Orders of the Day — Economic Situation

Part of the debate – in the House of Commons at 12:00 am on 10th November 1952.

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Photo of Sir Arthur Harvey Sir Arthur Harvey , Macclesfield 12:00 am, 10th November 1952

I will answer that in a moment. A great industry like the motor car industry cannot be turned upside down in a matter of months. If there is to be an alteration or a reduction, it has to be gradual, and if motor car factories are to turn over to making aircraft or components for export, that is the way it ought to be done.

I believe this Government is doing something in that direction. We heard the other day of a large order coming from Brazil for Meteor aircraft. What could be better for this country than to export aircraft to Brazil—provided they pay for them, and in this case we are going to be paid £5½ million. There are fine opportunities all over the world for such sales to take place, provided we can make the goods. We must give the factories all the raw materials required and every facility to enable them to expand their factories.

It goes much further than that. Britain can only live, provided we make goods which are competitive and which the world requires. We have lived in this country for 50 years by our brains and our knowledge. We have got to maintain the position of being four or five years ahead of any other nation, including the United States—and in many industries we are four or five years ahead of the United States. The reason is that we give a better technical education than the United States. They have many more students going in for technology and receiving technical education than in this country, but the results are far better in Britain, and the Americans know it. I am often asked how we achieve it.

I say to the Government: encourage a greater section of industry by giving reliefs from taxation, and get busy in giving this higher technical education, the results of which will show themselves in a few years right through industry as a whole. By doing that, in a few years' time we may well be selling goods which are comparatively easy to make and which will take the place of textiles and other industries.

It is my view that it was unfortunate that all the initial allowances given to industry disappeared overnight. I agree that when the country is in a financial crisis, for perhaps a year or 18 months we have to live on our fat for the time being. But to carry that process too far is highly dangerous. Industry has got to be constantly improved. Its equipment has got to be continually replaced. By doing that, we hand on orders to machine tool factories and we produce goods at cheaper prices which are competitive in the rest of the world. If we have not got the money to buy the machine tools, it cannot be done. But I hope the Chancellor will at the earliest opportunity try to give relief to industry, whether in the form of initial allowances or reduced taxation. Something has got to be done.

Do let us remember that the great bulk of industry—engineering, at any rate—consists of very small businesses employing 20, 30, 40, 50, or under 100 men. In Britain the small businesses, given a chance to grow, will make a valuable contribution. At the moment they have no chance. What chance have they to grow and improve their conditions? None whatsoever. Taxation is steadily killing industry and will continue to do so.