Space Agency centre has opened here at Harwell, a facility that will lead Europe on integrated applications, robotic exploration and the management of climate change data.

It will soon be joined by the International Space Innovation Centre, where publicly-funded science will take place right alongside industrial R&D. Together, the ESA and ISIC centres will serve as a vital cluster to exploit our competitive advantage.

But the majority of respondents to the consultation agreed that we do need to raise our game in several areas – like strategic decision making, like leading multi-partner programmes, like extending the space technologies in other high-tech, high-growth areas.

That’s what the new agency will do – not through more money, but through better organisation.

It will put the machinery of government fully behind the sector. It will secure cross-Whitehall decisions and buy-in on space-related issues – including education and outreach – and it will prioritise UK involvement in future space projects.

We need that unified approach to grab a greater share of the global market in space systems, services and applications – and remain at the forefront of advanced manufacturing.

Other countries have similar ambitions. At the moment, I’d venture that the UK is the place to be for space scientists and entrepreneurs.

Only yesterday, for example, we announced a new tax measure to support innovation – the patent box.

Businesses built on patents – as many in this sector are – will benefit from a 10 per cent rate on corporation tax.

That’s great progress – and we need to keep going in what is an increasingly competitive global market.

In the last 12 months, we’ve seen India – which has a comprehensive programme of launchers, telecommunication and Earth observation satellites – send its first probe to the Moon; carrying – I might add – an instrument built here at Rutherford Appleton.

The Canadian Space Agency has received a stimulus package worth $100 million to boost its robotics capability.

There’s been no let up in China’s programme to launch dozens of spacecraft, build its first manned space station, and dispatch probes to both the Moon and Mars.

It’s early days for the agency. A cross-Government group will now meet to begin planning the way forward – and there will be a formal agency launch in due course, where we’ll reveal its name.

If you saw the Times yesterday, you’ll know there’s already been some speculation about that.

Today, we’re also publishing an independent review of space exploration – one that’s unique in attempting to quantify the potential economic benefits from future human or robotic activities.

Although the broader economic climate means we’re not in a position to change our current approach to investment in space exploration, the data in this report will inform the work of the space Innovation and Growth Team – and, later, the agency. It only reinforces the case for space as a major growth sector.

For now, let’s celebrate an excellent 2009 – strong on the science side, strong on the commercial side.

I’ve had two personal highlights as minister.

The first was meeting apprentices at Astrium – young people describing the thrill of working on equipment being dispatched to the far reaches of space.

The other was news of Tim Peake’s success for being selected as one of ESA’s Astronaut Corps.

I know that BNSC are working on a publicity campaign featuring Tim that will encourage young people to study science subjects in school. Space has a unique capacity to inspire and Tim has iconic potential.

Next year, we’ll see more data from Herschel and Planck. The UK-led Cryosat mission to study ice thickness at the poles. The launch of the Hylas spacecraft, developed by start-up company Avanti Communications, which will deliver broadband across Europe to people unable to use surface links. And the imminent report from the IGT setting out a 20-year strategy for the sector.

So these are exciting times. Promising times.

A joint NASA/ESA programme of Mars exploration is being finalised with the UK at its heart. Space technology is being built in this very lab to monitor illegal destruction of the rain forests. And about 200 miles above our heads, there’s now a fully functional scientific laboratory on the International Space Station, conducting medical, material and biological research.

What we’ve got to do is build on what the UK already does extremely well, and really go for growth – growth backed by the agency.

The late Werner von Braun, arguably the greatest rocket engineer of the 20th century, once made a rather elegant quip. He said: “There is just one thing I can promise you about the outer-space programme: your dollar will go further.”

Von Braun’s observation applies in any currency. So let’s get our full pound’s worth – up there and down here.

Because, if you look carefully this sector, you can glimpse Britain’s future: built on great science, employing the most highly-skilled physicists and engineers, manufacturing leading-edge technologies in demand worldwide.

It’s a great future.

If you’ve paid for something and you’re not happy, establishing your rights is the first step towards claiming the refund, repair or replacement you may be entitled to.

The key rules to be aware of are:

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

Consumer Direct is a government-funded advice service for consumers and should be your first port of call for practical help with how to complain. For more information visit the Consumer Direct website or call the helpline on 08454 04 05 06.

Later today Kevin Brennan will tell the National Consumer Federation’s Consumer Congress in London that: “There’s a lot of of protection in place to support consumers, but we want to see a big improvement in awareness of this protection and of consumer rights in general.

“You are much more likely to get a fair deal, save money and get the right result if you are aware of your rights. This is especially important at Christmas when most people are spending money both on gifts and in the sales.”

Watch the ‘Know Your Consumer Rights’ video

Speech by: Rosie Winterton MP
Venue: New Local Government Network Conference – Invigorating Local Economies, London

Introduction

I am delighted to be here today and I’m sorry I have to leave so early. The reason is that I am going up to the North East to discuss the closure of the Corus plant. I think that illustrates very aptly why we are here today – to explore the role that local authorities can play in developing their local economies.

Later today I will be doing just that, meeting with local authorities and their partners to discuss what they can do to assist in what is a very, very difficult situation for thousands of people in the North East.

I believe that over the past 18 months or so, during the global recession, we have seen local authorities across the country rising to the challenges it has posed, and graphically illustrating the need for strong local leadership on economic issues.

So what we need to look at now, as the immediate crisis subsides and we focus our attention on laying the foundations of our future prosperity, is the hugely important role of councils – working closely with the Regional Development Agencies – in shaping our economic recovery.

Nurturing the economic recovery

The seismic shifts we have seen in the global economy are creating a wealth of opportunities, as well as challenges. And as a country, we have to be ready to grasp them.

So as a Government we have been examining what we need to do to facilitate that. The New Industry, New Jobs strategy we published earlier this year is our blueprint for a more active and interventionist approach towards industrial policy.

It’s not about picking winners – that’s not our job. But it is about identifying our existing economic strengths and developing new capabilities. So our people and our companies are equipped to compete and win in the new global economy that’s emerging as the recovery gets underway.

In recent years, British companies have secured a place at the top end of global supply chains, where our science, our engineering and design skills are best matched.

That expertise – and our investments in high-value, high-growth sectors like low-carbon; advanced manufacturing; healthcare and education; financial services; and others – puts us in a powerful position to compete globally.

But if we’re going to build on that we absolutely have to harness the power of Government at every level – targeting our interventions in the sectors and the areas of the country where they can have maximum impact. What we mustn’t have is a recovery that is powered purely by London and the South East.

This Government is passionately committed to economic opportunity for all – whoever they are, wherever they live. So we want to make sure that communities across the country are able to grasp the opportunities on offer.

That means ensuring that the skills training on offer meets the needs of local employers; providing the right transport networks so people can commute to work; putting in place an effective planning regime that allows firms to grow and develop; and guarding against a regulatory regime that stifles business innovation.

Partnerships for growth

Getting that right requires close partnership working – between councils and their local partners, the Regional Development Agencies, and central government. And to make that happen, each of us has to be clear about the role we need to play.

So tomorrow I will be publishing Partnerships for Growth: a National Framework for Regional and Local Economic Development.

This framework sets out the responsibilities of each tier of Government, and identifies the areas where central, regional, sub-regional and local partners can each make the greatest contribution to economic development.

It lays down how we can all collaborate to strengthen growth and spread prosperity – ensuring that every part of the country performs to its full potential.

It also identifies the growth sectors where targeted interventions can help Britain compete globally, and how support for these can be aligned with regional and sub-regional economic development to boost jobs and economic opportunity.

The framework will give local authorities, the Regional Development Agencies and other partners the ability to identify key priorities and combine their firepower to drive economic growth – for the benefit of their areas.

Councils have an absolutely vital role to play here, leading efforts in everything from creating the right environment for business investment, to equipping people with the skills that local employers need. The framework will establish economic development as a core activity for every authority.

It means they need to consider the economic impact of everything they do, and develop their understanding of how issues such as procurement, regulation, and the quality of local public services can boost – or hold back – growth.

But just as local and national priorities need to fit together, so local and regional priorities also need to be aligned.

The new Regional Strategies, being developed jointly by the regional Local Authority Leaders’ Boards and the RDAs, will set out the priorities for each local area and region, bringing together objectives for economic development, housing and climate change. They are a means of targeting key investments in infrastructure and sectors that will boost the economy across the region and drive national economic growth.

It’s essential not to lose that wider economic perspective. So the framework heralds a new approach for the RDAs, requiring them to work together with the Government to support national priorities, as well as to continue to promote economic growth in their regions.

RDAs are close enough to the ground to be sensitive to local circumstances, while being far enough away to take a strategic view. They can balance economic priorities; foster local and regional partnerships; and take the big decisions on the new infrastructure needed to galvanise growth.

That regional dimension is essential. Whitehall can never have the in-depth local knowledge; but town halls may miss out on economies of scale or sometimes the slightly bigger picture.

By aligning the priorities and the activities of Government at every level – nationally, regionally and locally – we can ensure that public investments have maximum impact and the fruits of economic growth are shared as widely as possible.

Now I suspect that for a lot of people here today, what is in the National Framework will reflect what you are already working towards; there won’t be any huge surprises.

But I do think it’s important to have written down, in a document that people can refer to, a description of how those different relationships work at national, regional and local level. And making very clear the point about local authorities’ crucial role in the driving the economy at the local level.

Local Economic Assessments

I also want to mention Solutions for Business and the role that councils have to play in that. What we have been trying to do – because we have been very aware that businesses have sometimes found all the different services on offer slightly confusing – is to bring them together.

We do need the help of councils in making sure businesses in their area are aware of what’s on offer, and in supporting the approach we have adopted in their own activities.

All of this is about creating the right environment for businesses. And I believe that the new Local Economic Assessments coming in from next April will give councils and their partners a very clear understanding of local economic conditions.

In view of what has happened in the North East with Corus we were discussing earlier whether, within the assessments, there should be the ability to look at what would happen if there is a big closure in an area.  These are the kinds of issues we need to tease out, and identify what it is that councils can bring to the table in such circumstances.

Councils can also use the opportunity of the assessment to draw up a Work and Skills Plan, which is a good way of taking the skills objectives set out in the regional strategies, and translating them into a coherent delivery plan for each area.

In the Government’s new skills strategy, Skills for Growth, published last month, we have laid emphasis on ensuring we have plans at the regional and local level to ensure we are able to equip people with the right skills for the jobs of the future, and with the flexible skills that employers constantly tell us they need.

I have been very struck by the way that councils have increasingly led from the front in ensuring they talk to local employers and involving them in the training that’s provided locally. If we get the Local Economic Assessment right, it will very good way of drawing local employers in even further to that process.

Multi Area Agreements have also been very important in ensuring local partners work together to identify priorities for the wider area – on issues such as skills, transport, and housing. And the Economic Prosperity Boards coming in from next year are a way of translating the economic assessments, as possibly the Work and Skills plans, into real action.

So I am absolutely committed to exploring just how ambitious we can be in this area, and how much further we can go in putting local authorities right at the centre of driving economic development.

Conclusion

But to do that successfully, of course, Whitehall, town halls and the RDAs all need to work together to translate our vision of economic opportunity for all into a blueprint for action in every region and local area.

I do recognise that this will involve big challenges for local authorities – we are asking a lot of you. So I think it’s important we have a dialogue about how we continue transforming the role of councils, equipping them to deal with the big challenges we face today and tomorrow.

I believe that by harnessing the power of councils and working in partnership we can generate prosperity for people in every part of the country. Today is a first step in defining how we take that forward – I am sure it will be very successful.

Thank you.

BIS is playing a key role in the Government’s plans announced as part of today’s Pre-Budget Report (PBR). Only if the economy returns to strong and sustainable growth can we reduce public borrowing and protect frontline public services.

That’s why we are prioritising and targeting our actions to ensure that they support recovery and drive longer term economic growth.

We’re building on the work we’ve done already, with the latest statistics showing Real Help for Businesses is getting through and initiatives under way to invest in growth as part of our active industrial strategy, New Industry, New Jobs.

Extra funding to invest in growth through the Strategic Investment Fund

The Strategic Investment Fund (SIF) has been expanded with an additional £200 million, bringing the value of the fund to £950 million. This will extend the targeted support for investments across the UK economy to strengthen its capacity for innovation, job creation and growth.

New investments announced are particularly targeted at low carbon and emerging technology projects around the country.

Support for small businesses extended

While most firms report that they can get the finance they need we recognise that closing our support schemes too early could risk derailing the recovery by stifling the investment plans of the businesses that create growth and jobs.

The Enterprise Finance Guarantee facility will continue for another year, supporting up to £500 million of bank loans to viable businesses between April 2010 and March 2011.

The Government also announced that the Time to Pay scheme, which helps businesses spread their tax payments, will be extended for as long as necessary and the increase in corporation tax for smaller companies will be deferred until April 2011.

Incentivising Innovation

To strengthen the incentives to invest in innovative industries and ensure the UK remains an attractive location for innovation, a 10 per cent corporation tax rate will be introduced on income which stems from patents. This will benefit all businesses that develop patents – in particular innovative industries such as pharma, biotech, aerospace, automobiles, and telecomms.

Key announcements

10 Dec 2009

• 1.07pm Government Welcomes GSK’s Response to Patent Box
• 12.57pm Consumer Minister Welcomes Additional £5m For Citizens Advice Bureaux
• 12.27pm Cutting edge computing institute for Wales

9 Dec 2009

• 4.13pm Investing for Growth
• 3.20pm New £24m Boost to Life Science Sector in Edinburgh
• 3.15pm Government Extends Loan Guarantee Scheme
• 3.05pm Government to Create Europe’s Largest Technology Venture Capital Fund
• The Chancellor’s speech in full
• How the PBR will affect you

Useful links

• Watch the Chancellor’s statement at BBC Democracy Live
• Visit the Treasury’s PBR website
• Follow the Treasury on Twitter
• Consultation on Implementing a Landline Duty (’broadband tax’)

IMAGE: Josh Hallett, licensed under Creative Commons 2.0

On 14th October David Lammy, the Minister of State for Higher Education, and John Goodfellow, Chair of the SLC, jointly commissioned Professor Sir Deian Hopkin, supported by Bernadette Kenny of HMRC, to provide external scrutiny of the lessons learned exercise undertaken by the Company

David Lammy, the Minister of State for Higher Education, and John Goodfellow, Chair of the Student Loans Company have now been presented with a report by Professor Sir Deian Hopkin on the recent problems surrounding applications for student support.

The Recommendations have been accepted in full.

The Minister made a Written Statement to the House of Commons on Tuesday 8th December.

Read the statement

Download the report 276KB

SLC letter to David Lammy 40KB

The SLC have delayed the opening of student finance applications for academic year 2010/11 to ensure that they are fully able to take the recommendations of the report into consideration.

Applications are expected to open shortly, and this date will be publicised via www.direct.gov.uk/studentfinance

Statement by: Lord Young
Venue: House of Lords

My Rt. Hon. Friend the Minister of State for Higher Education and Intellectual Property (Rt. Hon. David Lammy MP) has made the following statement.

This year Government is spending more than £5 billion on student support in England, underpinning our commitment that finance should not be a barrier to higher education. The number of undergraduate entrants to higher education has increased by 19% since 1997, and the 20 most deprived constituencies have shown higher than average growth in student numbers over that period.

Students need a simple and straightforward application service when they are applying for student support. As I said to the House on 14 October, this year’s problems have had an unacceptable effect on individual students and their families. Even when they have not led to financial hardship, they have undoubtedly caused worry and frustration. It is clear that there were serious lapses in the customer service provided by the Student Loans Company (SLC).

At the beginning of September I became aware that, in this first year of operating the new service, there were delays in processing, customers were unable to speak to the Company, and some documentary evidence could not be traced. I ordered that a number of actions be undertaken to enable the Company to accelerate the processing of applications and to increase the number of calls being answered.

These issues are why, together with the recently appointed Chair of the Student Loans Company, I commissioned Professor Sir Deian Hopkin to provide external scrutiny to the review of lessons to be learned from this year’s processing problems. Professor Hopkin has now provided his Report and I am very grateful to him for carrying out his work so swiftly.

Download the report 276KB

While at the time of this statement the Student Loans Company has paid 801,000 students, it is clear that this year the service has fallen short of expectations. The Report says that: “While some aspects of the Programme have been realised and some progress made on others, there has been a conspicuous failure in key areas of its delivery which has had a far-reaching impact on applicants and stakeholders”.

The Department accepts in full all the recommendations in Professor Sir Deian Hopkin’s report and, as I would expect, the Board of the Student Loans Company has also accepted the recommendations in their entirety.

I am now clear that decisive action is required to change the service and that the key to this is strengthening the leadership of the Company and ensuring that the customer is at the heart of everything the Company does. The Chair of the Student Loans Company has confirmed that the senior management team of the Company will be strengthened and reorganised.

I expect the Chair to ensure that the Company transforms how it communicates with its customers so that they know what to expect from the service, what is expected of them, and that risk management, contingency planning and staff training are all significantly improved.

I have asked my officials to consider the best practice in other public sector organisations to enable us to better challenge and scrutinise the Company’s performance. But there must be no confusion about roles: it is for the Student Loans Company Board to hold the Executive to account and to ensure it has the capacity and capability to deliver the service.

Key to moving forward and improving the service next year is early engagement with customers and stakeholders in the Higher Education sector. I have therefore asked the Company to establish a Stakeholder Forum which will include representation from the National Union of Students, Higher Education Institutions and UCAS. This will help the Company to develop Student Finance England, including implementation of the recommendations in Professor Hopkin’s report and should mean, with stakeholders more closely involved in the company, that many of the issues experienced this year can be identified earlier and swift action be taken to avoid them in the future.

We have invested significantly in a substantial programme of improvements which are designed to transform the way the student support service works for customers. Over the next few years, the centralised service – which takes over from applications to local authorities where the level of service was variable – will allow students to apply on-line; they will no longer need to send in their passports to verify their identity; and their sponsors will not need to send paper evidence of family income.

I acknowledge that some of the improvements will take time to implement, but I have received assurance from the Chair that improvements in the way the service is managed will be made quickly. As the Report says, the highest priority at the moment is to successfully complete this year’s application cycle. There remain problems with Disabled Students’ Allowances and I have asked the Student Loans Company to engage directly with universities and assessment centres to speed up the process, and to increase staffing resource for these activities.

The Chief Executive and Chair of the Student Loans Company have publicly apologised for the difficulties customers have suffered. As the Minister responsible for higher education, I too have expressed regret for the unacceptable service parents and students have experienced.

Customers must also play their part, and take responsibility for applying for their student support in good time if we are to ensure the service has the best chance of operating efficiently.

A copy of the Report and a letter from the Chair of the Student Loans Company are being deposited in the Libraries of the House and paper copies of the Report will be placed in the Vote Office and Printed Paper Office.

Download the report 276KB

This year Government is spending more than £5 billion on student support in England, underpinning our commitment that finance should not be a barrier to higher education. The number of undergraduate entrants to higher education has increased by 19% since 1997, and the 20 most deprived constituencies have shown higher than average growth in student numbers over that period.

Students need a simple and straightforward application service when they are applying for student support. As I said to the House on 14 October, this year’s problems have had an unacceptable effect on individual students and their families. Even when they have not led to financial hardship, they have undoubtedly caused worry and frustration. It is clear that there were serious lapses in the customer service provided by the Student Loans Company (SLC).

At the beginning of September I became aware that, in this first year of operating the new service, there were delays in processing, customers were unable to speak to the Company, and some documentary evidence could not be traced. I ordered that a number of actions be undertaken to enable the Company to accelerate the processing of applications and to increase the number of calls being answered.

These issues are why, together with the recently appointed Chair of the Student Loans Company, I commissioned Professor Sir Deian Hopkin to provide external scrutiny to the review of lessons to be learned from this year’s processing problems. Professor Hopkin has now provided his Report and I am very grateful to him for carrying out his work so swiftly.

Download the report 276KB

While at the time of this statement the Student Loans Company has paid 801,000 students, it is clear that this year the service has fallen short of expectations. The Report says that: “While some aspects of the Programme have been realised and some progress made on others, there has been a conspicuous failure in key areas of its delivery which has had a far-reaching impact on applicants and stakeholders”.

The Department accepts in full all the recommendations in Professor Sir Deian Hopkin’s report and, as I would expect, the Board of the Student Loans Company has also accepted the recommendations in their entirety.

