HC Deb 08 July 1987 vol 119 cc343-5
7. Mr. Pike

asked the Chancellor of the Duchy of Lancaster what five sectors of the manufacturing industries have suffered the worst deterioration in balance of trade since 1979.

Mr. Alan Clark

The worst deterioration in the balance of trade between 1979 and 1986 has been suffered by the following industries: motor vehicles; miscellaneous electronic equipment; pulp; paper and board; motor vehicle parts, and cotton and silk.

Mr. Pike

Will the Minister accept that his answer rather than the nonsensical answers that we have had from Ministers on the Government Front Bench earlier this afternoon puts in true perspective exactly what is happening to Britain's manufacturing industries? Will he accept that the nation has prospered in the past through our manufacturing industries and that, if we are to have jobs and employment in the future, we have to get those industries right, and that the Government must take action and not continue to accept the position in the way that they indicated earlier this afternoon?

Mr. Clark

That sort of perspective is what one gets if one looks through the wrong end of a telescope. The extraordinary backward-looking attitude of the Labour party is reflected by the fact that it always asks for the worst five sectors. Had it asked for the five best, it would have found that there was a £7.9 billion improvement and a net improvement of £2.1 billion.

Mr. Oppenheim

Would my hon. Friend like to remind some Opposition hon. Members who do not have very long memories that manufacturing output in 1979 was lower than in 1974 and that between 1974 and 1979 the ratio of manufactured imports to exports worsened threefold?

Mr. Clark

That is correct, and it is continuing to improve as is borne out by every forecast except those that are now admittedly somewhat muted by the right hon. Member for Birmingham, Sparkbrook (Mr. Hattersley).

Mr. Hoyle

Will the Minister tell us when manufacturing output will reach the 1979 level? Will he also tell us what talks have taken place with the manufacturers of motor vehicles for the development of power trains in this country? Would he agree that an expansion of power trains is not only high technology but would provide employment and help to reduce the deficit?

Mr. Clark

It is not possible, and it would not be prudent, to make forecasts of the level of manufacturing exports for any given year. All the forecasts—these are from bodies other than the Government—are uniformly optimistic.

Mr. Neil Hamilton

Does my hon. Friend agree that the actions of Opposition Members on this matter are absolutely fatuous? If we were in deficit on services and invisibles they would be up in arms about that, but if every country had a Government who thought they should be in balance in every aspect of their trade the whole of world trade would be brought to a grinding halt, to the impoverishment of everybody.

Mr. Clark

That is true. As I have said, the surplus in the five best sectors greatly exceeds the deficit——

Ms. Clare Short

Tell us what the figures are?

Mr. Clark

The figures can be circulated—[Hon. Members: "Answer the question."]—I have replied to it. The figures can appear in the Official Report by the morning.

Mr. Robin Cook

How can the Minister reconcile the confidence that he and his colleagues have in British manufacturing industry with the fact that investment in manufacturing industry has declined by one fifth since 1979? Is the hon. Gentleman aware that Britain is the only member of the OECD in which plant and machinery is depreciating faster than investment in it, that our investment in civil research and development is lower than that of any other member of the OECD, and that we are training only half the number of apprentices that were receiving training in 1979? If from time to time wealthy countries go into deficit on manufactured trade, will the hon. Gentleman tell us when this trend will come to an end and when the underlying strength of our economy will be reflected in a manufactured trade surplus?

Mr. Clark

If there is a surplus in every other sector of our trading account, why is the hon. Gentleman so obsessed about one sector in which we are in deficit but which is improving?

Mr. Favell

Would it not be sensible if we stopped lumping together all manufacturing industry for the purpose of these figures? Is it not true that the majority of our manufacturers are doing extremely well and that, but for the automotive trade deficit, which during the first quarter of this year was almost £900 million, we would he in surplus? As any car purchaser knows, if only we produced a car at the right price of the right quality on time we would not have a problem with that sector of manufacturing industry.

Mr. Clark

It is true that the manufacturing deficit in consumer goods is to a large extent the result of a series of individual choices. These choices are made on the basis of quality, price and delivery. To give an example of a sort that Opposition Members seem always to reject, all our oil exports to the European Community are absorbed by the entirety of German automotive exports to Britain.