Electronics Industry

HC Deb 11 March 1992 vol 205 cc839-40

7. Mr. Simon Coombs

To ask the Secretary of State for Trade and Industry what is his estimate of overseas earnings by the United Kingdom electronics industry in 1979 and 1991.

Mr. Redwood

Exports of electronics from this country in 1979 amounted to £2.7 billion and rose to £13.6 billion in 1990, the last full year for which I have the figures.

Mr. Coombs

Will my hon. Friend speculate on the effect on jobs in the electronics industry in my constituency and elsewhere of a Labour party proposal to increase value added tax on luxury items to 25 per cent? Does he agree that the right way to encourage the electronics industry to export is to help it at home by tax cuts such as those announced yesterday by our right hon. Friend?

Mr. Redwood

I agree. Such a big increase in VAT would be very damaging. I was delighted to learn recently that Arcam has announced that it will be the first British company in 10 years to make a cassette deck here in the United Kingdom. That builds on the success of the television industry and other electronic industries to which I referred in answer to earlier questions. We need to develop a good strong home market, and for that we need relatively light taxation so that people have more money in their pockets to spend. That is what the Labour party does not understand: there is no investment unless there is demand.

Mr. Flynn

What plans does the Minister have to ensure that the British-designed and British-invented transputer continues to be manufactured in this country? Is he aware that the parent company, which was nationalised as part of a French and Italian consortium, has threatened to remove the transputer from this country because of the British Government's failure to support British industry in the way that the French and Italian Governments have? Is another marvellous British invention—the miracle transputer which will be sold all over the world—about to be employed and manufactured by foreigners?

Mr. Redwood

There are many examples of good inventions developed here thanks to our industrial market-oriented policies. The United Kingdom is one of the leaders in open systems, which is a very important technological development. As for the future of the transputer, that, of course, depends on commercial decisions, but we have the right environment for many types of technological developments. We have an extremely lively electronics industry. What a pity that the Opposition never tell us any success stories.