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Volume 22: debated on Monday 26 April 1982

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Robot Support Programme


asked the Secretary of State for Industry how many firm applications have now been submitted under the Government's robot support programme.

Since April 1981 there have been 97 firm applications for assistance under the scheme. In addition, the Production Engineering Research Association has undertaken 54 robot consultancy studies.

I thank my hon. Friend for that information. Does he agree that in the long term the best way to ensure the regeneration of British industry, and therefore to create more jobs, is to introduce more modern methods, such as robotics? Does he therefore agree that nobody on either side of industry need fear the introduction of those techniques?

Yes, I do. I have made it clear many times that British industry will be competitive for the rest of the century only if it embraces the new technologies. I am glad that this scheme has been so successful.

British Leyland


asked the Secretary of State for Industry when he last met the chairman of British Leyland to discuss investment in the industry.

My right hon. Friend the Secretary of State and I meet the chairman of BL, whenever the need arises, to discuss a variety of topics.

Is the Minister aware that in the West Midlands male unemployment is now almost one in five and that one in six jobs are dependent on the vehicle industry? What will the Minister do to reassure industrialists and workers alike in the West Midlands that the vehicle industry will not be destroyed?

I am fully aware of the employment implications of the hon. Gentleman's questions. The Government have shown their willingness to support the motor industry and British Leyland in particular. We have put £970 million into British Leyland since coming to office. Nobody can say that the Government have not made a strong commitment to the motor industry.

Is my hon. Friend aware that British Leyland now requires to maintain and increase its market share? With respect to the hon. Member for Newcastle under Lyme (Mr. Golding), British Leyland wants more customers, not more speeches.

I entirely agree. Last year British Leyland managed to increase its market share above what it had planned. New models have been introduced and the response both to the Metro and the Acclaim has been encouraging. Productivity is rising sharply in British Leyland, and at Longbridge, on the Metro line, it is comparable to the best in Europe. British Leyland's future will be secured by its becoming competitive.

Has the Minister discussed with British Leyland the question of buying British? I noted what the Secretary of State said the other day about buying British. It is proposed that British Leyland may buy steel from Brazil. That would be very much against the interests of our steel industry. Is there not a policy for nationalised industries to buy British?

The right hon. Gentleman knows that there is a Government public purchasing policy. British Leyland is well aware of that. The buying power of the public sector should be used to strengthen British industry. That is the Government's objective, although relations between the British Steel Corporation and British Leyland are a matter for commercial negotiation. We have certainly made the Government's public sector purchasing policy clear to BL.

Is my hon. Friend aware how much the taxpayer resents paying large sums into British Leyland when certain parts of it could be divested and financed privately? That particularly applies to the Land Rover part of the group. Has my hon. Friend plans to ensure that that is sold off in the reasonably near future?

My right hon. Friend the Member for Leeds, North-East (Sir K. Joseph), the former Secretary of State for Industry, made it clear in his statement on 26 January 1981 that the Government supported British Leyland's intentions to create viable businesses and to attract private capital into them. That remains the Government's intention.

Regional Development


asked the Secretary of State for Industry whether he will take fresh initiatives to aid the regional development of industry.


asked the Secretary of State for Industry whether he proposes to take any additional regional policy initiative in view of the serious and continuing unemployment figures in the United Kingdom; and if he will make a statement.

The most effective stimulus to regional industrial development will be for British industry to continue the improvements in performance which our economic policies are encouraging. Beyond that our regional industrial policy is intended to concentrate the available assistance on those areas that are worst affected.

Is it not about time that there was a reversal of the deplorable decision taken by the previous Secretary of State for Industry? He reduced the development area status of many areas, including the Stirling travel-to-work area. That area is now faced with the proposed closure of the Player's factory as well as with job losses at Stirling university as a direct result of the Government's policy. Will the Secretary of State now consider restoring Stirling's development area status and uprating Denny to special development area status, because unemployment there is now higher than 30 per cent.?

Although unemployment in Stirling is regrettably high, it is not as high as in the assisted areas as a whole. Therefore, I cannot see a strong case for restoring development area status. However, Stirling will remain an intermediate area after the changes that come into force next August.

