HC Deb 20 July 1981 vol 9 cc15-6
15. Mr. Eastham

asked the Secretary of State for Industry whether, in order to maintain manufacturing capability in industrial areas, he will introduce a system of industrial improvement grants for the refurbishing of buildings and equipment.

Mr. Tebbit

No. I am satisfied that sufficient incentive for such activity is already provided through the present tax system and in the existing Department schemes.

Mr. Eastham

Does the Minister realise that, while industries in some of the old towns and cities are suffering, many old and out-dated houses in those areas receive grants from other departments for their improvement? The same encouragement is not given to industry. We realise that section 7 of the Industry Act 1972 makes some allowances, but the provision is very vague. Is it not time that clear criteria were made available so that industries need not move out of established factories into special development areas, thus causing further trouble in cities?

Mr. Tebbit

The hon. Gentleman is wrong to say that the Industry Act 1972 is vague. It clearly specifies that repairs in the shipbuilding, marine, aerospace, locomotive and railway stock industries, and the repair of any plant or machinery designed for use in a manufacturing process can be a qualifying activity. In addition to that, regional development grants are available to assist in the refurbishment of factory premises. In general, the repair of factories should be undertaken by companies out of their profits—from their profitable trading activities.

Mr. Chapman

Will the Minister say what has been done to increase building allowances? For example, does my hon. Friend accept that an up-to-date modern factory or warehouse is just as important to a business for the purpose of increasing productivity as the modern up-to-date machinery that it clothes? Whatever level of industrial investment the nation can afford, will my hon. Friend look sympathetically at applications, because I believe that there are special cases in which it could be beneficial to the country in the long term?

Mr. Tebbit

I assure my hon. Friend that I always view these matters with as much sympathy as I can. On the other hand, in general, we have an adequate supply of factory space, and it would be better, in those cases where we are giving assistance, to assist with the purchase of up-to-date machinery to put into those factories.