§ 5. Mr. Maclennanasked the Secretary of State for Scotland if he has any proposals to stimulate the Scottish industrial economy; and if he will make a statement.
§ Mr. RifkindThe Government's economic policies are already securing growth in the Scottish and United Kingdom economies. The latest figures show strong growth in Scottish industrial output in the first half of last year. A further rise in activity is expected.
§ Mr. MaclennanThe Secretary of State's reply is complacent. Does he recognise that the worldwide difficulties of the electronics industry bode ill for the future of the 40,000 jobs in the central belt, and that the downward pressure on oil prices must call in question some of the activities in the marginal areas of the North sea? Is it not the Government's duty to take counter-cyclical measures to stimulate the building industry, in particular, which is depressed?
§ Mr. RifkindThe hon. Gentleman is correct in saying that there have been some problems in the electronics industry, especially regarding semi-conductors, but that does not apply to the whole of the industry. My first responsibility as Secretary of State for Scotland was to take part in setting up a new company in Cumbernauld—Isola, from Germany—providing 200 jobs in the electronics industry.
Secondly, the hon. Gentleman referred to the need to stimulate the economy. He should be aware that since 1980 the Scottish Office has substantially increased capital expenditure in real terms on the Scottish economy in areas for which it is responsible.
§ Mr. HirstDoes my right hon. and learned Friend not find it a sad reflection on the Scottish media that although during the past month the Department of Trade and Industry has assisted in bring two major job-creating projects to Scotland, there has been virtually no publicity for the fact that TMC and English Sewing Cotton are moving to Scotland and creating as many jobs as are lost at Gartcosh?
§ Mr. RifkindMy hon. Friend is correct. Sadly, there is a much greater willingness to announce job losses than job gains. The media's responsibility should be to give equal publicity to both.
§ Mr. Robert SheldonIs the Secretary of State aware that the Scottish Development Agency, from which we expect development of the Scottish economy, should not be using the rate of return as a test? One can get a high rate of return by spending money on financial instruments. The SDA should be spending it on getting more jobs and improving industry. Its success should be judged against those objectives, not against the rate of return.
§ Mr. RifkindI am willing to listen to any suggestions that the SDA wishes to put to me for an improvement in its performance. I must emphasise that the SDA has a high budget and has been extremely successful in attracting investment and building up our economic infrastructure.
§ Mr. PollockDoes my right hon. and learned Friend agree that the Scottish economy will not be stimulated, certainly in rural areas, if there is a re-rating of agricultural land? Does he recall that until recently that appeared to be the policy of the alliance? Does he expect the alliance to reaffirm that policy in our debate later this afternoon?
§ Mr. RifkindThat may well have been the agreed policy of the alliance, but we can confidently expect to hear little about it in the months to come.
§ Mr. James HamiltonIs the Secretary of State aware that the Confederation of British Industry has stated that it expects a reduction in manufacturing industry and that that will mean an increase in unemployment in Scotland? In addition to the closure of Gartcosh with the loss of 700 jobs, 460 jobs will be lost at the Clydesdale and other tube manufacturing works. Is he aware that, because of that, Lanarkshire is fast becoming an industrial desert? Is it not time that the Secretary of State did something about that, and paid attention to the point about the SDA made by my right hon. Friend the Member for Ashton-under-Lyne (Mr. Sheldon)?
§ Mr. RifkindLanarkshire's problems are indeed serious, especially regarding employment. The SDA already has a substantial role in both the Motherwell and Coatbridge projects. It hopes to enable those projects to continue and, if possible, to expand. In addition to the money that the BSC provides in areas of steel closures, and new money from the European regional development fund, there are substantial sums of both public money and private investment in Lanarkshire. We welcome and encourage that.
§ Mr. LambieWhy is the Secretary of State allowing Scottish Office officials to stop a Finnish company from constructing a paper mill in Irvine, which will create 700 jobs? Surely that is interference in the commercial judgment of the company, which wants to come to Irvine?
§ Mr. RifkindThat is an absurd remark. Obviously we are extremely anxious to attract pulp mill facilities to Scotland, and naturally we will do all that we can to facilitate that. The Government cannot direct which part of Scotland shall have such a facility. If the hon. Gentleman has the interests of Scotland at heart he should do all that he can to ensure that the facility comes to Scotland, and should not deter that prospect by irresponsible comments.
§ Mr. FoulkesIs the Secretary of State aware that Icarus Trucks is going to Austria rather than Prestwick freeport because his Department refused the company a grant? Is he further aware that Argyll Sports Cars will go to another part of Scotland rather than Prestwick freeport because it has been directed to do so by the Scottish Development Association? Will the Secretary of State investigate why it is that Customs and Excise, the SDA and, indeed, his own Department are undermining Prestwick freeport?
§ Mr. RifkindOn reflection, the hon. Gentleman will be the first to appreciate that the SDA cannot direct anyone to go anywhere. The Government and the SDA have a responsibility to attract investment to Scotland. The precise location chosen by an investor is determined by that investor in the light of all the circumstances.
§ Mr. Bill WalkerDoes my right hon. and learned Friend agree that there is no lack of demand in Scotland, and that the Government's proposals on rating reform by making more people accountable, will, certainly help industry? The proposed Buy British campaign will also stimulate demand. These things will do a lot to offset the imbalance in imports.
§ Mr. RifkindMy hon. Friend is correct. Scotland is doing reasonably well compared to the United Kingdom 939 as a whole. The latest figures show an increase in manufacturing output in Scotland of 5½ per cent. compared with 3 per cent. in the United Kingdom as a whole. From a Scottish point of view that is an encouraging development.
§ Mr. EwingDoes no one in ministerial offices tell Ministers anything now? Has no one in the Secretary of State's office drawn his attention to the CBI survey published in today's Glasgow Herald? That survey shows that orders are down, employment is down and output and investment are back to 1963 levels, not 1979 levels. Against the background of that CBI survey, how on earth can the Secretary of State say that the Scottish economy is flourishing? It is precisely because the Secretary of State and his colleagues have presided over the destruction of the Scottish industrial economy that they will be completely wiped out at the next general election.
§ Mr. RifkindThe hon. Gentleman is quoting the CBI. He might like to find out from the CBI, including the CBI in Scotland, whether it would welcome the return of a Labour Government in preference to the present one.