HC Deb 26 October 1972 vol 843 cc440-2W
Mr. Nicholas Edwards

asked the Secretary of State for Trade and Industry whether he has completed his examination of the possibility of fixing a ceiling to the amount of regional development grant made in respect of a single project.

Mr. Anthony Grant

Yes. This proposal raises serious difficulties. Size and capital intensity do not always go together, so that a ceiling on large projects would be liable to affect some which are labour-intensive, and leave rather smaller capital-intensive projects unaffected. What one person regards as a single project another may regard as several projects, so that a ceiling would cause great uncertainty among industrialists and long arguments which could be settled only by arbitrary Government decisions. Thus a ceiling would be unlikely to be effective. For these reasons, I have concluded that, as with tax allow- ances which are the main national investment incentive, there should not be a ceiling to regional development grants. The employment implications of a project are, however, an important consideration in determining the amount and terms of selective assistance under Section 7 of the Industry Act.