To ask the Chancellor of the Duchy of Lancaster by how much he now expects manufacturing output to increase during 1987.

In his Autumn Statement my right hon. Friend the Chancellor of the Exchequer forecast that manufacturing output would be 5 per cent. higher in 1987 than in 1986.

May I start, Mr. Speaker, by wishing you many happy returns of the day on behalf of us all.

For the past three or four years the British economy has celebrated particularly happy anniversaries, in that it has grown faster than nearly all our major industrial competitors. As to the fall in equities, I am encouraged by the fact that the main barometer used by the manufacturing sector — its order book position — remains healthy, and recent CBI reports confirm that.

Is the Minister aware that textile firms, such as Lees-Newsome Ltd. in my constituency, have been badly affected by the increase in electricity charges? The company has written to me, and perhaps to the Minister, claiming that its export potential will be diminished by that increase. Was there any consultation with the Department before these increased charges were allowed?

With your permission, Mr. Speaker, I shall deal with the detail of the hon. Gentleman's question under question 5. Suffice to say the textile industry has enjoyed a remarkable recovery. It is getting its order share back and is concentrating on improving its design. It is obtaining higher value and has become very competitive. I should have thought that the hon. Gentleman would be proud of that.

Does it not augur well for manufacturing output in 1988 that 49 per cent. of CBI companies expect to increase their investment in plant and machinery next year? Given the uncertainties in the financial markets, is that not a positive endorsement of the strength of the British economy and of the new competitiveness of British industry?

That is very much the case. In the Autumn Statement, growth is projected at 3·5 per cent. for manufacturing output in 1988. It is a long time since the British economy has been able to sustain good, non-inflationery, real growth arising from increased competition and improvement in market share. All the signs are good.

Given that manufacturing investment in Britain is still lower than it was in 1979, that British real interest rates are higher than those of our competitors, that manufacturing imports have a higher share of our market than of any other advanced industrial country and that the pound against the deutschmark is now up by 11 per cent. in real terms compared with February, the Minister will not be too optimistic about prospects for manufacturing, so I shall ask him a simple, straightforward question: can he name one industrial country that has had a lower increase in manufacturing output than Britain since 1979?

I can understand why the Opposition are getting increasingly desperate in their search for bad news. Throughout the 1970s we were at the bottom of the league table in manufacturing output and growth, and we are now consistently at the top. This country is now enjoying increased competitiveness in each of its major sectors and has an excellent future.

My hon. Friend will be aware that many economic pundits wrote off manufacturing as a source of new jobs. How does my hon. Friend expect this increase in output to be reflected in the manufacturing sector and employment?

Until recently it was fashionable to say that, with the introduction of new manufacturing techniques, especially automation, it would be impossible to reverse the fall in employment in the manufacturing sector. That need not always be the case in future. It depends entirely on the way in which we continue to increase our market share. I fully agree with the comments made by the hon. Member for Dagenham (Mr. Gould) in July that inflation is certainly under control, that the balance of payments is likely to be manageable and that output is rising relatively fast.

To ask the Chancellor of the Duchy of Lancaster what is the most recently available monthly figure for the United Kingdom balance of trade in manufactures.

For the month of October there was a deficit of £0·7 billion in trade in manufactures.

According to recent figures, we are heading for a £7·5 billion deficit this year. Is it true that the deficit is not just in traditional industries but in high technology new industries? Does the Minister agree with the Chancellor's statement that the deficit is neither here nor there? Will the hon. Gentleman direct his attention away from the City and concentrate on those parts of the economy that are creating wealth and providing and selling goods and services?

The deficit estimate has already been revised downwards twice. The estimate by my right hon. Friend the Chancellor in the Autumn Statement was already a downward revision from the estimate in the March Budget review. I believe that the figures will undershoot that estimate when the whole year is assessed.

Is it true that under the Labour Government and, indeed, for most of the 1950s, 1960s and 1970s our balance of trade in manufactured goods moved rapidly towards deficit, but that in the past four years, for the first time in many years, not only has that deterioration stopped but our share of world trade in manufactures has increased?

My hon. Friend is right. Plainly, I have no responsibility for the direction of events under the Labour Government. The important point is that the quality of new manufacturing in terms of productivity and commercial resilience is now quite different.

Does the Minister know that, according to answers given by his colleagues, since 1980 about 22 million tonnes of hot-rolled steel have been imported? Does he also know that last year £1·1 billion worth of hot-rolled steel was imported? What will the hon. Gentleman do about this ruinous situation? Privatisation will not help.

