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?
I note my hon. Friend's views. I shall certainly look into the matter.
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.