HC Deb 23 July 1979 vol 971 cc13-6
15. Mr. William Hamilton

asked the Secretary of State for Industry what reply he has made to the recent proposals of the Confederation of British Industry concerning the future of regional policy.

Sir Keith Joseph

I replied that I thought that the policy, when announced, would reveal much common ground.

Mr. Hamilton

Is the right hon. Gentleman aware that the CBI, in one breath, said that it was opposed to the policies and in the next said that it agreed with them? Will he say what caused this overnight about-turn in opinion? Will he say whether the CBI agrees with the Secretary of State for Employment, who said this morning that these policies and others would lead to an increase in unemployment? What is the estimate of the increase in unemployment as a direct consequence of the right hon. Gentleman's policies and other policies of Government Ministers over the next 12 months or two years?

Sir K. Joseph

Perhaps the first reaction of the CBI was the result of reading an inaccurate newspaper leak and its considered reaction was the result of reading the full statement. I repeat that we do not expect unemployment to rise, except by a very small amount in one area, to be offset by a rise in jobs in the other areas, as I shall try to explain tomorrow.

Mr. Budgen

Is my right hon Friend aware that the changes in regional aid have been widely welcomed in the West Midlands, which has long resented the system by which it has paid its taxes and subsidised the bribes to encourage industry to go to other areas? Is he aware that, if there has been any criticism, it has been on the basis that the cuts in regional expenditure have been too small and too long delayed?

Sir K. Joseph

I am so aware.

Mr. John Evans

Does the right hon. Gentleman think that unemployment will rise or fall in the North-West as a result of his announcement on regional aid policy?

Sir K. Joseph

The change in policy on regional aid will make very little difference to the number of jobs in the assisted areas. In the North-West, so far as it is kept as a special development area, the rate of grant will remain the same.

16. Mr. Kenneth Carlisle

asked the Secretary of State for Industry what evidence he has found during visits to the regions that there is scope for change in current policies for regional assistance.

12. Mr. John Mackay

asked the Secretary of State for Industry what evidence he has found during visits to the regions that there is scope for change in current policies for regional assistance.

Sir Keith Joseph

My visits gave me evidence of the need to focus taxpayers' help more than previously and confirmed my view that redistributing taxpayers' money will not in itself close the gap between the different parts of the country.

Mr. Carlisle

Although I welcome that restriction in the geographical spread of the intermediate areas, and hence the abolition of many anomalies, I should be grateful if my right hon. Friend could explain, first, in what circumstances he would envisage in his special review that an intermediate area to be abolished in 1982 could retain its intermediate area status and, second, what criteria he will use in approving for grant a project in an intermediate area.

Sir K. Joseph

I must emphasise that the review is contemplated only in those areas which have been downgraded by more than one step and which cease as a result to be assisted areas. We shall consider special regional selective assistance on more selective criteria than obtain at present.

Mr. Strang

Is the right hon. Gentleman aware that his decision to downgrade the Edinburgh travel-to-work area by more than one step has been roundly condemned by both sides of industry and is in sharp contrast to statements by Conservative spokesmen during the last election? Will he at least have the intellectual honesty to admit that this is bound to mean that there will be fewer rather than more jobs in the Edinburgh area in the years ahead?

Sir K. Joseph

I do not think that it is possible, intellectually, to make such an assertion. If my hon. Friends and I have made a wrong judgment because we have not grasped all the criteria in any area, we are very ready to listen.

Mr. Bruce-Gardyne

Can my right hon. Friend explain how he expects to save £50 million in the current financial year and, I think, £100 million next year when the upgrading of some areas will antecede the downgrading of others? Also, is section 7 assistance subject to cash limits?

Sir K. Joseph

The threshold is being increased at once; that produces an immediate saving. Section 7 assistance will be subject to public expenditure limits.

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