HC Deb 11 January 1995 vol 252 cc135-6
3. Mr. Gunnell

To ask the President of the Board of Trade how many subsidiary companies with headquarters in the United States have received regional selective assistance since June 1979; and how many have since ceased operation in the United Kingdom.

The Minister for Energy and Industry (Mr. Tim Eggar)

Since June 1979, 644 United States-owned subsidiary companies have received offers of regional selective assistance in Great Britain in relation to more than 900 projects. Of these, 167 projects did not proceed and 49 were not fully completed.

Mr. Gunnell

I thank the Minister for that information. I recognise that successful inward investment owes much to regional selective assistance and to the work of regional development organisations and the support of local authorities, but has the Minister analysed why some projects were not completed and others were unsuccessful? Has he made any comparison between our figures for incomplete investments and the corresponding figures for failures in continental Europe? If his theories about the social chapter are to be supported, one must show that on the continent there is a greater proportion of failures than in the United Kingdom.

Mr. Eggar

The facts speak for themselves. No less than 43 per cent. of all United States investment in the European Union has been made in the United Kingdom. That investment, which has mainly been made with the aid of regional selective assistance, has led to the creation of 100,000 extra jobs since 1979 and has safeguarded 60,000 jobs. That is a record of considerable success. The hon. Gentleman has a long record of working constructively on inward construction projects. I pay tribute to him because such work is very much a partnership. He will recognise that a great deal of work is going on. In particular, we place emphasis on the need for proper aftercare of companies that have made an investment. We need to work closely with them, monitor their experience and see whether we can improve the quality of our services. We also need to use them as ambassadors for other sources of inward investment for the future.

Mr. Brooke

Would my right hon. Friend—what a pleasure it is to call him that—care to take this opportunity to testify to the enormous contribution in terms of economic activity, competition and transfer of technology made by American investment into Britain not only in the past 15 years but in the past 100 years?

Mr. Eggar

I thank my right hon. Friend for his first remarks. Britain's commitment to inward investment, as he rightly says, goes back many decades. It is extremely important to the economic success of the United Kingdom. The single most important factor is that an inward-investing company, whether it be American, Japanese, Korean or whatever, knows that once it has invested in the United Kingdom it will be treated by the British Government as a UK company and will be fully supported by us. There is no doubt that the rejuvenation in the past decade or so, particularly in the manufacturing sector, has largely been due to our success in attracting inward investment from established investors and from new ones.

Mr. Bell

Since it is still the season of good will, may I add the Opposition's congratulations on the right hon. Gentleman's elevation to the Privy Council? Will he confirm that the selective regional assistance packages that we offer are no greater than those offered by our European competitors through grants, financial incentives and soft loans? May I also congratulate the President of the Board of Trade on having seen off the former Chief Secretary to the Treasury, who did not believe in selective regional assistance and thought that it distorted the free market? Finally, can the Minister now reply to my hon. Friend the Member for Morley and Leeds, South (Mr. Gunnell) and congratulate local authorities, which play their full part, on putting together selective regional assistance packages?

Mr. Eggar

I welcome the peace and good will that appears to have broken out at this Question Time. I hope that it will be sustained during the coming months. Yes, I willingly pay tribute to the many local authorities that have taken a very constructive attitude to attracting inward investment, especially in the past few years. I also pay tribute to the training and enterprise councils, which have also come to the party, and to the private sector, which has helped. It is a co-operative partnership, which is working increasingly well and being increasingly successful.