HC Deb 18 April 1989 vol 151 cc185-96 3.30 pm
The Chancellor of the Duchy of Lancaster and Minister of Trade and Industry (Mr. Tony Newton)

With permission, Mr. Speaker, I would like to make a statement on a major new investment by the Toyota Motor Corporation.

The House will be aware that Toyota has been considering setting up a car plant in Europe and that the United Kingdom was the lead candidate as a location for the project.

I am pleased to be able to report that the company has now made a final decision to proceed with the project in the United Kingdom. The president of the company, Dr. Shoichiro Toyoda, and my right hon. and noble Friend are today signing a document setting out the heads of agreement reached between the company and the Government, copies of which will be placed in the Library of the House.

Toyota has chosen a 280-acre site at Burnaston near Derby. The project will be in two phases. In phase 1, after a short period of pilot production starting in December 1992, commercial production will begin in August 1993 and will rise gradually thereafter to the maximum capacity of 100,000 cars per year. When economic and commercial circumstances allow, the project will move into phase 2, in which capacity will be expanded to 200,000 cars per year. The plant will then employ some 3,000 people, and will involve a total investment of about £700 million.

The company has decided to proceed with the project without Government financial assistance, and it is its firm intention to achieve a local content level of 60 per cent. from the start of commercial production in August 1993 and an 80 per cent. level within a further two years.

Toyota's project was probably the largest mobile industrial investment still to be won and it represents a major vote of confidence in the United Kingdom. I have no doubt that it will make a significant contribution to the local economy in the area around Derby, to the United Kingdom economy and indeed to the European economy as a whole.

I am sure the whole House will join me in wishing Toyota every success with it.

Mr. Bryan Gould (Dagenham)

Will the Chancellor accept that we welcome his statement and an investment which will mean valuable jobs and new economic capacity in the east midlands? Does he recognise that warm congratulations are due to all those, and especially to my colleagues in Derbyshire county council—[laughter.]—lwho have worked hard to secure this investment? For all those who laugh in such an ignorant fashion, will the right hon. Gentleman confirm that Derbyshire county council has agreed to put in £12 million of its own money but has been refused any increased capital allocation for this year? Is this not an example of a Labour county council being prepared to make an effort which the Government have refused to make?

Does he recognise that, welcome though this news is, we should not be blinded to its real significance? If it were really evidence of economic strength, should we not expect comparable investments to be made by British companies with British resources? Is it not now easier for industry, especially in the regions, to obtain investment from the far east rather than from the south-east? Are we not now seeing the final stages of a process which has replaced an indigenous car industry with one which is owned and controlled from Detroit, Paris and now Tokyo?

What safeguards have been obtained about the meaning of local content? Will the right hon. Gentleman confirm that, for this purpose, "local content" means EEC content? Is there any guarantee that the Powertrain will be manufactured here and that design and research will be carried out in Britain? How soon does he expect our balance of trade in cars, at present in deficit to the tune of £4.7 billion, to return to balance?

Mr. Newton

I welcome the opening remarks of the hon. Member for Dagenham (Mr. Gould) and I am glad to note that he endorses the welcome that I and, I think, the whole House have given. A great deal of work has been done by all the local authorities involved, of varying political complexions and by the Department of Trade and Industry office in the east midlands, to secure this investment.

The hon. Gentleman's reference to Derbyshire's proposed investment must, I think, be related to reports that it has offered to invest £20 million from its pension fund in this firm. Whether that is accepted by the company is a matter for the company, but it is certainly not part of the project as it has been announced today, nor an essential ingredient of it.

If I heard the hon. Gentleman rightly, and his comment about the Government having refused help, I would make it absolutely clear that the company was well aware of the possibility of regional selective assistance, for example, in those parts of the country to which that applies, and specifically chose this location in Derbyshire, which is not an assisted area. To suggest that that is in any sense a refusal of Government assistance is an absolutely ridiculous and misleading proposition.

My answer to the hon. Gentleman's rather tendentious remarks about the replacement of an indigenous car industry is that import penetration of the British motor car market last year was almost exactly the same as in 1979. Between 1974 and 1979, it doubled. That was when the damage was done to the indigenous car industry, and we are now seeing some strengthening of it.

