HC Deb 31 January 1977 vol 925 cc14-6
9. Mr. Viggers

asked the Secretary of State for Industry if he is satisfied with the current rate of industrial investment.

Mr. Varley

No, but it is now improving and is expected to pick up substantially over the next year or so.

Mr. Viggers

Does the right hon. Gentleman agree that overseas investment in this country is likely to be severely damaged by the proposals in the Bullock Report if it should be implemented? Does he regard the principle as being more important than the jobs which may be lost?

Mr. Varley

The hon. Gentleman is jumping to conclusions in suggesting that confidence is being harmed by proposals in the Bullock Report. Companies which are considering investing in the United Kingdom—in particular the overseas companies which I have contacted during the last 12 months—regard the prospects for investment as very encouraging.

Mr. Mike Thomas

Is my right hon. Friend aware of the damage that is being done to investment in the shipbuilding industry in Newcastle upon Tyne, and particularly on Tyneside, by the impasse which currently surrounds the Aircraft and Shipbuilding Industries Bill? Is he also aware of the investment which C. A. Parsons has made in the development of the steam generating heavy water reactor and the problems which are created for that company by the present difficulties in the power plant industry? Will he comment on both those industrial problems affecting the Northern Region?

Mr. Varley

There is a later Question on the Order Paper on the power plant industry. I think that I had better reserve my comments until I reach that Question.

My hon. Friend has made a strong point about the difficulties in the shipbuilding and aircraft industries due to the Bill being delayed. I very much hope that the examiners will report to the House of Lords very quickly and that the Bill will reach the statute book as soon as possible. There is no doubt that the delay is causing great harm and uncertainty in both those industries.

Mr. Wigley

Does the Secretary of State agree that one of the greatest factors in discouraging investment in industry is instability of policy and that, as a result, certain companies have not taken account of regional incentives in calculating whether to invest? Does he accept that the cut-off of regional employment premium does incalculable harm to the encouragement of investment in areas such as Wales?

Mr. Varley

I do not agree that it does harm. In fact the REP, when it was in operation, represented only 2 per cent. in Wales. Many firms have told me and the Government that they were disregarding it as an incentive. As my right hon. Friend the Minister of State explained earlier today, in terms of preserving jobs the temporary employment subsidy is a more important incentive.

Mr. Norman Lamont

Is the right hon. Gentleman aware that my hon. Friend the Member for Gosport (Mr. Viggers) is quite right and that nothing could be more damaging to confidence in invest-ment than the unqualified introduction of the Bullock Committee's recommendations in the face of the unqualified opposition of management? As the Secretary of State for Energy tried to reassure management over the weekend by saying that the introduction of industrial democracy was not more alarming than the introduction of the vote, will the right hon. Gentleman point out to his right hon. Friend that the introduction of universal suffrage was not restricted to trade union members?

Mr. Varley

If the hon. Gentleman really wants to put questions to my right hon. Friend the Secretary of State for Energy, he should find a way of doing so and not put them through me. I do not know why he is getting excited and alarmed about industrial democracy. I always thought that an extension of industrial democracy and participation had some support within the Conservative Party. However, Conservative Members are getting themselves worked up into a lather over these matters. They should be examining the proposals carefully instead of jumping to these hasty conclusions.