Inward Investment (Hansard, 8 March 1995)

§ 13. Lady Olga Maitland
To ask the President of the Board of Trade what further steps his Department is taking to encourage inward investment into the United Kingdom.

§ Mr. Heseltine
A number of steps have been taken recently to strengthen the United Kingdom's inward investment promotion. These include the appointment of a new chief executive and moves to set up a computerised database to improve the presentation of all relevant information to prospective investors. Currently, proposals for upgrading the United Kingdom overseas marketing efforts and an "aftercare" programme for existing investors are being developed.

§ Lady Olga Maitland
I thank my right hon. Friend for his reply. Is he aware that 40 per cent. of Japanese inward investment into Europe and 43 per cent. of American investment into Europe comes into Britain? Does he agree that that is because Britain has more to offer than any other European country?

§ Mr. Heseltine
My hon. Friend is absolutely right, and we can add to the figures she gave the results now coming from Korea and Taiwan and the flow of companies coming here from Europe itself. It may interest the House, as this is such an important part of the reconstruction and rebirth of our manufacturing base, if I say that, in 1993-94, the Invest in Britain Bureau recorded 428 inward investment decisions, creating or safeguarding 99,000 jobs. If one takes the figures from 1979-80 to 1993-94, the IBB recorded more than 4,000 projects with more than 600,000 associated jobs.

§ Mr. Beggs
Can the President of the Board of Trade assure the House that Northern Ireland gets equal promotion with other regions of the United Kingdom when inward investment is being attracted, or is it left to the Secretary of State for Northern Ireland, Ministers, the Industrial Development Board or perhaps the present Minister for Trade, who did an excellent job when he was a Minister in the Northern Ireland Office?

§ Mr. Heseltine
The Invest in Britain Bureau is responsible for the United Kingdom, but in respect of the actual availability of cash to help the stimulation of 331 inward investment, the hon. Gentleman will be as aware as the rest of the House that Northern Ireland receives more than its proportionate share.

§ Mr. Bell
The President of the Board of Trade did not mention the fact that most of the multinationals that have come to our country have created works councils under the social protocol. We now have more multinationals with works councils than any other European country. I am grateful to the President of the Board of Trade, who, when he visited Samsung, recognised the work of Hartlepool council and Stockton council in getting Samsung to our area and the significant effort made by the work force, but can he not tell us now that he has made better arrangements with the Treasury for more regional assisted schemes? Will there be better infrastructure, and how will we meet the competition from Europe to get more regional development flowing our way?

§ Mr. Heseltine
I do not think that the hon. Gentleman could have heard what I or my hon. Friend the Under-Secretary of State for Corporate Affairs said. Britain is getting far in excess of any proportional share of inward investment flowing into the European Union. It is coming here because overseas investors see Britain as one of the most competitive places in Europe in which to invest. One of the reasons for that is that we do not have the social chapter which the Opposition would impose.

§ Dr. Twinn
In continuing his successful campaign to bring inward investment into Britain, will my right hon. Friend highlight the excellent location to be found in north London, Edmonton and Enfield, which is made even more excellent by the good help in the real terms of economic assistance given by him and by his Government?

§ Mr. Heseltine
I shall do my best to help my hon. Friend. He will know that he is not alone in making such suggestions.

§ 14. Mr. Bayley
To ask the President of the Board of Trade what his Department is doing currently to encourage inward investment in York.

§ Mr. Eggar
The Invest in Britain Bureau is providing £1.27 million in grant in the current year for the Yorkshire and Humberside development agency for the encouragement of inward investment in the whole of Yorkshire and Humberside—which, of course, includes York. It is important that local authorities such as York work in close partnership with the YHDA.

§ Mr. Bayley
Is the Minister aware that the Swiss-based multi-national company ABB Rail Vehicles Ltd. is one of the companies that have invested heavily in the British economy during the last few years? It has invested £50 million in the York carriage works. That investment, however, is likely to be written off by the company because of the Government's failure to ensure continuity in orders for new trains for British Rail.
What kind of advertisement for inward investment in the United Kingdom is provided when changes in Government policy mean that investors lose their money? What do the Government intend to do to ensure that 332 British Rail places an order for trains to keep the York works open, and to maintain a viable rolling stock manufacturing industry in our country?

§ Mr. Eggar
I suppose that it would have been too much to expect the hon. Gentleman to draw attention to the successes of investment in the York area—for example, the decision by Samsung Heavy Industries to invest in manufacturing industries at Flaxby. It is the first time that a Korean company has done so.
The hon. Gentleman mentioned ABB. British Rail has invested heavily: some £4 billion has been invested in rolling stock since 1979. and over the past 10 years nearly 4,000 new locomotives and vehicles have entered service. The public sector has made a considerable commitment to investment in rolling stock, and ABB must compete for the contracts that are available.

§ Mr. Waller
The information that my hon. Friend has given about inward investment in Yorkshire and Humberside is welcome. Is it not worrying, however, that the level of high-technology investment by small and medium-sized enterprises that are British-owned is still lower than that of many of their competitors? Will my hon. Friend seek a fiscal and financial environment in which such enterprises are encouraged to invest in the most high-tech equipment to a greater extent?

§ Mr. Eggar
We are considering all possible ways of encouraging growth in small and medium-sized enterprises. We recognise the critical importance of providing a climate in which established small companies in particular can grow into medium-sized companies, which often means taking advantage of modern technology, new investment opportunities and so on. Business Links can play an important role in that. We are constantly examining issues such as that raised by my hon. Friend; I hope that he will feel free to discuss the matter with us if he wishes.