The traffic, both inward and outward, in steel is, to a large extent, a function of our obligations under the treaty of Rome as a member of the European Community.

Is my hon. Friend satisfied with the outrageous position whereby British manufacturers of shoes and leather goods are handicapped when seeking to enter the Japanese market, not only by levies but by quotas? To add insult to injury, no one can find out who owns those quotas. Will my hon. Friend see whether he can knock some sense into the Japanese?

I am always delighted when the House returns to the subject of our trade relations with Japan. In fact, the shoe and leather section is one of the least satisfactory in that regard. However, I must say in all honesty—I hope that the House may take some credit for this improvement having expressed its indignation so forcefully last July—that our manufactured exports to Japan have increased by 30 per cent. over the past year.

What analysis is the Department making of the effect of the Governments regional policy — particularly the cuts in regional grants that the Government have made over the past three years—on our ability to contribute towards manufacturing output, not least from the Scottish economy.

The question refers to the balance of trade in manufactures. However, if the hon. Gentleman will allow me to make a short answer, I understand that there have been no cuts in regional development grants.

To ask the Chancellor of the Duchy of Lancaster if he will give the most recent figures for the establishment of manufacturing and service industry firms in the inner cities.

I regret that the information requested by my hon. Friend is not available because we do not keep the statistics on this basis.

Nevertheless, does my right hon. and learned Friend agree that, although the Government are making great strides in their policy towards encouraging investment in the inner cities in both manufacturing and services, there is still great scope for more private investment? Will he examine in particular the concept of the tax-exempt bond, along the lines of the industrial revenue bonds that have worked successfully in America?

I agree that there is scope for more encouragement of new investment and start-up business in inner-city areas. That is why we are working so closely in many ways with Business in the Community, Investment in Industry and the clearing banks, and with the task force areas in particular, to try to boost investment. I am familiar with the tax-exempt bonds used in the United States. My hon. Friend will no doubt address questions on that to my right hon. Friend the Chancellor of the Exchequer, too. I am not sure that the tax relief policies of the United States would automatically command support here.

Is the Chancellor of the Duchy of Lancaster aware that while he and Lord Young have been conspiring to get control of the Prime Minister's inner-city campaign, that campaign has died a death? Will he confirm that unless the Government are prepared to inject substantial new money into rebuilding inner cities, such as Bradford, private investment will not have the confidence to be forthcoming? When will he revive the campaign and inject substantial new money so that the important job of rebuilding our inner cities can get under way?

I thought that public interest in a non-existent campaign by my noble Friend and myself had died a death. No such campaign is taking place. The Governments inner-city policy—the urban development corporations, the city action teams and the inner-city task forces—is going ahead with great strength. More than 200 private sector firms are collaborating with our 16 inner-city task forces in projects of all kinds.

Would my right hon. and learned Friend care to refute the statement by the hon. Member for Bradford, West (Mr. Madden) by pointing out to him that £100 million of private investment has been put into Teesside development corporation in the 10 weeks since it was established?

I can certainly confirm that. There is very widespread support in Teesside for the work that is beginning in the urban development corporation area. We are backing the Cleveland youth business centre, and that idea is now making very reasonable progress, with private sector and public sector funds going into the project.

It is appalling that the answer to the question is that the information is not available, especially as the Minister is personally in charge of the inner-city task force and, as I am led to believe, gives his personal endorsement to every scheme. Is the right hon. and learned Gentleman aware that many organisations—particularly chambers of commerce, chambers of trade and local authorities — are highly critical of the Governments unco-ordinated piecemeal approach to the inner-city and urban regeneration policies? What exactly is happening on the Government side? The Daily Telegraphon Monday said:

"Thatcher set to appoint Inner Cities Minister."

No Government have ever kept statistics on a separate inner-city basis of the kind that have been asked for. I certainly agree that there is a case for considering whether we should keep statistics on that basis. We have always had the support of chambers of commerce and we have had the support of growing numbers of private sector companies. I have had discussions with the CBI, and I am already working with Business in the Community. Since the election most local authorities, too, have been working with us on inner-city policy.

To ask the Chancellor of the Duchy of Lancaster how many staff his Department s companies investigations department employs; and if he will make a statement on its investigation of financial fraud.

The current figure for staff in post in the companies investigation branch of my Department is 53 — a 50 per cent. increase during the past 12 months.

