§ 15. Mr. Biffenasked the Minister of Technology to what extent the recent increase in investment grants is estimated to result in a higher value of home orders and dispatches for machine tools during 1967 than in 1966.
§ Dr. BrayThe effect on orders depends on the extent to which the firms involved take advantage of the new and increased grants. We are drawing their attention to the advantages to be gained from placing orders now.
§ Mr. BiffenDoes not the Joint Parliamentary Secretary recall that there was a time when he and his hon. Friends were not so coy about making forward forecasts? Is it not now quite clear that home orders and dispatches for machine tools in 1967 are likely to fall below the level of 1966?
§ Dr. BrayWe are still very much concerned with forward forecasts and are anxious to maintain the rate of expansion and the capacity of the machine tool industry. In fact, the order pattern is by no means clear, since the order books of some firms are increasing whilst others are still going down.
§ Mr. David PriceDoes the Joint Parliamentary Secretary still adhere to the National Plan forecast of an annual average increase from 1964 to 1970 of 250 7.8 per cent. a year; and, if so, how is it to be achieved?
§ Mr. Edwin WainwrightHas my hon. Friend taken into account the fact that there cannot be a viable machine tool industry unless private industry takes up new designs and new machinery as they are brought into being? What is being done to ensure that private industry takes up these machines from time to time?
§ Dr. BrayWe have a pre-production order scheme; we have development contracts with firms for the production and use of machine tools, and we are considering what further steps we can take in this direction.
§ 16. Mr. Biffenasked the Minister of Technology if he is aware of the declining profitability of many machine tool companies; to what factors he attributes this decline; and if he will make a statement.
§ Dr. BrayI am aware that the profits of some machine tool firms have decreased. But the profits of other firms have increased and no clear trend has yet emerged.
§ Mr. BiffenIs the Joint Parliamentary Secretary aware that that is the most extraordinarily unsatisfactory Answer? If he will bother to acquaint himself with the announcements of all the major machine tool firms—for example, Coventry Gauge and Tool, Alfred Herbert, Newall Machine Tool, to mention only three—he will find that all indicate a decline in profitability. Is he aware that this results from the Government's economic policy having had a disastrous effect upon the level of private industrial investment? Will the hon. Gentleman be apprised of the fact that private investtrial investment is likely to recover only when the Government show a much more generous attitude towards industrial profits?
§ Dr. BrayThe hon. Gentleman has been very selective in his quotations. He did not mention Kearney and Trecker, or Elliotts. Looking at the industry as a whole, I am sure that he will agree that the position is not yet what he describes. 251 We are taking steps to maintain the level of orders and we are convinced that those steps will be adequate.