Investment

HC Deb 08 March 1995 vol 256 cc327-9

11. Mr. Roy Hughes

To ask the President of the Board of Trade what steps he is taking to help ensure that profit-making British companies invest in the United Kingdom.

Mr. Heseltine

The Government have pursued, and will continue to pursue, the policies that have turned the United Kingdom into an attractive place for investment, whether by British or overseas companies. Since 1979, the volume of investment in plant and machinery has increased by more than a half, and total business investment by more than a third. The United Kingdom is second only to the United States in attracting overseas investment.

Mr. Hughes

Does the President recognise the tendency of British companies, after they have made profits as a result of the efforts of their work force, to invest those profits abroad? Will he also recognise that it follows that Britain now has a record of investment that is about the lowest in the industrialised world? Bearing in mind the persisting high level of unemployment, what will the Government do about that position?

Mr. Heseltine

The first thing that I would advise the hon. Gentleman to do is return to his constituency and explain that unemployment has decreased by 430 in the past 12 months. Then perhaps he will move on to Electrotech Ltd., which has announced the creation of another 200 new jobs in the next three years. After that, he can go to British Steel at Llanwern, which has announced the creation of 150 jobs. After that—[Interruption.] I know that Opposition Members cannot take that, because things are going too well for them. After that, the hon. Gentleman can go on to Castle Leisure in his constituency, which has announced the creation of 80 new jobs. By the time that he has finished that journey, there will probably be some more good news.

Sir Cranley Onslow

Does my right hon. Friend agree that the biggest possible deterrent to profitable investment anywhere in the United Kingdom would be the imposition of the provisions of the social chapter?

Mr. Heseltine

I am in absolute agreement with my right hon. Friend that, if the Labour party ever had the chance to introduce the social chapter, that would be the biggest single accelerator of unemployment that one could impose on our manufacturing base.

Mr. O'Neill

Does the President of the Board of Trade recall that, when ICI was under threat from Lord Hanson, the whole House held that company's commitment to investment in high regard? On 24 February, Bryan Bullock, the ICI power services manager, said:

The UK's largest industrial consumers for whom electricity is a feedstock cannot wait indefinitely for competition to emerge and will emigrate overseas". Does the President agree with that statement? How long must we wait for Littlechild to change his mind about that issue? Is the President prepared to intervene to defend the major energy consumers in the UK and to give them the fair crack of the whip internationally that they have not had previously because of the regulator's indifference to their concerns?

Mr. Heseltine

The hon. Gentleman is fully aware that we recently changed the law to provide companies such as ICI with the opportunity to generate their own on-site electricity. I believe that ICI has already taken advantage of that new flexibility.

This is a question about Britain's interests in investment and in our major companies. ICI, whose officer the hon. Gentleman has quoted, is one of Britain's jewels in the crown. It invests across the world, earns profits across the world and carries the flag of British industry into every corner of the world economy.

Sir Dudley Smith

Does my right hon. Friend agree that it is essential that he continues to encourage the highly successful British pharmaceutical industry, to ensure that it remains firmly anchored in this country as one of the jewels in the crown to which he referred?

Mr. Heseltine

My hon. Friend will realise that we give every encouragement to the pharmaceutical industry, which is one of Britain's leading industries. There is massive investment in that industry, and we are pioneering new drugs which are extremely important for our future.