Does my hon. Friend agree that in recent years record numbers of overseas banks, financial institutions and companies have come to the City of London to raise funds and that they have received an extremely efficient and effective service from the City? Is he aware that they respect the integrity of the companies that operate in the City, and that that is of immense benefit for invisible exports in our balance of payments?

My hon. Friend is absolutely right. Every financial centre depends on maintaining and enhancing its level of business and on showing itself to be a safe and clean place to do business. The City of London is showing itself to be just that.

Bearing in mind recent history in the City, and as the special fraud squad has been created under the Director of Public Prosecutions, is it not time for closer liaison between the two departments to ensure the speedy prosecution of fraudsters?

The hon. Gentleman is right to say that close co-ordination is important. Indeed, that already exists at a hitherto unknown level, with the precise object of ensuring that investigations are completed swiftly. The results are processed quickly so that, if prosecutions are desirable and necessary, they can be got under way at the earliest possible opportunity.

Does my hon. Friend agree that in the investigation and prosecution of modern, highly sophisticated fraud the authorities are rather like a penny-farthing bumbling about in the jet age? Will he therefore fight the Treasury to ensure that those departments have the latest examples of information technology, which will be an advantage in speeding up the process of justice for both the defence and the prosecution?

My hon. Friend is right to say that it is essential that regulators and those concerned with the enforcement of the law are sufficiently well manned and equipped to match the challenges that they face. The serious fraud office, which is now being set up, will operate on a multi-disciplinary basis and a number of professional people will be involved. It is important that it has access to all the equipment and personnel that it needs.

To ask the Chancellor of the Duchy of Lancaster if he will make a statement on the effect of energy costs on industry's competitiveness.

On average, energy costs account for 3 per cent. of industrial gross output. The impact of changes in energy costs on competitiveness depends on a variety of factors, including the movement of other costs.

Does the Minister accept that, until the commission reports, the news on today's tapes that British Gas charges to industrial competitors have been referred to the Monopolies and Mergers Commission is welcome? Does he further accept that the recent announcement of increases in electricity charges is of considerable concern to industry as it will add £1 billion to its costs?

I share the hon. Gentleman's welcome for the referral announced at half-past 10 this morning. It is right that the Monopolies and Mergers Commission should consider the prices for contract gas supplies, and we look forward to its report. I am aware that energy costs are a controversial matter that is continuously focused upon, in particular by the manufacturing sector. Even after the proposed increases, our prices will be at the lower end of the range of world prices.

Does my hon. Friend accept that the proposed increases in electricity charges will be a severe disadavantage to British manufacturing industry, especially the chemical industry? Does he realise that in recent years production has increased directly as energy prices have fallen in real terms? Does he further accept that if the increases are allowed to go through British industry will be placed at a disadvantage compared with its European competitors?

My hon. Friend makes a valid point when she says that some industries, especially the intensive energy users, are significantly affected by movements in energy prices. But, in the generality, the proposed increase will account for no more than one sixth of 1per cent. of industry's costs, and prices for industrial consumers have fallen by more than 15 per cent. in real terms during the past five years.

Does the Minister accept that to talk about generalities of 3 per cent. is no great consolation to the energy-intensive industries, such as steel, coal, aluminium and chemicals, in which energy costs may account for as much as 25 per cent. of production costs? What will the Department do to protect those industries from the enormous electricity price increases that will take effect from next April? Does he accept that Ministers have a responsibility to ensure that British manufacturers are not placed at a competitive disadvantage?

The hon. Gentleman cannot have heard the second part of my answer to my hon. Friend the Member for Congleton (Mrs. Winterton). For the reasons that he cited, we are pleased that the qualifying industrial consumer scheme will continue to help those who have high energy-intensive production processes.

My hon. Friend should not accept the Opposition's statements without reminding us of their record in government. Is it not a fact—[Interruption.]Labour Members do not like it. Is it not fact that, under the Labour Government, electricity prices increased by 112 per cent.? Yet they are complaining about a 3 per cent. increase. Is it not a fact that gas prices increased by 28 per cent. in real terms, yet they have the gall to criticise the Government for increasing prices only modestly?

My hon. Friend speaks with the directness and candour of an ex-miner, and I welcome his comments. His figures are correct. Under the Labour Administration the price increases were almost exactly twice as high as they have been under this Administration.

