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Manufacturing Growth

Volume 523: debated on Tuesday 8 February 2011

The independent Office for Budget Responsibility is responsible for the official economic and fiscal forecast. Returning the UK to sustainable economic growth is the Government’s overriding priority. This includes a strongly performing manufacturing sector. The Chartered Institute for Purchasing and Supply’s purchasing managers’ index for January showed the manufacturing index at a record high. This was accompanied by a rapid increase in manufacturing outputs and the fastest growth in new orders in the survey’s history.

The closure has been announced of the bathroom manufacturer Ideal Standard, which is based in Middlewich in my constituency. Middlewich is a feisty town, as are its people, who want to rise to the challenge that this news presents. What support and resources can the Government provide to enable the people of Middlewich to help themselves to create jobs, develop new industries and go for growth?

My hon. Friend has a great deal of expertise in the business world. In the longer term, it is vital that we get the fundamentals right and have sustainable public finances, and the Government are pursuing policies that will favour growth. In the short term, obviously her constituents have our sympathy. Jobcentre Plus is able to provide a rapid response service in those areas, and I am sure that it will be acting closely with her constituents.

A firm in my constituency manufactures parts for motorbikes, and it plans to move into the full production of motorbikes, so why have the Government decided to cut investment allowance, which will hit firms that are trying to make such moves? How can there be growth with policies that undermine manufacturing?

We announced in the June Budget corporation tax reductions that will benefit all sectors, including manufacturing. As we can see, so far manufacturing is doing well. Of course, we cannot be complacent, but the early signs are that our policies are helping.

I want to ask the ministerial team which piece of recent data they find most interesting: the record level of manufacturing activity, the rebound in consumer confidence or the endorsement by the Institute for Fiscal Studies of this Government’s economic policy in paying off the previous Government’s debt?

It is absolutely clear that this Government are on the right course. There are some encouraging signs, but none the less we must stick to the course. The early indications are, in manufacturing in particular, that that sector of the economy is growing well.

We share the Government’s desire for a strong manufacturing sector, hence our disappointment at Pfizer moving overseas and the Government’s failure to support Sheffield Forgemasters. According to today’s Financial Times, the Deputy Prime Minister, despite his dismal track record on Forgemasters, is leading the drive for more bank lending to small and medium-sized enterprises to secure regional economic growth. Who is now in charge of growth policy? Is it the Chancellor or the Deputy Prime Minister?

It may come as a surprise to Opposition Members, but an entire Government are capable of working together. That was not the experience when the Treasury was being run by the current shadow Chancellor.