§ 3.7 p.m.
§ Baroness Elliot of HarwoodMy Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows: To ask Her Majesty's Government whether they are satisfied with the level of investment undertaken by microelectronic companies in Scotland in the last four years.
§ The Minister of State, Scottish Office (Lord Gray of Contin)My Lords, the Government welcome the substantial investment in Scotland in recent years by electronic companies, both British and foreign. We believe that Scotland is an attractive location for additional investment by both existing and incoming companies.
§ Baroness Elliot of HarwoodMy Lords, I thank the noble Lord very much for that encouraging reply. We are all very encouraged. Can he perhaps say whether or not a Japanese company's silicon-making group is going to Livingstone and whether a plant for an international microelectronic product from California is also to be set up in Scotland? I am not sure exactly where it is to be sited.
§ Lord Gray of ContinYes, my Lords, I think that I can be helpful to the noble Baroness on this matter. Scotland has had considerable success in attracting investment in the electronics industry. This year has seen the announcement of investment of £140 million in major expansions of national Semiconductors and Hewlett Packard and the decision of Shin-Epsu Handotai to establish a silicon manufacturing plant in Scotland.
§ Lord Ross of MarnockMy Lords, is the noble Lord the Minister aware that investment in these industries did not start four years ago? Is he further aware that there were more people employed in these industries in Scotland five years ago than there are today? Hewlett Packard has been there for a long time.
§ Lord Gray of ContinMy Lords, I do not think that it has ever been suggested that investment in those industries started only recently. What I am proud to say is that under the careful nurturing of this Government the investment is continuing to proceed.
§ Lord Gray of ContinMy Lords, I would remind the noble Lord that the package announced in the recent Budget means that the reductions in capital allowances have allowed the Government to reduce 1506 the rates of corporation tax, and my right honourable friend the Chancellor of the Exchequer proposes further reductions in the nominal rate of tax. These changes should simplify the tax system and encourage profitable investment, rather than tax-efficient investment.