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Industrial Development Act 1982

Volume 201: debated on Wednesday 15 January 1992

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To ask the Secretary of State for Trade and Industry if he will make a statement on the working of the Industrial Development Act 1982; and if he will make a statement.

A description of the way in which the powers conferred by the Industrial Development Act 1982 are exercised is contained in the statutory annual report. This includes details of financial assistance to industry.

Copies of the most recent report for the year ending 31 March are in the Library.

I am well aware of the contents of the report. Is the Minister aware that many of the schemes in the report now appear dated, as do the geographical definitions of the areas that can benefit? For example, in Wales, the micro-electronics scheme has provided only £100,000, for a total of £80 million spent on it. Moreover, selective regional assistance in Wales fell, from £80 million three years ago to only £50 million a year ago. Will the Government please review the workings of the Act and make them more effective?

The Act is already very effective because grants made under it are selective. We spend about £567 million on regional selective assistance in the public expenditure survey round, and I think that most people now accept that it has been more effective than the automatic grants made under the regional development grants system. Wales benefits greatly: about £124 is spent per taxpayer in the assisted areas there, compared with £82 in Scotland and £41 in England.

The hon. Gentleman also referred to the assisted area map. That map will be reviewed, as it is once every Parliament, at the beginning of the next Parliament.

Will my hon. Friend ensure that, in areas of Devon and Cornwall where unemployment reaches levels as high as those in similar areas of Scotland and Wales, similar benefits under the Industrial Development Act 1982 will be available, as they are not at present?

My hon. Friend is wrong—if he does not mind my saying so—in the way in which he phrases his question. Regional selective assistance is equal wherever it is applied for in Great Britain, although the limits for Northern Ireland are higher. A large part of Cornwall is covered by assisted areas. The assisted area map may well change after the general election, but I can assure my hon. Friend that we ensure absolute fairness between assisted areas and that no one area is disadvantaged or advantaged in relation to the others.

Is the Minister aware that, after the general election, the assisted area map will change because the Government will change, and that changes are necessary? For instance, in the county of Northumberland, we have an assisted development area pattern that runs from east to west—to areas such as Ponteland and Darras Hall, a huge executive residential estate which does not want or require industry. The industrial pattern runs from the south-east to the north of the county and the assisted area pattern ought to be changed to reflect the needs of the county as a whole. The industrial pattern in Northumberland runs from the south-east corner to the north—to the area represented by the hon. Member for Berwick-upon-Tweed (Mr. Beith). That pattern needs to be changed now, not after the general election, to reflect the needs of industry and the county.

The European Commission allows assisted areas to cover about 35 per cent. of the population. 'We are up against a ceiling and if we added new areas to the map, we should have to remove other areas. If we are to maintain confidence in the system, there is no point in our mucking around with the map several times in each Parliament. It is much better to have one review and to have it at the beginning of the Parliament, and that is exactly what we shall do. The assisted area map will change not because the Government will change but because circumstances have changed since the last review. We shall ensure that the map is drawn objectively.