I am now clear that decisive action is required to change the service and that the key to this is strengthening the leadership of the Company and ensuring that the customer is at the heart of everything the Company does. The Chair of the Student Loans Company has confirmed that the senior management team of the Company will be strengthened and reorganised.

I expect the Chair to ensure that the Company transforms how it communicates with its customers so that they know what to expect from the service, what is expected of them, and that risk management, contingency planning and staff training are all significantly improved.

I have asked my officials to consider the best practice in other public sector organisations to enable us to better challenge and scrutinise the Company’s performance. But there must be no confusion about roles: it is for the Student Loans Company Board to hold the Executive to account and to ensure it has the capacity and capability to deliver the service.

Key to moving forward and improving the service next year is early engagement with customers and stakeholders in the Higher Education sector. I have therefore asked the Company to establish a Stakeholder Forum which will include representation from the National Union of Students, Higher Education Institutions and UCAS. This will help the Company to develop Student Finance England, including implementation of the recommendations in Professor Hopkin’s report and should mean, with stakeholders more closely involved in the company, that many of the issues experienced this year can be identified earlier and swift action be taken to avoid them in the future.

We have invested significantly in a substantial programme of improvements which are designed to transform the way the student support service works for customers. Over the next few years, the centralised service – which takes over from applications to local authorities where the level of service was variable – will allow students to apply on-line; they will no longer need to send in their passports to verify their identity; and their sponsors will not need to send paper evidence of family income.

I acknowledge that some of the improvements will take time to implement, but I have received assurance from the Chair that improvements in the way the service is managed will be made quickly. As the Report says, the highest priority at the moment is to successfully complete this year’s application cycle. There remain problems with Disabled Students’ Allowances and I have asked the Student Loans Company to engage directly with universities and assessment centres to speed up the process, and to increase staffing resource for these activities.

The Chief Executive and Chair of the Student Loans Company have publicly apologised for the difficulties customers have suffered. As the Minister responsible for higher education, I too have expressed regret for the unacceptable service parents and students have experienced.

Customers must also play their part, and take responsibility for applying for their student support in good time if we are to ensure the service has the best chance of operating efficiently.

A copy of the Report and a letter from the Chair of the Student Loans Company are being deposited in the Libraries of the House and paper copies of the Report will be placed in the Vote Office and Printed Paper Office.

Download the report 276KB

Speech by: Rosie Winterton MP
Venue: Tackling Worklessness through Local Partnerships, Bloomsbury Hotel, London

Introduction

I am very pleased to be here today. Tackling worklessness is one of this Government’s top priorities and I believe that, since 1997, we have made real progress in helping people back into work. By 2007 the UK employment rate had reached a 30-year high, and we had the second highest employment rate in the G7 countries.

But we are also very aware – as Steve [Houghton] and I both know coming from South Yorkshire – that there are areas where people face particular challenges in joining the labour market. There are historic reasons for that which stem from previous recessions where, I believe, a very different attitude was taken to helping people during those difficult times. 

Of course, there have always been particular challenges that some people face and that’s why we asked Steve to undertake a review of worklessness. To look at what we could do to dismantle the barriers that some people face and overcome what had been entrenched deprivation. Thank you Steve for the work you have done.

The global recession, which has been felt in all our communities, has meant this work has done has taken on a new urgency over the past year. Although there are some encouraging signs that the economic recovery is getting underway, it is also true that people are still losing their jobs. Because unemployment is a lagging indicator we would expect it to continue to rise for a time after growth returns.

But what we are very clear about, as a Government, is that we must work together – nationally, regionally and locally – to make sure this recession does not leave behind a lost generation of people plunged into long-term worklessness and left on the scrapheap, as happened in previous recessions. 

Government needs to intervene so we don’t get that waste of talent; and we don’t repeat the mistakes of the past. I know that local authorities share this conviction – nearly 90% of Local Area Agreements have at least one target to tackle the causes of unemployment.

So Steve’s emphasis on the central role councils and their local partners must play in providing opportunities and raising aspirations is absolutely right.

Last month we announced an extra £40 million for the Working Neighbourhoods Fund, to be shared by 61 local authorities, to help them find innovative ways of tackling worklessness. 

And that’s why the £1 billion Future Jobs Fund was the centrepiece of our response to Steve’s review – making clear that we need local partnerships on the ground to take the lead in implementing it.

Houghton review and Future Jobs Fund

His review really set out the way ahead on this agenda. And his findings have provided a framework for tackling worklessness, especially in areas where in a sense it had become the norm.

The theme of this conference – Local Partnerships – is absolutely the right one if we are going to make this work. We can see many examples of councils are working with Jobcentre Plus, with Primary Care Trusts, the Citizens Advice Bureaux and others from the third sector, to tackle the complex barriers some people face in getting back to work.

And why is it so important to have the local council at the centre of this work? Well because it’s about local challenges and local solutions. Local authorities know their areas; they know their people; they know local businesses – so what we want to give is the freedom and flexibility to make sure that national objectives make sense locally.

Local authorities have a crucial role to play as champions and stewards of their local economy. The evidence I have seen – not only in my role as Local Government minister, but also in my role as Minister for Regional Economic Co-ordination at the Department for Business, Innovation and Skills – is that
local authorities have really risen to the challenge of leading efforts to tackle the fallout from the global downturn.

I think we need to build on the experience that has been gained. So that in future, economic development is a core activity for every authority.

The Future Jobs Fund shows how it could be done – and why it should happen. It is designed to help young people and other groups who are especially vulnerable to long-term unemployment.

But it’s also important to remember that it is a challenge fund. Which means councils can use it as a starting point and ask how they can take it forward – by using other resources flexibly and imaginatively to target worklessness and create that pool of job-ready people for local employers to draw on.

The Fund itself is expected to create something like 150,000 jobs nationally. Around half of the 95,000 jobs already in the pipeline are from local authority-led partnerships. I think what we need to do now, is ask how we can build on this strong start?

Steve gave an example of what is happening in Barnsley, where they are using the Working Neighbourhood Fund to double the length of time that placements last. And we are seeing other examples from around the country of how councils are building on the fund.

Hampshire County Council, for instance, is putting in £300,000 to set up an apprenticeship programme to complement its Future Jobs Fund. An Apprenticeship Officer, part funded by the Learning and Skills Council, is being recruited to co-ordinate and create additional apprenticeships.

Social Exclusion Task Force research findings

Projects like these show how important it is that Government, at every level, does intervene to dismantle the barriers that prevent access to employment.

We cannot simply stand back and expect the market to resolve some of these structural issues by itself. It takes active Government working with local partnerships to intervene in the right way, at the right time.

There is going to be some research published by the Social Exclusion Task Force next week, which will show these interventions can limit the corrosive social effects of recession.

Because, of course, it is not just a question of people losing their jobs. The effects go much wider – affecting people’s health, their personal relationships, and where they can afford to live.

So this time around we have put in extra resources to try to limit these effects.

• we have put  £263 million into the Social Fund to support the hardest-hit households;
• £20 million into the local authority Preventing Repossession fund;
• we are rolling out the £173 million Improving Access to Psychological Therapies programme;
• and a £13 million package to support people experiencing distress as a result of the recession, which includes the new NHS Stressline.

The preliminary findings from the Task Force research show that, this time around the social costs have been less severe than in the 1990s and 1980s. There has been no evidence of an increase in homelessness, or of property crime increasing – we can’t be complacent, of course, but these initial findings are encouraging. They suggest that if you do intervene, you can make a difference – not just in terms of employment levels, but on some of the other social effects as well. 

I think we can learn a lot from this research about what happened in previous recessions, and the practical steps councils and others can take to boost local economic recovery.

New Industry, New Jobs Strategy

But we cannot just leave it to local partnerships – we do need a coherent local response, but it has to be backed up by effective national policy. That’s why there is a relentless focus from Government on economic recovery. Because we know there can be no lasting solutions to worklessness unless we have economic growth – in every part of the country.

That’s why, through the New Industry, New Jobs strategy, we are looking to build on our existing industrial strengths and invest in new capabilities. That means a focus on key sectors – such as low carbon technologies; advanced manufacturing; healthcare and education; the creative industries – that will drive economic growth. Targeting strategic investments in the regions and areas where they can have most impact, so we can boost the regional and local economies.

But the other side of the coin is making sure that people are ready and equipped to take advantage of new job opportunities. The Skills Strategy, Skills for Growth, which published last month, is vital in that respect.

Skills

The strategy outlines how Government will ensure everyone can get the right skills for the jobs of the future, and the flexible skills that employers constantly tell us they need. And we need to make sure that, as growth returns, we have the strategy in place to help people with a history of exclusion from the jobs market into work.

So in the strategy we have signalled the importance of enabling people with low skills to access training that will help them get into a job, and keep it. It outlines plans to extend outcome-based funding, to incentivise colleges and other providers to help unemployed people get work. And it has plans for skills accounts, which are an excellent way of motivating adults to take up training and get advice and guidance about what is going to be most appropriate for them. 

We also want to build in flexibility, so that the training provided locally will meet the needs of employers and match the jobs that are available in an area. I remember going to Steve’s Work and Skills board, which was very well-led and ensured the work was done hand-in-hand with local employers: that is what made it so relevant to the local economy.

Local planning, and a clear grasp of the local economy, will be essential to ensure that the two agendas reinforce and complement each other. So councils and their partners do need to really understand the constraints and the opportunities that exist within the local labour market and economy.

Local Economic Assessments

But what else can and should Government do to help set the framework? From next April, all top-tier authorities will be required to carry out a Local Economic Assessment. And part of that will be a worklessness assessment.

This will ensure a strong evidence base and a strategic approach, so authorities really understand the drivers of worklessness in their area. They can also then take the opportunity to draw up a Work and Skills Plan, which they can use to formulate a strategy in response.

Those plans can provide a framework for tackling barriers to employment locally. And they can provide a starting point for any local partnerships that want a greater devolution of employment services in their area.

Work and Skills plans can also take the objectives that Regional Development Agencies set out in their regional skills strategies and translate them into a coherent delivery plan for each area, with identified priorities for action.

Now I believe that, when we take together the economic assessment and the Work and Skills Plan, we will see the building blocks of a ‘Total Place’ approach to tackling worklessness in an area.

They will offer the opportunity to use joint planning and resource-mapping to make funding go further, enabling local partners to align budgets around key priorities. I think that this will be an exciting new approach with the potential to deliver real benefits.

We will shortly be publishing an Employment White Paper to set out our vision for the employment and skills system, including plans to ensure a responsive, integrated support service for those who are out of work and on benefits.

Conclusion

But the success of that vision depends on effective local leadership. And I believe that only councils can truly provide it. National initiatives will fail locally without that vitally important contribution.

We cannot tackle worklessness on our own, sitting in Whitehall. Councils know their areas, their residents, their businesses better than anyone, so that partnership approach is absolutely the right one.

We are looking to devolve the freedoms and flexibilities that authorities need to get on with the job. And we are putting in place the broader frameworks that will make sure these efforts bear fruit.

I think we have to be clear. Economic opportunities – particularly in the difficult times that we face at the moment – do not just happen by themselves. Anybody who suggests the market can resolve these issues without assistance from Government is, I believe, wrong.

It is right that Government intervenes at national level. It is right that we work with the RDAs and have a coherent strategy at regional level.

But none of it can happen without councils taking the lead in their local areas. I know from my many visits to authorities around the country that it is not necessarily the core business of all councils yet. I believe we need to make it so.

Thank you.

To show your support, please sign the Back the Bid pledge. By signing up you’ll also receive daily morning updates from the summit.

The pledge forms part of the Act on Copenhagen website, from the Department of Energy and Climate Change. Other site features include:

• Ten facts on why climate change is happening
• An interactive map showing the effect of a 4℃ rise in temperature
• DECC’s Twitter stream and RSS feeds to keep in touch with summit news

Below is a taster from the Act on Cophenhagen site – a timeline showing key events en route to the summit.

The Autumn Performance Report shows there has been progress across all the PSAs and DSOs that have been assessed, showing that the Department is performing well in difficult economic conditions.  Of the five BIS-led PSAs, one is showing strong progress, three are showing some progress, and one is yet to be assessed.  Of the eleven DSOs the Department has inherited from BERR and DIUS, eight are showing strong progress and three are showing some progress. 

Also included in the Autumn Performance Report are an update on delivery of BIS’s value for money savings targets, and assessments of outstanding PSAs from the 2004 Spending Review.

Work, Recovery & Inclusion (PDF, 1.4MB)

It sets out a long term vision to radically increase the number of people from this group in employment by 2025, and to narrow the gap between their employment rate and that of disabled people generally.

Mental ill-health is the most common reason for claiming health-related benefits and costs the economy between £30bn and £40bn through lost production, sick pay, NHS treatment as well as the personal and financial costs that result from being out of work.

Skills Minister Kevin Brennan said:

“Today is a landmark in bringing together our long-held collective aspirations for a better deal for people with mental health conditions. Two years ago, the Foresight Project on Mental Capital and Wellbeing set out how we could achieve the best possible mental wellbeing for everyone in the UK. We have worked to develop a strong, cohesive set of services that will support those out of work, employees and employers to manage mental health. For our part, we are making sure that our learning and skill systems are part of that solution. “

Notes:

1. Download Work, Recovery & Inclusion (PDF, 1.4MB).  Related information can be found on the Cabinet Office website.

2. DWP reports can be found at www.dwp.gov.uk/realising-ambitions

3. The DoH report – new Horizons can be found at www.dh.gov.uk

4. An occupational health advice line for small businesses is being piloted in seven regions of England (East Anglia; Merseyside; North East; North and West Yorkshire; Portsmouth, South Hampshire, East Sussex & Isle of Wight; South Buckinghamshire, South Oxfordshire, West Berkshire; and West London), and across the whole of Scotland and Wales. The advice lines for all pilots will be open Monday to Friday, 9am to 5pm (9am to 4.30pm on Friday in Scotland). The advice lines will be operating from 7 December. DWP is working with the NHS to deliver the service.

England
Health for Work Adviceline – 0800 0 77 88 44
www.health4work.nhs.uk (website for England goes live a t 9am on
Wednesday 9 December 2009).

Scotland
Healthy Working Lives Adviceline – 0800 019 2211
http://webarchive.nationalarchives.gov.uk/20100107175034/http://www.healthyworkinglives.com

Wales
Health at Work Advice Line Wales; Llinell Gymorth Iechyd ar Waith Cymru – 0800 107 0900
http://webarchive.nationalarchives.gov.uk/20100107175034/http://www.healthyworkingwales.com

The paper will show how Government, by making the necessary savings and taking tough choices on spending priorities, can both protect frontline services and help meet its commitment to halve the public deficit within four years.

Download the publication and see live coverage of the launch here.

The package includes a new Advanced Manufacturing Research Centre in Sheffield, an £8m upgrade to the University of Manchester’s nuclear laboratories, a Rolls Royce facility in South Yorkshire, and designating the North West and Yorkshire a Nuclear Low Carbon Economic Area.

For more information on the package, visit the Advanced Manufacturing website here.

Speech by: Lord Mandelson
Venue: House of Lords

In this speech, Lord Mandelson responds in the House of Lords to the motion: That this House takes note of the Secretary of State for Business, Innovation and Skills Order 2009 (SI 2009/2748).

“In a global supply-chain economy, Britain cannot and should not ever aspire to be a country that competes by undercutting on wage costs or employment standards. We must compete by adding value, not reducing it.

“That puts a premium on what we do in knowledge, specialisation and sophisticated skills. It puts a premium on making this country one of the world’s great repositories of scientific and technical knowledge and the ability to commercialise that knowledge. It puts a premium on thinking about the interests of business – not just the businesses that already exist, but those that do not yet”

Simplifying Trade Across UK Borders – A Plan of Action sets out measures to boost trade by reducing the bureaucracy faced by businesses at UK borders.

Measures include making greater use of electronic processes to reduce paperwork and better coordination between border agencies to streamline movement of goods in and out of the UK.

Download Simplifying Trade Across UK Borders (PDF)

The plan of action, published during Doing Business in Asia Week, will aid the movement of goods between the UK and countries both within and outside the EU. Doing Business in Asia Week sees UK Trade & Investment export experts from 11 markets across Asia return to the UK to speak to 1000 SMEs. In London, Leeds, Birmingham and Edinburgh they will give practical trading advice and business climate updates to help UK companies win a larger share of Asia’s markets.

Read the full press release

Introduction

I am delighted to be here this afternoon to be able to contribute to this significant debate. I would like to pay tribute to BMW for bringing us together and hosting the event.

I first visited Berlin in 1979. I came again in 1990 in that strange time when the wall was open, the DDR remained but the re-unification of Germany was pending.

Today I am proud to be here in the midst of the futuristic architecture – characterised by the magnificent renewed Reichstag Building.

The new Berlin is celebrating a momentous and inspiring period in its history this year and it is a privilege to be here at this time.

If there is one political lesson from Germany’s recent past it is that there are no certainties. I never believed in 1979 that I would be free to walk through the Brandenburg Gate to Unter den Linden. But the point I wish to make today is that the old certainties are gone in industry too and we stand at a defining moment in our shared history. We will need the same boldness and creativity in the challenge we face in moving our societies to a low carbon economy.

The context

When I visit British factories I am struck by how much German plant and equipment is there. But Britain manufactures too. We were the first industrial nation and we have a great tradition of innovation – for example, the train, the light bulb and the television. But manufacturing in Britain is not just in the past.

No. The UK is still the world’s sixth largest manufacturer, and we are very aware that our manufacturers, our engineers will hold the key to our future economy.

The global financial crisis has shown all of us the centrality of innovation and new manufacturing technologies to economic growth as we emerge from this recession. And ultra low carbon represents a tremendous economic opportunity.

Of course, it is all too easy to  think of the shift to a low carbon economy as if it were something that is inevitable. But when you sit down and think about it you realise we must act and innovate to change everything we’re used to. The way we power our factories, the way we run our homes, and the way we fuel our cars. It’s nothing less than a new industrial revolution. And that means our focus will have to be on revolution not evolution.

And what’s driving this huge economic shift, this need for a fundamental re-ordering of the way we do things, is the threat of climate change – something that is inevitable unless we do act. That’s why the UK is committed to a legally binding target to reduce greenhouse gas emissions by 80 per cent by 2050.

The UK is keen to help lead the way in low carbon. We have an estimated 50,000 companies employing 880,000 people in the UK in the low carbon market. But to fully realise our potential in a sector already worth around £3 trillion worldwide we realised we needed to do more to reshape our economy and prepare for this low carbon revolution.

So our new industrial policy looks at how we can have a national capability in the areas where we believe our future interests will lie – in advanced manufacturing, in nuclear energy and in low carbon.  And, since, travel accounts for around 21 per cent of the UK’s total domestic greenhouse gas emissions, the need to place our travel on a more sustainable footing is absolutely key.

But the gapbetween ambition and success is vast. Consumers will not  simply switch to low carbon alternatives unless they are convinced it is right for all their needs. So today I would like to set out three ways in which the UK Government intends to have a world class capability in low carbon travel.

Educating our consumers

Firstly, we’re making sure consumers are properly informed to allow them to make greener choices. Our ‘Act On CO2’ campaign encourages people to reduce their carbon footprint whether it’s through better journey planning, vehicle sharing, cycling or walking. We know this sort of campaign can have a real impact. In the past five years the three Sustainable Travel Towns of Darlington, Peterborough and Worcester have seen car trips fall by around 9 per cent, walking increase some 14 per cent, and cycling increase by 12 per cent.

Infrastructure

Secondly, we’re making sure that we will have the right transport infrastructure in place.  So we’re spending money on widening our roads and motorways to relieve some of the congestion that blights our journeys. And we’re now expanding the electrification of  our railways – since an electric train typically emits up to a third less carbon per passenger mile than does a diesel train.

And you can’t expect people to take the train if the train is the slowest alternative.  So we’re following Germany – and Europe’s – lead on high speed rail.  We know this has the potential to lower carbon emissions by encouraging people to change their habit of relying on road or air travel.

So, by the end of the year, we will have delivered a dedicated route plan for the first stage of a high-speed line between London and the West Midlands.

Low carbon vehicle infrastructure

But, of course, the key topic of interest for the people in this room is what we’re doing with cars. How is the UK making sure its car industry is fitted out with the capability it needs in a low carbon age?

