Regional Policy (Hansard, 15 May 1978)

§ 13. Mr. Kenneth Clarke
asked the Secretary of State for Industry whether he will make a statement on the future of his Department's regional policy.

§ The Under-Secretary of State for Industry (Mr. Bob Cryer)
The Government remain firmly committed to their regional policy. The Department of Industry, in close co-operation with the other Departments concerned, continues to promote investment and employment in the assisted areas.

§ Mr. Clarke
Will the Minister give details of the pay policy conditions now being attached to offers of regional assistance which are threatening 1,000 jobs at 16 Schreibers, at Runcorn New Town, and no doubt many other jobs in assisted areas elsewhere? Can the hon. Gentleman tell us whether such conditions are now being attached to every offer of assistance under regional policy and, if so, can he say what is the authority in law for attaching those conditions to offers of assistance to projects which in every other respect satisfy the criteria of the Industry Act 1972?

§ Mr. Cryer
The matter raised by the hon. Member is one for negotiation which is currently under way. He would hardly expect me to embark on a detailed explanation of the negotiations which are generally confidential to the Department of Industry. The Department's policy remains firm and fixed, namely, that we shall try to use our best endeavours to promote regional policy and bring jobs to the regions.

§ Mr. Radice
May I thank my hon. Friend for his reaffirmation of the Government's support for regional policy Does he agree that if the Conservatives had their way and regional incentives were cut the impact on areas such as the North-East would be disastrous?

§ Mr. Cryer
That is certainly true. In 1976–77, the Government spent almost £720 million on regional assistance. It is interesting that Opposition Front Bench spokesmen and many other Conservatives have called for cuts in public expenditure while at the same time many Tories plead for more money for their constituencies. Earlier this afternoon, we heard two Conservative Members representing Welsh seats pleading for more money for the National Health Service, while one Tory Member representing a Welsh seat wanted the whole of Wales to be turned into a special development area. The Opposition ought to get their priorities sorted out.

§ Mr. Clarke
Will the Minister say whether the pay policy conditions are now being attached to all offers of regional assistance and, if so, what is the authority in law for that? The hon. Gentleman is in no way inhibited, because of his negotiations with Schreibers, from answering those important general questions.

§ Mr. Cryer
If the hon. Member will table specific questions on this point, we shall give specific answers.

§ Mr. William Hamilton
In view of events last week, whereby the Conservative Opposition sought to reduce tax revenue, which led to the Government saying that they would seek to raise that revenue by putting up employers' national insurance contributions, may I ask the Government to use that revenue-raising method on a differential regional basis in place of the regional employment premium, which was abolished recently?

§ Mr. Cryer
As my hon. Friend has pointed out, the Conservative Opposition want it all ways. They seek further public expenditure and the reduction of taxes for the well-off. I shall bring my hon. Friend's points to the attention of my right hon. Friend the Chancellor.

§ Mr. Sproat
Is the Minister aware that the case for a radical reform of regional policy is nowhere better illustrated than in the Aberdeen area? Does he realise that in the Aberdeen area oil and oil-related companies, which would locate there irrespective of whatever inducements the Government offered, are still capable of attracting Government aid whereas non-oil companies are now prevented by the Government from drawing the full amount of aid that is available to the same type of companies in other areas?

§ Mr. Cryer
The Government are always looking at regional policy to see by which means it can be best applied. We understand that there are certain circumstances which create difficulties, although I do not accept that the hon. Member has raised any. We are constantly re-examining regional policy. We believe that, by and large, in a difficult situation with a recession affecting other European countries, if we did not have our regional aid policy the regions would be far and away worse off.