HC Deb 03 March 1970 vol 797 cc263-4
Q7. Mr. John Fraser

asked the Prime Minister if he will submit further proposals to the National Economic Development Council to increase industrial investment.

The Prime Minister

Recommendations relating to industrial investment from the Economic Development Committees involved in the industrial consultations on "The Task Ahead" are currently being examined.

Mr. Fraser

Does my right hon. Friend envisage that the very favourable forecasts in Government documents and by the Institute of Economics will encourage industrialists to invest even more and that there will be a fair distribution of increased wealth between industrial investment and personal consumption?

The Prime Minister

As my hon. Friend will know, expenditure on manufacturing investment in the second and third quarters of 1969 was 12 per cent. higher in real terms than in the corresponding quarters of 1968, and the latest inquiry conducted by the Department concerned shows a continuation of this trend.

Mr. Hooley

Would my right hon. Friend not agree that the failure to achieve a much higher rate of industrial investment is serious for the future economy of the country, and that the White Paper on Public Expenditure was particularly disappointing and weak in this respect?

The Prime Minister

The problem of inadequate industrial investment compared to some of our industrial competitors has been a continuing problem of this country for some 15 years, and probably more. That is why I welcome the fact that there are now signs of a pick-up in industrial investment, which is already running at record levels. We shall do all we can to encourage this improvement in investment, particularly in the basic manufacturing industries.

Mr. David Howell

Does the right hon. Gentleman recall that the Minister of Technology and the President of the Board of Trade undertook last February to begin a study of the effectiveness of investment incentives? Has he seen Press reports that now, apparently, this will not be finished until the summer? Will he ask these Ministers to get a move on on this very important subject?

The Prime Minister

This is continuing, and, of course, these matters have been discussed with industry through the medium of the N.E.D.C.s for particular industries, as I said in my main Answer. But I thought that the hon. Gentleman's own party was now committed to dropping investment grants altogether.