HC Deb 27 February 1975 vol 887 cc694-5
17. Mr. Cryer

asked the Chancellor of the Exchequer if he is satisfied with the anticipated levels of investment in industry for 1975–76; and if he will make a statement.

Mr. Healey

The prospects for investment this year are obviously uncertain, and depend on a large number of factors, but the measures taken last November, the expansion of FFI facilities, and the proposals for planning agreements and the NEB, should all help to sustain the industrial investment which is needed to maintain our standard of living.

Mr. Cryer

Does my right hon. Friend agree that a curtailment of investment in the private sector could, in certain circumstances, be construed as a strike of capital? In such a situation, does he agree—I am sure he does—that it is vital for public bodies such as the National Enterprise Board to provide the urgently-needed levels of investment? Is he therefore concerned at the latest diktat from the European Commission that the levels of public investment in such areas as Yorkshire and Humberside are to be limited to 20 per cent.? Is not the solution for us to get out of Europe, so that we may have the freedom to invest?

Mr. Healey

The nub of that question lies in the last remarks of my hon. Friend. I do not believe that the European Community will effectively seek to limit the activities of the British Government in regional policy, investment or the location of industry, in ways to which we would not wish to submit.

Mr. David Howell

Is not the phrase of the hon. Member for Keighley (Mr. Cryer) about a "strike of capital" unusually fatuous and meaningless? Is not the Chancellor's real problem the fact that while public investment will rise considerably in the coming year—the figure I have is about 13 per cent. but perhaps the Chancellor may have a more up-to-date one—intentions for private investment are still abysmal? Does not the Chancellor now have a duty to tell the House, even before his next Budget, what he intends to do to revive profitability and investment in British industry, because that is the problem?

Mr. Healey

I cannot recall whether the hon. Member was a member of the previous Government. He will recall that when the rate of profitability was very much higher than it is today, when dividends and Stock Exchange activity were very much greater, the rate of investment was far below the levels to which it is expected to fall this year. In the first three-quarters of last year there was an increase in manufacturing investment of 10 per cent.