HC Deb 05 April 1971 vol 815 cc18-20
19. Mr. Carter

asked the Secretary of State for Trade and Industry if he is satisfied with the effect of Government policies on the present rate of growth of manufacturing industry; and if he will make a statement.

Mr. John Davies

My right hon. Friend's Budget statement establishes a new fiscal and economic framework for profitable industrial expansion.

Mr. Carter

I thank the right hon. Gentleman for that reply. Is he aware that growth in the manufacturing sector of industry is a prime mover to overall economic growth, and that the present very high levels of unemployment in manufacturing are an indication of inadequate investment? If the measures announced in the Budget do not produce a greater level of employment, what additional measures is it intended to take?

Mr. Davies

I will certainly keep the whole question of unemployment under careful scrutiny, as I do now. On the question of expansion, the hon. Gentleman should remember that manufacturing expansion in the period of the Labour Government was something like half the rate in the previous five years of Conservative Government. It is worth mentioning, too, that the upturn in manufacturing production took place in the last half of last year.

Mr. Body

Is my right hon. Friend aware that those who make weekend speeches about growth should recognise that our growth will be greater this year than it will be in Federal Germany, where it is estimated to be 2.5 per cent.?

Mr. Davies

I will keep that under consideration, too.

Mr. Dell

If, in the right hon. Gentleman's view, the effect of the Budget on investment will be progressive, may I ask him to give an estimate for the years beyond this coming year? If it is right to use investment grants to stimulate growth in manufacturing industry in Northern Ireland, where there is a very high rate of unemployment, why is it not right on Merseyside, in the North-East of England, in Scotland and in Wales?

Mr. Davies

The answer to the first part of that supplementary question is that the statistics which the Department gathers will give some indication forward in June of this year. The right hon. Gentleman knows very well of the multiplicity of surveys which are carried out and the fact that to increase the number still further would not be popular with industry.

The answer to the second part, about Northern Ireland, is that conditions are very exceptional there. This has been recognised for a long period. The Government have not introduced anything new in Northern Ireland. They have simply maintained a situation that has existed.

26. Mr. Douglas

asked the Secretary of State for Trade and Industry if he will publish recent estimates of investment in manufacturing, industry in the special development areas, development areas and intermediate areas.

Mr. John Davies

Information is not available in this degree of detail. Expenditure in recent years on machinery and plant attracting investment grants at the development area rate has been equal to about one third of total expenditure on these items.

Mr. Douglas

I thank the right hon. Gentleman for that reply, but is it not about time that we had this type of information available? It is extremely important to the areas affected. Will not the Secretary of State concede that even with the Government's investment policy we shall not get any real increase in investment in the regions nor any lowering of the unemployment percentage there in the coming winter?

Mr. Davies

I confidently expect that the measures taken by the Government of the kind mentioned earlier will have a very real impact on the level of industrial investment, and I believe that there will be a progressive improvement as a result of those measures in jobs available in the assisted areas.

Captain W. Elliot

Does not my right hon. Friend agree that it is wrong for industry constantly to turn to the Government for encouragement? Would it not be better for managements and unions between them to get together to make industry profitable, when investment would take place?

Mr. Davies

I entirely endorse those remarks. I have always felt that the effect that a Government can have is marginal in relation to the real effect to be obtained by management and unions.

Mr. Heifer

Would the right hon. Gentleman indicate what the position concerning Merseyside is? Is he aware that there are now 40,000 workers unemployed in that area and that this level of unemployment is quite criminal? Is it not time that the Government indicated their intentions in areas of high levels of unemployment, such as Merseyside?

Mr. Davies

I share the hon. Gentleman's concern about unemployment on Merseyside. However, I assure him that the Government's measures, which have been outlined by my right hon. Friend the Chancellor, have very much in mind the stimulation of the economy generally, with this purpose in view.