HC Deb 02 August 1976 vol 916 cc1196-7
13. Mr. Forman

asked the Secretary of State for Industry if he will make a further statement on the Government's industrial policy in the light of the work being done in the National Economic Development Office.

Mr. Varley

I have nothing to add to my statement of 8th July.

Mr. Forman

Is the right hon. Gentleman aware that all the so-called new industrial strategies and all the work of sector working groups are worth little or nothing so long as the Government continue to shatter fragile industrial confidence from time to time with their other policies? Is he further aware that the most recent example is the increase of national insurance contributions for employers? Will he give an assurance that in future both sides of industry will be consulted before damaging measures of this kind are introduced?

Mr. Varley

Both sides of industry are consulted. As I have already said, I think that the CBI has over-reacted to the package. I dare say that on reflection it will take a different view. I know that Lord Watkinson and the Director-General have said that irrespective of anything that has taken place over the past few days it is their intention to continue to co-operate with the industrial strategy. That is a realistic view.

Mr. Heseltine

Does the right hon. Gentleman understand that no consultation took place with the CBI about the payroll tax? How much of the £1,000 million now being levelled on industry through the payroll tax does he calculate will be met by passing it on in increased prices and how much of it will have to be met from the corporate resources of British industry?

Mr. Varley

We have not pretended that the increased national insurance contributions will not have a slight and damaging effect on companies. However, the package has to be seen as a whole. There have been changes, not only in the Price Code, and national insurance contributions are an allowable cost. I do not have any precise calculations in front of me. If the hon. Gentleman wants to table a Question, we shall attempt to give him an answer. Instead of talking down the industrial strategy, the hon. Gentleman should be assisting the Government and both sides of industry to ensure that our economy becomes strong again. If he were to do that instead of putting forward his constant carping criticism, he would be respected.