HL Deb 21 April 1993 vol 544 cc1562-4

3.3 p.m.

Lord Laing of Dunphail asked Her Majesty's Government:

Whether they have assessed the likely consequences of the tax changes of the Budget for British industry, with particular attention to its effect on Rolls-Royce cars; and whether they will publish a statement of their industrial strategy.

The Parliamentary Under-Secretary of State, Department of Trade and Industry (Baroness Denton of Wakefield)

My Lords, my right honourable friend the Chancellor of the Exchequer considered the overall impact of his Budget on industry and the impact of each measure with particular care. Rolls-Royce cars will of course benefit from the budget measures to help business and promote recovery.

The Government's industrial strategy is already clear—a long-term commitment to help British industry succeed in world markets. That involves all policies, including those pursued by the Chancellor in a Budget which cut the tax burden on business by £1 billion.

Lord Laing of Dunphail

My Lords, I thank my noble friend for her Answer. However, do not the Government understand that the erosion of our manufacturing base has, to an important extent, been caused by sudden changes in government policy, including tax changes—in the case of Rolls-Royce of up to 400 per cent. —to which companies, however efficient, cannot respond quickly? Secondly, do they understand that that is aggravated by a financial system which will sell great companies to foreigners at the drop of a hat?

Baroness Denton of Wakefield

My Lords, I hasten to reassure my noble friend that the Government consulted widely on proposals for change last year. On the issue of taxation on company cars, the great majority of respondents, including motor manufacturers, were against the banding of cars by price. I assure my noble friend that the Government continue to consider comments and suggestions. I am aware that my right honourable friend will be meeting senior representatives of Rolls-Royce in the next month. I assure him that we are working closely with industry. I am delighted that last month's increase in manufacturing output proves that we are being successful.

Lord Molloy

My Lords, will the Minister be implementing the last part of the Question? Will the Government publish a statement of their industrial strategy, as requested in the latter part of today's Question?

Baroness Denton of Wakefield

My Lords, we are operating an industrial strategy. We recognise the vital role of the private sector. We are working for a stable economic climate with an emphasis upon competitiveness and deregulation. We are supporting departments with critical interfacing with the wealth-creating sector and we are developing close links with business. Our aim is to provide services of the highest possible standard, properly co-ordinated and actively promoted. The figures show that we are achieving our aim.

Lord Peyton of Yeovil

My Lords, if the Government's industrial strategy is as clear as my noble friend suggests, why are the Government so unwilling to restate it for the benefit of those who do not have such a clear understanding of it? Is it just possible that the Government will not state their industrial strategy because it is difficult, if not impossible, to secure the consent, agreement and commitment to it by other departments?

Baroness Denton of Wakefield

My Lords, my noble friend ensures that I state regularly in the House the Government's industrial strategy. As I said in my previous answer, we work closely with other government departments which interface with wealth creation, and, in particular, he should note the help that the Treasury gives.

Lord Clinton-Davis

My Lords, is the Minister aware that, although she tries boldly to assert the Government's industrial strategy, she fails significantly every time she addresses the issue? Is she not aware that the alleged strategy is in absolute tatters? That could not be better exemplified (could it?) by the fact that in March alone the PSBR leapt by £9.5 billion; that the unemployment figures, despite the slight fall last month, are still devastatingly high; and that capital spending has been estimated in a recently undertaken survey not to rise significantly in 1993. When will the Government address those fundamental issues?

Baroness Denton of Wakefield

My Lords, we constantly address those fundamental issues. I am delighted to say that the other side of the coin quoted by the noble Lord is positive; this month we have seen growth in manufacturing.

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