HC Deb 26 October 1966 vol 734 cc192-4W
Mr. Bruce-Gardyne

asked the President of the Board of Trade if he will estimate the amounts which, on current forecasts of manufacturing investment, he will pay out in the form of investment grants in the current financial year; and what estimate he has made of the corresponding value of investment allowances plus free depreciation plus all such Board of Trade grants as are subsumed into or replaced by the new system of investment grants.

Mr. Mason

No investment grants will be paid in the current financial year. The second part of the Question does not therefore arise.

Mr. Bruce-Gardyne

asked the President of the Board of Trade what was the value of investment allowances plus free depreciation plus all such Board of Trade grants as are subsumed into or replaced by the new system of investment grants during the financial years 1964–65; and what would have been the amount paid out under the new system of investment grants if it had been in operation during that financial year.

Mr. Mason

The tax relief allowable in 1964–65 in respect of investment allowances, and the extra tax relief in respect of free depreciation, plus the offers of grants under the Local Employment Acts for plant and machinery, totalled about £265 million. I estimate that the amount of investment grants which would have been payable in that financial year had the new system been in operation then would have been of the order of £200 million. A comparison between these figures is however not meaningful, principally because of the changes in company taxation, because not all investment incentives are included, because of the selective nature of investment grants, and because free depreciation is only an acceleration of writing down allowances.

Mr. Sheldon

asked the President of the Board of Trade what would be the cost during the current financial year of paying investment grants six months after the date of purchase of the equipment.

Mr. Mason

The cost would be approximately £190 million but it would not in fact be practicable during the current financial year to pay grants within six months of the relevant investment expenditure.