With tens of thousands of school leavers footloose on the streets, and nearly 1 million long-term unemployed, does not the right hon. Gentleman's regional policy look hesitant and unconvincing? Does he know that the deprived regions have so little confidence in his policies that several of them are competing for the proposed Nissen car project? What can he tell us about that project?

I have a feeling that there would be a good deal of competition for the Nissan car project—if that company decided to come to Britain—whatever the level of unemployment. All the evidence suggests that the impact of regional policy on the creation of jobs is more effective if it is concentrated on the areas of greatest need. On the whole, regional policy was more effective in the 1960s, when it was fairly narrowly based, than in the 1970s, when it covered, towards the end, more than half the country and almost 40 per cent. of the working population. The decisions announced in July 1979 by my right hon. Friend the present Secretary of State for Education and Science were designed, once again, to concentrate help on the areas of greatest need.

Is my right hon. Friend aware that one way of helping the regions is to help enterprise agencies such as the one called "Make Lancaster Your Business", which is anxious to be granted approval so that contributions from companies will be granted tax relief? Is my right hon. Friend in a position to say when he will announce his Department's criteria for such approval?

Help for enterprise agencies is not confined to the regions. The decision to give tax relief was widely welcomed at the time of the Budget. My Department will be responsible for giving approval and it is working on the criteria. I hope to be able to give some information on that fairly soon.

How can the Secretary of State claim that regional policy has been more effective in the past two years during which it has been more accurately pinpointed, when more jobs have been lost in the past two years than were created in 10 to 15 years of positive regional development policy? Does he realise that unemployment now stands at 20 per cent. in the areas of the Sedgefield and Wear Valley district councils? If the closure of the British Rail works goes ahead unemployment will increase to 30 per cent.

I think that the hon. Gentleman has misquoted me. Of course unemployment has risen everywhere during the deepest recession for 50 years. Although it is notoriously difficult to ascribe any change in the level of employment to any particular measure, there is broad agreement that, on the whole, measures are more effective if they are concentrated on the areas of greatest need instead of regional help being spread too thinly across the whole country.

Although I accept that regional aid should be given to the areas of greatest need, is my right hon. Friend aware that in Grampian and in my constituency of East Aberdeenshire unemployment is rising very quickly because oil and gas constructional work and the indigenous industries are suffering as work has come to an end and there is no alternative employment? Will he take steps to alter what his predecessor did in removing the assisted area status of Grampian region, and particularly that of East Aberdeenshire?

My hon. Friend will know that we undertook to review areas in which there was a two-step change in the assisted area status. That review is in hand and I hope to announce the results later in the spring. We have also been looking—as I think the House knows—at some of the other areas in which circumstances have changed substantially and beyond the normal trends of the recession. I hope to announce those changes at the same time.

What are the industrial improvements of which the right hon. Gentleman spoke in his initial reply, and how have the Government's regional policies brought them about? Surely the most hard-hit regions in Britain have the highest unemployment of any regions in Western Europe. That is a direct result of Government policy.

Those industrial improvements consisted of last year's 10 per cent. increase in productivity, the reduction in the growth of unit labour costs from 25 per cent. a year ago to 2·5 per cent. according to the latest figures—a remarkable change—and our increased competitiveness, which is helping us to win substantial contracts overseas. That will restore the health of British industry.

British Steel Corporation


asked the Secretary of State for Industry when he last met the chairman of the British Steel Corporation to discuss the corporation's corporate plan.


asked the Secretary of State for Industry when he last met the chairman of the British Steel Corporation to discuss the corporation's external financing limits.

My hon. Friend the Minister of State, Department of Industry met the chairman of the British Steel Corporation on 30 March. They discussed a range of questions arising from the BSC's new corporate plan for 1982–85, including the external financing limit for 1982–83.

As there has been considerable speculation about whether the BSC will meet its targets for the current year, will the right hon. Gentleman make the exact position clear? If the corporation does not meet its targets, what are the implications for the external financing limits and employment?

