§ Mr. HardyTo ask the Chancellor of the Exchequer (1) by what proportion investment in manufacturing industry fell in the second half of 1988 and in the first half of 1989; and if he is able to provide an estimate of the change in investment in the second half of 1989;
(2) what was the level of investment in manufacturing industry in 1989 and 1979.
§ Mr. Norman LamontExpressed at 1985 prices, investment by manufacturing industry in fixed assets including leasing, is estimated to have been £12 billion in 1989, compared to £11.2 billion in 1979.
Such investment seasonally adjusted barely changed between the first and second halves of 1988. The first half of 1989 showed an increase of 6 per cent. followed by a fall in the second half provisionally estimated to be 1 per cent.
§ Mr. HardyTo ask the Chancellor of the Exchequer if he will estimate the proportion of capital investment in the service sector which has been devoted to the importation of goods and materials.
§ Mr. Norman LamontThe latest year for which it is possible to compile estimates of the import content of investment is 1985, the last year for which comprehensive input-output tables exist.
The import content of purchases calculated in the process of compiling the input-output tables is based upon approximate commodity flow methods—there is no statistical inquiry which establishes the import content of capital investment directly. The cases of goods and materials including and excluding vehicles, ships and aircraft (VSA), and capital investment including and excluding investment in new buildings and works (NBW), are given in the table.
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Capital investment of the Services sector including NBW Per cent. excluding NBW Per cent. Import content from goods and materials (including VSA) 18 47 Import content from goods and materials (excluding VSA) 13 35
§ Mr. HardyTo ask the Chancellor of the Exchequer (1) in what sectors of commerce and industry investment was higher in 1989 than 10 years earlier;
(2) what was the level of investment between 1979 and 1989 in those areas of industry and commerce in which there is or was public involvement and in those which are wholly within the private sector.
§ Mr. Norman LamontThe latest estimates of gross domestic fixed capital formation, by industry (other than manufacturing), may be obtained from the CSO databank —a collection of macroeconomic time series in computer readable form to which the House of Commons Library has direct access. For manufacturing, figures up to end 1989 were published by the CSO in a press notice "Capital Expenditure: Provisional Estimates for Q4 1989" on 15 February. The latest estimates of investment by other industries cover the period up to end 1987 or, where possible, 1988. The estimates cover investment by the private sector, and, where appropriate, include investment by public sector bodies. The CSO's "United Kingdom National Accounts", 1989 edition, shows which industry estimates are available.
§ Mr. HardyTo ask the Chancellor of the Exchequer what proportion of companies investing in the United Kingdom are wholly owned by Japan or the United States of America; and what is the ratio of investment by these companies to that by companies which are in United Kingdom ownership.
§ Mr. Norman LamontThe available information relates to capital expenditure on fixed assets by manufacturing companies based within the United Kingdom. The annual census of production provides such an analysis by country of ownership. The latest follows:
Net capital expenditure by manufacturing companies2 in the United Kingdom by country of ownership1 Net capital expenditure in 1987 Country of ownership Number of businesses £ million as percentage of United Kingdom United States of America 1,161 1,180.1 16 Japan 34 86.7 1 All other foreign owned businesses 1,088 722.3 10 United Kingdom owned business 143,210 7,339.7 100 Total 145,493 9,328.8 1 Foreign owned business are defined as those controlled or owned by companies incorporated overseas. 2 Divisions 2–4: Standard Industrial Classification, Revised 1980.
§ Mr. Martyn JonesTo ask the Chancellor of the Exchequer if he will estimate for 1990–91, assuming no748W change in company behaviour and assuming a 50 per cent. increase in investment in plant and machinery (a) the capital allowances claimable by companies in respect of plant and machinery assuming that first year allowances of: (i) 50 per cent., (ii) 40 per cent., (iii) 35 per cent. and (iv) 30 per cent. were available, (b) corporation tax payments forgone in 1991–92 as a result of such claims and (c) the increase in the rate of corporation tax which would be required to replace the revenue foregone under (b).
§ Mr. Lilley[holding answer 7 March 1990]: I regret that the requested estimates could be provided only at disproportionate cost.
§ Mr. Martyn JonesTo ask the Chancellor of the Exchequer if he will publish a breakdown for table 8.7 of Inland Revenue Statistics 1989 of capital allowances described as other, giving figures separately for each type of allowance subsumed in this heading.
§ Mr. Lilley[holding answer 7 March 1990]: The only breakdown of these capitial allowances that can be reliably estimated is provided in tables 8.8 and 8.9 of "Inland Revenue Statistics 1989" and in similar tables in earlier editions.