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Engineering

Volume 960: debated on Friday 15 December 1978

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asked the Secretary of State for Industry if it is his assessment that the most competitive sections of the engineering industry are actually those where the investment rate is lowest.

A recent report by Sussex European Research Centre, which my Department is studying, has drawn attention to a statistical relationship of this sort. The report concludes tentatively that it is the less capital-intensive branches of the engineering industry which show the strongest relative trade performance. It remains my assessment, which is quite consistent with these findings, that a high level of investment properly directed can contribute significantly to international competitiveness.

asked the Secretary of State for Industry (1) what specific action his Department is taking to help Great Britain's engineering industry to win back a larger share of its home market;(2) what specific action his Department is taken to arrest the decline in competitiveness of Great Britain's engineering industry.

The aim of the industrial strategy, which was launched by the National Economic Development Council in 1975, is to reverse the long-term decline in the performance of manufacturing industry and to create an efficient, profitable and internationally competitive industrial base. Effort is being concentrated on 40 key sectors for which sector working parties have been set up under the aegis of the NEDC. The engineering industry is at the heart of this effort. Most sectors of mechanical and electrical engineering are covered by SWPs. The Government have acted positively in response to the recommendations in SWP reports.Furthermore, a range of incentives designed to encourage greater efficiency and competitiveness in British industry is provided by the Government through various schemes of selective financial assistance under section 8 of the Industry Act 1972. Several industry schemes relate to specific sectors of the engineering industry. In addition, companies within the sector are eligible for support under the product and process development scheme. Sector working parties have also identified the need for improved customer-supplier links as the key to effecting import substitution. Many SWPs are now in contact with other SWPs representing their customers and suppliers.