HC Deb 26 April 1967 vol 745 cc1575-7
5. Mr. Higgins

asked the President of the Board of Trade whether he has now sought an estimate of the order of magnitude of the effects on private investment of the revised investment grants; and whether he will give such an estimate to the House.

45. Mr. Biffen

asked the President of the Board of Trade what has been the estimated effect of the changes in investment grant announced in December, 1966, and March, 1967, on the level of investment in manufacturing industry expected during 1967.

Mr. Jay

This influence cannot be separately measured.

Mr. Higgins

Do not the Government produce short-run forecasts before and after policy changes? Was no such estimate made in this case, or, if it was, why cannot the House have the information?

Mr. Jay

The hon. Gentleman has asked me to measure the effect of this particular change, but other things happened at the same time, and it would not be possible from the figures to attribute one effect to one cause.

Mr. Biffen

Would the right hon. Gentleman care to comment on the excellent speech of his hon. Friend the Member for Edmonton (Mr. Albu) in the Budget debate, when he suggested that it was the prospect of profit rather than the size of these grants which was likely to determine the level of manufacturing investment?

Mr. Jay

No, Sir; I think that it is even more the size of the market. But that is another issue.

Mr. Hall-Davis

Is the President of the Board of Trade satisfied that the proportion of total industrial investment found to qualify for grant is in accordance with the estimates prepared by the Board of Trade when the Industrial Development Bill was before the House?

Mr. Jay

Yes, Sir. I have no reason to suppose that that is not so.

54. Mr. J. H. Osborn

asked the President of the Board of Trade what is the total value of investment for which investment grants have been applied for to date; what percentage this is of total investment undertaken by British industry; and how many applications, and to what value, have been turned down or held up because of the discretionary clauses in the Industrial Development Act to date.

Mr. Jay

By 14th April, 1967, applications relating to £114,726,000 had been received in respect of investment in the first quarter of 1966. I estimate that this represents about half of the investment qualifying for grant under Part I of the Industrial Development Act. Applications so far received for the second quarter of 1966 total £35 million. It would cost too much to analyse how much of these amounts have been disallowed because of the exercise of the Board's discretion.

Mr. Osborn

Is the right hon. Gentleman satisfied that the firms entitled to a grant are actually applying for it, and that the scheme is working satisfactorily. or is there a need to give further information to industry to ensure that the scheme as envisaged is going to work to the advantage of industry?

Mr. Jay

As the hon. Gentleman probably knows, we have published a very full leaflet and distributed it widely, and all the information is available. There is no early closing date for these applications, and I think it is just a matter of the rate at which firms are moving.

Mr. Barnett

I appreciate that the leaflet was a good one, and worthwhile to industry, but can my right hon. Friend answer the question? What percentage has industry submitted of the applications which he personally expected from his estimate of the amount of investment in arriving at the figures which the Chancellor of the Exchequer put in his financial statement?

Mr. Jay

We did not feel that it was possible to make an exact estimate, but for safety sake we allowed for a rather more rapid rate of applications by firms than has so far materialised.