The hon. Gentleman asked about issues of local content. I confirm that local content means European Community content, as I am sure he understands. Toyota has made it clear that it intends to build up quite rapidly to the 80 per cent. figure which I mentioned. We hope that it will also decide to do research and development in this country, as Nissan has recently decided to do.

Mrs. Edwina Currie (Derbyshire, South)

Is my right hon. Friend aware that we in south Derbyshire are absolutely delighted and pledge to build at Burnaston a showplace factory of Europe? Will he agree that Toyota chose Great Britain in Europe because of the atmosphere of encouragement for investment and top quality business created by the Government, and that it chose Derbyshire in Britain because of the first-class site, the excellent work force and the full co-operation, which became apparent in recent months, between all concerned? It is inappropriate and cynical for any individual to try to claim the credit. All concerned deserve it, and we hope that that co-operation will continue.

Mr. Newton

I very much agree with my hon. Friend. It is a striking fact about the confidence of overseas investors in Britain as a good place to do business that within the past week three major international companies with world names have made decisions which amount to investment in this country of over £1 billion.

Mr. James Wallace (Orkney and Shetland)

I welcome the announcement and join the Chancellor of the Duchy in wishing Toyota and the people of Derbyshire well in this project. What time scale did the right hon. Gentleman have in mind when he said that "economic and commercial circumstances allowing", the project will move on to phase two? Will he also dispel fears that Britain in many respects is becoming an Airfix model kit assembly line? What design and engineering content will there be for British designers and engineers? Will they be involved in further development work by the Toyota group?

Mr. Newton

I must resist, on the basis of our experience with other major motormanufacturers here, including, most notably in recent years, Nissan, the suggestion that what is involved here is in any sense just a screwdriver assembly plant. I have made it clear that, when commercial production begins, local content will start at 60 per cent. and rise within two years to 80 per cent., which is rather faster than the build-up that has taken place at Nissan, which is now around 70 per cent. The precise make-up of that will be for the company to decide, but its initial investment includes a press shop, a body shop, a paint shop, a final assembly shop and a plastic moulding shop. I am encouraged by the experience of Nissan to suggest that it will not be long before Toyota is undertaking investment in design and development here in the same way as Nissan has found worth while.

Sir Hal Miller (Bromsgrove)

Does my right hon. Friend agree that there are two aspects of particular significance about this announcement? First, as the glum faces of Opposition Members testify, it is a tribute to our economic policy and the economic recovery of this country which is the place to make cars in Europe. Secondly, in the circumstances of the deficit—[Interruption.]

Mr. Speaker

Order. Sir Hal Miller.

Sir Hal Miller

In the circumstances of the deficit on the visible balance of trade, we should be grateful, in a situation where Ford and Vauxhall accounted for the total increase in imports into this country last year, to the Japanese for increasing the vehicle build in this country and remedying that situation.

Mr. Newton

Yes, indeed; I very much agree with the spirit of what my hon. Friend has said.

Mr. Tony Benn (Chesterfield)

Is it not a fact that the attraction to the company was that Derbyshire county council offered £12.5 million in infrastructure and support, against which no extra capital allocations of any kind are made available by the Department of the Environment, and that it has recommended the £20 million investment from the pension fund in accounting that has been attacked systematically by the Government as a very poor example of attitudes towards confidence? Having paid that tribute to the county council and its leadership, is it not also a tragedy that people in this country, particularly unemployed people from the motor industry, should have to look to foreign investment instead of seeing the money put in to build up our domestic product?

Mr. Newton

I have already made the point in response to the hon. Member for Dagenham (Mr. Gould) that, on any reading of the statistics, the principal difficulties of the United Kingdom motor industry in respect of imports occurred during the period of the last Labour Administration. What is equally clear is that the decisions about overseas investment in this country, not just by Japanese companies but in the recent decision by Ford to spend about £700 million on an engine plant in south Wales and just yesterday the decision by Bosch to invest £100 million in south Wales, reflect a significant strengthening of the United Kingdom motor car production and components industries, directed towards the difficulties of a longer period of decline, especially during the 1970s.

On the first half of the question of the right hon. Member for Chesterfield (Mr. Benn), I commented on Derbyshire county council earlier. Of necessity, various local authorities will need to work with the company in relation to infrastructure and access, and in other ways. The details of that remain to be sorted out.

