HC Deb 12 January 1994 vol 235 cc160-1
2. Mr. Merchant

To ask the President of the Board of Trade what assessment he has made of the outlook for industrial production in 1994 in (a) the United Kingdom and (b) France.

The Minister for Trade (Mr. Richard Needham)

The OECD expects both industrial production and overall output to rise by more in the United Kingdom than in France this year.

Mr. Merchant

Does my hon. Friend agree that what he has just said illustrates the powerful benefits that flow from successful policies of low inflation, low interest rates, low taxation and falling unemployment? Does he agree that a comparison of British and French achievement over the past decade further illustrates the success of this Government's economic and industrial strategy?

Mr. Needham

As my hon. Friend says, the United Kingdom currently has faster growth, lower inflation and lower unemployment than does France. United Kingdom manufacturing output has grown faster than that of France between 1979 and today. It appears that when France has a socialist Government it falls behind; when we have a socialist Government we fall behind France.

Dr. Marek

Nevertheless, does the Minister agree that if we compare the annual average rates of increase of industrial production between 1985 and the third quarter of 1993, the United Kingdom shows a rate of 0.7 per cent. whereas France shows a rate of 1.4 per cent? Is not the Minister doing a disservice to the country by bandying around selective statistics that can mean one thing or another? It would be far better if he provided us with a genuine set of statistics showing the trend, which, if we do not start in a dip or at a peak, indisputably show that France does better than we do in the long run.

Mr. Needham

The hon. Gentleman did not listen to what I said. I took the years from 1979 to 1993 and I did not even add the point that, as we are now out of recession and France is still in it, the gaps are likely to increase further. If manufacturing production in 1985 is taken as 100, between 1979 and 1993 Britain's manufacturing output grew faster than that of France.

Instead of knocking the achievements of our industry, the hon. Gentleman should realise that we are competing successfully against one of our great and major competitors.

Mr. Batiste

Is not another key difference between us and France the fact that over the past 10 years we have encouraged inward investment in high-quality manufactur-ing while the French have been relatively resistant to such investment? What assessment has my hon. Friend made of the impact of that investment on British manufacturing?

Mr. Needham

We have indeed attracted 40 per cent. of the European investment made by Japan and a similar percentage from the United States. The fact is that that inward investment—as Opposition Members now realise, although they did not before—has brought immense benefits to this country, in terms of improving our quality, productivity and competiveness. Under this Government, as my hon. Friend the Member for Beckenham, (Mr. Merchant) said, with low inflation and low interest rates this country is the best possible place in Europe for foreign investment.