In 1981–82 the BSC hopes to live firmly within its external financing limit. However, as the hon. Gentleman knows, there are a number of considerable uncertainties in the current year and the BSC has brought them to the attention of my hon. Friend the Minister. I refer, for example, to American markets, to anti-dumping and countervailing duty cases, and to the future of the prices regime in Europe. Until those matters are clear, we cannot be certain about the extent to which the BSC can meet its targets.

Given the corporation's present circumstances, does it make sense for it to sell a significant asset, Redpath Dorman Long, which has a full order book for what appears to many people to be a knock-down price? Will not the sale to Trafalgar House create a monopoly in the private sector? Is it not another example of the way in which the Government give away taxpayers' assets at ridiculously low prices?

The hon. Gentleman knows perfectly well that the disposal of non-mainstream activities by the corporation is a matter for the BSC. It did not require the Government's consent and was a matter for its management. If the hon. Gentleman wishes to substitute his judgment about the value of RDL for that of Mr. MacGregor and his extremely experienced board, he must take responsibility for that. The price was agreed between the seller and the buyer and the advice of merchant banks was taken about the appropriate figure, given RDL's profit record.

With the greatest respect to the hon. Gentleman, this sale has nothing to do with Amersham International. It is a straight sale by BSC of a non-steel making activity. It is entirely appropriate that the BSC should finance part of its development by disposing of assets that are saleable in the market.

Manufacturing Output


asked the Secretary of State for Industry if he will give the latest 12-month figures available of the increased percentage in output per head in manufacturing industry and the same information relating to nationalised industries.

Output per head in manufacturing industry increased by some 10½ per cent. between the fourth quarter of 1980 and the fourth quarter of 1981, the latest period for which figures are available. Aggregated figures for the nationalised industries, many of which do not form part of manufacturing industry, are not compiled.

May I congratulate my hon. Friend on his appointment and wish him well in his important responsibilities? May I welcome his answer and ask whether he agrees that increased output leads to the greater likelihood of increased investment in industry, which in turn leads to better job prospects and the prospect of new jobs and to higher wages for all employees in industry?

My hon. Friend is absolutely right, and I thank him for his kind remarks. There is a benign relationship between productivity, profit and investment, and the regeneration and recreation of jobs that are soundly based on productivity.

May I add my congratulations to my lion. Friend on his well-deserved appointment? Notwithstanding the welcome increase in output announced by my hon. Friend, does he agree that it is imperative that the increase should continue if British industry is to remain competitive, prevent import penetration and resecure many of the overseas markets lost during the years of uncompetitiveness?

The problems with which the Government are currently wrestling are both long-standing and deep-seated. I agree wholeheartedly with my lion. Friend's observations, and I assure him that the improvements that he has outlined will be sought by the Government, especially in the public sector.

Is the Minister aware that average productivity will rise if every firm, except the most productive, is driven into bankruptcy?

That is rather a simplification of economic objectives. Output increases genuinely when a fixed number of workers produce an enhanced amount of output for the same input. I hope that the hon. Gentleman, when he joins us in debates, especially on British Telecom, will agree with that assertion and that we shall be working on the same side to achieve that objective.


asked the Secretary of State for Industry if he is satisfied with the rate of recovery of output from British manufacturing industry.

No. Much obviously depends on the world-wide recovery from the international recession. It is, however, encouraging that between the first half of last year and the second half manufacturing output increased by 2·5 per cent.

In view of the Minister's reputation for fairness, does he accept that output in the manufacturing industry is lower than when the Government first took office and lower than it has been for the past 14 years? Does he accept that his Department has reigned over the destruction of the base of the British manufacturing industry and the addition of 2 million or 3 million people to the dole queue?

Manufacturing output is lower, but the hon. Gentleman—who is also very fair—must acknowledge that that is true of most parts of the world. No doubt he will have seen, according to press reports last Friday, that the Conference Board, a distinguished American body, has concluded that a world recovery may be shaping up—and that Japan, Britain and France are in the vanguard of that recovery. It is significant that Britain is singled out as being in the vanguard. It is certainly the case that manufacturing output is higher now than it was in the spring of 1981.

