§ Mr. Hugh Jenkinsasked the Secretary of State for Industry what inducements are offered to encourage private investment in industry; and to what extent they have succeeded.
Mr. Alan WilliamsThe most important general investment incentives are the 100 per cent. first year allowance for expenditure on plant, machinery and vehicles and the 54 per cent. initial allowance for industrial buildings. Regional development grants are also available on plant, machinery and buildings. In addition, regional selective financial assistance is available for employment—creating investment in the assisted areas and, nationally for particular sectors through the industry schemes. A variety of other instruments—like the current Price Code and the form of stock relief—are also framed in such a way as to give an inducement to invest.
Although the depth of the recent recession makes it difficult systematically to quantify the effectiveness of the total package of incentives, there is no doubt that they make a major impact on businessmen's investment decisions and the overall level of investment. The selective incentives are particularly effective: for example the Accelerated Projects Scheme, just closed, has generated or brought forward projects worth nearly £700 million.