§ 11. Dr. John Pugh (Southport)What assessment he has made of trends in manufacturing output in the north-west since January 2001. [44509]
§ The Economic Secretary to the Treasury (Ruth Kelly)The Government's latest assessment of developments in the manufacturing sector, based on all relevant factors, was published in November's pre-Budget report. An updated assessment will be published in the forthcoming Budget on 17 April.
Manufacturing in the north-west, as in the rest of the United Kingdom, cannot have expected to remain immune from the sharp slowdown in the world economy last year. However, the leading indicators from business surveys suggest that a recovery in manufacturing is under way.
§ Dr. PughWith regard to the application of state aid rules to manufacturing in the north-west specifically, is the Treasury, in its monitoring role, satisfied that European rules are being applied in the same way throughout Europe? Will Ministers investigate any allegations from north-west manufacturers that they are not? Will they seek in the Budget to give the same support as their French and German counterparts give their regions?
§ Ruth KellyWhat we need is not more state aid, but state aid that is well directed and focused on helping manufacturing across the United Kingdom. That is why my right hon. Friend the Chancellor has been arguing so strongly in Brussels that we should have a system that tackles market failures and puts in place, for example, regional venture capital funds across the country that can support growing and thriving manufacturing businesses. That is the way forward, and we will continue to argue our case in Brussels. I am confident that we are making progress in this area.
§ Mrs. Louise Ellman (Liverpool, Riverside)What discussions are taking place between the Treasury and the Department of Trade and Industry about the future of Marconi, with particular reference to Liverpool? Does my hon. Friend realise that employment at Marconi in Liverpool has halved over the past year? Does she accept that were that plant to reduce further, it would be a blow not only to manufacturing but to the skills base in Liverpool and the north-west?
§ Ruth KellyAs my hon. Friend knows, it is difficult for me to comment on the specific case, but the regional development agency is working with my hon. Friend and others with an interest in the problem. Manufacturing across the north-west and throughout the rest of the UK will have benefited significantly from the Government's tax cuts in the corporate sector. Corporate rates have been cut by 3 per cent; they are the lowest in the history of the United Kingdom and lower than those of any other industrialised country. We are also giving significant support to boost the manufacturing sector and I am confident that we will begin to see the fruits of a recovery in the manufacturing sector later this year.