§ Mr. Geoffrey Robinsonasked the Secretary of State for Trade and Industry if he will increase the level of his Department's assistance to the electronics components industry to respond to the report by the National Economic Development Office's electronics components committee; and if he will make a statement.
§ Mr. PattieThe Electronic Components EDC, in its report to the National Economic Development Council on 5 December, provided a useful view of the electronic components industry. There is much in the conclusions and recommendations, particularly on integrated circuit manufacture in the United Kingdom, which my Department would support.
The report underlines the importance of integrated circuits, especially those designed to meet individual applications, and the connection between a strong bases in this area and a sound and competitive electronics industry. While the United Kingdom's integrated circuit industry has improved markedly in recent years, with the encouragement of Government support, the competition is also growing fast, on average between 20 and 25 per cent. yearly. My Department accepts that the United Kingdom's growth rate in production of integrated circuits must at least reflect worldwide growth, and the prime objective of the £120 million microelectronics industry support programme (MISP 2) has been to aid this development.
The EDC recommends an increase in the United Kingdom annual investment in electronics to £400 million and that additional funds and a higher level of grant are needed to achieve this.
I informed the House on 12 November that the demands on Government support for research and development have increased over recent years and that the 1985–86 allocation for innovation grants is now virtually committed. I therefore decided to review the balance of this support and announced that no further applications would be accepted while the review is being undertaken. MISP 2 is included within this review.
The Electronic Components EDC's findings and recommendations will be considered carefully by my Department and will be taken into account in the review. I undertook to report to the council in six months on the recommendations and how they may be implemented.