Manufacturing (Hansard, 20 January 1993)

§ 13. Mr. Henderson
To ask the President of the Board of Trade if he will make a statement on changes in the manufacturing base of the economy.

§ Mr. Sainsbury
Over the 1980s, manufacturing output grew at the same rate as in Germany, and faster than in France and in Italy. Output in the three months to October was higher than at the end of 1991.

§ Mr. Henderson
Is the Minister aware of the plight of the machine tool industry—a key high-tech and capital goods industry at the heart of the British manufacturing base which has lost 25 per cent. of the United Kingdom market in the past three years? Will the Minister tell the House why he thinks that that has happened? What does he intend to do about it?

§ Mr. Sainsbury
I appreciate that the machine tool industry has suffered severely during the recession. It is understandable that it would be one of the industries likely to suffer most and therefore it is equally likely to benefit as the upturn comes, so long as we retain the competitive position that we now have with low taxation, less regulation and a competitive exchange rate.

§ Mr. Rathbone
What actions have arisen in Government policy in the light of the submission from the Engineering Employers Federation?

§ Mr. Sainsbury
It was an interesting submission and we have studied it carefully. We have discussed and will continue to discuss it with the Engineering Employers Federation. As I am sure my hon. Friend agrees, a careful reading of the report—rather than some of the press comment that accompanied its release—will show that there is much in it which is being done or has already been done on the recommendations made to the Government.

§ Mr. Turner
Will the Minister accept that the manufacturing base is fast disappearing in the black country of the midlands—an area in which there was more wealth created per acre than anywhere else in the world. The latest casualty is Cannon Industries in Coseley. Unless we can save it, the plant is to be closed, with the loss of 900 jobs. The company has been trading satisfactorily for the past 175 years and makes top-quality products—

§ Madam Speaker
Order. The hon. Gentleman is now doing a public relations exercise instead of putting a question.

§ Mr. Turner
Not at all.

§ Madam Speaker
Order. I ask the hon. Gentleman to come to his question.

§ Mr. Turner
I am speaking for the 900 workers who will lose their jobs, and for their families. What do the Government intend to do about that?

§ Mr. Sainsbury
I wish that the hon. Gentleman could use his public relations skills to praise the achievements of British manufacturing industry. Manufacturing output— [Interruption.] The Opposition may not wish to hear, but the country should know that manufacturing output is 372 now one fifth higher than it was 10 years ago, manufacturing investment is one third higher, productivity is more than one half higher and export volume is four fifths higher.

§ Mr. Nicholas Winterton
I entirely endorse the views just expressed by the hon. Member for Wolverhampton, South-East (Mr. Turner). What response will my right hon. Friend give to the Engineering Employers Federation on the excellent campaign that it has launched? Will he admit that the manufacturing industries of this country, together with construction, are the only source of non-inflationary economic growth? What action does he intend to urge on the Chancellor of the Exchequer for the two Budgets this year to broaden our manufacturing base? Although my right hon. Friend gave some optimistic forecasts and statistics, the fact is that we have one of the narrowest manufacturing bases in the European Community.

§ Mr. Sainsbury
I am happy to agree with my hon. Friend about the importance of manufacturing industry. I am sure that we share the wish to see the manufacturing base expand. I hope that my hon. Friend agrees that my right hon. Friend the Chancellor's autumn statement responded very adequately to the needs of manufacturing industry.

§ Mr. Cousins
The Minister will recognise that the British aerospace industry, which is our largest exporter, is facing a period of considerable change and difficulty. Last Friday the largest order for cargo aircraft ever placed was placed with Boeing. What action has the Minister taken to ensure that British Rolls-Royce engines are used for that order?

§ Mr. Sainsbury
The hon. Member is well aware of the difficulties being experienced by the aerospace industry internationally, partly due to the cutback in defence requirements. My Department works closely with the aerospace industry and keeps very close contact with it in all its aspects in order to promote the interests of British manufacturers. I am happy to have this opportunity to pay tribute to the export achievements of the aero-engine sector and Rolls-Royce in particular.