It would be entirely wrong to play down the huge strides that the motor industry has made in the past few years. Britain, for example, has a world wide reputation for making motor vehicles – everything from mass market cars to Formula 1.

However, the UK’s reputation as a major auto manufacturer will, ultimately, depend on more than evolutionary improvements to the internal combustion engine.  It will be about harnessing the potential of the revolutionary emerging electric and hybrid technologies, and accelerating the transition to ultra-low carbon vehicles.  This is where the UK sees a strategic opportunity to bring together our research and engineering skills to make a stronger impact in the global industry.

But the shift to low carbon won’t happen quickly enough without Government help. That’s why we set up the Office for Low Emission Vehicles (OLEV) to provide Government leadership with industry and link them with the energy providers. And we are doing everything we can to ensure we have a national capability in low carbon cars. OLEV has developed a comprehensive package to encourage demand, support supply, and enable places where these vehicles can be used, based on the industry consensus behind the formation of the UK Automotive Council.

Our ‘Plugged In Places’ scheme will support lead UK cities as they switch on for electric vehicle use. The UK is perfectly placed for electric vehicles, with high city population densities and short distances between conurbations.  So we are even turning our congestion into an opportunity!

London is aiming to become the electric vehicle capital of Europe, and it is aiming to have 25,000 charge points across the city by 2015; but it is just one of the cities in this revolution.

And we’ve already made a commitment worth over £400m to accelerate the transition to ultra-low carbon vehicles, and to encourage take-up and support the technology as it comes to market. This includes customer incentives of between £2,000 and £5,000 a vehicle from 2011, when we expect these vehicles to come onto the market in volume.

Encouraging innovation

I’ve talked about how the UK Government is helping consumers make informed choices and how we’re building up the right infrastructure. The third element of our plan is all about encouraging innovation.

What powers each industrial revolution is strength in innovation, linked to industrial capacity, capital, science and government support.  The abundance of people prepared to think in completely different ways. If we’re going to create the next generation of electric cars, if we’re going to power another industrial revolution, we need to find and nurture the right talent. Not just people with know-how and expertise but people capable of approaching a problem from a totally different angle.

Now we’re good at innovation in the UK. I mentioned our historic tradition but we’ve been pioneers in a whole range of fields recently from plastic electronics to Bluetooth technology.  We have an excellent science and research base supported by significant increases in government science investment in recent years.  And we have four of the best ten universities in the world.  

But, even so, we know there can be some gaps between having those great ideas and bringing them to market. So £150 million of our UK Innovation Investment Fund is designed, again, to lever in additional funding from the private sector.

And because we know innovators need space and time to test out their ideas – two commodities in short supply especially during a global recession – we’re building national centres for excellence to help develop the prototypes we need. Last week, for example, I visited Bristol to announce the site of the National Composite Centre which will help us realise our potential in this next generation material.

Low carbon vehicle innovation

When it comes to low carbon vehicles we’re encouraging innovation in a number of ways. Recently, we ran a competition to develop and demonstrate low emission vehicles. It brought together car manufacturers, energy companies, local and regional government and world-class universities. As a result we are now testing low carbon vehicles from 16 manufacturers in eight locations across the UK – from Glasgow to Oxford, the West Midlands to the South East – making it possible to showcase new and emerging low carbon vehicle technologies in real world situations.

We want the UK to become the place to be for ultra low carbon demonstrator projects.

BMW, our hosts today, will soon be advancing the next generation of electric vehicles by testing their electric Mini prototypes on the streets of Oxford. And they will be showcasing a range of electric, hybrid and conventionally-fuelled vehicles at the forthcoming 2012 Olympics in London.

Britain has been chosen by Toyota to be the home of the first Toyota hybrid vehicle to be produced in Europe. And we’ve a site chosen by Nissan to be the European “mother” plant for battery production. 

By taking such an active approach, the UK is already helping speed up the technological development of low carbon cars. Yesterday, I was fortunate enough to test drive the Ampera  electric car and it was an important moment when I realised I did not notice the difference from the internal combustion engine.
We are also funding exciting products such as Jaguar’s limo green – which is an electric vehicle in the luxury class.

But this isn’t just about products.  We are developing our skills system so that people with the right skills and abilities can come through into these exciting new areas of research, development and manufacturing. Last month we published a Skills Strategy to identify the skills gaps in our low carbon industries.  For example, this autumn we launched new qualifications for the production of hybrid vehicles.

As a result, we’re building up a new technician class through our revived apprenticeship system. We’re also seeing how we can devise practical low carbon courses in schools, further education colleges and universities.

And we are working with Richard Noble to use the new land speed record “Bloodhound” car targeting 1,000mph to create enthusiasm in our universities and increase engineering intake, just as the space race did in America 40 years ago.

Conclusion

Today I’ve mapped out three ways that will, when it comes to low carbon, make the UK the place to invest in years to come. But we will not be successful in our approach without a fourth and final element. And that is our ability to work in partnership – locally, nationally, and most particularly at the European and the global level. International partnerships, partnerships between businesses and between Governments are essential if we’re to build up those local and international markets in low carbon. Because the challenges we face in the shift towards a low carbon economy are global in scale. They transcend national boundaries. And global problems demand global solutions.

I’ve already highlighted areas where co-operation between British and German companies is bearing fruit. I had a superb visit earlier this year to the BMW Mini Plant in Oxford where, building on an iconic British brand, British and German engineering has combined to create a world beating car. More broadly the car industry’s consensus on a low carbon road map was central to the UK Government’s own strategy for the automotive industry which we published earlier this year.

And our newly created Automotive Council will set a long-term plan for the development of the industry. Its membership includes world class engineers, suppliers, scientists and business leaders from across Europe. It is an impressive group. And I’m delighted to hear that BMW’s Jürgen Hedrich, along with Hermann Kaess of Bosch and Franz Josef Paefgen from Volkswagen, have agreed to join the distinguished cast list.

In a few weeks’ time world leaders will gather in Copenhagen.  We believe that the conference must succeed.

But, whatever the outcome, that meeting has already underlined a few basic truths that are now universally acknowledged.  Our future is in low carbon.  We’re behind it here in the UK and we want to work with you to realise our full capability. Today’s discussions will advance our co-operation and I’m sure we will reap the rewards far into the future.

In this speech, Lord Mandelson debates the Second Reading of the Digital Economy Bill. He focuses on three key areas where the Bill will enable the UK to modernise its digital infrastructure; to update its copyright regime for a world in which we use digital content in radically new ways; and, finally, to protect and strengthen public service content both nationally and locally.

 ”When we talk about the digital economy, we are talking about every business that runs a website or transfers data digitally; every firm that sells goods online or whose creative or intellectual property is represented by digital content; and every business that enables these business models to exist.”

Lord Mandelson said:

“Growing financial services at the Post Office will help secure the future of the network and give people access to a full range of banking products at an institution they trust and value.”

Some of the proposals put forward include: a weekly budgeting account, a current account, a children’s saving account, business accounts, more mortgages and closer links to credit unions.

See the Post Office Banking page for more information.

Read the full press release

Making its initial response to the Gibson Review of Engineering Construction, a study of productivity and skills in the sector, the Government has committed to:

1. Earmarking £4.5 million of funding for more trainees and apprenticeships in the sector.

2. Working with the Engineering Construction Industry Training Board to ensure that the industry’s training levy is fairly applied to all firms working in the industry, including non UK firms.

Lord Mandelson also welcomed the creation of a new cross-industry body set up to promote change in the sector to be chaired by Ian Marchant, chief executive of Scottish & Southern Energy.

Lord Mandelson said:

“The engineering construction sector employs up to sixty thousand people in the UK. This new investment means that more home grown workers will be provided with the skills and experience needed for them to take the work opportunities that designing, building and maintaining the wave of new investment the country needs in power stations and energy infrastructure.

“I am delighted that someone of the calibre of Ian Marchant has agreed to take on this important role. His experience is highly relevant, and he is extremely well placed to take the work of the Forum forward.”

New chair of the forum Ian Marchant said:

“The UK’s engineering construction industry needs more people with more skills and better productivity if it is to play a full part in the transformation of the UK’s power stations, oil refineries and chemical plant that we will see over the next two decades. One of the key risks to the overhaul of the country’s asset base is that it lacks the engineers to do the work. Over the next 18 months, I expect the new Forum to set out a practical and comprehensive plan to turn this risk into an opportunity for the UK to improve skills, create jobs and provide work for a growing number of successful engineering construction companies.”

Download the Gibson Review 1.6MB

Accompanying analysis and press releases

PLEASE CHECK AGAINST DELIVERY

Thank you and good afternoon everyone.

Languages matter because words and the perspectives on the world that they represent matter. The more of those perspectives we can take in, the richer and more rounded we are likely to be as human beings.

I don’t think you need to be a professional linguist to understand that.

My work in the law and in politics has been an education not just in the power of words and ideas, but also in the diversity of viewpoints that language can express. And my life as a Londoner, living here in a city where 250 languages are spoken, has shown me that English is not the only tongue capable of giving expression to unique, valuable or beautiful insights.

So often in history, language has been a wall that separates people from each other, a barrier to mutual comprehension and a source of distrust. To break down that wall by learning another language is not just to find a new means of communication, but also to gain an alternative way of understanding the world and how it works.

Anyone who sees languages in that way cannot consider the promotion of language-learning as anything other than a priority for our education system. And I certainly want language skills to be recognised as a key contributor to our country’s success, now and in the future.

We cannot afford to ignore the fact that 75 per cent of the world’s population does not speak English. And even if we could, there is no virtue in showing an Anglo-centric face to a world that is much more complex than that.

Global ambitions, whether in commerce or in political influence, require global perspectives. And they in turn require our knowledge and use of languages other than English has to be nurtured and encouraged to grow.

Without this growth in language learning, we stand in danger of losing much that is valuable to us.

Our business competitiveness and our ability to attract inward investment will fall.

Our ability to research in collaboration with non English-speaking countries will decline.

And British people will be unable to compete for jobs in an increasingly open European labour-market.

I’ve met people who think of languages as an irrelevance, or at best as an afterthought to be tacked onto the end of a CV. Of course, they’re hopelessly wrong.

More and more businesses operate in more than one country. In those companies, staff need to spend time working abroad and speaking other languages if they are to gain promotion and get on in life. If we fail, as a country, to embrace language learning, we will set arbitrary limits on people’s aspirations and on their scope to achieve social mobility.

In that context, the recent CBI report Stronger together: Businesses and universities in turbulent times is required reading. It reminds us that the skills of language graduates are not just needed for interpreting and translation careers. They are important in global businesses and industry.

I quote: “Language skills are also important in an increasingly globalised workplace. Students should be striving to develop these skills which…are not an optional extra”.

In view of all this, it’s just as well that languages are not dying out in Britain. On the contrary. Today, you can hear more different languages spoken in this country than at any time in our history. And, as I’ve already said, there’s no better place to see that for yourself than here in London, the most linguistically diverse city on earth.

Moreover, more British children are growing up bilingual than ever before. Indeed, a recent survey of almost a million school-age children in London found that fewer than three-quarters of them speak English at home.

That’s not a cause for alarm, but for celebration.

Yet much of the rhetoric that has surrounded language-learning in this country is predominantly downbeat and defeatist.

And I don’t deny that there are some understandable reasons why languages are described by some people as being in decline.

I know that there remain concerns about the policy which permits 14 year olds to choose not to study a language at GCSE. And it’s certainly true that numbers of GCSE entrants in languages have been falling for nearly a decade.

But there are clear signs that the standards for languages at GCSE are improving now that compulsion is no longer there. We are encouraging languages in secondary schools through revitalising the curriculum for 11-14 year olds. And in 2011, it will become compulsory for primary schools to offer a language, as more than 90 per cent already do.

And the picture also looks much brighter at A level, where numbers of language entrants have been rising since 2005. And that ought to be feeding through into more demand for higher-level learning of languages.

Of course, it makes it much harder to take an optimistic view of the future of modern languages in universities when some vice-chancellors and their governing bodies decide to cut back or close departments, or to curtail the range of courses on offer.

I know, too, that some institutions have come to see their role in language studies as offering basic language modules for the generality of students rather than full degrees for specialists. And there’s a place for that sort of thing.

I welcome the work that is done by language centres up and down the country giving students studying other subjects the chance to add some French or Spanish to their skill set. But this must not be seen as any sort of substitute for fully-fledged teaching of high-level language skills, backed up by excellent research. We need to produce not just more linguists, but better linguists as well. And we need the understanding of the cultures, histories and politics and economics of the countries where they are spoken that only rigorous scholarship can give us.

These are all reasons why we’re here today. This event is about how we can move forward together in the context of the current state of modern languages and the recommendations in Michael Worton’s report.

I don’t pretend that Michael’s findings make entirely comfortable reading for any of us. But that’s all the more reason to take them seriously.

In particular, I’d like to hear what you think of the messages about languages that the Government gives out.

I know they haven’t always been welcome to many of you. Last year’s Research Assessment Exercise and its effects on language departments has been a particular bone of contention.

Detailed allocations of the quality-related block grant for research are of course a matter for HEFCE.

But I understand that the total amount of funding for each subject reflects the total volume of research in that subject submitted in the RAE. Volumes of language research grew at a smaller rate than in other research areas overall and so this is reflected in shares of funding.

People are understandably focusing on the year on year change in funding. But this year we are seeing a change to funding that reflects the relative volume changes since the 2001 RAE. Over that period the block grant has been steadily rising. In fact, for languages overall, it has risen by 4 per cent in real terms since 2002.

Last year’s RAE actually represented a very good outcome for some languages, like Arabic, Chinese and Japanese. But there’s no reason for it to have placed any department in these or other languages under threat.

I note, too, that Michael’s report argues that linguists in universities themselves could do more to ensure not just the survival but also the success of their departments. He says that they could make more of their successes and do more to convince university leaders of their value, for example, by emphasising their contribution to institutions’ international strategies.

I’d be interested to hear your views on that.

I know as well that some vice-chancellors have misinterpreted the need for the Government to invest in subjects like science, technology, engineering and maths that give the greatest economic return as a lack of commitment to other subjects. And that, of course, has created problems of its own. Over the last ten years, we’ve lost about a third of our languages capacity in higher education.

I don’t like seeing departments close and study options disappear and I don’t believe that the Government’s or HEFCE’s funding decisions have made that inevitable. But I can’t stop university authorities from taking management decisions. You know that the Government’s role in this is not an interventionist one and how protective of their autonomy universities rightly are.

I also want to hear your ideas on any actions we in Government can take to boost demand for university-level language studies. Because ultimately, only demand from prospective students can keep subjects sustainable.

Of course, we already have initiatives like our Routes into Languages programme which is encouraging pupils to learn languages and to enjoy the experience. The signs to date are that this is starting to have a real impact.

But I’m in no doubt that we could do more.

In particular, we must counteract the perception that the Government does not take language learning seriously. We do and we want to demonstrate this. That is why I welcome the recommendation in the report that there should be a forum to provide “clear, coherent messages” and to develop a communications strategy for them.

I want to take my share of the responsibility for this work, and that’s why I can announce today that my DCSF colleague Diana Johnson and I have agreed to chair the new forum jointly.

I’ve talked this afternoon both about some of the challenges that modern language studies face and about how necessary it is to find ways of overcoming them. But now I know that Michael and Chris are as anxious as I am to hear what you think and to answer any questions you’d like to ask.

Thank you.

Speech by: Lord Mandelson
Venue: House of Lords

In this speech, Lord Mandelson responds in the House of Lords to the motion: That this House takes note of the Report of the European Union Committee on Developments in EU Trade Policy

“It is important that Britain leverages the weight of Europe and that Europe leverages its collective strength in the world both to match those emerging economic powers and giants in the global economy and to engage them very seriously in a very practical way.”

I want to say something about the value and challenges of local media today, but I want to start with the bigger picture, which I think is the health of regional life in the UK generally.

Our big challenge now is, over time, to repair the country’s balance sheet, which has been hard hit by the banking rescues and the collapse in growth. To do that we have to get the growth back – and the growth has to be sustainable and diversified, and it has to be shared across the regions of the UK. I want to say something about how we make sure that our growth strategy has a strong regional dimension. And I want to say something about how we make sure that a strong regional culture of news prospers in Britain, and what we’re doing in the Digital Economy Bill to make sure that happens.

I don’t think it’s stretching it to talk about a renaissance of regional confidence in Britain. We must not have short memories about this. Fifteen years ago the talk in Manchester, or Newcastle or Birmingham or Sheffield or any of the industrial revolution cities was still too often about had been lost.

These days it is increasingly about what is being built and renewed, the new confidence, the new links to Europe or the global economy, the new jobs. I don’t want to sound starry-eyed or complacent but these places had the guts ripped out of them by economic change and I believe that this growing regional confidence is real and justified, and preserving it through the downturn has been an important priority for the government.

Flexing the regional muscle

Just to take one big example, almost all of our manufacturing muscle is a long ride from London. It looks different – these days it’s more likely to be a sleek barn on a business park than a factory and a smokestack, but it’s where it has always been. Even a huge chunk of the financial services industry isn’t actually in the City of London.

We talk about the need for a balanced economy in the UK and that means two basic things. A diversity of productive sectors and strengths. And a widely shared spread of growth across the UK. We might measure growth as a single national aggregate, but the reality of regional performance behind that number matters just as much.

That’s why we are committed to creating more regional autonomy and drivers of regional economic growth. It’s why we created the Regional Development Agencies, whose remit is to take a strategic approach to regional economic management. The RDAs have done this well – they produce over four times the regional economic growth for every pound they spend or invest. They’ve trained almost half a million people and helped create or secure more than 200,000 jobs over the last ten years. They are now having more responsibility passed to them for skills training in the regions – a vital key to future growth.

Our intention is to strengthen the RDAs further. Our new tasking framework for Regional and Local government, which we will launch in the next few weeks, sees them acting, for example, as a critical intermediary between local businesses and universities and colleges.

We want to see them collaborating a lot more with each other and with local government to bring in strategic public and private investment and build up regionally-based national strengths in key areas like low carbon and advanced manufacturing in a way that reflects local capabilities and local geography and is coherent across the country as a whole.

Challenges for regional and local media

Now, if you’re serious about strong regions, then the active commitment and engagement of local media is vital. Eight in ten British adults read a regional newspaper. This journalism is – or should be – the bedrock of local democracy and public life, the mirror of regional identity and an encourager of innovation and change.

But of course we all know that local journalism faces the same challenges that the wider media faces. Declining readership. A migration of advertising and interest online. And of course, for the last year the recession has hit revenues very hard.

Its good to see local media experimenting with new models like paying for premium web content and we’ll all be watching how that goes. But, all told, a tough business to be in.

Now, obviously, commercial reality is commercial reality. But a healthy culture of local news in particular is a public good and Government can’t just wash its hands. So I want to make two important points.

The first is that I recognise that many of you are concerned about the impact of the withdrawal of government advertising from local and regional papers. I also know that you are concerned about the competition to local and regional papers offered by Council freesheets.

Obviously Government faces a difficult balance here. Our first obligation is always to spend taxpayers’ money sagely- and revenue from government advertising can’t be a business model in itself.

Local authorities have a public service obligation to publicise the work they do at value for the taxpayer. But we have to weight the effect of this on a strong culture of local media – capable of holding local government to account!

I am looking forward to hearing the Audit Commission input on this question and we will then look at the evidence to see how government advice to Local Authorities might be strengthened.

Public service content

But to my mind the question of local public service content is the big one, and it’s my second and final point. The Digital Economy Bill will receive its second reading this week, and alongside its measures for upgrading the legal and physical infrastructure of our digital landscape for a global knowledge economy, it explicitly makes the case for support of public service content both nationally and locally.

I don’t buy into the view that says that public service content implies a lack of trust in people or that it equates to an evil called state-sponsored journalism. The question is whether we think an entirely commercial market for news or broadcasting produces the plurality and diversity and objectivity that the public demands.

A market for media will pull in the direction the majority of paying customers want it to go, and there is value in that. But broadcasting has a broader remit for a range and quality of programming and news that will never be delivered by the profit motive alone. That principle has to be defended.

You’d think the last two years would have taught us to be a little more cautious in ascribing absolute value to the judgments made by markets. Evidently not everyone thinks so.