Does the Minister agree that it will help to increase manufacturing output if. we attract overseas investment? Will he explain how Wales, with a population and rate of unemployment similar to the Northern region, has a budget four times that of the North of England Development Council for industrial promotion?

Manufacturing output and, often, productivity are enhanced by inward investment, and the United Kingdom has been successful in that. There is a separate question on the order paper on the point that the hon. Gentleman has raised, but it is important to bear in mind that 90 per cent. of all American investment has been attracted here by central Government activity, mainly through the Invest in Britain Bureau and the overseas diplomatic posts.

Does my hon. Friend agree that in some industries, such as the whisky industry, where there is over production, if management and workers apply themselves, increased sales can be obtained and increased profits can be achieved, such as was done by Arthur Bell and Sons?

I entirely agree with the general point. What is most important about the way in which improvements are now showing in the British economy is that they are concerned with fundamental problems such as that to which my hon. Friend drew attention. It is significant that in the last quarter of last year output per man hour in manufacturing industry reached a record level and was more than 6 per cent. higher than the average for 1979—the previous best. In many other ways there are improvements on the shop floor and between management and work force, which is where improvement is needed if we are to sell our products.

What hope does the Minister have for the recovery of the pottery industry? Three more firms in my constituency have closed during the past few months and unemployment is serious. We need ministerial intervention. May we have that as soon as possible and then some Government help?

The Government give assistance in many ways, not only through tax reliefs for capital investment, but with schemes designed to improve economic performance and competitiveness. If the right hon. Gentleman wishes to contact me about the prospects for the pottery industry I shall endeavour to answer his questions.

Does the Minister agree that the fall in output in manufacturing industry since 1979 has been 14 per cent., and that both the CBI and the TUC see no longterm propects for that industry? What will the Government do about employment and the manufacturing sector?

The important points are that manufacturing output is again rising and that many of the changes are highly beneficial for our future competitiveness. My right hon. Friend referred to unit labour costs, but industrial stoppages are at their lowest for 40 years. The most hopeful sign for the future is that we are tackling our fundamental problems.

British Leyland


asked the Secretary of State for Industry if he will make a statement on productivity in British Leyland.

I refer my hon. Friend to the answer that my right hon. Friend the Secretary of State for Industry gave to my hon. Friend the Member for Birmingham, Selly Oak (Mr. Beaumont-Dark) on 22 February 1982. I have nothing further to add.

Will my hon. Friend confirm that the production of the British Leyland Metro has increased from 7·7 per man-year in 1980 to 22 per man-year in 1982? Is not this welcome improvement due to more flexible working practices, less rigid demarcation lines, a more determined management and a more realistic attitude on the shop floor?

All those improvements have occurred at British Leyland, especially at the Longbridge plant. My hon. Friend will be interested to know that British Leyland generally had a 30 per cent. increase in productivity during the past year, but almost a 100 per cent. increase at the Longbridge plant, which must be welcomed.

Does my hon. Friend accept that British Leyland productivity has failed to increase during recent years because of the lack of a market? Does he welcome the reports that that market will lift off, and will he do everything possible to ensure that British Leyland increases its share of the market in these difficult times?

Within the confines of decisions that can be made at Department of Industry level, we shall do everything that we can to ensure that British Leyland's corporate plan and its plans for commercial vehicles receive all due support. We look forward to the commercial division achieving its targets when demand returns.

Information Technology Advisory Panel (Report)


asked the Secretary of State for Industry what action the Government have taken following the publication of the Information Technology Advisory Panel report.

I refer my hon. Friend to the statement made by my right hon. Friend the Home Secretary at the beginning of the debate on direct broadcasting by satellite and cable systems on 20 April 1982 and to my own speech in the same debate.

I thank my hon. Friend for that reply. How long will consideration of the ITAP report take?

Our aim—it is ambitious—is to conclude all discussions and consultations by the end of the summer and for Lord Hunt to report by 30 September. If we keep to that ambitious timetable we hope that, by the end of the year, we can announce the technical, regulatory and commercial framework that will allow cabling to become a reality.

