HC Deb 15 November 1984 vol 67 c789
14. Mr. Thurnham

asked the Chancellor of the Exchequer if he is satisfied with the current level of manufacturing investment.

16. Mr. Robert B. Jones

asked the Chancellor of the Exchequer whether he is satisfied with the level of investment in the economy.

Mr. Lawson

Yes. Total fixed investment this year is expected to be an all-time record. In the first half of 1984 manufacturing investment was up 15 per cent. on a year earlier.

Mr. Thurnham

Does my right hon. Friend agree that that should lead to extra and more secure jobs in manufacturing industry?

Mr. Lawson

Yes, Sir. It is of vital importance that we have profitable investment for the future development of the economy. That is why I am particularly glad that all the indications are that there will be a further good year for fixed industrial investment in 1985.

Mr. Robert B. Jones

I accept my right hon. Friend's encouraging figures, but is he not aware that there is widespread concern in the construction industry that the level of investment is not affecting it in the same way as the rest of the economy?

Mr. Lawson

I am aware of the concern in the construction industry. I am also aware that what the construction industry wants to see above all is lower interest rates because, of all industries, it is perhaps the most interest-rate sensitive. That is why the Government's policy of creating the conditions in which interest rates can come down still further is of such importance. The recent rise in the mortgage rate—[HON. MEMBERS: "Fall."]—is an indicator most welcome to the whole House, and not least to the construction industry.

Dr. Bray

Is the Chancellor of the Exchequer aware that manufacturing investment in the first half of 1984 was still 29 per cent. below the 1979 level?

Mr. Lawson

I am aware that the hon. Gentleman, unlike his right hon. Friend the Member for Birmingham, Sparkbrook (Mr. Hattersley), gets his statistics right. That is absolutely correct, but the fact of the matter is that total fixed investment in the economy this year is at an all-time high.

Mr. Evans

Will the Chancellor confirm that, notwithstanding the level of investment in manufacturing industry, the Treasury confidently expects employment in the manufacturing sector to fall? Will the right hon. Gentleman acknowledge that, while we have 3,250,000 benefit claimants, there are over 4 million unemployed, many of whom used to work in manufacturing industry?

Mr. Lawson

On the contrary, manufacturing investment is on a clearly rising trend. The latest figures for manufacturing employment show that it, too, now appears to have stabilised. The House will be aware that employment in manufacturing has been rising steadily since the middle 1960s.