Of course, the recent experience of the BBC does make the point that you have to be clear where the line between public service and commercial competition lies. The BBC seems to recognize that there are limits to extending itself into commercial markets, and its review of this is welcome. To say this is not to attack the basic mission of the BBC, as some of its commercial competitors are doing. It is to argue that mission creep can undermine the case for that basic mission.

There is also a strong case for alternative public content providers to compete with the BBC and keep it on its toes. The Digital Economy Bill does this with a new public remit for Channel 4, and we have high expectations of the Channel’s new leadership.

As you all know, we are also going to pilot the idea of Independently Funded News Consortia to provide alternative sources of high quality local and regional news, especially on television and online – the lines between these things now becoming increasingly fluid. Drawing on the experience of the initial pilots, a national roll out is planned for 2013. I’m glad that many in the local media world see a real potential vehicle for their expertise here.

In the first instance we are going to fund these out of the underspend from the digital switchover plan. For the future the Government has made it clear it favours maintaining the current top-up in the BBC’s funding and financing the consortia from that. However, we are not going to set anything in stone in the Digital Economy Bill.

Conclusion

So, to conclude. Preserving and reinforcing the local and the regional in public services, in politics, in policy is vital for effectiveness and accountability. Our economic strength depends on strong regional economies. So does our sense of social solidarity. A strong local media is vital to all of these.

It might sound a little paradoxical but I think one of the things that is driving us back to localism is globalization. Because while it is increasingly becoming rational to move some of our governance in, say, financial markets, or trade rules or action against climate change, to the EU or global level, the need to feel connected to our roots and sense of place means we also want local solutions and will build our political identities around what we want from, and feel about, our surrounding community.

Having grown up on the principles of Morrisonian municipal socialism and served for thirteen years as MP in Hartlepool I know exactly where this instinct comes from, and I think it’s a very good thing. I want to finish by saying again that the role you play in that is, and will always be, vitally important. Thank you.

Business Secretary Lord Mandelson and Minister for Science and Innovation, Lord Drayson, highlighted the exciting potential that exists to invest in technology in the UK.

The Summit will also provide more information on the UK Innovation Investment Fund (UKIIF) to fund managers.

The Fund was announced by the Prime Minister on 29 June 2009 as part of the Government’s strategy for Building Britain’s Future. BIS, DECC and DoH will invest a total of £150 million alongside private sector investment on an equal basis.

It is the Government’s ambition to create a Fund worth £1 billion over the 15 year life of the Fund.

Companies showcasing at the Summit include:
Horizon Discovery
ApaTech
NaturalMotion
TMO Renewables

Twitter
Follow @ukiif to read live tweets from the event.

LinkedIn
Contribute to the discussion about investment in the UK and keep up to date on UKIIF developments by joining the UKIIF LinkedIn group.

UKIIF website
For more information and contacts, visit the UKIIF website here.

A new film aimed at encouraging small and medium-sized enterprises to seize the opportunities presented by addressing climate change has been launched.

The ten minute film, entitled Low Carbon, High Potential, features interviews with five leading UK businesses, including SMEs who are already taking up the opportunities presented by the transition to a low carbon economy. They explain the steps that they have taken to reduce their climate impact, why they chose to do it, and the benefits they have received in doing so.

The film is the result of a collaboration between public, private and third sector organisations. These include The Prince’s Mayday Network, The Carbon Trust, The Prince of Wales’ Corporate Leaders’ Group on Climate Change, the Department of Energy and Climate Change (DECC) and the Foreign & Commonwealth Office (FCO).

Commenting on his involvement in the film, Adnams’ managing director, Andy Wood, said: “At Adnams, we have transformed ourselves into a low carbon business which brings huge benefits to our organisation, both in money savings, brand reputation and employee engagement. I was delighted to be in a film which encourages other businesses to do the same. Every business can make a difference.”

Energy and Climate Change Secretary Ed Miliband said: “Copenhagen is a real business opportunity for Britain. This video shows that going low carbon is not just something for big corporations, but that it is something that can open up new markets, create jobs and present cost saving opportunities to business of all shapes and sizes right here in the UK. That’s why we’ll be pushing for an ambitious outcome in Copenhagen – to help fast-track these opportunities for the benefit of UK business.”

The film will be distributed through a number of UK business networks and websites, including those of the film partners and key business organisations such as BusinessLink, the CBI, the Federation of Small Businesses and the UK Chambers of Commerce.

This guide focuses on cutting costs, both in the short and longer term, but also on the new opportunities that are available through entering expanding low carbon markets for low carbon and resource efficiency. This is a huge sector, globally £3 trillion and predicted to grow to over £4.3 trillion by 2016.

The booklet highlights the risks of inaction: losing out to more efficient competitors, greater exposure to volatile fuel and commodity prices, material scarcity and effects of climate change and responding to the challenges of new government policy.

And finally the booklet looks at how action also leads to benefits in engaging people from customers, through brand reputation, to employee retention.

Can you Afford Not To? (PDF, 471KB) is hosted on Business Link’s ‘Act on Copenhagen’ pages.

Introduction

I am delighted to be here today for the formal signing of the Leeds City Region pilot programme.

This partnership, between the 11 councils, regional partners and central Government takes a further step in this new way of working together – to deliver our shared vision of economic prosperity for all our communities.

The project has become more relevant in the economic downturn because although the recession may have been global in its origins, but the effects have been felt locally, in communities across Yorkshire and beyond.

This pilot will play a crucial role in tackling the fallout from the downturn and making sure that Leeds City Region is ready to seize the opportunities opening up as the recovery begins.

Because to make progress on these issues – whether tackling worklessness; improving skill levels; or nurturing enterprise and innovation – we all need to work closely together.  We can achieve more together than we do alone. And the pilot provides the tools to do just that.

Delivering tangible results

A Housing and Regeneration Board, with new devolved powers, will be set up so the City region can take control of this vitally important agenda. It will collaborate with local partners to deliver low-carbon communities and will strive to make the area a centre of excellence in sustainable design and innovation.

The Urban Eco-Settlement Programme, which is at the heart of this ambition, will provide up to 28,000 environmentally friendly new homes for local people and regenerate brownfield land in Bradford, Leeds, Kirklees and York.

There will also be a new drive to help everyone use less energy. The new Domestic Energy Efficiency Programme will improve 300,000 properties and help lift 50,000 households out of fuel poverty.

The signatories will also work to establish the city region as a globally-renowned centre of innovation, building on existing initiatives such as Science City York and the Bradford Learning Quarter to attract new inward investment.

The Leeds City Region Employment and Skills Board, driven by local employers, will have a crucial role to play here. It will make sure that skills programmes meet the needs of the local economy, training people to work in key sectors such as financial services and the digital and creative industries.  And inward investors also want to know there is leadership here, both civic and business.

But a more skilled workforce doesn’t just mean higher productivity – it means better job prospects, greater prosperity and more life chances for families everywhere. So the new Board will empower learners to get the skills and confidence they need to succeed in the modern working world.

The ambitious commitments that we are all signing up to today will generate new homes and new jobs for the people of the Leeds City Region – tangible outcomes that will change lives and communities.

A new approach

We have already devolved new powers and freedoms to kick-start economic growth through Multi Area Agreements. Now we are taking this up a gear through the City Region pilots.

There are just two in the country – one in Greater Manchester and now one here – so as the Minister for Yorkshire and the Humber I am proud and delighted that one of them is in our region.  I was anxious to make sure Y&H was at the forefront in this area.

The Government believes that devolving these new freedoms will give the pilot the tools it needs to boost economic growth. It is an exciting, ambitious new approach and we want to explore its full potential.

That’s why we have a high-level ministerial committee, which I sit on, devoted to the two City Region pilots. It is a sign of the priority they are being given and the determination to have Ministers and Local Authority leaders working side by side to make sure these pilots succeed.

Core cities matter

And why do we want them to? We believe that dynamic cities, in the North and elsewhere, have a crucial role to play in leading the economic recovery and powering future growth, in their regions and beyond.

The Leeds City Region generates 5% of the UK economy [national Gross Value Added], so we understand the significant contribution it makes to regional and national output and we want to see how much further we can go.

This work is absolutely crucial. Research published earlier this month by the Northern Way looked at Leeds and Manchester and the role these economic powerhouses could play in powering economic growth right across the North.

It found that reducing the commuting time between the two cities, by 20 minutes, could generate up to £3.7 billion of economic benefits, which would have a wider impact across the Northern regions, and help narrow the historic economic gap between the North and South of England.

So the Department for Transport is exploring, with the pilot, ways of working more closely with the Highways Agency and Network Rail to deliver a commuting network that will unlock this economic potential.

This area already has strong economic foundations to build on. The wider Leeds City Region has world-class universities, which are doing cutting-edge research and forging innovative partnerships with industry to become hubs of the knowledge economy.

These institutions are a major draw for inward investors and are playing a crucial role in driving economic development. We need to harness these existing strengths and use them to power economic growth and development hroughout the wider region.

But it would be a mistake to see the Leeds City Region pilot in isolation. The single regional strategy, agreed between Yorkshire Forward, and our local authorities and other partners, is a means of targeting key investments in infrastructure and growth sectors that will boost the economy right across Yorkshire and the Humber. So it’s essential not to lose that wider economic perspective.

And, of course, this is also about setting the agenda – intervening during the downturn – looking at how to stimulate the economy and encourage investment but also ensure that the structures are in place to deliver on the ground. 

That’s why we will shortly be publishing a national framework for regional and local economic development.

This framework will identify the growth sectors the UK will compete in globally, and how these can be aligned with regional and sub-regional economic development. It will give local authorities, the Regional Development Agencies and other partners the ability to identify key priorities and combine their firepower to drive economic growth.

Conclusion

The pilots are an essential part of this picture. They are all about giving members of the partnership greater control over how money is spent to ensure that resources are being used to meet local priorities and local needs.

I believe they are an exciting new development. This pilot gives the Leeds City Region the tools it needs to prepare for economic growth as the recovery gets underway.

And this is just the beginning – I am absolutely committed to exploring just how ambitious we can be, and how much further we can go.

So I look forward to working with the members of the Leeds City Region in the months ahead, to achieve our shared vision – grasping the huge opportunities in the new global economy for the people who live and work here.

Thank you.

Speech by:

Introduction

It’s fair to say that the events of the past year have illustrated how interconnected our world is today. National boundaries have been blurred, as technology has allowed companies in distant places to do business in seconds.

So when the economic crisis hit last year, it is no surprise that some of the biggest holders of Lehman mini bonds were in Hong Kong, and some of the biggest Washington Mutual holders were in Thailand.

I’ve been in Government for 12 months now, and when I joined the banking crisis had just happened, so I said: ‘I’m a politician, not a banker’. And then the MPs’ expenses problem blew up, so then I said: ‘I’m really a banker, not a politician’.

To be in government during the past 12 months has made me a front-row witness to the most extraordinary changes in the world. But the crisis followed a century of huge global innovation – we’ve had political, economic and technological change – where each decade has led to profound transformations.

In 1909 Woolworths opened its first store; in 2009 it closed its last. Now it exists online, its stores taken over by other big brands or community initiatives like Wellworths.

Its fortunes reflect the dual nature of globalisation – first it grew into an international brand alongside the consumer society, and then it fell victim to the financial turmoil that swept the globe.

A century of innovation

So I would like spend a few moments taking stock of where we are, because looking back over the past 100 years can help us think imaginatively and creatively about the next.

The first decade of the twentieth century witnessed the rise of technological innovation. The Wright Brothers took flight in 1903; there was the first radio transmission from America to Britain; and the first model T Ford rolled off the production line in 1908.

This period saw the development of new corporations, such as GE, to exploit these inventions; and the emergence of large corporations, assembly lines and production on a large scale.

Capitalising on this, Frederick Winslow Taylor published what’s widely regarded as the first management book: ‘The Scientific Principles of Management’ in 1911.

By 1914, the UK was at the apex of what has been called Wave 1 of globalisation. By that time, the new world’s labour force had grown by a third since the 1870s, thanks to migration, while Europe’s had shrunk by an eighth. There were increasing concerns about Britain’s ability to compete with what was described then as an emerging economy – the US.

The 1920s opened with the first Council meeting of the League of Nations, an attempt at multilateral regulation of the world order that was compromised by the US refusal to participate. The decade closed with the one of the seminal events in economic history – the Wall Street Crash, which saw 13 million shares sold in panic on Thursday 24th October, 1929.

When you read about them it’s difficult to comprehend how catastrophic the effects of the ’29 crash were. In the 1930s the Great Depression slashed US output by 30%. In the four years to 1933, 20,000 businesses went bust; 250,000 people lost their homes and 20,000 people committed suicide. Protectionist measures such as the Smoot Hawley Act saw international trade tumble from $10 billion to $3 billion by 1932.

In the 1940s, the turmoil of the Second World War led to the foundation of a new global financial system and the implementation of the Bretton Woods system, with the IMF and the World Bank at its heart. The principle of Free trade was promoted through the General Agreement on Trade and Tariffs (GATT), which was a precursor to the WTO.

Post-war stability laid the foundations for what was a ‘golden age’ of economic growth. Rising productivity and high levels of employment produced a substantial increase in living standards – Global GDP rose by almost 60% between 1950 and 1960, while GDP per head grew by nearly a quarter.

In the 1960s, Gordon Moore formulated his famous ‘Moore’s Law’ – that the power of a computer chip doubles every two years, transforming business and societies. In 1968, he and his partner Robert Noyce founded Intel.

As the 1970s dawned the economic environment became more volatile, with two major spikes in the oil price and the birth of stagflation. Silicon Valley saw a generation of entrepreneurs striking out on their own and founding companies that today have become major household names – such as Microsoft and Cisco.

In 1977 the first personal computers – the Commodore PET and the Apple II – went on sale. It revolutionised our relationship with technology. A year later, Deng Xiaoping launched the Four Modernisations – agriculture, industry, technology and defence – that set China on the path towards economic reform.

The early 1980s recession gave way to the boom of the late 80s. During this period the first laptop – the Gavilan SC – was launched in 1983, and Windows 1.0 was introduced in 1985.

But the early 1990s saw another bust. That was followed by the Non-Inflationary Constant Expansion – ‘NICE’ – era, during which Britain and much of the world economy enjoyed a long period of growth, benefiting from falling import prices, sustained increases in trade levels and a massive boost to international capital flows.

In 1995, here in the UK, AIM was launched as a new vehicle for companies seeking finance. But as the decade closed, the highs seen on the FTSE all-share index proved unsustainable as the dotcom bubble burst.

Even so, since the millennium, technology has continued to spread into every aspect of our lives. Mobile phones, iPods, blackberries and computers are now part of ordinary life and we live in a world where distance and time zones are now no obstacle to doing business.

The global economy today

Multinational companies today have no boundaries; it’s not really relevant any more where they have their international headquarters.

By 2008, there were a billion PCs in use worldwide, and laptops exceeded sales of desktop computers for the first time. The Windows operating system now has around 94% of the market.

The BRIC economies – Brazil, Russia, India and China – are taking their place in the world, accounting for 22 per cent of global GDP in 2008. And by last month, over 3,000 companies had listed on AIM, raising over £4.2 billion to fund expansion, and vividly illustrating the growing diversity in ownership and finance that hedge funds and private equity have delivered.

Of course, the seismic shocks in the global economy over the past year have taken us into uncharted waters. On some measures there’s no doubt the recession may be the worst since the 1930s.

But the response of Governments, learning from history, here in Britain and around the world has been very different. We have intervened where necessary, pumping huge amounts of money into the economy to shore up demand. The temptation to retreat into protectionism has, so far, largely been resisted.

The question now, as the crisis subsides, is: where are we heading next? Of course, it’s very difficult to predict the future – unless you are a professor! After all, many of today’s household names in business were not around a century ago. It’s very difficult to sustain your position at the top, even to maintain a company, for ten years let alone a hundred.

Emerging trends

But by scanning the horizon we can begin to see the trends that will shape the strategies and actions of UK businesses in the years ahead. In the short term, the focus will be firmly on getting through the recession and being well positioned for recovery.

In the longer term, it’s clear that we will see sustainability and the global shift to a low carbon economy take centre stage. It doesn’t matter what you’re business is, you’d better get on that train. Otherwise, you won’t survive. It has the potential to be the great industrial opportunity of our age.

This in turn will power technological innovation. There is an interesting debate over whether the increasing costs of research and development – where, incidentally, Britain is a world leader – will be a brake on innovation. The more positive view, put by Will Hutton, who is an adviser to the Government, is that the increase in innovation-related activity globally will boost the discovery of new general purpose technologies.

The corollary of this research is a changing asset base. Economists are developing new and broader measures of investment to capture this, moving away from merely recording investment in tangible assets such as capital equipment. Instead they are capturing the investment in so-called ‘intangible assets’ – which Britain really does excel at – such as R&D, design, software, training and organisational capability. There is no doubt that they are increasingly important for innovation, and help businesses and countries compete globally.

Provisional data suggest intangible assets account for a growing share of UK business investment. Figures soon to be published by NESTA [the National Endowment for Science, Technology and the Arts] in its pilot innovation index put the proportion at 14% of Gross Value Added in 2007. Since 1992, investment in intangibles has exceeded investment in tangible assets.

So as international competition – and co-operation, through global value chains – grows, these investments will underpin a firm’s ability to compete in the global market place. Globalisation creates new opportunities for business as markets expand and international value chains grow. Easier market access and technological change have made it easier – even for small businesses and fledgling firms – to enter them.

If they do, there is a big prize at stake – tens of millions of new customers. If emerging economies continue to grow at the pace that they have in recent times, hundreds of millions of additional ‘middle class’ consumers will provide an expanding market for high value goods and services. The World Bank estimates that the middle classes in the developing world will roughly double between 2000 and 2030. That will mean it will grow from 7.6% of the population to 16.1%, which is around 1.2 billion people.

The global economy of the future

The Government’s foresight unit – our think tank – has been looking at the impact of these emerging trends. It thinks there are four possible futures for world trade.
There’s a best case scenario – and I’m an eternal optimist, so I’m with this one – with strong and coordinated global organisations and abundant natural resources. They call this future ‘global citizen’, which sees the world recover, the world cooperating, and sees the world returning to the prosperity of the last decade.

Even with enough natural resources there is a danger of global fragmentation, leading to their second scenario ‘fragile alliances’ with ‘country cartels’ setting their own local agendas and poor and powerless countries completely losing out.

But the reality is that we have yet to deliver large scale alternatives to fossil fuels. We haven’t got enough arable land in the world, and not nearly enough water.
In this future of scarce resources, without global cooperation we risk the nightmare scenario of deglobalisation. Water wars, starvation, pollution – and no hope of restoring the economy to growth.

But there is a fourth possible future scenario that they predict. One that’s realistic about resources, but champions strong global organisations, that balance the needs of the strong against the powerless, and that finds new ways to develop and create wealth.

They call this scenario ‘global innovation’. That’s why creating a more balanced, sustainable global economy requires unprecedented levels of global co-operation.
Conclusion

The reality of today is that we are all internationalists. We have to be. So we need to create a shared sense of our collective future – economically, politically and environmentally.

That means building on the firm foundations that have been laid this year at the G20 summits in London and Pittsburgh. The sad thing is that it took a credit crunch and a financial crisis to change the G8 to the G20. We have to recognise the increasing power of India and China. These are essential first steps in redesigning the global architecture.

Now we have to balance the needs of the developing and the developed worlds. We have to reach a deal on climate change in Copenhagen next month, to slow the rate of change and fairly distribute the cuts in emissions.

But we also need to do more on multilateral trade deals. Doha is the ultimate goal, but any progress we can make in banishing protectionism and creating open, fair, global markets has to be embraced.

The Chinese have a proverb – opportunities multiply as they are seized. And that’s where we stand today. We are on the cusp of a new global order and a new co-operation around the world, with limitless possibilities. So to those of you who will be embarking on a future in business, I say this: you have to be international if you are going to compete.

Thank you.

Composites are increasingly used for their lightweight, super strength properties in aeroplane wings and racing cars.

In the ‘UK Composite Strategy’ document Lord Mandelson estimates that the high-value composites market is currently worth about £1 billion to the British economy.

The UK offshore composite wind turbine blade and aerospace wing market alone could be worth £22 billion by 2020 – highlighting composites’ low carbon credentials. For more information on the strategy see the Advanced Manufacturing website here.

