HC Deb 23 March 1970 vol 798 cc965-7
33. Mr. Sheldon

asked the Minister of Technology when he expects to receive the results of the study of the effectiveness of the investment grant scheme.

60. Mr. David Howell

asked the Minister of Technology by what date he now estimates that his Department's investigation of the effectiveness of investment grants will be completed and published.

Mr. Varley

I hope that the study will be completed by the end of the year. The question of publication will be considered when the results are available.

Mr. Sheldon

I am sure that it is the wish of the House that the information should be published in full for the benefit of all. Does my hon. Friend accept that there is no need for any delay in making certain changes to the investment grant scheme during the period we are waiting for the report? Can he confirm that there is evidence that changes in the amounts of the grant possibly affect investment decisions even more than the level of the grants? Will he go into that matter as well?

Mr. Varley

The question of a study is a complex matter, as my hon. Friend understands. It must take into account all the factors that affect profitability of investment and influence businessmen's investment decisions. I must ask the House to be patient.

Mr. Howell

Does the Minister recall that it is well over a year since the study was first announced and that in the meantime investment grants have gone spiralling upwards while manufacturing investment has not? There is growing evidence of a widespread waste of public money in this programme, and it is high time the report was produced—not at the end of the year, but now.

Mr. Varley

I cannot accept that there is widespread waste in the investment grant system. I am sorry that the programme has slipped a little, but we hope to get the report out by the end of the year.

Mr. Blenkinsop

Is my hon. Friend aware that very grave damage is being done to possibilities of industrial development in our development areas because of the injudicious remarks from the other side of the House about the security of investment grants?

Mr Varley

I agree that some of the ill-judged statements by hon. Members opposite and Opposition spokesmen about the matter calling this into question affect businessmen's investment decisions and create a great deal of harm.

Mr. Blaker

Will the Minister now answer the question his hon. Friend notoriously failed to answer a moment ago? How is it that since investment grants were introduced in 1966 the buoyancy of investment by manufacturing industry in real terms has been half that of investment in the distributive and service industries?

Mr. Varley

The question is about the study. I have explained that it is going ahead and that the questionnaires have been sent out. I must ask the House to be patient.

Sir K. Joseph

Will the Minister accept that if any changes are made by the next Government—the Conservative Government—they will, as my right hon. and hon. Friends have always stressed, be in no way retrospective?

Mr. Varley

I think that that came out loud and clear in the right hon. Gentleman's article in the Spectator. For the very first time we heard from the Opposition that they acknowledge that investment grants are no more expensive than investment allowances. I think that that also came out very clearly, and we are very pleased to have it from the right hon. Gentleman. There is still a basic difference here on the Opposition Front Bench, and it is about time the right hon. Gentleman and his right hon. Friend the Member for Enfield, West (Mr. Iain Macleod) got together on the matter and straightened it out.