HC Deb 14 July 1975 vol 895 cc1037-8
6. Mr. Carter

asked the Secretary of State for Industry if he is satisfied with current levels of investment in British industry.

2. Mr. Lane

asked the Secretary of State for Industry whether he will make a further statement on his plans for encouraging investment in manufacturing industry.

Mr. Varley

The Government have made it clear that they seek to increase the level and quality of investment in British industry, and their general economic and industrial strategy is geared to this.

Mr. Carter

Does my right hon. Friend agree that after inflation the increasing of investment, particularly industrial investment, without which this country has no future at all, remains the top priority of Government policy? May I ask what plans the Government might have to bring about an early meeting between themselves, trade unions and industry generally to ensure that this objective is achieved?

Mr. Varley

I agree that it is a question of tackling inflation as well as investment. If we could bring down inflation, that would remove a major obstacle to getting investment up. My hon. Friend will be aware that this question has been discussed on two occasions over the last few months in NEDC.

Mr. Rost

Is the Secretary of State surprised that investment is flagging when the Government have spent the last 16 months trying to knock confidence out of the private sector of industry by replacing reward and incentive with disincentive and penalty?

Mr. Varley

I do not accept that comment. In fact, the hon. Gentleman would be wise to look at the pretty deplorable figures for investment under the previous Conservative Government.

Mr. Ward

Will my right hon. Friend bear in mind that parts of the automotive industry are still waiting for a conclusion to the talks he has been having for some months on energy saving, particularly the greater use of diesel engines? Will he undertake to expedite those talks so that investment decisions can be taken more quickly in the automotive industry?

Mr. Varley

I am aware of my hon. Friend's concern. I shall consider his request and see whether the matter can be expedited.

Mr. Heseltine

We agree with the Secretary of State when he says that the Government are seeking to increase investment, but is he aware that his Department has shown that investment this year and next year will be down by 15 per cent? Therefore, in which specific year does he think that we shall see an upturn in investment? Is he aware that even if the whole of the budget of the National Enterprise Board were spent in one year, there would not be sufficient funds to compensate for the decline in investment which the Government's policies have precipitated?

Mr. Varley

I cannot add much to what I have already said. The main objective is to get the rate of inflation down. I hope that in the coming weeks and months we shall have the support of all right hon. and hon. Members on the Opposition side. It is our intention to get the rate of inflation down. That will improve confidence so that investment decisions can take place.