Manufacturing Investment

Oral Answers to Questions — Trade and Industry – in the House of Commons at 2:30 pm on 5th April 1995.

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Photo of Chris Mullin Chris Mullin , Sunderland South 2:30 pm, 5th April 1995

To ask the President of the Board of Trade what recent discussions he has had with representatives of manufacturing industry about the availability of long-term finance; and if he will make a statement. [16451]

Photo of Jonathan Evans Jonathan Evans Parliamentary Under-Secretary (Department of Trade and Industry)

My right hon. Friend the President of the Board of Trade has frequent discussions with representatives of manufacturing industry. Many of these cover long-term finance. The Government can best encourage investment in manufacturing industry by providing a stable macro-economic environment based on low inflation and sound public finances.

Photo of Chris Mullin Chris Mullin , Sunderland South

Is the Minister aware that I was talking the other day to a member of the northern branch of the Engineering Employers Federation? He said that the greatest obstacles to the expansion of his business were the greed, myopia and excessive short-termism of British banks. Does the Minister's Department have plans to do anything about that, or is his party too deeply in hock to the bankers?

Photo of Jonathan Evans Jonathan Evans Parliamentary Under-Secretary (Department of Trade and Industry)

There is no more ludicrous a spectacle of new Labour than the hon. Gentleman presenting himself as the champion of manufacturing industry. May I point out to the hon. Gentleman that, during the 1980s, business investment in this country grew faster than in any other Group of Seven countries except Japan? Opposition Members may shout about it, but that is a fact.

Photo of Mrs Elizabeth Peacock Mrs Elizabeth Peacock , Batley and Spen

Does my hon. Friend agree that many manufacturing industries, particularly in west Yorkshire—and in my own constituency since 1984—have been investing money since the early 1980s? Does he further agree that a slightly more sympathetic venture and help from banks would now be a great advantage to all those industries?

Photo of Jonathan Evans Jonathan Evans Parliamentary Under-Secretary (Department of Trade and Industry)

I think that my hon. Friend will be aware of the loan guarantee scheme, which is run through the Department of Trade and Industry. Changes were introduced in the Budget, to do with capital gains tax reinvestment, single company personal equity plan schemes and employee share schemes. A number of measures were taken to help investment, but I very much take on board the point that my hon. Friend makes. We are looking to the banks to make their contribution as well.