HC Deb 20 February 1991 vol 186 cc270-2
15. Mr. Ron Davies

To ask the Secretary of State for Trade and Industry when he next plans to meet representatives of the CBI to discuss the condition of industry in the United Kingdom.

16. Mr. Knox

To ask the Secretary of State for Trade and Industry when he next expects to meet the president of the Confederation of British Industry to discuss manufacturing industry.

The Minister for Trade (Mr. Tim Sainsbury)

My right hon. Friend regularly meets representatives of the CBI. He met the director general most recently last week.

Mr. Davies

When the Secretary of State next meets the CBI, will he discuss with it the latest manufacturing output figures which, as I understand it, show that the value of manufacturing output has declined by some £5 billion and that the level of investment has decreased by 15 per cent? Will he also discuss with the CBI the GDP figures published today which show that, officially, we are in recession? If the Department can bring itself to acknowledge that we are in recession, will the Minister tell us what precisely he proposes to do to get industry out of that recession?

Mr. Sainsbury

The hon. Gentleman may agree that, as the songwriter might have put it, recession is among industry's unfavourite things. I remind him and the House of some other unfavourite things of industry: excessive trade union power, high rates of business taxation, too much Government interference and continuing high rates of inflation. Those are the things which characterise Labour Governments and make them very unfavourite among business men.

Mr. Knox

When the Secretary of State next meets the president of the CBI, will he discuss with him the fact that manufacturing output last December was 4 per cent. higher than in December 1973—a period of 17 years? Does my hon. Friend believe that that represents satisfactory progress?

Mr. Sainsbury

Manufacturing output in the 1980s grew faster than in Germany, France or Italy. I suggest to my hon. Friend that we should look at the underlying strength of manufacturing industry and at the underlying strength of British industry. The massive strides and great improvements that we made during the 1980s mean that manufacturing industry, like the whole of British industry, is a great deal stronger and more resilient as it faces the 1990s than it was in 1979.

Mr. Janner

Does the Minister share with the CBI the recognition that there is a terrible underlying weakness in many manufacturing industries, including hosiery, textiles, shoes and other staple industries in areas such as Leicester which were firm before the Government came into power, but are now in a state of absolute disaster?

Mr. Sainsbury

It is strange that the hon. and learned Gentleman seems so ready to join those of his hon. Friends who spend their time running down the performance and capabilities of British industry. Manufacturing productivity grew faster in the 1980s than in any other major industrial country. It has improved by a half since 1979 and we should applaud that.

Mr. Beaumont-Dark

Does my hon. Friend accept that one problem faced by industry and others is caused by state and private monopolies? British Rail is increasing fares way above inflation; British Telecom, British Gas and the water companies are all raising their prices; and now the electricity industry has announced that it will increase charges by 13 per cent. Why should all those concerned be able to protect themselves against last year's losses when they help to encourage the losses of private industry, which has no monopolies on which to fall back?

Mr. Sainsbury

As the House knows, my hon. Friend is a robust supporter of competition. That is what Conservative Members believe in, although I have serious doubts whether the Opposition do.

I shall not go into detail about all the industries that my hon. Friend mentioned, but we like to introduce competition and we ensure that regulatory control is introduced where it is absent. Such control usually ensures that the increases allowed are substantially lower than the level of inflation.

Mr. Gordon Brown

Are not manufacturing investment, manufacturing output and manufacturing employment now falling? Today's figures confirm a 6 per cent. drop in manufacturing output which is unique in western Europe. As the Minister cannot blame OPEC, the Gulf conflict, the EC, workers or management for the recession, whom does he blame? Is not this a direct result of the mistaken policies of discredited Ministers in a failed Government?

Mr. Sainsbury

I congratulate the hon. Gentleman on getting his facts right. It makes a change. Yesterday, for instance, when he alleged that manufacturing output had increased by only 7 per cent. since 1979, he was only 70 per cent. wrong; the increase was 12 per cent. He is improving.