HC Deb 02 April 1998 vol 309 c1406
12. Mr. Jim Cunningham

If she will make a statement on her Department's policy towards encouraging research and development in British companies. [35984]

Mr. Battle

The Government recognise, and publicly acknowledge, the importance of encouraging research and development as an absolutely vital component of innovation and improved competitiveness.

Mr. Cunningham

What responses has my hon. Friend received, first, from industry and, secondly, from universities regarding research and development? The previous Government decimated the west midlands. Several hon. Members led deputations to former Tory Ministers to discuss that matter, but we received no response. As a result, some highly paid engineers in the west midlands became shelf-stackers at Sainsbury's.

Mr. Battle

I am grateful to my hon. Friend for that question. From day one, we have worked to strengthen investment in United Kingdom research and development and to build a partnership with industry and academia. We have invested in measures such as the joint research equipment initiative. We have pushed forward the foresight link awards, and my right hon. Friend the Chancellor announced the university challenge in the Budget. Those measures have been welcomed by industry and by universities as a way of turning the corner and reversing the cuts in research and development that were made by the previous Administration.

Mr. Gibb

How does the Minister believe that raising the employers' national insurance contribution rate from 10 per cent. to 12.2 per cent., as announced in the Budget, will help companies that are engaged in research and development?

Mr. Battle

I am amazed by Opposition Members: they suffer from permanent amnesia. The Conservative Government cut research and development. Their figures show that there was a 6 per cent. reduction in Government spending on R and D and a 3 per cent. reduction in business spending on R and D under the previous Administration. Our measures will strengthen industry. We will encourage business to look to the longer term and to invest in research as a means of achieving a long-term future. Our fiscal measures go some way to underpinning that, which is why they were warmly welcomed.