Mr. Greg Knight (Derby, North)

Is this not good news for Derby, not least because the Toyota Motor Company has an excellent record of not closing any factory that it opens? Is it not also true that Derbyshire is now a far more attractive county for inward investment, following the Government's excellent decision to introduce a uniform business rate? That means that the days of high business rates, due to the high spending of irresponsible Left-wing county councils such as Derbyshire, are numbered.

Mr. Newton

Certainly, I understand that Derbyshire is the second highest rated shire county in the country. One of the facts that Toyota may have had in mind is the Government's policy to ensure that businesses will not be penalised in the way that they were in Derbyshire and elsewhere.

Mrs. Margaret Beckett (Derby, South)

Does not this decision vindicate the way in which elected members and officers of the county council, city council and district council have worked together for the benefit of the people of Derbyshire? Is it not a pity that, with the exception of the hon. Member for Derbyshire, South (Mrs. Currie), that all-party pursuit of the interests of the people of Derbyshire has not been reflected by Conservative Members?

Mr. Newton

From what I heard, my hon. Friend the Member for Derbyshire, South also recognised that there had been a co-operative exercise between all the local authorities involved—quite apart from their political complexion—and central Government, particularly as represented by my Department's office in the east midlands. Everyone involved should be well satisfied with the outcome of that effort.

Mr. Phillip Oppenheim (Amber Valley)

Is it not the case that, if Toyota has been more successful than British car manufacturers, it is because it produces products that people want to buy? In the 1960s and 1970s, the British car industry was hamstrung by poor labour relations and management, and the unthought-out and irrational reorganisation policies of successive Labour Governments? Is it not also true that the real reason that Toyota has come to Derbyshire is the excellence and skills of the local work force, combined with the new economic climate that makes manufacturing attractive in Britain? It is totally ludicrous for one county council, or county council leader, to muscle in and try to claim all the glory for what was a co-operative effort by the Government and a range of local authorities.

Mr. Newton

I agree with my hon. Friend that the fundamental reason for the decision of Toyota, and other overseas companies, to come here, is the dramatic improvement in the climate for doing business—including that of industrial relations—in this country. Without such a climate we certainly would not have received the flow of major new projects into this country.

Mr. Harry Barnes (Derbyshire, North-East)

Does the Minister recognise the professionalism and businesslike nature of the prospectus put forward by Derbyshire county council? The fact that it also runs a highly successful and professional pension fund means that money is available for investment, which will produce returns for the pension fund and make it viable. Will local suppliers have access to provisions in the area, or will the free market knock out some of the potential which exists in Derbyshire? Will the markets in the EEC be open to Toyota or will we be confronted by the problems that recently arose with Nissan in France? Will the east midlands line be electrified in order to transport the goods produced, through the Channel tunnel into the European market?

Mr. Newton

The subject of the hon. Gentleman's last question will be a matter for my right hon. Friend the Secretary of State for Transport, and I have no doubt that he will note it. On the question of local content and access to the European Community market, the understanding signed between my right hon. and noble Friend the Secretary of State for Trade and Industry and the company today specifically indicates the commitment of both Toyota and the Department to ensure that the project contributes to the development of long-term collaboration between Toyota and the local components and other supplying industries.

As for access to European markets, the hon. Gentleman will be aware that my right hon. and noble Friend made a statement yesterday about the outcome of our representations to the Commission on the import of Nissan cars into France. The Commissioner has just replied saying that he has now received a formal assurance from the French Government that Nissan cars manufactured here will be allowed to enter France independent of the level of car imports into France from Japan. Given that the local content arrangements are expected to be the same as Toyota, I see no reason why the outcome should be different.

Mr. Michael Grylls (Surrey, North-West)

Does my right hon. Friend agree that the news that he has announced this afternoon is a tremendous coup for Britain? Is it a great success for Britain to have landed the two biggest motor car firms for investment within the EEC, and it will give our component manufacturers and many thousands of small firms a wonderful opportunity to bid for the business. That will provide employment and added wealth for this country. We should be welcoming it, not carping like Opposition Members.

Mr. Newton

Yes. It indeed seems likely that the spin-off effect on jobs in the components industry, and other related industries, will be at least as large as the employment directly generated by the Toyota factory. Over a period we may expect 3,000 or more jobs, apart from those in the plant itself, to be created as a result of this investment.