Is the Minister aware that the Post Office Engineering Union has been disturbed to read of leaks that the Home Office intends to ignore the Department of Industry's desire to provide a modern system of cable and will patch up instead, in the interests of Visionhire and Rediffusion?

If the union has heard that, it has been listening to unfounded rumours. The technical nature of the cable system is very much in the hands of my Department. A committee is deciding whether it should be a copper or fibre optic system and I made our position clear during the debate. Some people have said that the Home Office is dragging its feet, but I do not agree with that assessment. The Home Secretary has given a clear steer to the Home Office and the decision on direct broadcasting by satellite shows the remarkable speed with which the Home Office is moving.

What steps is my hon. Friend taking in relation to information and production technology to discuss, for example, with my right hon. Friend the Secretary of State for Defence how he might best assist the British aerospace industry?

That question goes wider than the question that we are discussing. As regards the industrial input into the new cabling system, I made it clear to the House before that that will be the most exciting and important economic programme before the country over the next 10 to 15 years. We are discussing with British industry and with those who make cable and attachments that are put on to the cable system how they can plan and make arrangements so that British industry will benefit.

Is the Minister completely satisfied that a report made by a panel of interested parties can be a sufficiently realistic and objective report on which to base future progress?

People have schizophrenic attitudes towards the report. We could have done one of two things. We could have gone to business men and asked them to produce a report—which we have done—which is imaginative and challenging, but the report is essentially a consultative document. We could have gone to the Government and asked for a report that put half a dozen reasons on one side and half a dozen on the other, only to be rightly criticised as being dull and unimaginative. We have produced a discussion document which we hope will allow cabling to start in this country in the reasonably near future.

Is the Minister aware that his decision on timing will be welcomed, but does he expect that there will be legislation in the next Session, or will it be delayed until the subsequent Session?

It is probable that, in order to establish a cable framework that will involve broadcasting as well as narrowcasting all the extra services—I emphasise that cable television is much more than extra television channels—legislation will be required.

Is my hon. Friend aware that we in Havering are looking forward to welcoming him to Romford this Wednesday morning when he opens the Havering information technology exhibition? Will he take the opportunity then to reconfirm that innovative industries such as information technology provide the opportunity for increased new employment rather than act as a source of increased unemployment, as is commonly feared?

I am looking forward to my visit to Romford on Wednesday morning. I hope that the citizens will be there in their numbers to greet me. I assure my hon. Friend that one of my main purposes in my various activities in information technology is to release and create job opportunities in Britain for that range of activity in electronics, computing, cable and telecommunications. It will be the fastest-growing area of economic activity for the next 10 years. We cannot afford to lose out on that.

By his answer to my hon. Friend the Member for Blaydon (Mr. McWilliam), has not the Minister conceded that the report is written by people with a narrow, vested interest and that it is a prejudiced report? Is not that the sort of evidence that is being put to the Government by wider representatives of British industry? On a practical note, if the report is so important, will the Minister arrange for it to be placed in the Vote Office so that hon. Members can have easier access to it?

Hon. Members have access to the report. It is a public document and has already gone into a second printing. I shall see whether it can be provided in the Vote Office. I disagree with the hon. Gentleman. The report was written by people who wanted something to happen. Therefore, there is an urgency about it. We have not accepted all its recommendations. The report is essentially a consultative document. I believe that it will he looked upon as historically important in the future.

Young Persons (Businesses)


asked the Secretary of State for Industry if he is satisfied that enough help is being given to encourage young people to start up in business on their own account.

We have taken various steps to encourage enterprise in young people. They are, of course, able to take advantage of the many measures available to stimulate and help small businesses. I am happy to consider any other suggestions that my hon. Friend or others may wish to put forward.

I thank my hon. Friend for that reply. Does he agree that we should do more to make more young people aware of the rewards of creating their own business? Will he liaise with the Departments of Education and Science and of Employment to see that proper instruction is given in schools and in the new youth training programme to make young people aware of the many possibilities and challenges of starting their own business?

I entirely agree with my hon. Friend. Much more is now happening. The Department has an industry education unit. We are currently working on a number of initiatives to encourage young people to think in terms of starting their own businesses. For example, there are films for showing in schools. I shall continue to liaise along the lines recommended by my hon. Friend.

