§ 2. Mr. James Gray (North Wiltshire)What recent representations he has received on the impact of his policies on manufacturing industry; and if he will make a statement. [60337]
§ The Chief Secretary to the Treasury (Mr. Paul Boateng)The Chancellor receives regular representations on a variety of topics, including manufacturing. The Government have embarked on an ambitious programme of economic reform, which, having served as a solid and stable foundation for the economy, now provides the best basis for manufacturing output to recover, through 2002 and into 2003, from the sharp slowdown that has affected the world economy in the past year.
§ Mr. GrayThe Minister may not yet have had a chance to read the excellent report that arrived on my desk this morning, but perhaps he will find an early opportunity to do so. The report, produced by Great Western Enterprise and entitled "Economic Prospects for Chippenham", says that manufacturing industries in the area are declining, in both relative and absolute terms. It states:
Large-scale closures in Chippenham and North Wiltshire, e.g. NHS Logistics, Dyson Ltd and Lucent Technologies are of concern.It goes on to talk about the levels of taxation and bureaucracy that have caused that large-scale decline. Does the Minister accept any personal responsibility for the fact that manufacturing is, and has been for 12 months, in recession?
§ Mr. BoatengWe have cut the burden of regulation. [Laughter.] Oh yes we have. We make no apology whatsoever for what we have done on the minimum wage. We make no apology for what we have done to promote fairness at work. As for the regulation that has been imposed on industry and business over the year, this Government have done more than any other to put in place the means by which it can be checked, so we rebut that allegation.
I very much look forward to learning more from that report about what is happening in Chippenham. However, I hope that the hon. Gentleman, in the spirit of generosity for which he is well known, will at least acknowledge what has been done by this Government, including the action by my right hon. Friend the Secretary of State for Trade and Industry to support regional development agencies. In addition, in the past week, the south-west manufacturing advisory service has opened in the hon. Gentleman's constituency. It will fund a team of five experts, who are already in place, to provide practical advice to manufacturers in the region. That addresses the real issues that face manufacturing and builds on the stability that my right hon. Friend the Chancellor has given the economy. This is something that the hon. Gentleman should welcome, instead of criticising as he has done.
§ Mr. Peter Pike (Burnley)I congratulate my right hon. Friend on his promotion. Does he recognise that in 394 constituencies such as mine manufacturing is extremely important to the local economy and for maintaining employment? Will he confirm that he recognises that the aerospace industry in particular has had difficulties since 11 September, that it remains the Government's policy to ensure that industry can overcome those problems, and that the Government continue to be ready to discuss the problems faced by industry in both the short term and the long term?
§ Mr. BoatengI am grateful to my hon. Friend for the generosity of his remarks. I know that he takes a particular interest in manufacturing and in the aircraft industry, and we share that interest. In the aftermath of 11 September, we have given the industry specific help on insurance. He will know that it is also benefiting from the tax credits that we have provided for research and development to promote the industry's productivity and build on its high skills. That is the best way to give manufacturing a long-term competitive advantage against our rivals.
§ Mr. Elfyn Llwyd (Meirionnydd Nant Conwy)With Welsh manufacturing industry in sharp decline, thousands of jobs have been lost over the past five years. Does the right hon. Gentleman agree that objective 1 funding will help provide infrastructure to boost the Welsh gross domestic product? Will he or his right hon. Friend the Chancellor please confirm, therefore, that Wales will receive full public expenditure cover of £170 million from Europe, plus £100 million match-funding from central Government, which we were not given last year because we were sold short? Will the right hon. Gentleman redouble his efforts to ensure that that does not happen this year?
§ Mr. BoatengI must resist the temptation, however beguiling, to make public spending announcements at this stage. The hon. Gentleman well knows that we are working closely with my right hon. Friend the Secretary of State for Wales and with the Welsh Executive to do all that we can to support manufacturing in Wales. I hope that the hon. Gentleman will accept that additional jobs have come on stream since the Government came to power in 1997, and recognise the real gains that have been made as a result of the steps that we have taken in terms of macro-economic reform, and the excellent work that is being done in Wales between the Executive and the Government to promote the Welsh economy.
§ Mr. Chris Mole (Ipswich)Does my right hon. Friend agree that one of the planks of the Government's support for manufacturing industry has been the provision of resources to regional development agencies in order to establish centres for manufacturing excellence? Does he also agree that the Conservatives' proposals to abolish RDAs would undermine the ability of our regions to support their manufacturing sectors?
§ Mr. BoatengThat is undoubtedly the case. Nothing undermined manufacturing more than the boom and bust that characterised the previous, Conservative Administration. We have sought, particularly in respect of small and medium-sized enterprises, to build on the platform of stability that has characterised the first five years of this Administration, and to take SMEs forward 395 by means of the RDAs, the research and development tax credit, and the mechanisms that we are introducing to reduce the tax burden on business. All that is good news for manufacturing and has contributed to the record number of jobs that are now enjoyed by our constituents throughout the country.
§ Mr. John Bercow (Buckingham)I congratulate the Chief Secretary warmly on his appointment. I relish jousting with him, but I gently remind him that last year there were an extra 4,642 regulations impacting on business.
They're incompetent when it comes to governing. They don't care about manufacturing. They don't understand business. The end result is that my members' jobs are going down the plughole and this government isn't lifting a finger to help".Given that that was the recent verdict in the Financial Times of the general secretary of the Amalgamated Engineering and Electrical Union, the Chancellor's friend, Sir Ken Jackson, what need does the Chancellor have of any enemies?
§ Mr. BoatengI only wish that the generosity of the hon. Gentleman's opening remarks had been reflected in the rest of his comments. What he clearly overlooks is the fact that it is this Government who have created a record number of jobs—more than a million new jobs created since 1997. It is this Government who have created, for the first time, the basis of stability that enables us now to tackle the deficit in productivity that existed over so many years when the Opposition had the administration of the economy. As a result, the most recent survey on the subject by Lloyds TSB can say that growth in productivity has accelerated to its fastest pace in more than two and a half years. That is progress. The Opposition would take us back to the past, and that would be a disaster.