Mr. Roland Boyes (Houghton and Washington)

Does the Minister agree that part of Toyota's reason for deciding to come to Britain may have been that it noted that the highly skilled workers in the north-east were building a better version of the same model of car in Washington than is being built in Japan—which is recognised by people in Japan? As a result, Nissan has brought the European technology centre into Britain—and, I hope, into Washington—recognising that that will create 250 jobs for highly skilled designers and engineers in Britain. The Nissan development is creating up to 4,000 jobs for people who desperately need them, and is also giving pride to highly skilled engineers, far too many of whom are on the dole.

Mr. Newton

I am grateful to the hon. Gentleman. I think that he speaks for many people in the north-east in recognising the great value that Nissan has brought to the whole economy of the north-east, and the way in which decsions to invest, for example, in design and development have followed its experience of success in manufacturing here. That is why I am hopeful that the same will happen to Toyota.

I am also glad—and I am sure that I carry the hon. Gentleman with me—that the decision by Fujitsu, which I announced last week, to undertake a major investment, again in the north-east, also reflects the growing acknowledgement in Japan of the success of its companies here in Britain.

Mr. Peter Rost (Erewash)

Is it not remarkable that, whenever there is good news for Britain, confirming that the present Government's policies have made the United Kingdom the most attractive country in the Community for inward investment, all that we get from Opposition Members is whingeing, carping and sulking?

Mr. Newton

I do not know that I would have put it quite like that, but I think that the answer is yes.

Mr. Dennis Skinner (Bolsover)

Has not the Japanese takeover more to do with the fact that the Japanese have an £80 billion balance of payments surplus, as opposed to the £15 billion deficit that we have in this country? Can the Minister give any guarantee that all car trade unions will be allowed to recruit? Will they have the right to strike?

Is the Minister aware that one of the reasons why the Japanese decided to come to south Derbyshire is probably that they misread the newspaper reports? When they read that "Currie had been sacked", they thought that she had gone for ever.

Mr. Newton

It will not surprise the hon. Gentleman to learn that the question of how to conduct its industrial relations is, in my view, for the company to decide. As for the first part of his question, we all know that the Japanese economy is successful because of the success of many of its companies. That is why it is so encouraging that those companies are deciding to come here to do business.

Mr. Roger King (Birmingham, Northfields)

Is my right hon. Friend aware that our warm welcome for Toyota extends not only to the manufacturing sector—including the component industry scattered throughout the west midlands, where new opportunities arise—but to existing car manufacturers? Nothing stimulates success more than good competition.

Is my hon. Friend aware that, compared with the £700 million that Toyota will spend in the next few years, Rover Group will spend £1,000 million on new products and new factory capacity? We say to the people of Derbyshire, "We shall build a better car than you will, and everyone will benefit."

Mr. Newton

I am glad to note what my hon. Friend says and the confidence with which he says it. I shall pass on to hon. Members on the Opposition Front Bench his reminder that rising investment in United Kingdom motor car manufacture and components is by no means confined to firms in foreign ownership.

Mr. Jack Ashley (Stoke-on-Trent, South)

I do not begrudge the investment in Derbyshire, but when the Minister discusses investment with Toyota or any other company, what consideration does he give to cities such as Stoke-on-Trent which, on any sensible criteria, need Government assistance but are refused all Government assistance and therefore need encouragement through investment? How does the right hon. Gentleman propose to help those cities?

Mr. Newton

I hope that the right hon. Gentleman will take some encouragement from the fact that Toyota decided to go to Derbyshire without Government assistance, as I said in my statement.

Mr. John Redwood (Wokingham)

Does the Minister agree that the excellence of Toyota systems is reflected in their accent on complete quality, training, speed of product throughput in the factory and total manufacturing concepts, including mass customisation? Those are all things from which British industry could benefit and learn, and that is another bonus for Toyota coming here.

Mr. Newton

Yes—and the effect on components suppliers in the United Kingdom in helping them to increase their competitiveness is an advantage throughout the United Kingdom motor industry and increases our chances of component exports.

