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Aerospace Engineering: Pendle

Volume 594: debated on Thursday 26 March 2015

1. What plans his Department has to support aerospace engineering in Pendle constituency over the next five years. (908332)

Government and industry are working together in the aerospace growth partnership to implement a long-term industrial strategy that benefits companies throughout the UK. This is backed by a £2 billion investment over seven years in aerospace research, and a £250 million sharing in growth supply chain improvement programme. ELE Advanced Technologies in Pendle is one company benefiting from that programme.

The aerospace sector is vital to Pendle’s local economy, and as vice-chair of the all-party group for aerospace I have been pleased with the level of support provided to the industry by the Government over the past five years. Although overall the aerospace sector across Pendle is doing well, Rolls-Royce has cut its work force at its two Barnoldswick sites. What more can my right hon. Friend do to support Rolls-Royce to maintain and expand its operations in Pendle?

Perhaps I may preface my answer by reflecting on the fact that I think I have held this job, or its equivalent, for longer than anybody in 60 years, and I thank everybody in the House for their interest in the affairs of the Department for Business, Innovation and Skills over those five years. I thank you, Mr Speaker, for your impartial oversight of our proceedings, but I will stop short of wishing everybody well in the forthcoming election.

The hon. Member for Pendle (Andrew Stephenson) is right to say that the aerospace sector is booming, and I think his constituency contains the headquarters of the North West Aerospace Alliance. He is also right to say that despite its considerable successes, his constituency has lost 100 jobs out of the 1,000 at Rolls-Royce. We are supporting Rolls-Royce in many aspects of the industrial strategy, and in surrounding constituencies such as Burnley there is unalloyed success with Aircelle’s recent big investment supported by the regional growth fund.

As in Pendle so in Derby great concern followed the Government’s plans for aerospace engineering, following the announcement by Rolls-Royce last year that 800 skilled engineering jobs would be lost in the UK. When many of us, including the Minister, met the company to discuss forward plans in November, did the Government know that Rolls-Royce would be recruiting up to 500 skilled engineers in Bangalore, and does he share my concern for what that implies for the long-term future for skilled jobs in the UK?

I have discussed Rolls-Royce’s long-term strategy with its chief executive on several occasions. We are well aware that it is a global company, and that to maintain its strength it invests internationally, including in India. It is also investing a great deal in the UK, and we work closely with it, not just in the aerospace sector. The talent retention scheme is ensuring that the vast majority of the unfortunate individuals who lost their jobs in the restructuring will be redeployed in high value jobs in the aerospace and related industries.

The aerospace industry is important not only to Pendle but to many constituencies in the United Kingdom. With that in mind I welcome the proposal to extend an enterprise zone to cover Manston airport, for aviation-related purposes only. I hope that the Secretary of State will feel able to give every possible encouragement to reopen the airport so that we can take advantage of that.

I am pleasantly surprised that somebody from the south-east is arguing for an expansion of airports—some of us have expressed doubts about the wisdom of that, but I am well aware of the interest in Kent in that airport, and I am sure it can add to the diversity of the sector.

Rolls-Royce has received hundreds of millions of pounds from the British taxpayer for research and development, yet the company has not paid corporation tax for a considerable time. It is now offshoring jobs to low-wage economies—we have heard about India this morning. I have heard Ministers say that they want to rebalance the economy, so what steps has the Secretary of State taken to try to deter companies from offshoring high-skilled engineering jobs?

There is indeed some offshoring taking place, but there is also a great deal of onshoring, by Rolls-Royce and other engineering companies elsewhere. Indeed, engineering that used to be carried out in India is now carried out in the UK. In particular, Rolls-Royce is investing: I have been to several events and seen the new advanced blades for its engines. The research and development and the production is being done in the UK and Rolls-Royce will continue to make a major contribution to the UK economy.

Aerospace is important in Pendle and it is also important in north Wales, with the Broughton site, which has 7,000 workers, and the Filton site near Bristol. Some 70,000 jobs depend on it. Airbus is a joint European venture. What does the Secretary of State think would happen if the Tories took us out of the European Union?

I would hope that all parties continue to support the industrial strategy, which has been a considerable success, particularly in the aerospace industry, and Airbus has been one of its beneficiaries. To be frank, when I came into office I was warned by the industry that it was gradually drifting away overseas and that we would no longer be able to claim that we were the second aerospace power in the world, but with the big, long-term commitment we have made its future is secure, including that of Airbus.