Instead of standing there and supporting the attempt by his colleagues in other Departments to get industry and the consumer to bear the cost of saving the Government's face on their privatisation programme, which is what this is about — the country knows that, even if Conservative Members do not — why will the Minister and his colleagues not fight for British industry in the Cabinet instead of selling it down the river?

For many years we have been defending the interests of the British manufacturing sector, to the extent that our industries are better placed than their international competitors. My right hon. Friend the Secretary of State for Energy has introduced policies that will ensure that the Conservative Administration in the year 2000 will be presiding over an economy that is still underpinned by a cost-effective and efficient energy industry.

To ask the Chancellor of the Duchy of Lancaster what representations his Department has received on Britain's space spending.

We have received letters from hon. and right hon. Members, space companies, interested organisations and members of the public. I and other Ministers have had several meetings with representatives of the aerospace industry.

Is it not a further symptom of complete despair to learn that the director general of the National Space Centre recently resigned? Is the Minister concerned that it is expected that during next year there will be a reduction of 40 per cent. in contracts related to the industry?

I do not think that the hon. Gentleman is bang up to date with events. The former director of the British National Space Centre resigned early in August of this year. Up to that time he had been criticising the way in which the European Space Agency programme had been going increasingly towards grandiose manned space projects, so it cannot have come altogether as a surprise to Mr. Gibson, the gentleman who resigned, that we exercised our option not to join in those projects at the meeting at The Hague.

Does my right hon. and learned Friend agree that the Government have a duty to examine the value for money that we receive from the funds that we put into space research? The European Space Agency's plan to put a French midget into space hardly seems productive.

I have heard comments of that kind that are related to the design of the proposed spacecraft. It is an optional programme, and other countries appear to have decided to go to the next phase of developing a spaceship that does not seem to have adequate scientific or technological advantages for us. We put our money in other aspects of space work. As a country we invest £4·5 billion in scientific and technological investments of one type or another.

Will the Chancellor nevertheless accept that, since his announcement that we will not support the next phase of the ESA programme, there has been genuine concern amongst the hundreds of companies in Britain that are involved in the space programme that the consequences of that decision will be to cut them off from valuable future orders? Given that there is a three-month period in which the decision can be reviewed, will the Minister listen to the representations that are made to him? I accept that the criticisms that he has made of the programme may be valid, but we should be arguing within the programme rather than hurling abuse from outside it.

Most of the representations that are reaching us come from companies that hope to participate in contracts using the money that the Government were putting in. We do not put money in merely to hand it on to a British company. A project must be evaluated in terms of its long-term potential to the economy as a whole, to see whether sufficient technological and scientific advantages will flow from it to people other than the companies that are directly concerned. We are receiving representations from companies and I am having meetings with several of them. If they can satisfy me that there is some valid national interest to be had from taking part in parts of the space industry, we shall of course do so.

Will my right hon. and learned Friend ensure that, now that we are not providing extra funds for the ESA, extra money will be found from Government sources for the continuation of the HOTOL project?

I have had yet another meeting to discuss the HOTOL project with British Aerospace and Rolls-Royce. We must look for other international collaborators and see what the next step is if we are to continue to evaluate the project. This is a long-term matter, and it will have to be considered carefully once we have found what other industrial and governmental partners we might be able to collect for it.

I am sure that the Minister now realises that his decision to do nothing has presented us with the worst possible scenario. Will he tell us what he will do with the 300 firms that are now investing their own private money in space research and related activities? How does he see that money being used in the future? Are the Government expecting the private sector to make up the gap between what the Government would normally put in and the position now, and if so, what mechanism do the Government propose to use to ensure that those private funds are put into the programme?

We are already spending more than £100 million each year on our space programme, which is not doing nothing, as the hon. Gentleman has suggested. We have declined to spend £200 million a year on a project to put Europeans—probably Frenchmen—into orbit by the year 2000. That does not have adequate advantages. We are now examining what other projects might be of industrial advantage to us, and what participation the private sector is prepared to contemplate to obtain commercial advantages for itself. Those discussions are continuing.

To ask the Chancellor of the Duchy of Lancaster if he will make a statement on the main priorities for his Department's budget for 1987–88.

The main priorities for my Departmenfs budget in 1987–88 were set out in the last public expenditure White Paper and were reflected in the Supply Estimates and Supplementary Estimates for 1987–88. All of these have been presented to Parliament.