Mr. Dafydd Wigley (Caernarfon)

While recognising the satisfaction of hon. Members representing constituencies in Derbyshire and the midlands, the House will recognise that we are tinged with a little disappointment that Wales missed out on the project because of the failure of the Secretary of State's blandishments to the company. Will the Chancellor of the Duchy recognise that, if a company such as Toyota, in making a major investment, can afford to ignore Government incentives, perhaps the Government are pitching conditions on selective financial assistance and other incentives too high to have any meaningful regional policy? Will the right hon. Gentleman examine the conditions that apply to such investments and ensure that a real regional policy is applied to such investments?

Mr. Newton

I simply draw the hon. Gentleman's attention to the help given recently to a variety of projects, including Fujitsu last week, Bosch, announced by my right hon. Friend the Secretary of State for Wales yesterday, and the Ford engine plant in south Wales to which I referred earlier. I think that we are doing pretty well on regional policy and I do not think that the hon. Gentleman, as a Welsh Member of Parliament, can complain about the share that Wales has.

Mr. Martin M. Brandon-Bravo (Nottingham, South)

May I add a welcome from Nottinghamshire to the welcome from my hon. Friends representing Derbyshire for my right hon. Friend's statement and share their distaste at the sour grapes we have heard from Opposition Members? Will my right hon. Friend, his Department and related Government Departments look at one issue that may help the project become even more successful—the provision of a freight terminal at Toton on the borders of Nottinghamshire and Derbyshire? The site is tailormade for the project, but I understand there may be some planning problems. If my right hon. Friend can help us overcome those problems, he will have helped Nottinghamshire and Derbyshire to make the project even more successful than I know it will be.

Mr. Newton

I do not think my hon. Friend will expect me to venture into intervening off the cuff in a local planning problem, as he delicately describes it, but I shall certainly ensure that his remarks are drawn to the attention of my appropriate right hon. and hon. Friends.

Mr. Harry Ewing (Falkirk, East)

I congratulate the Chancellor of the Duchy of Lancaster on his command of the pronunciation of the names of Japanese companies, which is obviously a result of so much practice. When does he think that he will come to the Dispatch Box to announce a major investment in Britain by a British company?

Mr. Newton

The hon. Gentleman cannot have been listening to what my hon. Friend the Member for Birmingham, Northfield (Mr. King) said a few minutes ago. I answered by saying that a significant amount of investment was being undertaken by companies of various national ownerships.

Mr. Nicholas Budgen (Wolverhampton, South-West)

Is my right hon. Friend aware that this decision will be warmly welcomed in Wolverhampton, where there are many important accessory manufacturers? But does my right hon. Friend agree that the choice of site is a lesson to hon. Members of all parties—and even to one of his Cabinet colleagues—who argue that decisions about where manufacturing sites should go are decided wholly by the generosity of the taxpayer through regional grants and subsidies?

Mr. Newton

The point is that it is sensible to have, as we have—especially through regional selective assistance —a policy that enables us to take account of what is required to achieve given outcomes in particular cases. In the other cases to which I have adverted, where regional selective assistance was paid or offered, it was, in our judgment, necessary to secure the project. In this case it has, happily, proved not to be necessary and I welcome that.

Mr. Bob Cryer (Bradford, South)

The right hon. Gentleman has given the time scale for the development of local content in the production of the car. Has he a similar time scale for the development of jigging tool and design manufacture in this country?

The right hon. Gentleman acknowledges the lead achieved by Japanese manufacturing industry. Does he think that it is because Japan has invested massively in manufacturing industry and spends less than 1 per cent. of gross national product on defence, whereas we spend 5 per cent. and are pouring £11,000 million into Trident? Does he think that there is a serious and important lesson to be learned?

Mr. Newton

I am not in a position to prejudge the commercial decisions the company may take on the aspects to which the hon. Gentleman referred. It is asknowledged to be the case throughout the House that one of the difficulties of this country over many years was inadequate investment in this and other industries. Therefore, one of the most encouraging signs of the past few years has been the dramatic rise in investment, especially in manufacturing industry.

Mr. Nicholas Bennett (Pembroke)

My right hon. Friend need have no fears that the people of Wales will begrudge a slice of inward investment to their fellow citizens in Derbyshire. Does my right hon. Friend agree that inward investment has come as a result of the Government's policy of low company taxation and good labour relations, and not purely as a result of regional investment programmes? Does my right hon. Friend also agree that the hon. Member for Bolsover (Mr. Skinner) might be more generous in his view of the single market in Europe than he has been in the past few years, and that he should welcome this positive encouragement for European investment?

