§ Mr. HepburnTo ask the Secretary of State for Trade and Industry what measures have been taken to promote the manufacturing industry within schools. [145120]
§ Jacqui SmithWe published the Government"s Manufacturing Strategy in May 2002—the first such strategy for 30 years—which we developed in partnership with industry, trade unions and other stakeholders, following a summit meeting on the challenges facing manufacturing held in December 2001. We are working closely with industry and other stakeholders to create a high value and high skill manufacturing sector that attracts young people as an exciting and innovative area of work.
We are supporting a number of key initiatives in order to promote the manufacturing industry within schools. For example, SETNET (The Science, Engineering, Technology and Maths Network) operates through a UK wide network to encourage young people to take an interest in these areas, and to understand the opportunities that a career in industry can offer.
117WMany of the new Sector Skills Councils are also helping to promote careers in manufacturing. For example, SEMTA—the Sector Skills Council for Science, Engineering and Manufacturing Technologies—runs several schemes to promote careers in industry to young people, including an Engineering Careers Information Service.
Advantage West Midlands and the West Midlands Manufacturing Advisory Service are working in collaboration with the Manufacturing Foundation to support the Inside Manufacturing Enterprise regional company visit programme, which gives both businesses and schools access to some of the best manufacturing and engineering companies in the West Midlands.
§ Mr. Stephen O'BrienTo ask the Secretary of State for Trade and Industry what assessment she has made of the change in manufacturing sector investment over the last five years; and if she will make a statement. [143425]
§ Ms HewittGovernment's Manufacturing Strategy, published in May 2002, identified the UK's longstanding weakness in investment as a key factor for the gap with our main competitors in manufacturing productivity. Manufacturing investment has declined from £20.4 billion in 1998 to £14.6 billion in 2002, due in part to weakness of external demand, spare capacity and increased uncertainty about the prospects for the global economy. It is also the case that UK manufacturing investment is cyclical with respect to the UK economy. The accelerating economic growth currently being experienced by the UK is likely to engender stronger manufacturing investment, albeit with a lag. This is consistent with the CBI's November 2003 forecast (Economic and Business Outlook) that UK manufacturing investment will grow by 0.8 per cent. in 2004 and 4.8 per cent. in 2005.
The Government are taking action to provide a climate conducive to investment for the long-term in UK manufacturing, by maintaining a stable macroeconomic framework, together with measures such as reforming capital gains tax; making permanent enhanced capital allowances for small and medium sized firms; introducing the R&D tax credit for small and large firms; establishing Regional Venture Capital Funds; and extending the Small Firm Loan Guarantee.
The Pre-Budget Report contained a number of announcements that further build on this, including: measures to overcome barriers to raising finance for small business, notably a pathfinder round of Enterprise Capital Funds and proposed enhancements to Venture Capital Trusts and the Enterprise Investment Scheme. It also announced a new, clearer and more accessible R&D tax credit definition and extension of the scope of qualifying costs.
§ Mr. Stephen O'BrienTo ask the Secretary of State for Trade and Industry what assessment she has made of the impact that changes in manufacturing investment will have on the competitiveness of UK businesses. [143428]
§ Ms HewittThe Government's Manufacturing Strategy, published in May 2002, has identified the UK's long-standing weakness in investment as a key118W factor for the gap with our main competitors in manufacturing productivity. Manufacturing investment has declined from £20.4 billion in 1998 to £14.6 billion in 2002, due in part to weakness of external demand, spare capacity and increased uncertainty about the prospects for the global economy. It is also the case that UK manufacturing investment is cyclical with respect to the UK economy. The accelerating economic growth currently being experienced by the UK is likely to engender stronger manufacturing investment, albeit with a lag. This is consistent with the CBI's November 2003 forecast (Economic and Business Outlook) that UK manufacturing investment will grow by 0.8 per cent. in 2004 and 4.8 per cent. in 2005.
As explained in the UK Productivity and Competitiveness Indicators 2003, investment is one of the five key drivers of productivity and thus competitiveness identified by the Government. Investment in physical plant, machinery and buildings helps make workers more productive and is a way of embodying new technology in the production process. As such, investment is vital to manufacturing's long-term prosperity and the Government are committed to creating an environment where such investment can flourish. That is why the Government have reformed the macro economic framework and are undertaking extensive reform of the product, labour and capital markets. For example, in terms of capital markets, the Government have reformed capital gains tax; made permanent enhanced capital allowances for small and medium sized firms; introduced the R&D tax credit for small and large firms; established Regional Venture Capital Funds; and extended the Small Firm Loan Guarantee.
The Pre-Budget Report contained a number of announcements that further build on this, including: measures to overcome barriers to raising finance for small business, notably a pathfinder round of Enterprise Capital Funds and proposed enhancements to Venture Capital Trusts and the Enterprise Investment Scheme. It also announced a new, clearer and more accessible R&D tax credit definition and extension of the scope of qualifying costs.