May we have some assurance from the Minister that these priorities are set against the real needs of the United Kingdom as a whole? May we have an assurance that there will be a review of regional policy, because, while we might expect work to be done in the inner cities, there is a great deal of work needed to correct the imbalance between the north and the south of the United Kingdom? Aid needs to be given to mining areas, such as my own area in Fife, that have been in decline for a long time because of pit closures and because of other aspects of the recession.

I can certainly give the assurance that our increased budget will be devoted to the priorities of the United Kingdom as a whole and to all its industry and commerce. We are reviewing the objectives and policies of our Department and will give a detailed statement on that in due course. I can assure the hon. Gentleman that it is not our intention to reduce the expenditure that we incur in the assisted areas either north or south of the border.

Does my right hon. and learned Friend accept that the administration of regional funds in the assisted area of Corby has been an outstanding success, and that the lessons to be learnt from that could be applied to other assisted areas in which aid should be concentrated in future?

We take great encouragement from what has occurred in Corby, where the local community has taken advantage of what is on offer and of the state of the British economy to establish a great deal of new employment and a new economic base for the town. To a certain extent the same thing has happened in Consett, Scunthorpe and other places hit by steel closures. Obviously, that is the kind of thing that we all want to see in all parts of the country that have been most adversely affected in the last 10 years by rapid industrial change.

Can the Minister tell the House when the Government will publish their review of regional policy?

As I said, we are reviewing the policies of our entire Department. I have no doubt that some time next year we shall come forward with our conclusions.

To ask the Chancellor of the Duchy of Lancaster what proportion of the United Kingdom motor car market was taken by British-made cars in the first eight months of the current year; and how this compares with the last three years' performance of the United Kingdom motor industry.

British-made cars took 49 per cent. of the United Kingdom car market in the first eight months of this year, compared with 43,41 and 43 per cent. for the corresponding period of the previous three years.

Will my hon. Friend confirm that the Rover Group has fully shared in this progress and that he will therefore be reinforced in his determination to privatise that company as soon as practicable?

I am as encouraged as is my hon. Friend by the news that Austin-Rover's total sales at home and abroad in the first half of this year increased by nearly 3 per cent. over the same period in 1986. Together with a 15 per cent. increase in export sales, that is particularly welcome and, clearly, will certainly not harm the prospects of the Austin-Rover Group when it comes to privatisation.

Conservative Members are fond of quoting statistics about the Labour Government. Does the Minister not know that in 1979 foreign imports accounted for only 38 per cent.? This year they are accounting for 50 per cent. and in September United Kingdom car sales were down by 15 per cent. How can this be a success story?

I must tell the hon. Gentleman that the penetration of foreign vehicles into Britain has declined in recent months. That is a sign of the impressive performance by the British car industry and by the component industry, which is so important to it.

In view of the complex interdependence of the modern motor car industry, which I am sure my hon. Friend understands only too well, do the terms "British made" and "Foreign made" have any real significance, and what does the term "British made" mean today?

My hon. Friend is as informed on these matters as I am—[Interruption.]—and he makes a good point about the country of origin of cars. Certainly we have noticed in recent months and years a reduction in foreign penetration. As I said, we take a continuing interest in making sure that the component sourcing from the United Kingdom is on the increase. We shall continue to do that.

Is it not true that British Leyland has been rescued from its private enterprise fate-worse-than-death by billions of pounds of taxpayers' money, and that the people of Britain would find it extremely offensive if, after having rescued this firm, it is slimmed down yet again and sold off? Is it not the truth that British Leyland is barely holding its market share and that, with only about 18 per cent. of the United Kingdom market, it cannot survive?

Many hon. Members will recognise that there has been a great improvement in the performance of the Rover Group, partly as a result of the vast sums of taxpayers' money that have been put into the company. All hon. Members recognise that that success story should be told worldwide. That does not necessarily mean, however, that all hon. Members would agree with the hon. Gentleman in saying that we should not return the company to the private sector as soon as practicable.

To ask the Chancellor of the Duchy of Lancaster what recent representations he has received about the impact of United States protectionist measures on the British textile industry.

My colleagues and I have received a number of representations about the United States Textile and Apparel Trade Bill currently before Congress. The Government have repeatedly made clear their concern about this proposed Bill, and the European Community has warned that it will respond to any restrictive United States measures in accordance with its rights under the GATT.

If the American Trade Bill is enacted, would it not heighten international trade tensions and undermine the whole progress of the GATT and multilateral negotiations? Will my hon. Friend therefore emphasise the fact that if the measure is passed the Government and the European Community as a whole will not hesitate to act with firmness to ensure that the diversion of trade does not harm our industry?

