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Engineering Investment Scheme

Volume 22: debated on Monday 26 April 1982

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asked the Secretary of State for Industry how many small firms he expects to benefit from the small engineering firms investment scheme.


asked the Secretary of State for Industry what response there has been to the new small engineering firms investment scheme for small firms in the Midlands.

Interest in the scheme has been very high and 397 applications for assistance have already been received. The average project cost to date is about £50,000. On this basis, at least several hundred small firms will benefit. A large number of these applications have originated in the West Midlands.

I congratulate my hon. Friend on his answer and on this latest example of Government assistance to small businesses. Will he undertake to look carefully at giving greater publicity to the scheme, given the time limit, so that other companies that may be eligible do not miss out on the chance of the grant?

We have done much already to market the scheme both in terms of general publicity and in sending leaflets direct to 4,000 small engineering firms. The remarkably high rate of applications within the three weeks since the scheme began shows that we are getting the message through. The scheme is organised on the basis of "first come, first served". The fact that so many people have already applied should serve as a warning to others to make their applications as quickly as possible.

Are not those schemes desperately needed because of the appalling decline in the engineering industry as a result of the Government's policies? Is the Minister aware that the engineering industry in West Yorkshire has lost one in four jobs since the Government came to office, which is the most significant loss next to job losses in clothing and textiles in West Yorkshire? What is being done to help the engineering industry in Yorkshire as part of the progress that has been reported?

Part of the problem was the lack of sufficient investment in a number of small engineering firms before the Government came to office. The worldwide recession has compounded that problem in the sense that those firms do not have the resources to make investment in advanced capital equipment. That is why we have introduced this generous scheme. It is available in Yorkshire and Humberside, where already about 34 firms have applied.

I congratulate my hon. Friend on what he has said. Is he aware that many of the problems associated with small engineering companies are related to the cut-off level of the temporary short-time working compensation scheme being for 10 or more employees being made redundant? Will my hon. Friend consider whether there is a chance of reducing that cut-off level?

That is a matter for my right hon. and hon. Friends in the Department of Employment. They have reviewed that point, but the decision was made not to lower the cut-off level, because of administrative difficulties. However, I shall draw my hon. Friend's comments to the attention of the appropriate Ministers in the Department of Employment.