“Our challenge certainly isn’t to fight off that process of technological and structural change – if anything Government has an obligation to drive it faster both for environmental and economic reasons.

“Our job has to be to help you make sure that when the technological kaleidoscope slows again, Britain emerges as one of the best place in the world to makes these new kinds of vehicles and their components, to design and manufacture these new kinds of technologies.”

Read the full speech

Lord Mandelson also announced the full line-up of members making up the Automotive Council. The council will be jointly chaired by Lord Mandelson and Richard Parry Jones (ex-Ford).

I was admiring the cars on display on the way in and it’s hard to disagree with Paul Everitt’s comment in the programme that they are British icons. We’ve been making motoring icons now for more than half a century.  I was born the same year the Triumph TR series was launched. One of us went on to become a classic…

But it’s interesting that we look back on those post-war decades as the heyday of British car manufacturing, when in fact we have twice as many motor manufacturers in the UK now than we did then. We make twice as many cars today as we did 25 years ago, even before the big Asian players revolutionised the market, and twice as many engines as we do complete cars. If you put the 1.65 million cars made in Britain last year nose to tail…they would look like a bank holiday on the M4!

My point is that we sometimes have a glib notion in this country that we don’t really make anything anymore, that we are no longer an industrial economy. The motor industry makes a nonsense of that idea. If we want a balanced, diversified economy then the engineering and technological strengths of the motor industry are a national asset of the most unique kind.

It has been a difficult two years for the motor industry – the toughest imaginable market conditions internationally. So I want to start today by paying a very genuine tribute to the resilience of the industry and its people.

It’s easy to think that motor manufacturing is chiefly about machines, but of course its biggest asset is its people. The workers whose skills and productivity are one of the reasons why this country is one of the best places in the world to make cars and components.  The staff who have accepted limited hours to keep plants viable through the downturn. The innovators in management who have had to build strong business models around high structural costs and ruthless price competition over the last two decades.

This industry is the cornerstone of Britain’s manufacturing economy. I know you’d expect a politician to stand up here and say that – but for the last year I’ve spent more time working for the future of the UK motor industry in one way or another than doing just about anything else. The car scrappage scheme has maybe been the most visible part of that, but through our business support schemes and worker assistance schemes and Train to Gain we have made sure that you had the help you needed.

Of course the wider government stimulus is acting like a crutch for demand as private investment has collapsed, and that helps across the economy. As the IMF stressed again yesterday, prematurely withdrawing this stimulus would put at risk the very jobs, skills and capacity that we have worked so hard to protect. So although there are some politicians who try to make a virtue of their haste to pull away support for demand, it’s clear we need an exit strategy for the stimulus, not a rush for the exits.

Now, I’m going to disappoint you here. This commitment to motor manufacturing is not because it exerts some kind of special sentimental tug on Ministerial hearts. Sorry to say it.  It’s a cold hard judgement of what this industry means to our skills base, our engineering supply chains, our niche manufacturing skills, especially in design, low carbon and ultra high tech. It’s a measure of what this business means for the UK’s industrial future.

We are very very good at making motor vehicles in this country – everything from mass market vehicles to Formula 1. I’ve made that case in Brussels, and Japan and Germany. I’ve made it to the management of GM and Magna.

But the reality is that this is an industry at the end of the current stage of its evolution. That was the basic analysis of the New Automotive Innovation and Growth Team chaired by Richard, whose excellent report has done so much to shape Government strategy over the course of this year. Today I want to take that analysis and ask what Government and industry need to be doing to make sure UK motor manufacturing is equipped to prosper through that change.

The horizon

There are two big basic problems out there for the vehicle industry: decarbonisation and over capacity. The basic evolution of car making over the last century has been based around the constant refinement of the same basic technology on which the automobile was originally based – the internal combustion engine. This has given a huge natural advantage to market incumbents.

But suddenly the market is much more open.    Low carbon technologies provide a real opening for new and innovative firms to shake up supply chains and this presents real opportunities for the UK and for the UK automotive sector.

The industry also suffers from longer-term structural overcapacity – an overhang of productive capacity that is probably 20% higher than demand. Even if we project huge levels of car ownership in the developing world, it is inevitable that some of that European capacity is going to have to be absorbed through consolidation.

Our challenge certainly isn’t to fight off that process of technological and structural change – if anything Government has an obligation to drive it faster both for environmental and economic reasons. Our job has to be to help you make sure that when the technological kaleidoscope slows again, Britain emerges as one of the best place in the world to makes these new kinds of vehicles and their components, to design and manufacture these new kinds of technologies.

It’s absolutely vital that that process is guided by commercial logic, not politics. That’s why I put up such a stiff fight against any suggestion that the future of plants in Luton and Ellesmere Port might be decided by political considerations rather than productivity. Now, how we do that at the European level is a difficult question, to put it mildly. But the long term competitiveness of the motor industry in Britain and Europe depends on restructuring.

Active help from government

So the question we face is how we turn that process of change into something from which British motor manufacturing emerges even stronger. Some of the most important answers to that question emerged from the work done by Richard and his team and the Government’s response to it. I want to say something about three of them: the new Automotive Council, low carbon vehicle policy and the wider strategic way we see the industry and its supply chain.

The creation of the Automotive Council is a great development and has the potential to bring a whole new strategic dimension to the self-management of the industry, and in particular to the way it works with Government. But of course, it will only be as effective as the people on it, and the ideas and energy they bring to it. It needs to represent every part of the industry – the full supply chain including the research base, and the specialist producers.

It needs to be proactive and influential and have a very clear forward strategy, based on a very frank assessment of the industry’s strengths and weaknesses. The better that it is able to set out the strategic challenges facing the industry, the better government and industry will be able to respond to them together.

Keeping membership of the Council to a manageable size has forced some hard decisions.  We have announced the membership this morning and I think it is a great list.  For example, Richard Parry-Jones and Gordon Murray are engineers of world status.  Trevor Mann is a product of the Nissan revolution in the north east of England.  Franz Josef Paefgen brings a bit of continental European class.  Andrea Paver of Leyland Trucks and Gwenne Henricks of Caterpillar show that this isn’t just about cars.  We have suppliers and scientists and SMEs and environmental expertise and the OEMs.  So it’s looking good.

Clearly one of the most important strands of the Council’s work will involve low carbon vehicle policy. Now, I recognise that there is no silver bullet solution to cutting automotive emissions. But the industry’s consensus around a low carbon road map has provided a very useful tool and was central to the Government’s own strategy for low carbon cars, which we published in April.

As you all know, as part of the £150 million Low Carbon Vehicles Innovation Platform, this included £25 million for the TSB’s demonstrator programme for low carbon cars, £30 million for pilot infrastructure for charging ultra low carbon vehicles and £20 million for trials of low carbon vans in public fleets. We have created a Low Carbon Economic Area for ultra low carbon vehicles in the North East that will leverage the various research and production strengths in the region into a single network of mutually-reinforcing strengths.

I think we have to accept that barring a crippling new plateau in oil prices, consumer choice alone isn’t going to get us to a tipping point in decarbonising road transport fast enough. The carbon cost needs to start showing up in the price a lot more clearly. That’s why we were the first country in the EU to tie vehicle taxation to CO2.

But we are also providing positive incentives by investing in charging infrastructure and making £230million available from 2011 for consumer subsidies for the first major generation of ultra-low carbon cars – a policy that reflects closely the timetable for technology roll-out that the industry itself set out in its roadmap.

Key Tier One suppliers around the world are starting to sit up and take notice of what is going on in the UK on low carbon cars. The trick now is to make the UK the place you just can’t ignore if you’re in the low carbon motor business.

I’d like to think that it’s a reflection of this commitment to making Britain the best place in Europe to manufacture low carbon vehicles is one of the reasons why Toyota, Nissan and Ford have all made the decision to locate key parts of their low carbon operations here.

Finally, in building the industry’s future strength we need a comprehensive view of how the sector works: from the manufacturers to the Tier Ones to their suppliers and beyond.  For the future I want a determined strategy to build strength at all levels and sustain the industry’s critical mass here in Britain. The Innovation and Growth Team report left unfinished business here.

For our part, government will make sure that good suppliers can prosper here. We will actively seek out more companies to locate here.We’re supporting the research base in a big way, especially in low carbon. We’re building a new technician class through our revived apprenticeship system. And a Supply Chain Council  – as part of  the Automotive Council – will provide us with advice on further steps.

But the big players in the industry need work with us in partnership – and I think this was clear in Richard’s report. We all agree that there has been some hollowing out of the supply chain in this country  – and we all know who has done the hollowing out!

My offer is partnership. A partnership in which manufacturers show their share of responsibility for the UK supply chain. There needs to be more collaborative, longer term partnerships with suppliers.  When a big player tells me, as one did last week, that it wants to source more here rather than put its faith in supply lines that stretch over the Alps or the Urals – I say, good, let’s ensure that that happens.

Conclusion

Right, that’s enough from me. I’ve argued today that the transition to low carbon and the challenge of rationalising European vehicle production make the next decade critical for vehicle makers in Britain.

My basic message to you today is that Government is committed to working with you to tackle that change.  This has been a tough industry to be in and it seems to me that it is only going to get tougher.

But you know what they say: if everything is coming your way – you are in the wrong lane! Thank you.

The closing date for submissions of Expressions of Interest is 17:00 on the 25 January 2010.

Published jointly by the Department for Business and the Department for Culture, Media and Sport, the Bill aims to support growth in the creative and digital sectors and includes measures aimed at tackling widespread online infringement of creative copyright, such as peer-to-peer file-sharing.

Read the text of the Bill on the Parliament website

Key measures in the Bill include:

• obliging individual ISPs to take action against infringers
• modernising the copyright system
• unlocking large volumes of previously unusable ‘orphan works’
• extending public lending rights to include digital material
• improve the regulation of internet domain names
• update digital radio regulations for a digital switch over in 2015
• give OFCOM powers to support regional and local news
• age ratings compulsory for boxed videos designed for those aged 12 or above

Lord Mandelson said:

“On current definitions our digital economy accounts for nearly £1 in every £10 that the whole British economy produces each year – so our creative and digital industries are key to Britain’s future economic success. This Bill will give them the framework to develop competitively and make the UK a global creative leader.

“Better protecting our creative communities from the threat of online infringement will ensure existing and emerging talent is rewarded and will bring new choices for online consumers.”

“Creating the right conditions for investment in our communications infrastructure will bring benefits for households and businesses in all parts of the country.”

Secretary of State for Culture Ben Bradshaw said:

“”Our digital economy is worth around 8% of GDP.

“Britain’s creative industries have become number one in the world as a proportion of our economy.

“This Bill is a key part of the Government’s active industrial strategy and will maintain and build on Britain’s leading position. It includes measures to ensure universal broadband, the protection of music, film and other creative content and the future of quality local and regional news. The market will not provide these things, only Government action can.”

Minister for Digital Britain, Stephen Timms, explains the Bill:

Press notice
Read the full press notice here

Links
Read more about the Bill on our dedicated website.

The Bill is the legislative programme that realises many of the recommendations made in the Government’s Digital Britain White Paper, published on 16 June 2009.

I remember a cartoon in the FT last year that showed a cigar-smoking industrialist leading his son around a factory. The factory was full of people in white coats staring at computer screens and the industrialist was saying – presumably in a strong Lancashire accent: “Son, where there’s knowledge-rich low-carbon, high-tech… there’s brass!”.

The knowledge economy has become a bit of a cliché, but it reflects a very basic truth about Britain’s future. The global economy is an extended, international supply chain along which very many jobs are located. Some add more value to a finished product or service. Some add less.

Wages in Britain are high, and to pay those wages requires the greatest possible productivity and value-added in the jobs we do here. Some of that we will add through sophisticated technology alone, but most of it we will add through knowledge. Skills are applied knowledge. If we want to pay our way in a globalised economy we can no more cut off our investment in these capabilities than we can cut off our supply of oil or electricity.

In this kind of world it’s no longer credible to have any notions about a hierarchy of elite academic higher education and under that, vocational or further education. There is a higher skills system, built on a wider school system, with a single core goal. Which is: people equipped with the character, confidence and skills for the world of modern life and work.

In setting out over the last month our frameworks for Skills and Higher Education Policy I have explicitly seen them as a single higher skills system. They need to mesh and reinforce each other. Skills need to be a ladder up into a job, or, as often, on to higher qualifications, university, or professional advancement. They need to be accessible throughout a working life, and in a way that fits around work, or integrates work.

Where we are

Now, I remember the skills system as far back as the Callaghan days. So I know as well as anyone that we have done a lot of good work on skills policy in this country over the last decade. We have made real progress in tackling the economic and social scandal of adult illiteracy and innumeracy. We have revived apprenticeships, which were allowed to wither away in the 80s and 90s.

We have eradicated much of the poor quality that blighted our further education system – or rather, you have, in a huge push for quality management and student service. Last week, during Colleges week I visited Westminster and Kingsway Colleges in London and I was hugely impressed – the distance we have come is genuinely striking.

But the fact remains that skills are still an area of relative weakness for Britain. Especially in some key strategic areas for growth and job creation such as STEM, and especially at key levels like level 4, where a lot of the sophisticated skills for fields like advanced manufacturing are clustered and at the technician level. We also need the skills for growth areas like healthcare where demand will inevitably rise with an ageing population.

So it seems to me that we have a collective challenge now. We need to take that renewed skills system forward with a clearer sense of strategic priority. That doesn’t mean scrapping our commitment to basic skills – you don’t strengthen a ladder by removing the bottom rungs. You can’t build sophisticated STEM skills in a worker who can’t count.

But we do need to fill these skill gaps higher up. So on top of that basic commitment needs to be some more focused priorities for the additional spend.

And of course we are going to have to do this in an environment of considerable fiscal constraint. So there will have to be the clearest possible benchmarks for public investment, and they will have to be reform, relevance, and quality.

Like any public service provision, the skills system needs to target public investment where it produces the maximum return on investment. It needs to empower colleges and training organisations to innovate and users to improve quality by exercising choice wherever possible. And it needs to eliminate duplication that confuses the delivery of services.

The Skills strategy

The Skills Strategy we published last week reflects this – I know that Kevin Brennan has set out some of the detail for you. The strategy targeted three key areas for development in the skills system, and marks a radical shift in some of our priorities.

First, it tackles the gap in technician-level skills in this country by expanding our apprenticeship numbers to create a modern class of technicians. We’ve also made it clear that we expect expansion to be focused in strategic skills, especially those linked to areas like low carbon, digital technology and biosciences and modern infrastructure. Resources will be prioritized in these areas.

Second, it gives real new customer power to learners by creating skills accounts backed with much greater access to information about courses and their outcomes, that will enable learners to plan and invest in their own futures. By allowing learners to shop around, and opening up the field for over other training organisations, we expect to see pressure to provide quality, relevant training rise.

To achieve these goals, we need colleges and training providers to have the space and freedom of manoeuvre to be out there doing the right things for employers and learners. I know colleges feel that you have been over-managed and over-directed in the past. Some of that was a response to patchy quality in previous years – which you have now very largely irradicated. Some of it was a consequence of putting in place major reforms – to which you responded with characteristic flexibility and determination. So we can now move on and focus on investing in the future.

We will still have national goals and targets, reflecting our economic priorities . We will still want you to be putting the needs of employers and learners first, helping people access the training to which they are entitled. We will still want high quality. But I know that you want those things too.

So in future we should be able to operate at the level of the whole programme you offer for employers, and for learners, and how well that whole programme reflects the range of national needs, rather than getting stuck in the detail. We then want rewards to flow to those who best respond to the range of national needs, with funding reduced to those who don’t. We will work with you on building fair ways of doing that.

Finally our strategy commits to dramatically reducing the number of public bodies involved in skills and training policy. We welcome the UK Commission on Employment and Skill’s recommendation to reduce the number of separate publicly funded agencies sharply and that’s what we are going to do. The result will be a clearer, more focused skills system.

Expectations

Now, clearly this is an approach that puts a new accent on vocationalism and I think that that’s right. The system has to be producing relevant, quality skills, with real market value.

Obviously our expectations of FE colleges are going to continue to be extremely high. But I think the last decade suggests that there is no shortage of good and ambitious leadership to be tapped in the sector. I want to say very clearly today that we are empowering you to innovate in the pursuit of wider national aspirations, and we will work with you to deliver our new measures and if you feel that Government is somehow standing in the way, I want to hear about it.

Our expectations of business will also rise – and here the track record is rocky, as business itself concedes. This strategy is explicitly targeted at producing the skills that business tells us they need, and in giving employers a greater role in shaping outcomes.

But business has to get a lot better at communicating those needs, both to you and to your students, clearly and quickly. Otherwise both you and the Government are left trying to make educated guesses about where the market is going.

We expect businesses to invest, and keep investing, in skills. And often the most effective way of doing this is going to be to build strong collaborative ties with colleges. And because they are the key beneficiaries of these new skilled people, we are going to expect business to bear more of the cost.

I’m delighted that Chris Banks, working with the CBI, AoC and Association of Learning Providers has agreed to carry out in independent review of the implementation of our fees policy to see how better to make this work.

Conclusion

I started by saying that skills are an urgent challenge for us in Britain. That urgency comes from an external challenge above all: this is a competitive and demanding world and people rightly expect Government to help them equip themselves for it.

There is a compelling case to make that investment in skills is not a cost to our society or economy but an investment that pays back many times over in growth. For us as a country the brass really is in knowledge-rich, high-tech, low carbon and the skills that drive it.

For that reason investment in skills is as important in the recovery as ever. We should be making that case. But that doesn’t remove the pressure to keep measuring what we do against those benchmarks of relevance, quality and reform.

The AoC will be central to that, you have the expertise and the experience. My ambition is that the new Department of Business, Innovation and Skills really delivers a dividend for you and for policy here – bringing skills right into the heart of growth policy making and seeing it as a driver of innovation, knowledge and enterprise. The SFA and the RDAs will be a key part of the machinery for making that real on the ground.

Our aim must be to put further education where it belongs, right at the heart of the knowledge economy, at the heart of our recovery and our future prosperity.

Let me start by saying how the constructive relationship Steve Elliot and the CIA have built with the Government is central to everything I have to say tonight.

Together, we’ve strengthened the UK’s position as a leading location for investment in this industry. And that partnership remains essential to our future prosperity in this century. So I welcome today’s launch of the CIA’s Manufacturing Strategy.

I also want to echo Steve’s thanks to Bob [Tyler] and Brian [Iddon] for their service over the last few years. And let me wish John [Saul], the very best of luck in his new role as CIA President.

The Building Blocks for Growth

If you go back down the supply chain of just about any manufacturing industry in Britain, and many other parts of our economy too, you’ll find a chemical producer.

We sometimes say that this is the carbon age – it is also the age of chemistry. And the omnipresence of fossil fuels in this industry is, as Steve said, a huge challenge.

What I want to do tonight is acknowledge the strength of the British chemical industry, and sketch out the key ways in which government will back you in facing this and other major challenges ahead.

The Challenges Ahead:

The last two years have obviously been difficult for this industry. Precisely because you are so fundamental to the industrial economy, the collapse in global demand for manufacturers is hurting you. That is why it is so critical that we maintain our fiscal stimulus until our recovery is fully locked in across our economy.

To withdraw that support now would threaten the stability that the Government, this industry and its trade unions have worked so hard to secure.

Because in the long view, this industry remains one of the UK’s great industrial successes. It is a global leader – generating billions for our economy every year, adding value across our manufacturing base and investing heavily in business-related R&D.

But even when global growth returns, this will remain a tough business to be in. You’ll be competing for markets with the chemical industries of the industrialising economies. You’ll remain highly dependent on a strong and consistent supply of trained technicians and scientists.

And of course, you will face the huge challenge of decarbonising industrial chemistry, which remains heavily rooted in fossil fuels. When we think about decarbonising the economy we tend to think about energy, about cars, about planes – but the chemical industry also faces a high and radical reinvention of itself.

That’s a huge demand. But it’s also a very exciting challenge and I’m encouraged by initiatives like those at Runcorn, such as the new Ineos Chlor Plant which are helping reduce the carbon footprint of this sector.

But this is also a massive global opportunity for our advanced manufacturing base. As we’ve heard tonight, your industry will be integral to the development of cost-effective low carbon solutions and services.