Yes, my hon. Friend is right. This would be an acutely damaging measure if passed. We and the European Commission have repeatedly made our views clear on that. My right hon. and learned Friend and I saw the United States trade representative Clayton Yeutter only last week and repeated our concerns to him.

Will the Minister and his colleagues start to speak out on this issue rather than whisper in dark corners? This has been a very important issue for the textile industry for a long time and we hear too little from Ministers protecting our textile industry.

I have heard the House of Commons called a number of things in recent weeks, but a "dark corner" has not been one of them. The negotiations would have to be conducted by the European Commission. At present the Bill has not been passed by Congress and we are lobbying very strongly in Washington to ensure that it will not be passed. It is a matter of judgment whether national agitation at this time would be likely to inflame or moderate Congressional attitudes.

Will my hon. Friend accept that protectionism measures implemented by the United States of America would be particularly damaging to the textile and allied industries, many of which are located not only in inner-city areas but in other areas where there are currently economic problems? Such a measure would reduce investment in those industries and have a direct impact on employment in those areas. Will he therefore take this matter—as hon. Members on both sides of the House are urging — very seriously and ensure that the diversion of trade which could result will not have an unfair impact on this country?

I am glad of the opportunity that my hon. Friend gives me to repeat the very serious concern with which we view this prospect. As my hon. Friend is a powerful advocate in this area, he knows only too well that the multi-fibre arrangement provides a skeletal structure, which allows us to safeguard our industries. Essentially, the defence must be mounted through the GATT by the European Commission. The Commission is minded to do that in the strongest possible manner.

By the way, happy birthday, Mr. Speaker.

I am very grateful to the hon. Gentleman.

Is the Minister aware that I recognise the work that he put in during the last renegotiation of the multi-fibre arrangement? However, will he now get stuck into the Yanks and stop the American imports, in the interests of the British textile industry, especially in my constituency?

The problem with protectionist measures is that they are directed against our exports. I appreciate the tribute paid to me by the hon. Gentleman, but if he has a particular problem with imports from the United States I will see what I can do if he draws it to my attention.

To ask the Chancellor of the Duchy of Lancaster what are the latest figures for the productivity of manufacturing industry; and what comparable figures he has on the recent performance of the United Kingdom's major competitors.

In the year to the third quarter of 1987 productivity in manufacturing industry, as measured by output per man, increased by 6·9 per cent. In the year to the second quarter of 1987, the most recent period for which international comparisons are available, productivity in manufacturing industry increased by 6·5 per cent. in the United Kingdom. This was the fastest increase achieved by any of the major seven industrialised countries and com-pares with an average increase for the major seven countries of 2·7percent.

I thank my hon. Friend for that answer. Does he agree that if he checks the record he will find that under the last Labour Government the United Kingdom was at the bottom of the productivity league of all the industrial countries? Does he agree that the future competitiveness of British industry and British manufacturing vitally depends upon individual British companies maintaining control of unit labour costs, which under the last Labour Government went through the roof?

The United Kingdom's average growth rate was only l½ per cent. between 1970 and 1980. In that period we were at the bottom of the productivity league of major industrialised nations. That contrasts with this decade in which the average growth rate has been over 5 per cent. and we have been at the top of the league. In regard to costs, of course we have to maintain our healthy obsession with unit wage costs and all unit costs. If we can keep that going until well into the 1990s, we shall have a very favourable outlook indeed.

Will the Minister encourage industry to plough back the improvement in productivity into investment in manufacturing, which is still showing a decline in areas such as the north? Investment needs to be — [Interruption.]I am only going on last month's figures. Investment in manufacturing needs to be increased, so that areas such as the north can benefit from increased investment and increased growth, so that we may put the hundreds of thousands of people who are still out of work back to work.

As a northern Member, I hope that the hon. Lady will have drawn much comfort from the fact that the manufacturing sector is now spearheading our economic growth. It is growing faster than the general level of the economy.

Are not the encouraging figures that my hon. Friend has given to the House further evidence that the enterprise culture is well established in many parts of the United Kingdom? Will my hon. Friend make it his overriding objective——

Two million jobs have gone.

Shut up.

The hon. Gentleman does not like the truth.

Order. Questions are to the Minister, not to the Bench below the Gangway.