Does the Minister agree that one of the best ways to help young people to set up their own business is to encourage the establishment of cooperatives? What lesson does he learn from the difficulties of the Breckland poultry co-operative in his constituency? Will he make further efforts to help that co-operative?

There is a place for co-operatives, but it must not be over-exaggerated. The lesson of the Breckland poultry firm is relevant. On Saturday afternoon I had a long meeting with those who are trying to get things moving. I have spent a great deal of time trying to help the co-operative. It has decided that it would like to proceed as a private firm, making use of schemes such as the business start-up scheme. I have written to the firm today advising it of other ways in which it can go forword.

Engineering Investment Scheme


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.

Confectionery Industry


asked the Secretary of State for Industry whether, in view of the effect of present levels of value added tax on the confectionery industry, he will seek to introduce a scheme to provide additional financial support for the industry.

The Government have no plans to introduce a scheme to provide additional financial assistance to the confectionery industry. This industry is eligible for the same range of Government support measures as the generality of manufacturing industry.

Will the Minister bear in mind that Rowntree Mackintosh, which is the largest employer in Halifax, and which has a proud reputation nationally and internationally, has been severely hit by value added tax and that, without urgent financial help, hundreds of jobs will be lost as a result of the Government's industrial and economic policies?

I shall certainly bear in mind what the hon. Lady said, but there is no evidence to suggest that the confectionery industry faces difficulties greater than those that the recession has caused for many industries. Obviously, regional grants in assisted areas and the normal sectoral schemes—product and process development schemes, and Science and Technology Act 1965 assistance—are available for that industry.

Manufacturing Industry (Investment)


asked the Secretary of State for Industry what was the level of investment in manufacturing industry in each of the last three years, at constant prices.

Including assets leased to manufacturers, at 1975 prices the figures are £4,439 million, £4,157 million and £3,602 million in 1979, 1980 and 1981, respectively.

Does my right hon. Friend agree that those figures provide evidence of a worrying decline in investment in manufacturing industry? Does he further agree that the decline in investment in manufacturing industry will have an adverse effect on our future competitiveness in world markets? Is there not a strong case, if the decline is to be reversed, for a substantial increase in domestic demand to persuade manufacturers that more investment is worth while?

I agree that the fall in investment is not welcome. I can take some comfort from the fact that it is not as great as the fall in the last recession, although this recession has gone very much deeper. In other words, firms have maintained a substantial part of their investment programmes. The signs now are that investment is turning the corner. I would expect there to be an increase in 1982 and a bigger increase in 1983. Those are the forecasts.

I am sure that the right stance now is to help to make industry more competitive and not necessarily to inject a substantial sum of additional demand into the economy. All the evidence suggests that that would lead to higher inflation, not higher output.

Is the Secretary of State aware that falling investment in manufacturing industry has meant the advent of depression for many communities in the Northern region, including the town of Maryport in my constituency, where unemployment is now nearly 30 per cent., following the latest redundancies from Spillers last week? Will the Minister introduce selective measures to help such communities to attract the investment that the general strategy of the Government has failed to provide?

Many of the firms making equipment for industry have looked overseas and have won some spectacular contracts in other countries, which have gone some way to replace the fall in business in the domestic economy. Many firms in the North of England and elsewhere have taken the opportunity substantially to increase their efficiency and productivity and to reduce their costs relative to those of their competitors. That is the way to win business both here and overseas.

Will my right hon. Friend seek to expedite the passing of the new draft regulations on the European regional development fund, which will be very much more effective and flexible than the present regulations and should help to increase investment in manufacturing industry and the all-important infrastructure to go with it?

Will the Secretary of State give the House the facts relating to increased investment? All the forecasts—not least from the CBI—are that investment is going down. Where is the evidence for his statement?

The right hon. Gentleman will be familiar with the forecasts, published at the time of the Budget, of my right hon. and learned Friend the Chancellor of the Exchequer. In the public sector, investment in new construction will be up by 14 per cent. this year over last, and investment by the nationalised industries will be up by 26 per cent. this year over last. Nationalised industry investment amounts to £½ billion—about one-third of it in British Telecom. The Government are playing their part. We want to see the higher levels of investment which are necessary to get industry moving.

