§ 54. Mr. Dickensasked the President of the Board of Trade what further steps he is taking to stop the decline in manufacturing investment in 1967, following the recent survey by his Department of the investment intentions of private industry.
§ Mr. JaySince the replies to the recent survey were received I have announced a further acceleration in the payment of investment grants. I am confident that this, together with the other measures the Government have taken, will have a favourable effect on investment plans.
§ Mr. DickensNotwithstanding these improvements, is my right hon. Friend aware that investment in the private sector this year will be almost 10 per cent. down on last year and will be the lowest 2111 figure since 1961? Should we not now be taking steps to set up a national investment board and resume economic expansion on the lines suggested in the statement which 70 of his hon. Friends have signed recommending such proposals?
§ Mr. JayWe have already had this year three reductions in Bank Rate, an extension of the rate of investment grant and two decisions to accelerate payments. These have been quite major contributions to sustaining private investment.
§ Sir K. JosephIs the right hon. Gentleman aware that there is a close connection between profitability and investment propensity? Has he observed, from reports in the newspapers, that profits are still falling?
§ Mr. JayYes, Sir, but if we were simply to expand the home economy at the rate at which it was expanded by the Conservative Government in 1964 we would find ourselves with a very wide balance of payments deficit.