Mr. Newton

Yes, I agree with everything that my hon. Friend has said.

Mr. Paul Flynn (Newport, West)

One alternative favoured site was at Duffryn in my constituency, and another was in the constituency of my hon. Friend the Member for Newport, East (Mr. Hughes). In our disappointment, we want to congratulate Derby and offer our best wishes to Dr. Shoichiro Toyoda that he and his company will be happy and prosperous in Derby as many other Japanese companies are in Newport and Gwent. The significant point about the announcement today is that the overall level of unemployment for Newport is 9.1 per cent., whereas for Derby it is 7 per cent.

We are not seeing today a failure by Newport. It has great pulling power in attracting new jobs and will be brilliantly successful again in attracting new jobs. We shall miss these jobs because they are the missing piece of the jigsaw in the Newport economy—blue-collar work for male workers. It is a failure for regional policy.

There was another missing piece in the announcement. Have the engine plant and the plant for manufacturing gearboxes yet to be allocated to Derby or is it still possible that they will be allocated to Newport?

Mr. Newton

I do not think that I will add further to what I have said about Wales. The company is still considering plans for the engine plant. The Government, and I am sure all others involved, will do everything possible to encourage the company to locate that plant in the United Kingdom. As I have said, our experience with Nissan suggests that we can be reasonably optimistic about that.

Mr. Andy Stewart (Sherwood)

My right hon. Friend's statement today will be widely welcomed in the east midlands, and especially in my mining constituency of Sherwood. In view of the fact that the mining industry is running down its manpower and so that the company is successful in attracting the right type of employment, will my right hon. Friend ensure that the miners have ample facilities for retraining to take the opportunities that the company will make available?

Mr. Newton

I have no doubt that this company, like the others to which I have referred, will want to place heavy emphasis on the importance of training and will contribute to it. Training will be one of the things to which the local authorities will also be directing attention. I very much hope that the company will provide new job opportunities for those whose opportunities are unhappily shrinking in the mining industry.

Mr. George Foulkes (Carrick, Cumnock and Doon Valley)

May I also assure the Minister that I join in congratulating Derbyshire on a welcome increase in its number of jobs? However, may I point out that we in Scotland have noticed that there has recently been new inward investment in the midlands, in the north-east and even in the south-east of England—and especially in Wales —whereas over the last few months we have noticed a lack of new inward investment in Scotland which, in my view, has been caused by the substantial disarray in Locate in Scotland which, in turn, has partly been caused by rumours that have appeared in many newspapers that the Minister's Department wants to dismantle Locate in Scotland? Will the Minister scotch—if the House will excuse that expression—those rumours and give an absolute assurance that his Department has no intention of cutting or dismantling Locate in Scotland in any way?

Mr. Newton

All of us concerned with these matters —myself, the Secretary of State for Scotland, the Secretary of State for Wales and the Secretary of State for Northern Ireland—are concerned to ensure that regional policy produces a spread of prosperity in all those places where it has not yet reached the level of the south-east. The precise mechanisms for achieving that are a matter in this case for the Secretary of State for Scotland.

Mr. Derek Conway (Shrewsbury and Atcham)

My right hon. Friend will recall that, although Shrewsbury is not an assisted area, our town was in the final four for this inward investment. While we clearly envy Derbyshire's success, we in no way begrudge it. I am sure that my right hon. Friend and the House will be interested to know that, despite the fact that that 250-acre site in Shrewsbury will not now be occupied by Toyota, there is still considerable interest in that site, not only from foreign investors, but from a considerable number of British investors. The Toyota deal is neither the first nor the last involving sizeable investment in our area. Does my right hon. Friend agree that that is a sign of the underlying strength of the economy and that it can be judged by foreign and British investment and not by the niggling sour faces of the Opposition?

Mr. Newton

Yes, indeed, I have noted and will draw to the attention of the people concerned with the Invest in Britain Bureau what my hon. Friend has said generally about his own location.

Mr. Tony Banks (Newham, North-West)

Is it true, as the hon. Member for Derbyshire, South (Mrs. Currie) claimed in the Sunday newspapers, that she nagged Ministers into supporting Toyota's bid for the new factory? If that is so, would it not be better if we sent the hon. Member for Derbyshire, South, who has a bit of time on her hands these days, on a nagging tour of British industrialists so that they can start investing in British manufacturing industry?