Will my hon. Friend make it his overriding policy objective to ensure that the enterprise culture is established throughout the United Kingdom? We have the conditions for further investment, further productivity growth and more jobs.

I can understand the antagonism of some Opposition Members towards the enterprise culture, because the arrival of the enterprise culture in some of their constituencies could well mean that they will lose their seats to the Conservative party. In regard to the sedentary question——

Order. Please do not answer sedentary questions.

Is the Minister aware that increased productivity and increased investment frequently lead to fewer jobs in industries such as the textile industry? If more jobs are to be created, which I assume we all desire, there has to be a buoyant market for the products, so that their improved competitiveness can result in increased sales. If the United States puts on an embargo on our goods, is it not true that goods intended to be imported into the United States from many other countries will be diverted to Britain? That will result in the market here being less buoyant. There will be fewer jobs and the investment in productivity will have been for nothing.

To take the last question first, it confirms that we are right to be concerned to see the continuation of the open trading market internationally. That is a prime objective of my right hon. Friend the Chancellor of the Exchequer. On productivity and job loss, productivity gains are the friends and precursors of increased employment, as the Japanese experience demonstrates. I hope that we shall no longer be sidetracked by the myth that increasing productivity equals job losses. It means gains in income to United Kingdom plc and therefore gains in jobs.

To ask the Chancellor of the Duchy of Lancaster if he will undertake a review of the impact on the Fylde coast area resulting from the removal of assisted area status.

No, Sir.

Because of my hon. Friend's deep knowledge, care and concern for the affairs of Lancashire, I am sure he will realise that I and the other hon. Members serving the Fylde coast area are still deeply concerned about the level of unemployment. Does he agree that the key to reducing that is the starting of the second phase of the Peel industrial estate? The problems relating to English Industrial Estates in that venture mean that progress has been non-existent. Can his Department offer any hope of further options or ideas to enable industrial development to start in that area?

As my hon. Friend is fully aware, as a fellow Lancashire Member I understand the problems of that part of my hon. Friend's constituency. I have written to him making it clear that any involvement of English Industrial Estates must be dependent upon its being able to recover its costs. Since that letter I have been able to explore the possibility of further options and discuss them with my hon. Friend. If he cares to come to see me I am sure that we can find a way out of the problem.

Is my hon. Friend aware that the Fylde coast regularly has the highest unemployment in Lancashire? While I am grateful for what he has just said about the Peel industrial estate, will he consider, rather than diverting the land to retail industries — which would be contrary to the structure plan and contrary to policies of the Department of the Environment — whether it might be appropriate to encourage English Industrial Estates to divest itself of that part of the estate that has been partly developed so that it can be further developed by other companies?

My right hon. Friend, as ever, represents the interest of his constituents extremely well. His suggestion is one of the options that we shall consider.

To ask the Chancellor of the Duchy of Lancaster what representations he has received following the acquisition of a 14·7 per cent. stake in the Pearson group by News International; and if he will make a statement on competition policy for national newspapers.

Eight letters have been received by my Department, including one from the hon. Gentleman. Major newspaper mergers are regulated by special provisions in the Fair Trading Act 1973, and we shall rigorously examine all applications for consent which are put to us.

Will the right hon. and learned Gentleman accept that there is real anxiety among people working in the Financial Timesat the implications of the acquisition of a 14·7 per cent. stake in the parent corporation by Rupert Murdoch's company? Does he accept that the increasing concentration of ownership of the British national press has reached a level which cannot be in the best interests of the freedom of the press? Is it not time the Government came forward with a review of the right way to deal with competition and ensure that we have a free national press?

The matter would come to a head only if any attempt were made to acquire a controlling interest in the newspaper and in the group, which would trigger the provisions of the Fair Trading Act. That would involve the ability to own or control about 25 per cent. of the votes cast at a general meeting of the company. If that were to happen, the special newspaper provisions of the Fair Trading Act would come into play. My right hon. and noble Friend has already indicated that we are seeking to improve the workings of that part of the Act. We are asking the Monopolies and Mergers Commission to report back more quickly when references are made, and we are looking at ways in which this part of the Act can be made to work more effectively.

While recognising that Mr. Murdoch's description of himself as a friendly investor in the Financial Timesgives a new and bloodcurdling meaning to that phrase, in all seriousness may I ask whether my right hon. and learned Friend accepts that there is an important public interest dimension to this which demands a firm assurance from the Government? Will my right hon. and learned Friend promise the House that in the event of Mr. Murdoch making a takeover bid for the Financial Times,the necessary Government consent under the Fair Trading Act will be debated in the House before a final ministerial decision is made, and not afterwards, as happened in such a shameful way in the cases of Today, The Sunday Timesand The Times?We must have decisions taken here first.

