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Industrial Investment

Volume 975: debated on Monday 10 December 1979

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asked the Secretary of State for Industry whether he is satisfied with the current level of industrial investment; and if he will make a statement.

No. But the way in which many firms use existing investment is equally disappointing.

Is the Minister aware that Scottish industry will be starved of investment because of the Government's decisions to cut the budget and powers of the Scottish Development Agency and to withdraw development area status from many places where unemployment is still too high? Does he realise that we need more, not less, public investment, especially since the ending of exchange controls will shift more private investment out of the country?

Questions concerning the budget for the Scottish Development Agency are matters for my right hon. Friend the Secretary of State for Scotland.

Does my hon. Friend accept that, with minimum lending rate at 17 per cent. and, therefore, industrial borrowing 3 or 4 per cent. higher, there is an even greater need—if we are to get on top of inflation so that interest rates can come down—for the trade union movement to back Government policy in cutting public expenditure and not oppose it?

My hon. Friend is right. The low level of productivity and the consequent low level of sales in this country are caused by a number of circumstances, not least lack of incentives, inadequate management and restrictive practices, all of which have played their part.

Will Conservative Members, who seem to have a balance-sheet mentality in relation to industry, accept that their policies have been entirely loss-making? In those circumstances, will the Minister give an assessment of how long this loss-making white elephant of a Government will continue?

The Government's first target of cutting inflation at its sources will be followed by a second one of helping the creation of many thousands more businesses, which will create sufficient wealth that, by the time of and after the next election, we shall have another Conservative Government?