HC Deb 19 June 1996 vol 279 cc855-6
1. Mr. Win Griffiths

To ask the President of the Board of Trade what plans he has to discuss developments in manufacturing industry at the next meeting he attends with his European Union counterparts. [32107]

The President of the Board of Trade and Secretary of State for Trade and Industry (Mr. Ian Lang)

My colleagues and I meet regularly with our European Union counterparts to discuss a range of industrial issues. Later this afternoon I shall be meeting the Swedish Minister for Industry and Energy, Mr. Anders Sundstrôm.

Mr. Griffiths

I thank the President for that reply. Given that the occasional paper on United Kingdom investment performance shows that manufacturing investment is lower now than in 1979, and the latest output figures show that we are technically in recession, does the right hon. Gentleman agree with the Chancellor that our poor manufacturing record could be made worse by the antics of the Tory Europhobes who, even now, could be scaring off inward investment?

Mr. Lang

The hon. Gentleman might need to be reminded that under this Government total investment has risen six times faster than under the Labour Government. Manufacturing investment in plant and machinery is up 12 per cent. since the beginning of the recovery and up 10 per cent. last year alone. The hon. Gentleman is painting a somewhat misleading picture. I am encouraged by that strength of investment, which will lead to greater output and better export figures in due course.

Mr. Clifton-Brown

When my right hon. Friend next meets his European counterparts, will he remind them that Britain is more competitive today than it has been for decades? Will he remind them that between a third and a quarter of all inward investment in the past 10 years has come to this country rather than to the rest of the European Union? Above all, will he remind them that whereas Britain is creating jobs—we have more people in work than ever before—the rest of Europe has 18 million unemployed and that figure is rising?

Mr. Lang

My hon. Friend is absolutely right. That inward investment is a measure of our increased competitiveness. As a result of our policies, overseas companies, many of them European, are flocking to the United Kingdom. When the Leader of the Opposition was in Germany yesterday, I wonder whether he reflected on the fact that, last year alone, 58 German companies decided to locate in Britain, fleeing from the sort of stakeholder economy with which Labour wants to saddle us.

Mrs. Beckett

Will the Secretary of State acknowledge that investment in manufacturing is lower in real terms than when the Government came to power and that, far from what was just said by the hon. Member for Cirencester and Tewkesbury (Mr. Clifton-Brown), in manufacturing output we are seventh out of 15 in the European Union? Will he acknowledge that we are not even in the top three for unemployment, investment or inflation, and that we had the largest total trade deficit in Europe in 1991, 1992, 1993, 1994 and almost certainly in 1995? Is it not the case that, far from being the enterprise centre of Europe, under this Government Britain has slipped from 13th to 18th place in the world prosperity league?

Mr. Lang

The right hon. Lady is talking nonsense and giving a totally misleading picture. She seems to have forgotten that since 1980 the United Kingdom has had the fastest growth in gross domestic product—equal with Germany—the fastest growth in productivity bar none, the fastest growth in manufacturing output, the fastest growth in investment, the fastest growth in private consumption and the lowest tax burden. The right hon. Lady should give a fairer and more accurate picture of what is going on in this country.

Rev. Martin Smyth

Does the President of the Board of Trade agree that sometimes the opposition to investment in the United Kingdom comes from some short-sighted British firms who object, for example, to the Europe Tool Company from South Korea investing in Northern Ireland? Some of those firms are actually purchasing tool components from Korea that could be manufactured in the United Kingdom by British industry.

Mr. Lang

The hon. Gentleman will acknowledge that the economy of Northern Ireland has benefited enormously from inward investment into this country. I believe that most of those decisions are taken for long-term reasons, because countries throughout the world can identify the improvement in productivity and competitiveness in this country, and therefore in their manufacturing plans for the global market they regard the United Kingdom—including Northern Ireland, obviously—as the best base for exporting into the European market and beyond. The dramatic success that the United Kingdom has had in attracting inward investment is a tribute to the progress that has been made under the present Government.