Industrial Investment (Hansard, 26 October 1977)

§ 9. Mr. Crawford
asked the Secretary of State for Scotland if he is satisfied with the current level of industrial investment in Scotland in the light of current levels of interest rates.

§ Mr. Gregor MacKenzie
Interest rates have reduced dramatically during the last year from 15 per cent. to 5 per cent. and this will give an important boost to investment in Scotland. There are now signs that Government policies to promote a recovery in investment are succeeding, and the latest surveys suggest that there will be an increase in Scottish investment over the remainder of this year and in 1978.

§ Mr. Crawford
Will the Minister give us a categorical assurance in respect of the Scottish steel industry—one of the most important industries in Scotland—that the capital investment programme 1425 proposed in the Beswick Report will be carried out on schedule? If he cannot give that assurance, will he give some hope to steelworkers in Lanarkshire and Ayrshire by resigning?

§ Mr. MacKenzie
My right hon. Friend the Secretary of State was invited to resign a few moments ago. I can only give the same reply as he gave, which is that the more the hon. Gentleman and his hon. Friends ask my right hon. Friend and myself to resign, the happier and more secure we feel in our jobs. My right hon. Friend dealt with the question of the steel industry a few moments ago. We are concerned about the position in Lanarkshire, as in all parts of the country, and we are discussing it with the BSC.

§ Dr. Bray
Investment in the steel industry has gone ahead and is going according to plan. Is my right hon. Friend aware that all new investment in Ravenscraig is working to design outputs? Is he further aware that to achieve the full advantage of the investment which has been made further investment will be needed, and that the proposals for that are coming forward? May I ask him and his right hon. Friend to give them sympathetic attention?

§ Mr. MacKenzie
The question of investment is one for the BSC in conjunction with my right hon. Friend in the Department of Industry. We for our part will indicate to those concerned with this decision-making process our attitude to and interest in Scotland's steel.

§ Mr. Gordon Wilson
Many badly-needed jobs could be obtained if the Scottish Development Agency were able to invest in the service industry side. Is the Minister aware that it is unable to do that at the moment under the terms of the legislation? Is he further aware that the SDA is charging fairly high rates of interest, in some cases up to 14½ per cent.? Since the Bank Rate has declined, should not the SDA rates of interest also come down?

§ Mr. MacKenzie
The present mood of confidence is, I believe, very encouraging. In recent months there have been announcements of substantial investment from concerns such as Nairn Floors, Ferranti and Cummins Engines, and this is all of considerable importance. The 1426 SDA has made dramatic and large investments in some companies, and these have been of considerable importance to small companies based in the North of Scotland.

§ Mr. Robert Hughes
Does my right hon. Friend agree that we have seen a remarkable ideological conversion this afternoon on the part of the SNP? Did he note that two supplementary questions from SNP Members have looked to the Government—in one case through the British Steel Corporation and in the other through the SDA—as the instrument to solve Scotland's economic difficulties? Will my right hon. Friend ask the SNP whether it does not therefore feel ashamed at having opposed nationalisation and opposed the setting up of the SDA?

§ Mr. MacKenzie
I do not go as far as my hon. Friend in suggesting that there has been a remarkable conversion today. What we have heard today has been said by only a couple of SNP Members. What we shall hear next week from someone else in that party will be a different story altogether. It is clear that the SNP Members do not speak with one voice at all times.

§ Mr. Teddy Taylor
In his travels around Scotland, has the right hon. Gentleman found any industrialist or trade union leader who takes the view that industrial investment in Scotland would improve if the SNP policy of separatism were implemented? Does he not think that fears of separatism might have contributed over the last 18 months to a worsening in Scotland's relative employment position from a level of 119 to the current 132, according to the Government's own figures, in spite of what the Secretary of State said a few moments ago?

§ Mr. MacKenzie
The hon. Gentleman cannot get away from the facts which my right hon. Friend the Secretary of State gave him a few minutes ago. These are that unemployment relatively now and current wage levels in Scotland are a great deal better than when he and his colleagues were in office a few years ago. Perhaps I may answer the hon. Gentleman's first point. I have met the CBI, the STUC, the Scottish Council (Development and Industry) and, with my right hon. Friend, probably more industrialists 1427 in Scotland than anyone else, and I cannot find anyone who thinks that separatism would be to the advantage of Scottish owners of industry or Scottish workers in it. When my right hon. Friend and I visited America recently, we found that potential inward investors surveyed the prospect of separatism with a great deal of gloom.

§ Mr. Speaker
Order. Perhaps now that we have finished with that Question we can have shorter questions and answers.