HC Deb 03 April 1979 vol 965 cc598-9W
Mr. Hordern

asked the Chancellor of the Exchequer if he will give an estimate of the cost to the Exchequer of allowing the present building allowances given to manufacturing industry to be extended to commercial investment in (a) all inner cities and development areas and (b) inner cities only.

Mr. Denzil Davies

The cost of a 50 per cent. initial allowance for new capital expenditure incurred on the cost of all commercial buildings after 5 April 1979, together with annual writing-down allowances on this expenditure at 4 per cent. is estimated on the basis of the current level of expenditure to be approximately as follows:

All inner city* and assisted areas
£ million
1979–80 negligible
1980–81 150
1981–82 300
1982–83 350
Inner city areas only
£ million
1979–80 negligible
1980–81 70
1981–82 130
1982–83 150
* The 43 districts designated under the Inner Urban Areas Act 1978.

The annual cost would continue to rise until it reached an expected maximum of a little under £600 million after 20 years in the case of all inner city and assisted areas, and over £250 million in the case of expenditure only in inner city areas.