Industrial Growth

Oral Answers to Questions — Trade and Industry – in the House of Commons at 12:00 am on 9th March 1994.

Alert me about debates like this

Photo of Mr Dudley Fishburn Mr Dudley Fishburn , Kensington 12:00 am, 9th March 1994

To ask the President of the Board of Trade what forecasts have been made for industrial growth for 1994 in the United Kingdom and in Germany.

Photo of Mr Michael Heseltine Mr Michael Heseltine President of the Board of Trade

Industrial production rose by nearly 3 per cent. in the UK last year, but fell by 7 per cent. in Germany. Both the Organisation for Economic Co-operation and Development and the European Commission are forecasting that the UK will be the fastest growing major EC economy in 1994 and 1995.

Photo of Mr Dudley Fishburn Mr Dudley Fishburn , Kensington

Would my right hon. Friend like to spell out some of the reasons behind the remarkable change in the industrial prospects of the two countries? Will he hazard a guess as to whether that change will be permanent?

Photo of Mr Michael Heseltine Mr Michael Heseltine President of the Board of Trade

The reasons are to be found in the fact that our exchange rate is competitive, our interest rates are low, our industrial relations are the best in 100 years, our inflation is low and our productivity has been rising significantly. That gives us a remarkable opportunity if we can contain the inflationary pressures, which the Government are determined to do.

Photo of Mr Martin Redmond Mr Martin Redmond , Don Valley

The President of the Board of Trade must be aware of the tremendous input of the people of South Yorkshire in those figures. Will he, therefore, ensure that the Rechar money to create that manufacturing base is made available to improve on those figures?

Photo of Mr Michael Heseltine Mr Michael Heseltine President of the Board of Trade

We shall do whatever we properly can to ensure that the Rechar money is distributed where it can do the most good. The hon. Gentleman is absolutely right to draw the attention of the House to the fact that none of the excellent indicators to which I have referred could have been achieved without the dedication of the British work force. The fact that we now have the trade unions off the backs of working people means that we have achieved quite remarkable productivity gains.

Photo of Mr John Butcher Mr John Butcher , Coventry South West

Does my right hon. Friend agree that one of the things that worry German industrialists is the way in which social and welfare costs in Germany are loaded on to employers' costs and the costs of employment? In this country, the same social and welfare programmes are funded by the taxpayer. Does that not represent the best possible deal for British wealth creators and the British social programme? Will my right hon. Friend use his role as the defender of the interests of the wealth-creating sector and of other Whitehall Departments to ensure that that deal is not broken, no matter what emanates from Brussels in the future?

Photo of Mr Michael Heseltine Mr Michael Heseltine President of the Board of Trade

My hon. Friend draws attention to an important aspect of our competitiveness. Underlying the Government's strength is the opt-out provision, negotiated by my right hon. Friend the Prime Minister, which gives us a real opportunity to pioneer in Europe and to change attitudes towards the costs which increasingly mirror the anxieties of the Europeans.

Photo of Mr Peter Hardy Mr Peter Hardy , Wentworth

Does the right hon. Gentleman consider that we can maintain adequate industrial growth without a successful engineering steel industry? How can he justify the grossly inadequate response of Her Majesty's Government to the unfair practices in the EC steel-producing areas?

Photo of Mr Michael Heseltine Mr Michael Heseltine President of the Board of Trade

The hon. Gentleman will know that my right hon. Friend the Minister for Industry secured clear assurances from the European Commission in December that there would be no revenue subsidies, that there would be close monitoring of any aid given to the industry and that there would be a reduction in capacity. He will also welcome the fact that the privatised British Steel is now one of the most effective steel producers in the world.

Photo of Mr Bowen Wells Mr Bowen Wells , Hertford and Stortford

How much does my right hon. Friend estimate that industrial production will be reduced by the damaging speeches of the right hon. Member for Tweeddale, Ettrick and Lauderdale (Sir D. Steel), the leader of the Liberal Democrats, and of the right hon. and learned Member for Monklands, East (Mr. Smith) on the Pergau dam?

Photo of Mr Michael Heseltine Mr Michael Heseltine President of the Board of Trade

I have no doubt that the speeches of the leader of the Liberal Democrats and of the leader of the Labour party would be capable of reducing jobs in Britain, provided that one condition was fulfilled, and it is extremely unlikely that that would ever happen—that anyone took a blind bit of notice of either of them.