And Government is committed to equipping your industry and others to realise our vision for the UK to become a world leader in low-carbon. That includes ensuring secure, competitively priced energy supplies.

The challenge for Government is making sure that the conditions are in place to help this industry continue to make that transition and to prosper. It needs an active, strategic approach to industrial policy that puts public investment behind the capacities that the chemical industry builds on. I want to focus on three during my remarks: the right regulatory environment, the right skilled workforce and the right kind of policies to back industrial innovation.

The Right Regulation

This is always going to be a sector that has to live with health and safety regulation. It provides the reassurance people want and need that chemicals are safe. This industry can’t survive without that transparency and trust. We need to see that regulation as an enabler of innovation and commercial growth, not as a check on it.

But we need to regulate intelligently, not least because for every one big chemicals player, with the budget to handle heavy due diligence burdens, there are ten chemical SMEs who need to carry out the same checks on much smaller budgets. A big part of that challenge is at the EU level, where we need to make sure that big essential regulations like REACH and EU-ETS are proportionate, well-designed and enforced consistently across all Member States of the EU.

The Right Skills

In a laboratory-based industry like this, we also need to ensure the right numbers of skilled technicians and STEM graduates. This has long been recognised as a gap in the British skills market and something that we have addressed in our new strategies for adult skills and higher education.

Both policies retarget marginal funding in the UK higher skills system towards filling strategic skills gaps, especially in industries like chemicals, pharmaceuticals, bio-science and wider advanced manufacturing. And I make no apologies for targeting and fine-tuning at areas of skills and skill needs in this country. I’m not afraid of making those choices.

We will create a modern class of British technicians through 35,000 new advanced apprenticeships for 19-30 year olds, and many of these apprenticeships will be in the chemicals sector.

To get the best out of the skills system we need industries like yours to communicate strategic demand to both trainers and students as clearly and quickly as possible. The best way to do this is often going to be to establish collaborative partnerships with local universities and colleges, in the way that companies like AstraZeneca and Shell already do. We will continue to strongly encourage and support this.

Boosting Research & Innovation:

But it’s not just about leveraging the potential of universities for training. With investment in science topping £6 billion next year, the UK’s science and research base represents a knowledge bank second only to the US. It’s one of the few banks left that can never be too big.

Turning the intellectual resources of our universities into commercial applications is one of the defining challenges for industrial Britain that we face in coming decades. Since 2003, UK universities have spun off almost a thousand companies worth around three and a half billion pounds.

This is a good record, but I am convinced we have the potential for more, especially in new materials, processes, catalysis, nanotechnology and drug development, where the premium is on innovation. And I was pleased that today’s first meeting of the Industrial Biotechnology Leadership Forum was so constructive in identifying future opportunities in the UK.

There are a number of ways Government can back you. Evidence shows that R&D tax credits have certainly helped. The science budget is one of the most powerful public investments we make in this country and I will fight hard to protect it in principle and practice.

In the last year we’ve also taken a more active approach to investing in some of our key capabilities in this area through the new Strategic Investment Fund, especially where the market was failing these perfectly viable developments for whatever reason.

Now, we are funding the Industrial Biotechnology Open Access Demonstrator at the National Industrial Biotechnology Facility at Wilton, and have created a fund to help SMEs access it. And last month we became the enabling investor in the new Welcome Trust drug development incubator at Stevenage alongside GSK.

Conclusion:

For a decade our key concern in Government has been making sure that this country is a good place to invest in pharma and industrial chemistry. That won’t change. That’s not just about the tax and regulatory regime – although those things are of course vital. It’s about access to the right skilled workforce, the right IP regime, the right ecosystem of universities and innovation, including access to finance for innovation.

At this point as a country we are right to be having a serious debate about how we live within our means. But we also need to be thinking about how we invest in and drive the growth that will power recovery and put in place the conditions for our economic success. Because the fastest way – the only way – to get out of debt is to grow the economy, especially through exports. Investing in modern manufacturing in Britain is, in my view, the key investment in our future as an economy and as a country.

A strong chemical and pharmaceutical industry is an essential part of our industrial base. It’s also key to the solutions that will define environmentally sustainable industry in this century.

This next generation of British chemists will be among the most important we have ever produced. A lot of our best and brightest have chosen careers in the City over the last ten years, and from the perspective of 2009 it’s hard not to ask what the opportunity cost of that has been in the research lab and modern manufacturing.

Active outreach by the industry to students is key to changing this, and it’s something we support through Manufacturing Insight.

Actually, I think this year’s CIA’s young ambassador Greg Simmonds from GlaxoSmithKline is here tonight. Greg? No pressure, but our future rests on you. We need more like you.

And we need to be equipped to take advantage as much as possible of new technologies, materials and markets like the emerging economies.

Korea is one such market with an active chemicals sector. As EU Trade Commissioner I initiated the EU-Korea Free Trade Agreement to open up the lucrative Korean market to UK companies. That agreement will come in to force in the mid-2010 and will remove 97% of all tariffs between the EU and Korea within three years, creating a massive new trade opportunity. More UK businesses must seize that chance.

Let me end, as I started by saying again that we are committed to working with the CIA to ensure your industry is equipped for a changing world. I hope you enjoy the rest of your night.

Transport Secretary Andrew Adonis today invited cities and businesses to join together to bid for the money which will help fund the installation of charging points on street, car parks and in commercial, retail and leisure facilities.

This initiative – called Plugged-In Places – will support the development of between three and six electric car cities and regions across the UK which will act as trailblazers for electric car technology. The experiences of these locations will inform the future development of a national recharging infrastructure.

Overall, the Government is investing over £400m to encourage the development, manufacture and use of next generation ultra-low carbon vehicles. Delivered by the Office for Low Emission Vehicles this support is being targeted to create new jobs in a low carbon automotive sector and to cut carbon from UK road transport.

Transport Secretary Andrew Adonis said:

“The UK can be a world leader in low carbon transport which is why the Government has already committed around £400 million of support to encourage development and uptake of ultra-low emission vehicles.

“Our aim is for ultra-low carbon vehicles to be an everyday feature of life on Britain’s roads in less than five years. There is still a lot of work to be done, however Plugged-In Places is one very significant step in putting us firmly on the path to a low carbon future.”

Encouraging companies to get involved, Business Minister Pat McFadden said:
“The move to lower-carbon forms of transport is a turning point for the automotive industry, opening up new opportunities for existing UK automotive companies and with the potential to create new jobs and new industries, for example around the charging infrastructure.

“I urge British companies to get involved and seize these new new opportunities for growth and jobs.

“Our aim is for Britain to become a global centre for low carbon transport development, manufacturing and delivery – the Government is backing businesses who want to help make this happen.”

The total number and location of charging infrastructure supported by this initiative will depend on local plans and requirements. The intention is that successful applicants will match the Government’s investment.

These plans build on existing measures to support alternative fuels and today the Government is announcing the seven schemes that will benefit from £500k of funding through the Alternative Fuels Infrastructure Grant Programme. These schemes will see the provision of 72 electric charging points and 4 gas refuelling stations in areas across England.

Visit the Office for Low Emission vehicles

CHECK AGAINST DELIVERY

Good morning.

This is an industry where – for me – the personal and the political are perfectly aligned.

That’s because the highlight of my 2009 – without question – was fulfilling a lifetime ambition by competing in Le Mans 24 hours. Ask me for a second, and I’d have to say it was moving up to LMP1, my team securing pole at Okayama and winning the Michelin X Challenge in the Le Mans Series Champtionship. I could give you a third, a fourth and a fifth.

My passion for motorsport grows with every race. But besides my own ambitions, I’m also convinced that this industry can – and should – have a greater impact beyond motorsport itself.

That’s in no way to dismiss what motorsport and high performance engineering already mean – for this country in particular.

Awareness of British achievement has been boosted by Brawn GP and Button in F1. I was delighted to pay a small part in enabling Ross Brawn and Nick Fry to buy the Honda team – although I never expected it to pay such immediate and spectacular dividends.

Yet what many people don’t realise is that British success in this sport is quite outstanding. Besides Jenson & Brawn GP, we’ve had several other winners in 2009: Dario Franchitti in the Indy Car Series; Kris Meeke in the Intercontinental Rally Challenge. Aston Martin Racing, using a Lola chassis, took the Le Mans Series constructors’ title.

These drivers, these teams all raise the profile of the UK – and in particular the quality of our science, engineering and technology.

According to research conducted this year by the Advanced Institute of Management, the British industry involves some 4,500 firms with an annual turnover of £6 billion that make a contribution to the UK economy through exports valued at £3.6 billion. They employ about 38,500 people on a full- and part-time basis, including 25,000 engineers.

These companies are also resourceful. This recession has caused major problems across the board, but motorsport has again shown its capacity to adapt. Another survey, conducted in December last year, found two-thirds of companies in this sector diversifying into new markets, with more than half of companies developing new products and services. Many are looking to significant opportunities overseas, in growing markets like the Middle East.

In terms of formal collaborations, we’re seeing several leading companies involved in collaborations with other industries: McLaren with BAE Systems; Williams F1 working with Airbus and Rolls Royce on next-generation computational aerodynamics.

I should add here that the pace at which new technology is developed and applied in this industry has really opened my eyes to different ways of doing things. In my capacity as a defence minister, it was the example of motorsport which persuaded me that Mastiff vehicles could be delivered to British armed forces in theatre on much shorter lead times.

The clear ability of this industry to innovate – the frequency with which its pioneering technologies and methods to improve safety have found their way not only into mainstream automotive but aerospace and marine, medical and military – brings me to my main point today.

For the foreseeable future, the most pressing demands for transferable technology all relate to the climate change agenda.

Now, given that my team, Drayson Racing, has – from the beginning – competed as a green team, I know UK firms are at the forefront of environmentally-friendly technologies: in biofuel development, energy efficiency, super-light materials, lean burn engines.

All the same, I am keen to make a case for the importance of going green to an audience with a high proportion of engineers – and to hear your views about current obstacles, opportunities and feasible timeframes.

I won’t trouble you with the science of climate change, nor the politics of the Copenhagen summit that’s fast upon us – except to say that a bold agreement with legally binding commitments is necessary, amongst other things, to send clear signals to green entrepreneurs – to give them confidence in the future market opportunities.

Instead, my starting point is this.

We’re not going to bring about a radical transformation in human behaviour – and that’s what we need – by pedalling doom. Guilt is unreliable as a motivating force. So is bullying.

We have to offer people a practical, accessible, attractive low-carbon future – one which offers 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 – which is why I’ve not got much time for the hair-shirt environmentalists.

That’s where motor racing comes in, and it’s contribution can be twofold.

First, it has an exceptionally talented workforce with an unrivalled track record on innovation.

Second, if I’m right in thinking that – with climate change – it’s not the technological solutions that actually represent the greatest challenge but public attitudes, then motorsport has the considerable advantage of being extremely cool.

When racing cars demonstrate that it’s possible to achieve high performance by going green, people take notice.

When the experiencing of driving electric vehicles becomes exciting (exhilarating even) – as opposed to simply worthy – then people will change from curious observers to active consumers.

So I’m not advocating that you increase your focus on green tech out of altruism. I’m advocating that focus because it can make you rich.

The push to decarbonise will be a major driver of growth over the next decade and beyond.

The global opportunities here are enormous. We all know that car travel isn’t about to disappear. It can’t. Economic growth is fundamentally linked to individual accessibility and mobility. So is personal freedom.

From the Government’s perspective, the transition to low-carbon can’t be achieved without our input. The challenges involved are too great – the technology, the investment, the coordination, the need to win over hearts and minds.

I’m encouraged by what’s happening so far with cars. For example, we’ve agreed with the automotive industry a technological roadmap for the coming decades that incorporates business opportunities and the necessary drivers of change.

We’ve created the cross-government Office for Low Emission Vehicles, which has participants from the automotive industry, power and infrastructure companies, as well as creative thinkers and experts on pricing and systems design.

And we’re already running the world’s largest EV and plug-in hybrid demonstrator competition. I’ve test-driven some of the prototypes, and these are no poor imitations of petrol cars. Some of the sports models have bucket loads of torque and fantastic chassis dynamics.

Now, the way forward is by no means easy. But my experience of being in and around science and engineering all my life – as a researcher and entrepreneur, as a minister and most recently a race team owner – has made me a qualified optimist.

I believe we can develop the tools needed to adapt to changing ecological circumstances; that we can achieve zero carbon emissions by 2050 in most forms of UK surface transport.

It will require, however, the continuing efforts of industries like this one to push technological envelopes and thereby convince people that a world without carbon is not only achievable, but superior and cooler – in both senses of the word.

Thanks for listening.

CHECK AGAINST DELIVERY

Good afternoon, everyone.

As many of you will know, Oxford was the place where my own career as a science entrepreneur really took off. So I know first-hand how Milton Park has supported many science-based businesses over the past 20 years – and I’m delighted to join you in marking the formal opening of this new centre to incubate the smallest of companies.

The past 18 months have obviously been tough for almost any kind of business. As a veteran of previous recessions, I understand the sorts of challenges you’ve been facing: threats from the bank manager of a non-idle variety; the real prospect or actual experience of making colleagues redundant. Those aren’t memories that fade.

It’s very encouraging, therefore, that this centre opened for business last December, at pretty much the worst point in the downturn. It’s very encouraging that 32 tech start-ups and early-stage firms have set up shop here, with ambitions to grow and make money in the key sectors of the future: clean tech, life sciences, digital and creative industries.

Leading-edge facilities aside, you are increasing your chances of success through buying into the cluster effect.

Now, it’s been my constant refrain as minister for science and innovation – that, for all the headaches caused by this recession, this is the time when smart people make the decisions that ultimately yield the greatest dividends. It’s one of the main themes of a lecture I’ll be giving this evening at the Saïd Business School.

The quality of IP emerging from our universities – and not just the golden triangle of Oxbridge and London – has never been better. International investors are telling me that they’re looking to the UK to get it on breakthrough technologies – in renewables and plastic electronics, in computer games and regenerative medicine.

I’m in no way underestimating the current problems, especially the chronic lack of capital. Nevertheless, the upturn is on its way – and the Government is determined to help position innovative firms to steal a march on the global competition.

Enough context. What are we actually doing?

I’m not going to reel off a shopping list. The presentation of policy by volume convinces no-one. And besides, the purpose of visits like this isn’t for me to preach – but to find out what’s working and what isn’t from entrepreneurs.

The key point is this. The Government now has a strategy in place – “New Industry, New Jobs” – to create the conditions in which UK businesses can thrive in those industries most likely to drive economic growth and create high-value jobs. It covers the state’s function as both customer and regulator, as well as areas like skills development and support for SMEs.

Within this strategy, there are actions which can be categorised as immediate, ongoing and new.

By immediate, I’m referring, for example, to loans totalling around £520 million for some 5,250 businesses through the Enterprise Finance Guarantee – or the more than

By ongoing, I mean the support available to companies through Business Link, the Intellectual Property Office and the Regional Development Agencies.

I also mean activities which predate the downturn, but which are now getting up to speed.

Like the work of the Technology Strategy Board which, in partnership with the RDAs and the Research Councils, will invest over £1 billion to support commercial innovation in this spending period through technology-specific competitions and collaborative programmes.

Like Innovation Vouchers, which enable SMEs to buy in specialist advice from the research base. Eight out of nine RDAs, including the South East, are now issuing vouchers.

Like harnessing the full purchasing power of the public sector– it spent £220 billion in 2008/09 – to drive demand for innovative products and services. Low-carbon is the classic case, where Government can create certainty around new markets – but it’s not the only one.

Here, the Small Business Research Initiative is expanding across Whitehall and to other institutions like health authorities, so that more SMEs bid for – and win – Government contracts. Next year, all contracts worth over £20,000 will be advertised on a single web portal.

But I want to focus more on how our approach has shifted in line with the industrial strategy. Three examples, and then I want to invite questions.

The first involves supporting research in those sectors where Britain can and must prosper.

We’ve committed funding to technology testing facilities for low-carbon wind and wave power, and for plastic electronics. The most recent investment has gone to a pharmaceutical demonstrator site at Stevenage, co-funded by the Welcome Trust, the RDA and GlaxoSmithKline.

The second means changing the way that Government and industry work together on boosting the UK’s competitive advantage. There’s a much greater emphasis now – and it’s been much needed – on Government departments sharing budgets and agreeing practical solutions with the key players from commerce and academia.

The Office for Life Sciences has already made a tangible difference to the operating environment for pharmaceutical and biotechnology firms. With measures to exploit the NHS as a driver for innovation and market UK life sciences more effectively, I expect the UK to attract greater inward investment, put on more clinical trials and develop more products. The same goes for the Office for Low Emission Vehicles.

The third brings me back to the fundamental issue of financing innovation.

You know as well as I do how hard it is to raise capital at present.

The UK Innovation Investment Fund should provide hope for tech-based businesses dependent on equity finance – and we’ve been listening to investors, fund managers and CEOs to maximise its effectiveness.

The Government has provided cornerstone investment of £150 million to leverage private sector funding. Over its lifetime – 12 to 15 years – we’re hoping to have a fund worth £1 billion, the scale required to replicate what the best of US funds already do: making investments at all stages with the kind of patience that breeds success.

We’ll soon be announcing the professional fund-of-funds management who’ll be in charge of investing in a limited number of top-tier tech funds. The Government will not be involved in investment decisions. We expect first closing to take place early in the new year.

The experience of promoting the fund over the past few months has convinced me that this is an opportune moment for science-based businesses. We have the IP. We have the management. We will have the capital.

It’s now up to companies to demonstrate their “investment readiness”.

I’m clear that the best way to drive on the recovery is to get behind science entrepreneurs. It’s the people here – the people I met at the inaugural iAwards on Monday – and not the banks who must be the catalyst for jobs and wealth creation.

To that end, the Government is right behind you. As a final illustration, the Regional Development Agency have plans to invest over £1 million in businesses located at nearby Harwell. That campus is also home to the Centre for Defence Enterprise – a facility of dual interest to me given my responsibilities, which enables firms to discuss their innovations directly with the Ministry of Defence.

In total, we’re spending over £6 billion next year supporting British science and innovation.

The best of luck to each of your businesses and thanks for listening.

Introduction

It’s good to be here today. Before I came here, I had a look at the LBRO’s website. There are a couple of quotes on there about the Primary Authority scheme, which I’ll talk about in more detail later on. I mention them here because they got me thinking about regulation in general.

The first quote is from the Managing Director of Raymond Blanc’s chain of brasseries. It says: “It’s wonderful that we have one authority which can efficiently ensure all our brasseries are run to the same high standard.” And the second is from B&Q. It says: “We fully support the need for the scheme, which helps us to receive consistent information and decisions from all local authorities.”

Outside of the regulatory world, people probably think this is a bit of a dry subject. But these quotes reminded me that regulation is really about issues that matter to people. It is about making life simpler for businesses to do their job, about making sure industry has the highest standards and about ensuring customers in general and the most vulnerable in particular, are not exploited and taken advantage of. The work of the LBRO is absolutely key to making that happen. It has a vital job and is doing it well. A World Bank report recently recognised that we are the best place in Europe for ease of doing business and the fifth best in the world. And your work is key in maintaining Britain’s position as a great place to do business.

The regulation debate – not more or less but right and better

In an ideal world, regulation should keep a low profile. I used to run a small business myself and my attitude to regulation was that it was fine – as long as I could get on with things without too much difficulty. But the global recession and the collapse within the banking sector has turned the spotlight on regulation as never before. Yet I think that has given us a golden opportunity to rethink our attitude to regulation.

Now, for opinion formers, the regulation debate seems to centre on whether or not we have too much or too little. Could we have stopped the global recession with more regulation? That might very well be the multi-million dollar question. But, for me, the debate is not about more or less but right and better. That is to say, have we got the right regulation to get through these tough economic times? Have we got a regulatory system that allows us to adapt to a changing environment? And can we continue to deliver better regulation?

Regulation in a recession

We should look at how we are measuring up and make sure we only bring in regulation where it’s really needed. With many businesses struggling on our high streets, or even going to the wall, there’s been a real sense of urgency in doing what we can to limit the burden on business. And it’s worth highlighting some of the action we’ve taken.

We’ve looked at how we could cut red tape. We are on track to reduce the paperwork burden to business by one quarter by next spring – that’s £3.4 billion a year and, so far, it equates to £5million a day, every day! And we’ve delayed the introduction of nearly 30 new laws, postponing nearly £3.5 billion in costs to business until after April 2011.