North Of England Development Council


asked the Secretary of State for Industry when he expects to conclude his discussions with representatives of the North of England Development Council on the level of grant to be paid to the council for the three-year period 1983–85.

My hon. Friend the Minister of State had a useful meeting with the chairman and directors of the four English regional development organisations on 1 April, and we now hope to reach a decision quickly about the future level of grant.

What are the so-called constitutional differences which may lead to Wales and Scotland receiving a bigger grant than the North of England Development Council? Why will Wales receive its grant from April 1982, whereas the North of England Development Council will receive its grant from April 1983? We in the north strongly support the case for Wales and Scotland, but the Minister must be under no illusions. We in the north must receive similar treatment.

My hon. Friend the Minister of State made it clear that we are anxious that there should be reasonable equity of treatment between the different parts of the United Kingdom, but that does not mean identical amounts of grant, as other factors have to be taken into account. As I indicated in answer to an earlier question, 90 per cent. of successful United States inward investment projects come by way of United Kingdom central Government effort, through the Invest in Britain Bureau and overseas diplomatic posts.

Many English local authorities in new towns spend public money on overseas promotion, whereas Scottish and Welsh local authorities are not very active in that area. No new Government money is being given to the Development Commission for Wales. The money is being redirected from elsewhere within the Welsh Development Agency budget.

However much the Minister may wriggle, is it not clear that extra resources, which we welcome, have been given to Wales? Should not the critieria be the nature of the problems and the number of people out of work, not some constitutional excuse? Will not the people in the Northern region conclude that yet again the Government have taken a deliberate decision to damage their prospects?

Extra resources have not been given. As I indicated a moment ago, it is a change in the distribution of the WDA's budget. There is no extra central Government money, in the sense of new money, going for that purpose this year. It is just a movement within the budget itself.

The hon. Gentleman ought to be fair and recognise that a very high proportion of regional development grant, which is caused because of investment, goes to the Northern region. We expect nearly 4,000 jobs in the North-East to be created as a result of foreign-owned companies, known to the Invest in Britain Bureau, starling or firmly deciding to start during 1980 and 1981. Inward investment projects have been going to the Northern region. I assure the hon. Gentleman that the interests of that region are always borne in mind in all the activities concerning inward investment.

North-East Lancashire


asked the Secretary of State for Industry what representations he has received on development area status for North-East Lancashire; and if he has made a decision.

My right hon. Friend and I have received a number of representations urging development area status for North-East Lancashire. My right hon. Friend saw a deputation from the North-East Lancashire Development Association on 18 March, and he is giving its case careful consideration.

Is the Minister aware that, even since the Adjournment debate last Thursday, yet another firm in the Blackburn travel-to-work area, Mossbridge Yarns, has announced closure, and that there is no sign in North-East Lancashire of the recession coming to an end, let alone being over?

Is the Minister further aware that the travel-to-work areas of Blackburn, Hyndburn and Burnley have unemployment levels which, although not the average for assisted areas keeping their status, certainly come within the band of areas keeping assisted area status? Therefore, the case for assisted area status for our areas is overwhelming.

As the hon. Gentleman knows, we had a full Adjournment debate on the subject on Thursday evening, when I set out the criteria. We have always made it plain that we are prepared to look at any permanent changes in the structural decline of an area relative to other parts of the country. That would apply to North-East Lancashire as well as elsewhere. We shall continue to monitor the position.

Will the Minister examine closely the projected unemployment figures for the Accrington travel-to-work area of 19 per cent. and for the Hyndburn area of 16½ per cent.? If he accepts those figures, which have been worked out by the Hyndburn borough council, is not the case for granting development area status not just overwhelming, but unanswerable?

One must always be careful about projected figures as distinct from the real, existing figures. The situation can change considerably over the course of a few months. I have seen that happen in other travel-to-work areas. I believe that the hon. and learned Gentleman and representatives of the district council are to see me shortly. We can look at his projections then.