§ 2.39 p.m.
§ Baroness SHARPLESMy Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
§ The Question was as follows:
§ To ask Her Majesty's Government what is their policy towards encouraging investment by Japanese and US companies in the British microchip industry.
§ The MINISTER of STATE, DEPARTMENT of INDUSTRY (Viscount Trenchard)My Lords, within Her Majesty's Government's policy of encouraging inward investment a particular welcome is given to high technology industries, such as the microelectronics industry.
§ Baroness SHARPLESMy Lords, I thank my noble friend for that reply. Is he aware that there is no concern amongst many small firms on competition in this country? Would he agree that taking a lot of the weight off the Government's shoulders in training young people for this new revolution will be helped by the foreigners coming in?
§ Viscount TRENCHARDMy Lords, it is very important, from whatever quarter, to continue the emphasis on the microelectronics industry because of its all-pervasive influence on the whole of British industry. We therefore welcome the latest technology, both developed at home and by companies who bring it from overseas.
§ Lord GRANVILLE of EYEMy Lords, may I ask the Minister if he can say how this will help the three electronic factories that were recently closed in this country?
§ Viscount TRENCHARDMy Lords, the recent closure of the three consumer electronics factories in this country was caused by a whole set of factors, including the world recession and the international competition in this area. While we regret it very much, fortunately we still have in this country a strong consumer electronics business which we believe will survive and grow.
§ Baroness FAITHFULLMy Lords, may I ask the Minister whether in our schools, colleges and universities we are teaching the technology of the microchip, so that the children of this country are brought up in the way of working in this area?
§ Viscount TRENCHARDMy Lords, I think that is a separate Question that ought to receive attention to itself if it were to be tabled. However, such teaching is increasing in schools and universities.
§ Lord ORR-EWINGMy Lords, will my noble friend confirm that, whereas it is the Government's policy to encourage investment from United States and Japanese companies, there is a danger that the embryo British industry may be starved and that the competition may become so intense that we shall not have the national capability which is so essential for our defence effort and our industrial progress?
§ Viscount TRENCHARDMy Lords, I am glad my noble friend asked that supplementary. First of all, as long as the Government are concerned we believe in an open climate for investment for our industries abroad and for other people here, but we do not intend to give aid 1044 specifically to foreign companies in this area, or in any other. Our aid schemes, whether regional or for a specific industry as in this case, are open to the home industry and to foreign industries alike. Further, in my department we advise potential investors in this country as to what we see to be the state of the market. Normally commerce is best at sorting out where there are gaps in our marketplace or our technology, but occasionally my department can help in avoiding a degree of over-competition in a saturated market such as my noble friend envisaged.
§ Baroness SHARPLESMy Lords, can my noble friend further help us? Will the foreign companies be encouraged to go not necessarily to the areas of highest unemployment, but to the areas where they have the real back-up facilities?
§ Viscount TRENCHARDMy Lords, that is their choice and their commercial decision. We have a regional policy and if, indeed, their needs can be met in the areas of greatest need, we are of course happy.
§ Lord GRANVILLE of EYEMy Lords, can the Minister say how this policy really helps technical development and research in the electronic industries in this country, upon which our war potential and our defence requirements may vitally depend?
§ Viscount TRENCHARDMy Lords, that, again, I think, is mainly a separate question. But we continue major support of micro-electronics. We have backed the second stage of Inmos, we have two major micro-electronic schemes which are still operating and we have companies specialising in the defence area which are in the forefront of this kind of development.