§ Q7. Mr. Patrick Jenkinasked the Prime Minister whether the speech of the President of the Board of Trade on 16th October at the luncheon of the Canadian 220 Club in Toronto about the Government's fiscal measures to increase efficiency represents Government policy.
§ The Prime MinisterYes, Sir.
§ Mr. JenkinIs the Prime Minister aware that the President of the Board of Trade said in Toronto that the S.E.T. was introduced to encourage people to move to industries where they could be most efficiently utilised? Is he further aware that the increase in unemployment in manufacturing industry since October, 1966, has been about 60 per cent., compared with less than 15 per cent. for the economy as a whole? Is the right hon. Gentleman boasting, as he did last night, that this is a streamlining of British industry, and that this was the object of the S.E.T.?
§ The Prime MinisterThe answer to the first part of the hon. Gentleman's Question is "Yes". The answer to the second part is that, as he knows, the measures taken on 20th July have led to a cut-back in industrial production, but production and employment at the basic level are now rising again.
§ Sir G. NabarroPresuming that the President of the Board of Trade understands the operation of Corporation Tax on overseas corporations, how can the Prime Minister justify an increase in efficiency when British companies trading abroad are now called upon to pay more than 70 per cent. of their profits in taxation of one kind or another?
§ The Prime MinisterThe hon. Member—for reasons which we all understand —was not in the House when we debated these matters. He can be quite sure that my right hon. Friend does understand this question at least with as much authority as does the hon. Gentleman. My right hon. Friend's references to the changes in taxation were to the effect that they were designed to provide an incentive for pumping more of the profits of British industry into investment at home, and this is what we need.