§ 11. Mr. Allan Roberts
asked the Secretary of State for Industry what plans he has for the revitalisation of industry on Merseyside.
§ Mr. David Mitchell
The best prospects for industry on Merseyside, as in the country as a whole, lie in the Government's policies to defeat inflation and in firms' own efforts to regain their competitiveness. But the Government are enormously concerned about the problems of Merseyside. Hence, most of it remains a special development area, and manufacturing firms there are eligible for the highest level of Government assistance.
§ Mr. Roberts
Is the Minister aware that 17,000 school leavers are facing the prospect of there being only 2,000 jobs available to them in the summer, and that there is now more chance, statistically, of a young person winning the pools than of getting a job on Merseyside? Is he further aware that his answer will be considered as complacent, particularly as the Government have altered the method by which grants are given in development areas so that manufacturing industry that wishes to expand cannot now get the grants that it received under the Labour Government?
§ Mr. Mitchell
The hon. Gentleman will be aware of the statement that was made last Friday by the Secretary of State for Employment, which has a bearing on his first comment. With regard to his second point, we should not underestimate the substantial degree of Government assistance that is available for new businesses starting up on Merseyside in the special development area. There are available a 22 per cent. regional development grant—the highest level available anywhere — the section 7 selective financial assistance, and the product and process development scheme, with a 25 per cent. grant for new products. There are also available the manufacturing advisory service, the European Investment Bank loans—loans that are available for seven years at 10 per cent., plus a 1 per cent. surcharge for insurance cover against changes in the exchange rates—and the small firms advisory service. That is a substantial amount, and Labour Members do ill service to employment in the assisted areas by crying down the extent of Government aid.
§ Mr. Hordern
Is my hon. Friend aware that the measures that he has announced concerning regional aid 197 to Merseyside appear to some hon. Members to be complicated and employ a great many bureaucrats and have not so far proved to be effective? Will be and his right hon. Friend consider whether a more generous fiscal regime might be preferable, and will be study in particular the free trade area zones that exist in the United States and other countries?
§ Mr. Mitchell
I am grateful to my hon. Friend for his observations. We are constantly looking for more effective ways in which to achieve our objectives. By reducing the areas available for assistance the Government have concentrated assistance more effectively on those in greatest need. The automatic regional development grant is widely regarded as a major asset in bringing in industry.
§ Mr. Spriggs
Is the Minister aware that the questions of my right hon. and hon. Friends on the subject of high interest rates, the high value of the pound, and the high cost of energy to industry mean more than he appears to understand? Does he not understand that British industry is having to compete with firms in the United States and the rest of the world whose energy is subsidised by their Governments, and whose interest rates are lower? On every count British industry is having to try to surmount almost impossible conditions. What will be do about the situation?
§ Mr. Mitchell
What the hon. Gentleman says is partly true, but interest rates are now higher in the United States. If we could get our productivity up to their level, we should not have the problems that we have today.
§ Mr. Les Huckfield
Since the sums of money available under the various schemes of assistance to which the hon. Gentleman has just referred are being reduced, is not that exhibiting the most appalling complacency in reply to my hon. Friend's question? Is not the whole tone of the reply the best encouragement that we could want for a massive turnout at the Labour Party's unemployment demonstration on 29 November?
§ Mr. Mitchell
The sums are not reduced. These things are demand-led. It is up to the hon. Gentleman to let those who may use them know what is available.