HC Deb 04 November 2003 vol 412 cc558-9W
Mr. Djanogly

To ask the Secretary of State for Trade and Industry what plans she has to encourage an increase in the capital per worker ratio in UK manufacturing. [134869]

Jacqui Smith

By maintaining a stable macroeconomic environment, together with measures such as reforming capital gains tax, making permanent enhanced capital allowances for small and medium-sized firms, and introducing the Research and Development Tax Credit, we are providing a climate conducive to investment for the long-term in UK manufacturing.

The global slowdown in 2001 and added uncertainty in 2002 have led firms to postpone investment decisions, but the UK's strong economic fundamentals mean that manufacturers are well placed to benefit when the global recovery shifts up a gear.

Mr. Rosindell

To ask the Secretary of State for Trade and Industry if she will make a statement on manufacturing industry. [135581]

Jacqui Smith

While we should remain cautious, we may now be at the start of a recovery path, with positive data from the last four Chartered Institute of Purchasing and Supply (CIPS) surveys and manufacturing output from the Office for National Statistics up by 0.5 per cent. in the three months to August. However, the sector clearly remains under considerable pressure and we are doing all we can to help.

For example, the Manufacturing Advisory Service has been a real success as a major source of advice and support for small- and medium-sized manufacturers. Since it launched in April 2002, the Manufacturing Advisory Service has handled over 17,000 enquiries from manufacturing companies and has carried out over 3,000 diagnostic and advisory visits. Over 1,000 firms have benefited from in-depth consultancies to help them improve their productivity. The total value added benefit to firms helped by the Manufacturing Advisory Service is over £18 million.

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