Will the Minister tell me why, when there is still demand among domestic consumers for cars made in this country, our motor vehicle industry is being taken over more and more by foreign investors and foreign imports? Has it got something to do with the way in which the Government have continually sold out manufacturing industry since 1979?

Mr. Newton

I hesitate to weary the House by repeating the point that I made at the outset about the period in which import penetration into the British motor car market really grew, which was when the Administration that the hon. Gentleman supported were in office.

Having worked closely with my hon. Friend the Member for Derbyshire, South (Mrs. Currie) in another capacity for some time, I would never have accused her of nagging.

Mr. Tony Banks

She said it herself.

Mr. Newton

What I would simply say is that she is never backward in coming forward in the causes that she espouses.

Several Hon. Members


Mr. Speaker

Order. I will call the four hon. Members who have been rising regularly, and I ask them to make brief contributions. I call Mr. Wardle.

Mr. Charles Wardle (Bexhill and Battle)

Is it not the case that the prospects for this excellent project will be greatly enhanced if Toyota can negotiate a single-union agreement? Is my right hon. Friend aware of the interest of Mr. Bill Jordan of the Amalgamated Engineering Union in that regard? In spite of the silence on this from the Opposition this afternoon, does my right hon. Friend agree that it would serve the trade union movement well to bear in mind and to learn from the lessons of the fiasco of Dundee a little while ago?

Mr. Newton

I agree with my hon. Friend's last observations, but, having said clearly to the hon. Member for Bolsover (Mr. Skinner) that the question of how to conduct its industrial relations is for the company, I must say the same to my hon. Friend.

Mr. Nicholas Baker (Dorset, North)

Will my right hon. Friend point out to the hon. Members for Newham, North-West (Mr. Banks) and for Bolsover (Mr. Skinner), who do not appear to understand, that this is not a takeover, but an extremely welcome inward investment? It is the result of successful negotiations conducted by my right hon. Friend and the Secretary of State, who are to be congratulated. Does my right hon. Friend agree that the basic reasons for that success are the strength of the British economy, the industrial revolution that has been achieved and the access to the Continent through the Channel tunnel? Those are all achievements of this Government.

Mr. Newton

It is the clearest single message, not just from the announcement today, but from other recent announcements—not least in the past week—that this country has become the favoured location in Europe for investment by many overseas investors. That is a tribute to what the Government have achieved in the British economy.

Mr. Christopher Gill (Ludlow)

My right hon. Friend has stated that the Toyota company was attracted to make this important investment in this country because of the dramatic improvement in the economic climate. An important feature of that improvement has been the reduction of our corporation taxes to among the lowest rates in the world. Does that not demonstrate the virtue of continuing to drive the rates of corporation taxes down, so that companies are left with more money of their own creation to spend on research and development, on training and on the all-important capital investment?

Mr. Newton

I certainly agree with my hon. Friend that the policies that the Government have pursued for industrial relations, both personal and business taxation and, indeed, national insurance, have made an important contribution to bringing about those decisions.

Mr. Michael Brown (Brigg and Cleethorpes)

As one whose constituency was also being considered for this project, I add my congratulations to Derbyshire on securing this investment. Is it not clear from what the hon. Member for Newham, North-West (Mr. Banks) said that the part played by my hon. Friend the Member for Derbyshire, South (Mrs. Currie) was not insignificant and that the House and her constituents should congratulate her on what she has done to pull all the parties together? Is not another conclusion that we can draw from my right hon. Friend's statement the fact that the case for regional financial assistance is now no longer necessary?

Mr. Newton

I am afraid that I do not quite go along with the latter, as I indicated in one or two of my earlier comments. My hon. Friend's remarks about my hon. Friend the Member for Derbyshire, South (Mrs. Currie) were characteristically generous. I am sure that she will have been characteristically pleased by his reference to her.

Mr. Speaker

Application under Standing Order No. 20.

Mr. Harry Ewing (Falkirk, East)

On a point of order, Mr. Speaker.

Mr. Speaker

No, I shall take the Standing Order No. 20 application first.

Mr. Harry Ewing

On a point of order, Mr. Speaker, arising from the statement.

Mr. Speaker

That may be, but I shall take Standing Order No. 20 first.