Pulp, Paper and Board Industry (Hansard, 12 July 1982)

§ 15. Mr. Proctor
asked the Secretary of State for Industry if he will make a statement on the United Kingdom pulp, paper and board industry.

§ Mr. MacGregor
I appreciate the difficulties faced by the industry in 1980 and 1981, in the circumstances of world-wide recession. During that time companies have been taking steps to improve their efficiency. These, together with the Government's success in reducing inflation, will help the industry to compete more effectively in the future, especially as important grant-aided investment projects come to fruition this year and next. Companies in the industry remain eligible for a wide range of industrial support measures.

§ Mr. Proctor
I thank my hon. Friend for that reply, but is he aware that, notwithstanding the Government's help for large energy users, particularly of electricity, the industry, particularly smaller and medium-sized companies that are energy intensive, still has problems? Will my hon. Friend join the federation in the representations that it will make in the near future to his right hon. and hon. Friends in the Department of Energy to try to get further help?

§ Mr. MacGregor
My hon. Friend knows that energy costs in the industry were discussed in the Adjournment debate on 14 June. My hon. Friend the Under-Secretary of State for Energy explained then how cost disparities have reduced and outlined the action taken to help industry. My hon. Friend will also know that I attended a meeting at the Department of Energy in December to discuss those issues. I should be happy to consider doing so again.

§ Mr. Maclennan
When do the Government hope to announce the result of their examination of the possibilities of replacing the Wiggins Teape operation at Fort William?

§ Mr. MacGregor
I would require notice of that question. If the hon. Gentleman would like to table a question, I shall see that it is answered.

§ Mr. Moate
Does my hon. Friend understand the frustration of the British paper industry, particularly in the South-East, at having to compete with Continental production that is heavily subsidised by the Government, through capital allowances? Is my hon. Friend aware of how much that frustration is intensified when the industry has to compete with other regions where capacity is increased when in the South-East the industry has to close that capacity? Does my hon. Friend agree that the time is now ripe to reconsider the range of grants available to the paper industry, particularly when it has moved into new technology and higher value added products?

§ Mr. MacGregor
My hon. Friend referred to capital allowances. He will know that they are available to the 639 United Kingdom industry. With regard to grants, there are a wide range of measures, to which I have referred. My hon. Friend mentioned unfair competition in the United Kingdom. That is an important aspect of regional policy, which also must be taken into account. My hon. Friend also referred to unfair competition in Europe. He will know that cases concerning the Community's Treaty partners are matters for the Commission, but we are ready to raise cases with the Commission when suitable grounds exist, as we have done on several occasions in the recent past.