HC Deb 12 March 1992 vol 205 cc955-7
2. Mr. Nicholas Winterton

To ask the Chancellor of the Exchequer what representations he has had from manufacturing industry in respect of his Budget proposals.

The Financial Secretary to the Treasury (Mr. Francis Maude)

Businesses of all sizes have welcomed the reduction in the burden of business rates next year by £480 million. The car industry—at the heart of the manufacturing sector—has said that the Budget measures should boost sales by 70,000. The director general of the Confederation of British Industry has said: This is a prudent and positive Budget".

Mr. Winterton

I warmly welcome the bringing forward of the benefit of the uniform business rate, and the measures announced in the Budget for small business and especially for the car industry. Does my hon. Friend accept that the two strongest economies in the world—Japan and Germany—are built on broad and substantial manufacturing bases? Will he consider sympathetically further measures to regenerate our manufacturing base, should such measures prove necessary?

Mr. Maude

One is always especially grateful for the steadfast support of my hon. Friend. I am familiar with his longstanding concern for the health of the manufacturing sector—the Government share that concern. My hon. Friend will be glad to note that the share of gross domestic product deriving from manufacturing is greater in this country than in even the United States and France. There have been substantial improvements in investment. Indeed, investment in plant and machinery in this country—the most important measure that there is—has risen dramatically over the past decade. Of course, we shall continue to consider carefully measures that could improve the lot of manufacturing industry. The one thing that manufacturers say that they want above all is a firm commitment to driving inflation down, so that they can continue to compete effectively in an ever more competitive world.

Mr. Pike

Although the Minister had the nerve to say what he just said, I do not think that he can really believe it. Many industrialists in key manufacturing regions such as the north-west and Lancashire believe that the Budget has done nothing to overcome the havoc that the Tory party has wrought on manufacturing industry over the past 13 years. They will be glad to see the back of this Tory Government.

Mr. Maude

Rather than relying on the hon. Gentleman's synthetic assertions, one ought to place more reliance on what business people say. They are the ones who really know. When a reputable City firm asked a number of finance directors of large and important companies what they thought of Labour's proposals, 5 per cent.—to give the good news first—thought that a Labour victory would be good for the economy. The bad news is that 86 per cent. thought that a Labour victory would be bad for the economy.

Mr. John Townend

Is my hon. Friend aware that family-owned manufacturing businesses—indeed, all family-owned businesses—are delighted at his inheritance tax proposals? They will prevent businesses from being sold or closed because of debts—factors that are devastating the many family businesses in the north. Has my hon. Friend ascertained whether the Opposition support the proposals?

Mr. Maude

The House—indeed, the nation—is waiting on tenterhooks for Opposition Front-Bench Members to vouchsafe to the country whether they intend to support this important measure, which has been warmly welcomed, particularly by the small business sector. However, so far we have waited in vain. No doubt, the Opposition will let us know this afternoon what their attitude is, or perhaps they are still dithering.