§ 2. Mr. Bill Michie
To ask the Chancellor of the Exchequer what plans he has to improve the competitiveness and capacity of Britain's manufacturing industries.
§ The Economic Secretary to the Treasury (Mr. Anthony Nelson)
The Government's role is to create the best climate for industry and to ensure that economic recovery is sustained through low inflation and sound public finances.
§ Mr. Michie
It is a pity that we have not yet seen the evidence of their success. When the Chancellor draws up the Budget, will he take note of the British shipping taxation proposals and create a level playing field for our merchant fleet, bearing in mind the terrible crisis in our shipbuilding at the moment?
§ Mr. Nelson
I hear what the hon. Gentleman says and I know that my right hon. and learned Friend the Chancellor met representatives of the shipping industry this week. I assure the hon. Gentleman that his representations will be taken carefully into account.
§ Mr. Nigel Evans
Will my hon. Friend confirm that during the past three years interest rates have gone down from 15 to 6 per cent. and that that has wiped £11 billion off interest charges for British industry? Is not that particularly helpful to manufacturing industry?
§ Mr. Nelson
My hon. Friend is right. That is £11 billion of cash flow going through businesses which otherwise would not have done. That must be added to the facts that unit wage costs have declined and that we have low inflation and a more competitive exchange rate. Our manufacturing industries, as well as other businesses, have the edge in competition at home and abroad.
§ Ms Eagle
Does the Minister realise with what cynicism the workers of Cammell Laird, who are listening to his reassurances about the future of British shipbuilding, treat his remarks? Despite assurances and pleas of sympathy from the Government, Cammell Laird has now closed and the rest of our once-great shipbuilding industry is under constant threat. It looks as though the legacy of the Government will be that Britain, as an island nation, will have no shipbuilding industry left. What value are the Minister's reassurances when the industry is being devastated?
§ Mr. Nelson
Of course, I understand the problems in the hon. Lady's constituency to which she refers. I acknowledge the importance of the shipbuilding industry 503 nationally, as well as the importance of other manufacturing industries which employ some 4.2 million people.
In the previous Budget, we introduced a number of measures, not the least of which was the time-limited enhancement on capital allowance. That was specifically to assist those industries and to enhance the export credit facilities that are available to them. We still have a shipbuilding capability, which admittedly is much smaller, but specialist. Some areas have benefited from orders from the defence and other spheres, and I hope that that will continue to be the case.