HC Deb 28 March 1984 vol 57 cc278-80
8. Mr. Boyes

asked the Secretary of State for Trade and Industry what improvement in competitiveness would be needed to enable the United Kingdom to balance its trade in manufacturing.

Mr. Channon

Such an improvement as is necessary to cause customers to buy British goods rather than foreign goods.

Mr. Boyes

Does the Minister agree that one of the many indicators of the Government's disastrous policies caused by their blind adherence to scientifically unproven monetarist policies is the massive trade imbalance in manufactured goods? Is it not true that the lack of ability to compete is costing us hundreds of thousands of jobs and leading to massive unemployment? In my constituency there is 30 per cent. male unemployment. What will the right hon. Gentleman do about that?

Mr. Channon

Again I have to say that I am absolutely astonished that the hon. Gentleman should put that question to me today. Exports by volume are 7.5 per cent. higher in the latest three months than in the previous three months, and 9.5 per cent. higher than a year ago. British industry, through its quality, reliability and delivery, is selling more and more abroad. Why are hon. Members so critical?

Mr. Kenneth Carlisle

Did not Labour Members, when in government, substantially increase the costs falling on industry in one Budget after another? Did not we in the last Budget substantially reduce the costs on industry, a step that will do more than anything else to help us to be more competitive in our exports?

Mr. Channon

I entirely agree with my hon. Friend. The Budget will reduce by £900 million in the coming two years the total tax burden on the corporate sector. We are doing more to help industry than Labour ever dreamt of doing, and this afternoon we shall be discussing ways of removing the unfair burden of rates that so many Labour local authorities would like to impose.

Mr. J. Enoch Powell

What particular benefit is there to a nation in balancing its trade in manufactures?

Mr. Channon

That is a question that the right hon. Gentleman should perhaps address to those sitting near him. [HON. MEMBERS: "Answer."] It is perfectly clear, although the Opposition fail to recognise it, that it is impossible for this country to run for ever a surplus in manufactures — in oil and all other goods — unless Opposition Members are prepared to see a substantial outflow of capital, which is another aspect about which they complain.

Mr. Terlezki

How much damage does my right hon. Friend think Mr. Scargill and his apparatchiks are doing to our industries and balance of trade by their political bully tactics—

Mr. Speaker

Order. That supplementary question goes very wide of the main question.

Mr. Nellist

Will the Minister explain why, since the appointment of the Under-Secretary of State for Trade and Industry, the hon. Member for Coventry, South-West (Mr. Butcher), as the Minister responsible for the west midlands we have lost one job for every half hour of his appointment? Does he agree that his answer to my hon. Friend the Member for Houghton and Washington (Mr. Boyes) should have taken into account the fact that Britain, to be competitive with Japan, Germany or America in manufacturing, would require annually 40 times more investment in manufacturing industry than the right hon. Gentleman's mates in big business are prepared to make? When does he think that that position will be reversed and we can get the 5 million on the dole back to work?

Mr. Channon

The Opposition are scoring an own goal today. It is ridiculous that they should be putting such questions to me the day after figures have been published showing that last month we exported, in manufactures, the largest amount in value in British history.

Mr. Richard Page

Does my right hon. Friend agree that Government support of £200 million-plus for the Alvey programme and our support for the £850 million EEC ESPRIT programme will do much to increase the competitive base of our hardware and software companies, so enabling us to close trade gaps and provide jobs for our people?

Mr. Channon

My hon. Friend puts his finger on an extremely important point. We want to see British industry being able to sell its goods throughout the world. We have already seen an enormous increase in British reliability, in our competitiveness and in the quality of the goods that we deliver. I only wish that hon. Members on both sides of the House would join in the general welcome that is felt throughout the world for Britain's performance.

Mr. Shore

I warmly welcome the change in trend in the British trade figures, as published today, and I hope very much that they will be sustained, because on our success in this area depends all our hopes for the future. Having said that, may I draw the right hon. Gentleman's attention to the figures that he provided for us yesterday? More than £400 million of the trade improvement in the single month is represented by our trade with the United States. To what does he attribute this welcome and dramatic change in our trade with America? Does he put it down to the continued effect of the massive depreciation of sterling against the dollar; to the fact that the United States economy is expanding more rapidly than any other economy in the Western world; or to the increase of 6 per cent. in productivity in the performance of British industry in the past year?

Mr. Channon

I am sure that all the factors mentioned by the right hon. Gentleman were involved in the British performance last month in the United States. I draw the right hon. Gentleman's attention to the fact that last month our exports to a great many other parts of the world increased dramatically. The House will not wish to read too much into one month's figures, but I am glad that the right hon. Gentleman pointed to the astonishing rise this year and last year in productivity in British industry. I hope that will long continue. As long as it does, British industry will do better.