Recession (Hansard, 16 October 1991)

§ 14. Mr. Livingstone
To ask the Secretary of State for Trade and Industry if he will make a statement on his assessment of the long-term effects of the recession in industry.

§ Mr. Redwood
British industry is becoming more competitive and more productive. Manufactured exports are 60 per cent. up in volume terms compared with 1979. The balance of payments deficit in manufactures has been 310 closed. Total investment in the economy is above the levels of the 1970s and private consumption per head is above that in France and Germany. It is about time that Opposition Members started looking at some of the pluses in the situation.

§ Mr. Livingstone
Given that since the Prime Minister took office we have lost 250,000 manufacturing jobs out of a total of 750,000 jobs that have been lost and that 30,000 firms have gone bankrupt, can the Minister say upon what basis British industry can expand and tackle the balance of payments crisis? Can the Minister tell us about any point in a post-war recession at which at the depth of that recession we did not have a balance of payments surplus? What is the difference this time?

§ Mr. Redwood
The difference is that the hon. Gentleman does not know the facts. The manufacturing deficit has disappeared in recent months because of the great export success of British manufacturing industry, especially in the motor car industry, which has been mentioned already by my right hon. and hon. Friends.
In a recent radio programme, the hon. Gentleman said that he thought that there would be a Labour Government. That was a rather strange prediction, but the rest of his predictions seemed to be extremely accurate. He said that such a Labour Government would soon enter an economic crisis and would then lurch to the left. That is exactly what happened to the previous Labour Government when they entered an economic crisis, and it would happen again. Perhaps the hon. Gentleman believes that the Labour party's £10 billion takeover plans for British industry by renationalising public utilities are what is needed to revitalise the economy. I have news for the Opposition: that is not what is needed. It is the Government's policies which are needed to produce progress and prosperity.

§ Mr. Grylls
Does my hon. Friend accept that wise and experienced industrialists know well that recessions are part of the economic price of every industrialised country? Britain went into recession in an incomparably stronger position than it did 10 years previously because of tax changes, deregulation and a huge improvement in productivity. That is very much a plus and when the present recession ends, we shall be ready to win more markets.

§ Mr. Redwood
I agree with my hon. Friend. We were much stronger and we delayed a recession for 10 years, a much longer period than the Labour Government were able to delay recessions in their time. There have, of course, been slowdowns around the world and it is difficult to resist all of those all the time. The important thing is that the economy will recover. All private sector forecasters are looking to growth next year. That is why Opposition Members are so glum. There will be more good news, and they do not like good news.