HC Deb 27 March 1996 vol 274 cc1020-1
7. Mr. Congdon

To ask the Secretary of State for Scotland what assessment he has made of the trend in Scottish exports of electronic goods over the last five years; and if he will make a statement. [21325]

Mr. Kynoch

Over the past five years, Scotland's exports of electrical and electronic engineering have nearly trebled to reach a value of £2.122 billion in 1994.

Mr. Congdon

Can my hon. Friend confirm that that is reflected in employment in the Scottish electronics industry, which has increased by 5 per cent. since 1984, and that employment in electronics manufacturing in Scotland accounts for 13 per cent. of all manufacturing jobs in Scotland? Does not that demonstrate the success of the Government's policies in stimulating an enterprise culture and competitiveness in the Scottish economy?

Mr. Kynoch

Yes, I agree with my hon. Friend. In fact, not only do they do that, but they have contributed significantly to the change in the economy of Scotland, where traditional industries that have gone through difficult times have been replaced by a significant electronic sector. That sector is growing and is aided by inward investment, which is attracted by the highly competitive nature of the environment in which we work and live under the Government in Scotland.

Dr. Reid

Given that, a few moments ago, the Secretary of State asked us all to pull together and not to undermine industry in Scotland, will he take the same ordinance to heart? In future, will he stop undermining the possibility of future inward investment in Scotland with his puerile scares about a Scottish Assembly? Would he not do better to take the advice of Neil Hood, former director of Locate in Scotland, and now head of the Strathclyde international business unit, who said that there is no prima facie case that devolution in Scotland will affect inward investment? Least of all, will the right hon. Gentleman stop attempting to use petty party political points, which undermine future investment in Scotland, when he and his colleagues are at the same time demanding that everyone else should follow that stricture when it comes to beef?

Mr. Kynoch

I am disappointed in the hon. Gentleman, who I considered to be a fairly responsible Member, given the co-operation he gave me when discussing the unfortunate incident at Cummins. I shall, however, continue to ensure that everyone in Scotland is well aware of the implications of the tax proposals put forward by the Opposition parties—

Dr. Reid

There he goes, deterring investment again.

Mr. Kynoch

The hon. Gentleman does not like hearing it because he believes that a drop in competitiveness will not affect industry in Scotland.

I believe, however, that it is clear that, if Scotland became the highest taxed part of the United Kingdom, and if the tartan tax were applied by the Opposition parties, Scottish industry would become less competitive and therefore not succeed. That would be bad for employment in Scotland and, as the hon. Gentleman knows, make it much more difficult for Scotland, in competition with other parts of the United Kingdom, let alone other parts of Europe, to attract inward investment to Scotland and Lanarkshire, which is near to his heart.

Mr. Stewart

Would my hon. Friend pay tribute to the management and work force of those Scottish companies that have achieved enormous success in the production and export of personal computers, automatic banking machines and workstations? Does he also agree that there is additional and considerable potential to improve Scotland's exports of software?

Mr. Kynoch

Yes. My hon. Friend is right to refer to the significant contribution made by the many employees in the electronics industry. Their productivity gains and commitment to their companies have contributed significantly to the success of those companies. My hon. Friend is right to talk about improving the export of software. Certain initiatives have already been taken and there has been a good exchange between Virginia and Scotland and Scotland and Virginia, with inward missions going both ways, and good co-operation on successful joint ventures in the interests of the industry. I hope that that will be encouraged. I also hope that future initiatives will be taken under the Scottish export strategy, known as international challenge, which I launched last year, to ensure even greater success in that important sector of business.