Manufacturing Output

HC Deb 13 February 1992 vol 203 cc1102-3

14. Mr. Knox

To ask the Chancellor of the Exchequer what is the most recent monthly figure for output in the manufacturing industry; and what is the comparable figure for the same month 18 years ago.

Mr. Mellor

The idex of manufacturing output was 111.2 in November 1991, the same level as 18 years earlier.

Mr. Knox

Does my right hon. and learned Friend think that this situation represents satisfactory progress over the last 18 years?

Mr. Mellor

The real test of what has happened has been the overall growth in gross domestic product, which has been very substantial. In so far as one concentrates on manufacturing output, the fall was in the earlier part of this period. Between the first half of 1974 and the first half of 1979, there was a fall in manufacturing output of 2½ per cent.; whereas from the end of the first half of 1979 to the third quarter of 1991, there has been an increase of nearly 6 per cent.

Ms. Armstrong

The complacency that the Chief Secretary has just demonstrated is way beyond anything that my constituents will understand. They have seen manufacturing industry absolutely devastated during the period of this Government. What do the Government intend to do not just to offer help to individuals but to give areas such as mine the opportunity to be again a fully participating part of this nation?

Mr. Mellor

With the greatest respect to the hon. Lady, perhaps she should read the Confederation of British Industry's recent publication, "Modern Manufacturing Strength". It is a fair assumption that the CBI knows at least as much about manufacturing as the hon. Lady does, and she will see a commendation of the Government's policy in the 1980s and a firm recommendation that it should continue.

Mr. Devlin

Is not the constituency of the hon. Member for Durham, North-West (Ms. Armstrong) in the middle of the area of the United Kingdom which gets the largest level of outside investment into this country and, indeed, into the European Community? Is not that new manufacturing capacity brought here by the Government's successes in promoting Britain and the north of England as a location for manufacturing?

Mr. Mellor

My hon. Friend has made an invaluable point. The fact that this country has recently received 50 per cent. of total inward investment by the United States and Japan in the European Community has made possible a diversified economic base, particularly in manufacturing in the north. This has enabled the north to weather this recession far better than any previous recessions and in a way that bears the best comparison with the south.

Mr. John Smith

As the Chief Secretary has no doubt noticed, the Government's figures today indicate yet a further fall in investment in the manufacturing sector. Given the horrendous job losses that have been announced this month in the manufacturing sector, are these signs of the success of the Government's economic policy?

Mr. Mellor

What those figures certainly reveal is that the real gains in investment in British business since 1979 have been sustained, so that even at the depth of this present recession investment is 40 per cent. higher in real terms than it was in 1979. That was the position last year and it is a sign of the real improvements in investment that have followed the policies of this Government.