We’ve looked at how we could give businesses more certainty in planning for the future. Which is why we have published, for the first time, a detailed timetable of all the Government’s new planned regulations that will come into effect between now and April 2011.

Instructive experience.

And, of course, we announced a new commitment to cut the costs of existing regulation by a further £6.5 billion. Added to the savings made in the last five years, UK business is set to benefit from close to £10bn worth of reductions in regulatory costs by the end of 2015.

So we’ve been doing all we can to get regulation right in the short term and the recent World Bank survey is proof our approach is having a positive effect.

Regulation in the upturn

But the short term is not our only concern. We also have to think about the future. In New Industry, New Jobs we set out some of the areas where we thought we would need to develop a national capability – whether it was low carbon, life sciences or advanced manufacturing. If we’re to be successful in these areas we need to do everything we can to give companies the freedom and certainty to innovate and grow. Yet the reality is that there can often be barriers that prevent companies turning potential into achievement. Having the wrong regulation is one of them.

So, in tandem with our active industrial approach to the upturn, we’ve been taking an active approach to regulation. That’s why we recently set up an independent Regulatory Policy Committee which will strengthen the way we regulate by challenging new regulations to ensure the benefits justify the costs.

And we’ve also been preparing for the EU Services Directive which comes into force at the end of the year. You’ll probably know more about the detail of this than I do, but essentially local authorities and regulators have been asked to remove unnecessary red tape faced by businesses in the service industry.

Each country in the European Economic Area will set up a Point of Single Contact, where businesses apply for licences online. In the UK, that means joining up more than 400 local authorities and other regulators through the Electronic Licence Management System website.

Regulation – a collaborative effort

I’d like to pick up on this last point. Regulation works best when it has the support of business. Collaboration in regulation – between local business, local councils as well as the LBRO and Government – will be the watchword in future. And, I’m glad to say, when it comes to working together, local authorities – many represented here today – have worked hard with businesses to make sure they have an easier time of things.

For example, Lichfield District Council was nominated in the Better Regulation category of the National Business awards for developing a way for regulators to share information across one single shared data system. This means that the local authority is in a better position to treat businesses in a proportionate and consistent manner.

Earlier this year saw Bexley, Cambridgeshire and Westminster achieve Beacon status for providing innovative working practices that reduced burdens on business. Not only does this show the importance attached to local authority regulatory services, it shows the value of getting it right.

When it comes to collaborative working, the Local Better Regulation Office has again been leading the way with its Trading Places scheme. Designed to break down barriers, the scheme offers local authority regulatory officers the chance to spend time at the premises of major companies, where they find out first-hand how council inspection and enforcement operations impact on day-to-day business. 99 local authority regulatory staff have already participated in the scheme with a further 117 due to take part in the coming months.

In this context I’d also like to mention the Primary Authority scheme. Launched in April, this is the new way for local authorities to regulate businesses that trade across council boundaries. It will mean they only have to speak to one local authority about their regulatory concerns. And it is the tool for ensuring that businesses comply with local regulation.

There are now 70 Primary Authority partnerships between businesses and local authorities covering nearly 7,000 premises across the country. Companies benefiting include B&Q, Moto, Iceland, Boots, the Trading Standard Institute, Dr Oetker, Ladbrokes and Raymond Blanc’s group of restaurants, Brasserie Blanc.

Three new partnerships

And it gives me great pleasure to announce three new partnerships today between Asda and Wakefield District Council; and TK Maxx and Watford Borough Council and Bright Star Fireworks and North Yorkshire County Council.

Conclusion

I began by looking at the importance of regulation to individuals up and down the country. What I hope I have shown today is that the importance of good regulation will continue to increase as we look to the future. And that places ever more emphasis on your capacity to work together with business to create an environment where innovation and creativity can flourish. The Primary Authority scheme is showing the way forward and, with the guiding hand of the Local Better Regulation Office, I feel certain that the UK will remain one of the best places in the world to do business for many years to come.

Speech by: Pat McFadden MP
Event: GEW Parliamentary Reception, Westminster, London

Introduction

I’m delighted to be here for global entrepreneurship week. This is a worldwide event. Eighty countries are taking part in this focused week designed to draw attention to achievements of young business people and to inspire others to follow in their footsteps. And I can’t think of many things more important than that.

Last year, during this equivalent week, a quarter of the schools in the country held some kind of event. This week, through the make your mark campaign, 72 000 young children are being sent an enterprising challenge to challenge their skills to think to work together in an enterprising way.

Britain a good place to do business

And it’s all designed to try to foster talent, to try to inspire people, either to start up on their own or maybe to think and work in an enterprising way in whatever career they choose in the future. And Britain’s enthusiastic about global entrepreneurship because Britain is a good place to do business – Europe’s number one location for inward investment from other countries.

The World Bank rates us as the number one country in Europe for ease of doing business.

And the OECD says the United Kingdom has the lowest barriers to entrepreneurship among OECD countries that is the leading economies in the world.

And we want to keep that record. It’s very important. We have 4.8 million small and medium sized businesses. They employ around half the private sector workforce and they are responsible for the lions’ share of the creativity and innovation that takes place in our economy. And the government wants to work with business to keep that going.

Backing young entrepreneurs

So we back things like the Peter Jones Enterprise Academy designed to inspire young people to start out in business. Just a couple of weeks ago I visited a Prince’s Trust event where I learned about the story of La Diosa. We are now backing the Prince’s Trust to go out and work with young people: to inspire them; to encourage them to follow in the footsteps of those who the organisation has already helped; and to help them set up their own business.

Through the Federation of Small Businesses we are now funding for thousands of new internships to give people the chance to work in a small businesses to see what’s required, to see what it takes. Access to capital is important in this credit crunch. And that’s why we’ll be working with the private sector to establish an innovation fund – public and private working together to get capital to new businesses to help them grow and to try to get the best ideas to the market. We want to keep this record going.

People want advice. Business link services help some 900,000 businesses – nine out of ten people who used it said they were satisfied with the service. So I’m here to celebrate that success tonight. That’s not for a moment to deny that we’ve been living through tough economic times but I believe in Britain’s business people and I believe in Britain’s young people.

Conclusion

So I want to talk Britain up not talk it down. To point to our strengths – our creativity, our use of the English language, our excellence in digital creative industries – computer gaming film, music, web services and so on.

We are world leaders in these sectors and what we’ve got to do is use this week to celebrate what is best about Britain. And nobody can do that better than the kind of businesses we’ve been hearing talk today.

They represent, many of them, the best that there is of our country. In the day to day political debate, of course, we can often emphasise the problems and the challenges we face but in entrepreneurship this really is the best of our country. And I’m sure that, coming through the tough economic times that we’ve seen, we will continue to see Britain as a country that’s a great place to do business.

That’s what the government wants to see and I draw strength and inspiration from the young businesses that I meet in the course of my job. So let us make sure that this week is a success. Let us make sure that it inspires others to follow in the path of the great entrepreneurs this country has produced so that we keep our place as the best place in Europe to do business.

Good afternoon everyone. I’m very glad to be able to join you today for the first time as Further Education and Skills Minister.

It’s a special pleasure for me to come here after Colleges Week last week: It’s a week when we celebrate everything that the FE sector does to transform individual lives by giving people new skills and the new hope of getting on in the world that comes with them.

I was delighted to help launch the week at Pat Bacon’s college – St Helen’s – where I saw their wonderful new facilities, and even had the chance to play the guitar to a hopefully appreciative audience.

This year especially, it was also a week when we celebrated what you are doing to train the employees whose skills keep businesses going, giving them confidence in their ability to take full advantage of the opportunities that recovery will bring.

In view of all that, it’s appropriate that your conference this year should have two BIS Ministers on its agenda rather than just one.

On Thursday, you’ll be hearing from Peter Mandelson about the Government’s new Skills for Growth Strategy published last week.

In my speech today, I want instead to focus on some of the structural issues that will influence how you do your jobs from day to day in the future. They include the role and priorities of the new Skills Funding Agency; the concept of earned autonomy and what it means. In doing that, I want to give you a flavour of the simpler, more streamlined and more efficient skills system that we must build.

And I want to leave plenty of time at the end to answer your questions and listen to your views.

I’m going to start with the Skills Funding Agency.

The main thing I want to say about that is that is how invaluable your input to development of the Agency has been. As the new body, now begins to come to life, I want that input to continue as we move forward.

With your help, we’ve designed the Skills Funding Agency to enable faster more effective response to policy – needed to support growth/help move out of recession and to be more customer-focused and streamlined than the previous systems you’ve known.

Three things in particular will help to achieve that.

As an agency of BIS, Skills Funding Agency staff will be directly accountable for their performance to Peter and to me. And, of course, we’ll be accountable to you. So you’ll know exactly where the buck stops.

Second, the Skills Funding Agency will implement a national account management system; with each college and learning provider, wherever they are, having their own account manager: one point of contact within the Skills Funding Agency with which to deal

And third, the Skills Funding Agency will have a more proportionate relationship with the colleges and providers it funds. That will be supported by a shared online system to support the contracting and payment processes which will enable much more effective working.

That brings me inevitably to the question of funding. A question which, after the media coverage we’ve all seen over the last couple of weeks, must be at the front of many of your minds. Yesterday we published the Skills Investment Strategy.

You’ve all seen Government grants for FE rise to historically high levels in recent years. But you’ve also seen demand for your services from learners and their employers grow, if anything, even faster.

Those of you who’ve read Skills for Growth know that in the coming years, the Skills Funding Agency will need to concentrate funding on the priorities that will give the best return on the taxpayer’s pound.

On the sectors and markets on which future jobs growth depends.

On Apprenticeships, perhaps the greatest FE success story of recent times. Many of you are already recruiting apprentices directly helping to meet the BIS FE/HE target of 2,500 public-sector apprenticeships, although we’re not quite there yet.

On supporting people to gain the basic skills they need to get on in life and work whilst building skills at the intermediate, technician associate professional and skilled occupation level. These are levels where we remain comparatively weak by international standards.

And on helping more people to progress to higher-level study.

I know that Peter’s going to say much more about the context for these priorities. But today, I want to stress that, whilst investment will increase next year, it is clear that we are going to have to work with an increasing tight financial environment. That means we’re going to require from you. More efficient and innovative delivery. Greater use of e-learning. And an open-minded approach to the development of shared services.

It’s by no means too early for you to start thinking and sharing ideas about that here and now.

The framework within which you’ll be addressing these challenges is one of earned autonomy. We’ll be asking you to take on more responsibility for improving your own quality and to accept greater ownership of LSIS services.

Together, we’re already taking the tough decisions needed to drive out poor provision and reward excellence.

I want the rewards in question to make it easier for good providers to get on with their jobs. For example, we’re introducing new light touch monitoring arrangements in 2010 with a further review in 2012. Quality will be maintained through annual performance assessments, underpinned by the performance measures in the Framework for Excellence’, which will be linked to future funding.

We will also introduce greater freedom for all colleges and training organisations to manage their resources more flexibly within their separate employer responsive and learner responsive budgets.

Colleges and training organisations that make an outstanding contribution to meeting national skills priorities will also be given enhanced freedoms across their total budget.

This earned autonomy, will allow you greater freedom to plan the mix and balance of your provision across the full range of levels, types of learners and subject areas so that you can shape your offer to respond to local need.

I want to turn finally to the reason why many learners come through your doors or seek out your services in the workplace. The piece of paper they get at the end of their studies which is so much more to them than just a piece of paper.

It’s evidence that, however well or badly their previous experiences of education were, they have got what it takes to learn and to progress to higher levels of skills and knowledge.

It’s hard evidence to prove to current and prospective employers throughout their working lives that they can be the proverbial person with the right skills in the right place at the right time.

Of course, in practice the qualifications system has been largely impenetrable to many learners, employers and indeed providers for years. That’s why the Qualifications and Credit Framework (QCF) such an essential innovation.

I know that many people in your sector have already grasped this. Over 500 providers are now involved in delivering QCF units and qualifications.

But we need all providers to deliver more flexibly, using unit and credit accumulation and transfer. We need the right set of levers and drivers to realise the benefits of QCF.

That’s why we’re now working to build the capacity and capability of colleges and training organisations. For example, the provider readiness programme co-ordinated by LSIS; consultancy support to senior managers.

We’re also developing QCF champions. Over 200 staff will be trained to support providers in taking advantage of the flexibility offered by the QCF and to develop new models of delivery, using new resources and online tools.

I do know that qualifications still remain a cause for concern to many of you. I acknowledge in particular your complaints about some awarding bodies’ lack of price transparency.

I want to assure you today that I’m determined to ensure that the market is efficient. This is a key task for the independent regulator, Ofqual

An economic regulation strategy has already been agreed. This focuses on better efficiency in the production of vocational qualifications, and on how awarding organisation services are procured

I know that the AoC is also working with the LSC to promote better procurement of services from awarding organisations. Ofqual, too, will be checking that there is a properly competitive market, and, if not, awarding organisation fees will be capped

I hope that we can all count on your support in this important work.

I’ve covered a lot of fairly detailed ground in a short time today, but I’m going to stop there. I want to give you a chance to ask any questions you may have. But even more, I’d like to hear your views on the areas I’ve been talking about and what more you think we should be doing to build an efficient and effective FE sector for the future.

Thank you.

The iawards ceremonly was held on November 16 at the Science Museum in London.

Hosting the event, Science and Innovation Minister, Lord Drayson said:

“The iawards winners epitomise the best of British innovation that will drive the future growth of our economy and make Britain a better place to live and work. I’m delighted to be part of an event celebrating British success. ”

Co-host and business entrepreneur, James Caan, said:

“All of the finalists have demonstrated that Britain is home to some of the best innovators in the world. I’m privileged to be part of the iawards and recognise and honour all finalists for their expertise and vital contribution they make to our economy. I’d like to say huge congratulations to all of the winners who have helped bring the deserved attention to these new technologies and innovations.”

The iawards winners

The iaward of the year and iaward for best technology start-up
Horizon Discovery Ltd, Cambridge: X-MAN Model Cancer Patient

A tool that identifies personalised cancer medications – reducing R&D costs, shortening clinical cycles and increasing patient survival.

Chair judge, Mike Butcher said:

“Horizon Discovery really impressed us with their ‘patient in a test-tube’, which is the first human cell model that can identify personalised cancer medications, leading to shorter drug trials and increased patient life. Quite simply, this is world-class scientists doing first-class work.  They have developed a revolutionary approach and demonstrated clever innovation in a difficult area, with excellent prospects for impact on the health sector.”

The iaward for places to live and work
E-Stack Ltd, Cambridge: E-Stack Atrium Ventilation System

A new approach to reducing the energy consumption of residential and commercial buildings by up to 50%, based on recycling internal heat.

Chair judge, Peter Drummond said:

“E-Stack is a well-deserved winner of the iaward for ‘Places to live and work’ category. It answers a significant market problem in a simple and interesting way and this is why it was selected.”

The iaward for energy and environment
Siemens Mobility. London: Environmentally Friendly ELV Traffic Systems

Extra Low Voltage traffic signal equipment that delivers unprecedented reductions in power consumption and costs, as well as improved electrical safety.

Chair judge, Dale Vince said:

“Siemens was a clear winner for us. What initially appeared to be a rather simple case of putting LEDs into traffic lights actually required a great deal of innovation and focus. They clearly identified a need and developed a solution with commercial success. Siemens has produced a targeted innovation addressing a well-defined problem, which can reap significant success in the UK market.”

The iaward for digital communications
Powertraveller Ltd, Hampshire: Solargorilla

A portable solar charger for power-hungry devices including laptops, mobile phones and MP3 players.

Chair judge, Justin Pearce said:

“As digital communications become freed from the fixed-line internet, being able to efficiently power digital devices via renewable energy sources is increasingly important. Solargorilla is an innovative solution to a growing issue and a well-deserved winner of the iawards ‘digital communications’ category.”

The iaward for entertainment and media
The Foundry, London: Ocula

The first set of dedicated software tools for 3D film post-production, which address common problems experienced with stereoscopic imagery.

Chair judge, Dr Lincoln Wallen said:

“The Foundry’s Ocula is likely to have a significant impact on the film industry and as such we are proud to announce it as the winner of the 2009 iawards ‘entertainment and media category’. We look forward to seeing the results in many upcoming films that have benefited from the use of this technology.”

The iaward for a consumer product
Unilever R&D, London: Pureit

The first home water purification device that kills 100% of water-borne bacteria and viruses.

Chair Judge, Dominic Littlewood said:

“With Pureit, Unilever demonstrated a commercial innovation that tackles an important social problem. We can expect to see this product appear in many homes across the UK as we work to combat the effects of water-borne bacteria and viruses.”

The iaward for cross-application of technology
Metrasens Ltd, Worcestershire: FerroGuard

A portable metal detector for medical and security purposes that uses technology originally developed for submarine and mine detection.

Chair judge, Jonathan Kestenbaum said:

“FerroGuard represents a superb example of the cross-application of technology. It’s a smart idea with clear market potential and links to some of Britain’s national priorities. An outstanding entry and well-deserved winner.”

The iaward for best collaboration
Opal Contracts, Birmingham: Infection Minimising Curtain Hook

A new curtain hook that reduces the risk of superbug infection in healthcare environments by enabling the easy packing, storage and handling of disposable curtains.

Chair judge, Annette Williams said:

“Opal Contracts’ curtain hook has shown great commercial potential. It’s a superb example of successful collaboration and will have major impact on societal needs. It represents a significant innovation that can positively impact on numerous lives.””

The iaward for British inside
Ubisense, Cambridge: Ubisense Real Time Location System

An innovative system that accurately tracks people and goods in real time – benefiting industries including manufacturing, the military, transport and animal husbandry.

Chair judge, Allyson Reed said:

“The celebration of ‘British inside’ encouraged an impressively diverse range of companies. We felt that Ubisense’s entry was a particularly versatile product – the ability to locate people and assets with unmatched accuracy has potential in a huge number of industries. And it’s great to see university research underpinning the success of this technology. Ubisense can be proud of their achievement.”

The iaward for the next big thing
Diverse-Energy Ltd, West Sussex: PowerCube

A fuel-cell based power solution for cellular telecoms towers, designed to provide a clean, low-cost and reliable alternative to diesel generators.

Chair judge, Rory Cellan-Jones said:

“This was an extremely difficult category to judge because the ‘next big thing’ could be from any industry and in any stage of development . But Powercube really stood out for us. This fuel-cell based power system could reduce the number of polluting diesel generators, improving the local environment and giving cell providers a green alternative as they expand into developing markets. As previously disenfranchised communities come online, this product could make a real difference to the way we live.”

Links
For more information and videos of the winners reactions please visit www.iawards.org.uk

Twitter
To read updates on the iawards and the winning companies, follow @iawards

To track the discussion online, use the hashtag #iawards

Social Media News Relase
For bloggers and online journalists seeking additional videos, images and more information

Download Skills for Growth – The National Skills Strategy
UPDATE 16/11: Download the Skills Investment Strategy 2010-11
Read the full press release

Skills for Growth – The National Skills Strategy sets out a pathway to achieving a bold new ambition for three quarters of the population to go to university or get an advanced technical qualification by the age of 30. The Government will:

• Create a modern class of technicians, through a dramatic expansion of advanced apprenticeships, creating 35,000 new places over the next two years;
• Give every adult a personal skills account, empowering learners to shop around for training with new information on how well different courses and colleges can meet their needs;
• Radically simplify the way in which skills policy is delivered – working with the UK Commission for Employment and Skills to reduce the number of public bodies by more than 30.

Lord Mandelson said:

“Higher level skills have never been more important to our growth. This strategy marks a radical shift in our skills priorities. It shows how we’ll make sure we’ve got the skills to power the new industries and jobs of the future.

“We need engineers to lay the cables to expand access to high-speed internet, skilled people to build the electric vehicles of the future, and technicians to develop the medicines that will save lives.

“The goal of this strategy is a skills system defined not simply by targets based on achieved qualifications, but by ‘real world’ outcomes. Relevant, quality skills, with real market value.”