I recognise that my hon. Friend is always a friendly questioner on the subject of this and similar acquisitions. I am being reasonably forthcoming on hypothetical questions which would arise only if Mr. Murdoch sought to exercise control over this newspaper. The Fair Trading Act 1973 covers that situation. I understand what the views of hon. Members on both sides of the House will be if this occurs and I assure my hon: Friend that we shall apply the Act as it is intended to be applied.

Does the Minister recall the takeover of the Todaynewspaper earlier this year, which the Government meekly accepted, like lambs? This gave Mr. Murdoch 35 per cent. control over the popular press in this country. The triumvirate of Maxwell, Murdoch and Stevens controls over 80 per cent. of the popular press. Two hundred weeklies come under the control of Mr. Murdoch. Is this not a fearful control over ideas, opinions and attitudes? Should it not be prevented, and should the Government not operate a proper anti-monopoly policy?

The special provisions of the Act do not apply, and were never intended to apply, where there is financial urgency. In the case to which the hon. Gentleman refers there was an imminent threat of the newspaper closing. It had only a small circulation. I cannot answer hypothetical questions, but the hon. Gentleman must ask himself whether that situation could apply to any attempted acquisition of the Financial Times.It is on that basis that we shall decide whether the Fair Trading Act applies and whether reference should be made to the MMC. No application for consent has been made, so there is a limit to how forthcoming I can be.

Although I support the comments of my hon. Friend the Member for Thanet, South (Mr. Aitken), which received great support from both sides of the House, will my right hon. and learned Friend bear in mind that there is a big difference between a minority stake, which is equivalent to raising money or gaining financial support, or a rights issue, and seeking to intervene in the affairs of a newspaper? Will my right hon. and learned Friend undertake to ensure that the Financial Times,a masterpiece of objectivity and balance, remains truly independent?

I share my hon. Friend's admiration for the Financial Times,which is one of this country's strongest journals and has a great international reputation. We shall have a duty to address the Act if anyone attempts to acquire a controlling interest. My hon. Friend can rely on Ministers to take their duties seriously if such an event occurs.

To ask the Chancellor of the Duchy of Lancaster what proposals he has for providing increased support for the traditional industries of Leicester.

My right hon. and noble Friend and I are looking at the whole range of the Departmenfs policies to ensure that they are effectively targeted on the areas and on the people that most need assistance.

Is the Minister admitting that the traditional industries of Leicester and cities like it are in decline? Is he aware that the Government's policies of removing protection from workers and reducing the number of factory inspectors has led to intolerable sweatshop conditions, and that even the Government are investigating this? When will they provide the support that these industries need to bring back prosperity to a city which, when they came to power, was the second wealthiest in Europe and today is suffering greatly from unemployment and misery?

I recently opened an exhibition of the wool and knitting industries, of which there are many representatives in the hon. and learned Gentleman's constituency. They spoke in glowing terms about the success of their traditional industries and felt that the serious problems facing them could be overcome with the continued support of the Government both at home and abroad.

To ask the Chancellor of the Duchy of Lancaster when he next intends to meet the National Consumer Council.

I shall be meeting the National Consumer Council on 1March 1988.

Perhaps the Minister could bring that date forward and take the opportunity to discuss with the NCC its recent report on security risks and personal loans, which illustrates one of the worst characteristics of the so-called enterprise culture. Is the Minister aware that that report showed the use of deliberately deceitful advertising on loans and high brokerage charges? It also showed that many people, often in extremely difficult financial circumstances, were putting their own homes at risk because of the nature of this loan business. Is it not about time that the Government acted against those sharks?

We are already consulting on proposals to change advertisement regulations and will be issuing revised regulations soon after further consultations. Those regulations will require credit-granters to make it clear in the advertisements that if a secured loan is being offered the borrower's home is placed at risk. It is right that that. should be done. However, that does not remove the burden that must lie with anyone seeking credit to look carefully at the terms of the loan that he is seeking and to shop around to get the best possible deal.

What injury would be done to the progress of mankind if the National Consumer Council were to be abolished?

My hon. Friend has asked a fascinating hypothetical question to which I will not venture an answer at this stage.