Capital Investment (Hansard, 19 December 1968)

§ 8. Mr. Hastings
asked the Secretary of State for Economic Affairs what proportion of the gross national product he estimates will be taken up by the manufacturing and construction industries between 1968 and 1972.

§ 25. Mr. Alison
asked the Secretary of State for Economic Affairs what estimate he has made of the proportion of the gross national product in 1972 that will be absorbed by manufacturing and construction investment.

§ 31. Mr. Ridsdale
asked the Secretary of State for Economic Affairs what estimates he has made of the proportion of the gross national product over the next five years that will be absorbed by manufacturing and construction investment.

§ 39. Mr. Dickens
asked the Secretary of State for Economic Affairs what estimate he has made of the proportion of gross national product which will be devoted to capital investment in the period 1969 to 1972.

The Under-Secretary of State for Economic Affairs (Mr. Alan Williams)
In consultation with the N.E.D.C, we are discussing the implication of a range of possible growth rates of output and investment up to 1972. The need to increase productivity and to switch resources into exports and import saving clearly implies that output and investment in manufacturing should be higher in relation to total national product than in the past.

§ Mr. Hastings
Is it not a clear fact at the present time that the figure for out investment is lower than it is amongst any of our industrial competitors? Now that these consultations are at an end, can the Under-Secretary of State tell the House clearly what proposals he has 1544 made, and what ideas he has, for improving the position?

Mr. Williams
On the first point, the hon. Gentleman has to take into account the fact that the ratio between ourselves and Germany and ourselves and Japan has improved since this Government came into office and that, in fact, while hon. and right hon. Gentlemen opposite were in office we were virtually at the bottom of the league table in investment terms throughout that last decade. As to our industrial competitors, the hon. Gentleman should bear in mind that in investment terms we invest proportionately more than the United States.

§ Mr. Ridsdale
Is it not the fact that Japanese and German investment has gone down rather than that ours has gone up? Does not the hon. Gentleman realise that if we want more investment, we must have a Government that do not attack capital, do not tax capital, and have a progressive attitude towards savings?

Mr. Williams
On the last occasion when the hon. Member raised this question I pointed out that, taking the last five years, during the three years that we have been in office the investment ratio in relation to G.N.P. has been better than when hon. and right hon. Gentlemen were in office. As to confidence, I should have thought that the mischievous efforts of the Leader of the Opposition have certainly been damaging nationally and inter nationally.

§ Mr. Dickens
Will my hon. Friend agree that one way to get rid of capital investment is to go for a sustained rate of economic growth, and to prevent an excessive outflow of private capital to advanced countries abroad?

Mr. Williams
I agree completely with my hon. Friend. This was the whole point of the exercise which my right hon. Friend the Chancellor of the Duchy of Lancaster was trying to describe, amidst the catermauling of hon. Members opposite, when replying to Question No. 1.

§ Mr. Ogden
If the level of investment is as disgracefully low as hon. Members opposite suggest, what is happening to the hundreds of millions of£s which this Government are giving to private investment?

Mr. Williams
This is having to be done, in fact, in order to encourage private industry to invest with a sense of social responsibility which it has not had in terms of regional development.