In addition, the Government will:

• Work with business to focus funding on the areas of the economy that can do most to drive growth and jobs, deploying around £100m to support around 160,000 training places in areas such as life sciences, digital media and technology, advanced manufacturing, engineering, construction and low carbon energy;
• Offering 1,000 new scholarships worth £1,000 each, to encourage the best apprentices to progress into higher education; and
• Give more employers the chance to drive and shape training provision through launching a fifth competitive bidding round of the National Skills Academies programme.

Speech by: Pat McFadden MP
Event: TUC ‘Beyond Crisis’ conference, London

Introduction

I am glad to be here today discussing what is a critical issue for our economy – This conference is focused on how we reshape it to make the most of the transition from a high carbon to a low carbon economy. This is not the only question, but it is a fundamental one.

This is not a small shift, a minor tweak in direction. In fact I believe we are standing on the brink of a second industrial revolution with this change.

If that seems like an exaggerated claim; if we think about the first industrial revolution, it was powered by coal, steam, oil and gas. Those energy sources in turn powered the technologies, the inventions and indeed the consumer demands of the 20th century.

So, if we think about low carbon and the technologies that will be to the fore in this shift – nuclear, wind, wave, carbon capture and storage, clean coal, these too will have a profound impact not only on the way we generate our energy but also the cars we drive, how homes are built, how goods are produced.

And of course it will not only be a top down revolution. It will be also driven by consumer demand – witness the change in just two years in the demand for greener goods, behaviour changes with regard to recycling, the decline in use of free throwaway plastic bags in supermarkets and in other areas.

This shift in energy generation, production and consumer demand will fundamentally shape the economy of the 21st century.

And in the run up to the Copenhagen summit, I want to stress that this agenda is not just about emissions targets, distant deadlines of 2050, complex international carbon trading arrangements.

It is also about jobs, and industries and opportunities to do things in a cleaner and better way. The market for such technologies will be enormous. It is already estimated at £3 trillion. In the UK low carbon market, it is estimated that 50,000 companies employ 880,000 people and this is set to grow in the years to come as profound changes take place in the way we produce our energy, build and heat our homes and workplaces, and transport ourselves.

Government’s role in the shift to low carbon

What I want to focus on today is government’s role in this shift. How do we underpin this second industrial revolution to ensure that Britain has a strong capability in the technologies of the future? It is a shift that will affect every country. But how do we, in this country, ensure that in creativity and design, manufacturing and services, that Britain is well placed to succeed?

1. Industrial capability

The Government’s starting point is a simple one. That we have to work with the energy and drive of markets to make this happen. We have adopted a stance of industrial activism because we know that without strong signals – and in some cases funding – from government – the UK will not be best placed to succeed.

And that is one of the reasons, for example, why we established a strategic investment fund of £750 million to support industrial change and to foster capability. Around a third of that was committed to the low carbon industrial strategy published in July.

It set out support of up to £120 million for offshore wind, up to £60million for wave and tidal power and £19 million for the nuclear supply chain and other initiatives too.

We have already committed around £400m for low carbon vehicles. Some of this money is being used for some of the most advanced low carbon vehicle demonstrator projects in the world. In the streets of Oxford today you will soon be able to find electric BMW minis being tested in everyday use as a result of government supported investment.

Later this week Andrew Adonis and I will have more to say about the charging infrastructure and how we want to see electric vehicles in the UK.

And of course last week my colleague Ed Miliband announced the national planning policy statement designed to help bring out a new generation of nuclear power stations as a key part of cleaner energy production.

So part one of this strategy is about industrial capability, about trying to ensure that a decent proportion of the products, the technologies and the energy production benefit industries in the UK and their workers. And by this I don’t mean we take a nationalistic view. We know many of the companies may be based abroad or owned abroad. The issue is that they operate here, they invest here and they create employment here.

2. Skills

The second key issue I want to stress is skills – equipping the workforce for the jobs of the future. This is absolutely essential if Britain is to succeed in the 21st century. It’s a worldwide race and there is no hiding place for the countries that fall behind.

We have reasons to be confident. We have four out of the best 10 universities in the world. We have an excellent science and research base supported by significant increases in government science investment in recent years. We have expanded the numbers going in to higher education and, in doing so, increased our national capability as well as enhancing the life chances of many people who would not have enjoyed these opportunities had we not made that commitment. We have also revived apprenticeships, bringing them out of the intensive care ward they were in when we came in to power and making them once again a part of the mainstream labour market. And, of course, we have the Union Learning Fund doing excellent work to promote skills in the workplace, benefitting not only employees but also employers as well.

And yet for all these gains we know there is still a lot to do. We have come far but others are moving fast too. And believe me, you won’t find abroad the self limiting debate about a lump of quality, about the theory that more means worse and that there is a limited amount of excellence to go around and so we shouldn’t send as many people to university. No, you will not find that today. That would seem a very strange notion indeed to some of our industrial competitors around the world. Instead other countries are trying to maximise their participation in Higher Education, trying to drive up their skills and knowledge base because they know that is the right option for the future.

In the last two weeks, we have published our Higher Education Framework, launched our student finance review and published our skills strategy.

And these documents seek to continue our emphasis on expanding opportunity for people from all backgrounds and trying to strengthen the relationship between skills, education, and what employers and the economy need to succeed.

In skills we are placing a greater emphasis on boosting the technician level of worker with an announcement last week of up to 35,000 more advanced level three apprenticeships, an area where Britain has traditionally been weak.

We are empowering learners through skills accounts matched by accredited learning institutions and high quality advice from UKCES about the value and employability of particular courses.

And we want to simplify the skills landscape – everybody knows this is necessary – removing some of the confusion in what can be an overly complex field.

So, industrial capability and individual capability are two sides of the same coin. And for Britain to succeed in the 21st century we need so ensure we enhance both.

3. Capital

The third area I want to talk to you about today is capital and in particular access to capital for innovative, growing businesses. The credit crunch and its aftermath have exposed weaknesses in how businesses access capital to grow and invest, and how the best ideas get developed to reach market.

So we have launched an innovation investment fund with £150m including funding from my Department, DECC and DoH.

It’s designed to lever in up to £1 billion in total from private investors to support the best in UK innovation. It should mean that as, products change ever faster, we are well placed to have more successful and dynamic start ups and our existing companies will have the capital they need to go on and fulfil their global potential.

The Fund will invest in the key strategic sectors that will help rebalance the UK economy including clean technologies, life sciences, digital and advanced manufacturing. And we will be making an announcement before Christmas on exactly how that would be managed and run.

The Rowlands review has also been looking at access to capital and how medium sized businesses, who can’t issue corporate bonds in the markets, get access to growth capital. This will report at the Pre budget report, in a few weeks time and we will incorporate its findings into how we design support for small businesses which will underpin growth and job creation in the future.

4. A just transition

And finally, I want to talk about the spirit in which this change comes about. I have seen in my own constituency, Wolverhampton South East, how industrial change can affect a community, how the loss of several large employers can have a damaging effect that can last for years, indeed decades.

And as we shift from a high carbon to a low carbon economy I believe it is important that we consider the social and opportunity side of this shift, that we have a fair distribution of the costs and benefits, that we talk through the employment implications and new employment opportunities and that we bring together a group of people committed to the success of this who point out new opportunities to government to make the most of these changes in areas we have so far not spotted.

That’s why I am pleased to announce that the Government will proceed with the establishment of a Forum for a Just Transition. And I want to thank the TUC for their input into this idea and the form will include representatives from unions, industry, high energy user groups and consumers. It will have its first meeting in a few weeks’ time on 10 December and will be jointly chaired by me and Ed Miliband. Its purpose will be to make sure we make the most of the opportunities I am talking about, presented by this shift and that change is carried through in a fair way.

Conclusion

And, after the severe worldwide economic contraction we have seen around the world it would be natural for a loss of confidence to take hold, but that would be a mistake. The economy would change anyway in terms of the balance between real engineering and financial engineering but the environmental imperative, climate change, gives this a greater urgency. My message today is that the potential in terms of new jobs, new industries and new services is enormous. And it is not only about the new. It’s also about doing what we traditionally done in a better and cleaner way.

This government is determined to play our role in both making sure that Britain can succeed in these changes and that our workforce is equipped for the jobs they will bring. I don’t want to be too political but today I do have to say that this is not an agenda we have heard much on from our opponents. They seem to have little to say about our industrial future but if they are silent, we are certainly not. We are determined to make sure Britain succeeds in the shift to a low carbon future and that this transition is carried through in a just manner that makes our economy stronger and enhances opportunity and quality of life for people.

One final point – this isn’t an agenda that can just in one sit that can just sit in one government department. If we want to make the most of low carbon industrial opportunities, if we want to transform our transport, if we want to respond to consumers properly, we have to work together across government. That’s why many of these initiatives between us and the Department for Transport, between us and the Department for Energy and Climate Change exist across Government to embody our industrial activism of recent times. That’s what we have been doing and that’s precisely what we’ll keep on doing in order to make the most of the shift we have been talking about today.

Ends.

Over seven days hundreds of thousands of people from across the UK will take part in events and activities to develop their entrepreneurial ideas, with a focus on realizing global opportunities – helping create jobs, drive recovery and deliver growth.

Events are taking place in schools, colleges, universities, football grounds, pubs, town halls, businesses and workplaces.

The initiative is run by Enterprise UK, the business-led, government-backed campaign to increase entrepreneurship in the UK.

Lord Davies, Minister for Trade, Investment and Small Business, said:
“The challenges faced by the global economy in the past year highlight the interconnectedness of the world today. Entrepreneurs have a valuable role to play in applying their creativity and boldness to help us overcome those challenges.

“That is why Global Entrepreneurship Week supports entrepreneurs to make the global connections that maximise growth.”

“British ideas have changed people’s lives across the globe. In recent years, British entrepreneurs have brought to life the internet, the i-pod and the wind-up radio. I hope this week inspires a new generation of ideas that will change the way we live.”

Business Secretary Lord Mandelson said:

“Whether they’ve built a global empire or work from their kitchen table, entrepreneurs are key to driving economic prosperity. Their contribution to the UK and global economy cannot be underestimated.

“Global Entrepreneurship Week helps ensure that the ideas and aspirations of all entrepreneurs are built in to successful enterprises.”

For more information about Global Entrepreneurship Week 2009 and to participate in an event near you, go to www.gew.org.uk

To find out what the global commuity is doing, go to www.unleashingideas.org

Through areas such as innovation and high-skilled job creation, the automotive sector will be driving the UK’s economic growth. With the industry at a technological turning point in radically reducing carbon emissions, investment now will be critical to its success.

To ensure that the UK’s car industry can build on its strengths and develop the new capabilities needed to compete in a competitive global market, the Council will have an important strategic role in helping to achieve these goals.

The move is part of the Government’s positive response to the wide ranging recommendations made in a report from the New Automotive Innovation and Growth Team (NAIGT) published earlier this year, setting out its 20-year vision for the automotive industry.

The Council will be chaired jointly by Lord Mandelson and by ex-Ford boss Richard Parry-Jones. The Automotive Council will be tasked with taking forward the agreed actions from the NAIGT report including the importance of the technology road maps and developing a stronger supply chain.

Business Secretary Lord Mandelson said:

“The Automotive Council will be an opportunity for Government and industry to work together on the long term strategic development of the sector. The car industry needs to capitalise on the economic opportunities and job creation offered by the shift to low carbon.

“I am delighted that Richard Parry-Jones will be continuing the good work he started with NAIGT as chairman of the Automotive Council.”

Automotive Council Chairman Richard Parry-Jones said:

“I’m delighted to co-Chair the Automotive Council and take forward the long term strategic agenda laid out in the NAIGT report. The UK must raise its game to compete for international investment in automotive R&D and manufacturing.

“To do that, the UK’s car manufacturers need an ever more strategic, collaborative relationship with the Government and to be working with the supply chain and other stakeholders to achieve long term goals. I want the Council to make that happen.”

The first meeting is expected to be held in December.

Read the original press release

Notes to editors

1. NAIGT report and the Government’s response
2. The NAIGT’s other main recommendation was to establish a technology roadmap to include the trialling of low carbon vehicles. The Government announced a project in July that will see over 340 low carbon vehicles being tried out on the UK’s roads. A common research agenda will help direct government funding to those areas most critical to the deployment of low and ultra low carbon vehicles. The ownership of this agenda will lie with the Technology Strategy Board and the Automotive Council, working with the Office for Low Emission Vehicles.
3. A list of Council members will be published in due course.

The Report identifies four key recommendations and these will be developed by establishing a pilot scheme, which focuses on a particular sector that crosses several Government Departments.  This will demonstrate good practice in action, and act as a model for successful engagement between Trade Associations and Government.

Ian Lucas, Minister for Business and Regulatory Reform, welcomed today’s announcement.  He said: “It is important that BIS positions itself as a strong voice for business at the heart of Government, and we will need to change not just what we do, but how we do it.

“The way Government sees its own role in the market needs to change in order to deliver a more coherent and effective approach. Government can promote investment, growth and jobs in Britain through policy consistency across departments, regulatory certainty, smart public procurement and a readiness to intervene where necessary.

“This involves Government acting creatively and pragmatically in new ways to supplement the market, but not substitute itself for the market. We have published our “Building Britain’s Future – New Industry, New Jobs” policy statement which identifies key areas where Government action can have the most impact. 

“We are investing in growth to speed recovery and building manufacturing capability and services, which is essential to ensure British people and businesses can compete successfully for the jobs of the future”.

The ‘VOBB’ Project offers enormous potential for Trade Associations to represent their members in an effectively coordinated fashion when interacting with Government, and quickly cascading messages about Government policy. 

“By building on the solid partnership that already exists between BIS and the Trade Association Forum, it is intended that the Project can be the catalyst for much improved methods of better collaborative working that helps boost the value of communication between businesses and Government.”

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Engaging well with employees makes good sense, and good business. Building a productive relationship with employees ensures that everyone is working to the same goals, and giving their best as they do so.

Effective engagement is a fundamental business requirement. Recent research indicates that:

The cost of ‘disengaged’ employees to the UK economy is between £59.4 and £64.7 billion

Engaged employees generate 43% more revenue than disengaged ones

Good engagement is even more important in a downturn – employees can play a central role in helping businesses to survive a recession, but employers must be careful not to trade off short-term gains in productivity with staff engagement and longer-term loyalty and motivation.

To help businesses with the ‘why’, ‘what’ and ‘how’ of employee engagement, the Department of Business Innovation and Skills has launched the People InterAction campaign.

As well raising awareness of the benefits of effective employee engagement, the campaign will also be deliver a range of practical, no-nonsense support that employers – particularly SMEs – can download free of charge and put into practice from early 2010.

The People Interaction campaign is a response to recommendations in ‘Engaging for Success’, an independent study exploring the benefits and drivers of employee engagement in the workplace by David MacLeod and Nita Clarke.

My Lords, I would like to make a statement on our policies for skills and their role in our future economic growth.

An active government approach to equipping this country for globalisation means making sure we have the skills that underwrite the industries and jobs of the future. That means skills for the high tech, low carbon, more high-value added sectors that drive the growth that underwrites everything else we want to achieve as a society. These skills are becoming more sophisticated and even more vital.

My Lords, I also start from the position that skills in our society must always be an individual’s ladder up. That’s why the skills system also needs to mesh with our university system. We need schools and colleges to make a strong vocational offer, which leads to a clear vocational route from apprenticeship to technician to Foundation degree and beyond.

Equipping unemployed people with the skills they need to get jobs in key sectors will be essential to a strong recovery. And let us remember that, by equipping more of the domestic population with the right skills to compete for jobs, we help employers become less reliant on migrant labour.

Addressing these skills challenges has been the focus of our Skills Strategy in recent years, and remains the foundation on which our new policies build.

We recognise that skills have historically been an area of British competitive weakness. Since 1997 we have made real progress in tackling the economic and social scandal of adult illiteracy and innumeracy. We will not abandon our promise of basic skills for all.

We have eradicated much of the poor quality that blighted our further education system. We have transformed work place training through Train to Gain which has trained over one million employees and helped them get on in work.

We have revived apprenticeships, which were allowed to wither away in the 80s and 90s. The Apprenticeship, Skills Children and Learning Bill which received its Third Reading in this House yesterday will ensure this progress is sustained.

This Skills Strategy builds on the progress made. It reflects some important decisions and marks a radical shift in the balance of our skills priorities. It reflects the world we find ourselves in: a world where higher level skills have never been more important to our growth, and where the skills challenge has to be tackled within more constrained resources.

So we have made some difficult choices. The crisis help we targeted to help counter the effects of the recession will progressively be refocused on the skills we need for a sustained recovery.

We have taken three key decisions:

• We will change the focus of our skills system so that a new premium is put on higher skills, especially the technician skills that are the foundation of high tech, low carbon industry.
• We will empower learners through more choice and better information to drive up the quality of the system through skills accounts.
• We will dramatically reduce the number of publicly supported bodies delivering skills policy, working with the UK Commission for Employment and Skills to reduce them by over thirty.

These choices will target public investment on the most relevant skills for the future, at the highest possible levels of quality and marketability.

The first of these decisions reflects the need for a new focus on the skills we need in the laboratory, the high-tech factory floor and the computer facility. We will create a new, modern class of technicians, something that has long been identified as a gap in our labour market.

To build this technician class, we will further expand the apprenticeship system, by creating thirty-five thousand new advanced places for those aged nineteen to thirty over the next two years. The aim of creating this technician class will also be aided by the new generation of University Technical Colleges whose creation we are supporting.

To turn these apprenticeships into potential ladders to university, from 2011, all apprenticeship frameworks at levels three and four will be required to have UCAS tariff points just like A-levels, so that holders can apply for, and make their way into university. We will also commit to Alan Milburn’s Panel on Fair Access to the Professions’ recommendation that we create an Apprenticeship Scholarship Fund that will provide one-off bursaries of up to one thousand pounds for one thousand apprentices entering higher education every year.

We will take a more strategic approach to the skills we fund. That means prioritising strategic skills in key industries like advanced manufacturing, low carbon, digital technologies and biosciences and in important growth sectors such as healthcare. Our decisions in the next bidding round of the National Skills Academies programme will reflect these core national priorities.

The second of our decisions is to increase the power of learners to drive up quality in the skills training sector by giving them more choice over where and when they train and better information on how to exercise that choice.

To give effect to that greater choice, we will set up new Skills Accounts which will enable students to shop around for training, backed by good information on how well different courses and colleges can meet their needs.

Critically, we are going to more than treble the number of public and private institutions where accounts can be used to over one thousand five hundred – not only creating new options for learners but creating a big incentive for providers to design courses that attract students.

The FE sector has made significant strides in improving the quality of its provision over the last decade. Many of our colleges are performing at world-class levels and overall success rates have increased by over 40% in the last 10 years. We will build on this by providing progressively greater autonomy to colleges that demonstrate teaching excellence – but also by cutting funding to low priority and poorly provided courses. We will invest in the courses that employers judge are in line with their needs and requirements.

Finally, we have decided to simplify the organizational clutter of public bodies delivering skills policy. We welcome the recommendation of the UK Commission for Employment and Skills to reduce the number of separate publicly funded agencies by over 30 and will work with them and others to make this happen. Our new model will make the Regional Development Agencies responsible for leading the regional skills strategy in each area, working in partnership with local authorities and others.

Conclusion

My Lords, this skills strategy shares its fundamental challenge with our recent Higher Education Framework. They must equip our people to prosper in a globalised knowledge economy. They must contribute to our return to sustained and sustainable growth.

The goal of this strategy is a skills system defined not simply by targets based on achieved qualifications, but by ‘real world’ outcomes. Relevant, quality skills, with real market value.

It will be driven by the realities of a changing global economy – by demand from the British businesses and individuals who have to prosper in that economy. The clearer that demand is, the better the system will work.

Our expectations of business will rise. We will strengthen the role of employer-led Sector Skills Councils and business-led Regional Development Agencies in shaping an excellent supply of courses and training, designed in direct response to local and national employer needs.

But we will also expect businesses to make a greater contribution to the funding of skills training for their workforce. We need a culture in which all employers take the view that the skills of their staff are one of the best investments they can make.

Our ambition is that, thanks in large part to the innovations in this strategy, three-quarters of people should participate in higher education or complete an advanced apprenticeship or equivalent technician-level course by the age of 30.

This strategy empowers the further education system above all to compete to meet the needs of businesses and learners. That will put further education where it belongs, right at the heart of the knowledge economy, at the heart of our recovery and our future prosperity.

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