| Previous Section | Home Page |
Column 635
"leave the NHS as a ghetto service for those who are too poor to afford anything better".In The Times of 1 February 1989, he said of GP budget holders : "For the first time, GPs will have an incentive to turn away patients with a high price tag, the elderly, the disabled and the chronically sick."
In The Independent of 5 October 1990, he spoke of
"an NHS in which pensioners queue up for their operations in an end-of- season sale".
What happened? All the trusts are still in the public sector, and 1 million more patients are being treated than when the hon. Gentleman was making his statements. The hon. Gentleman is a man with a record. He has been through it all before. He should be judged by how true it all turned out to be.
I took a little time off last Wednesday to listen to the hon. Member for Dunfermline, East, and I am glad to welcome him to our deliberations today. Some of us had the privilege to watch him. He was at his most ferocious. Psychologically, the red flag was up--I see that it is round his neck today. Red blood was flowing all over the carpets as he ended his speech with these fighting words : "There is no one left for this Government to betray ; they have no credibility in this country. The electorate will never trust them again. If Britain is to have a new start, it will need a new Government--and that will be a Labour Government."--[ Official Report, 17 March 1993 ; Vol. 221, c. 298.]
Trust a Labour Government! In September 1964, the Leader of the Opposition, Mr. Wilson, said :
"Over the period of a Parliament I believe that we can carry out our programme without any general increase in taxation."
When that Government left office, they were collecting £2 for every £1 collected when their promise was made. In the same election campaign, the late George Brown-- [Interruption.] Oh yes. Opposition Members may laugh now. I know that it is a long time ago, but it is a long time since we had a Labour Government. The reason why it is a long time is because the Labour party said these preposterous things and was found out.
The late George Brown said :
"For new mortgages we have something in mind of the order of 3 per cent."
By the time that Government left office, mortgage rates were 8.5 per cent. By the late 1960s we had the then Prime Minister, Lord Wilson, proclaiming on 17 April 1969 :
"The Industrial Relations Bill is an essential Bill, essential to full employment and essential too for the Government's continuation in office."
On 18 June 1969, the Bill was withdrawn from the legislative programme.
For those who are interested in the flights of fancy of the hon. Member for Dunfermline, East about trusting a Labour Government, what about all the bravura claim in October 1964 :
"Labour will abolish poverty in Britain"?
Six years later, the Child Poverty Action Group had sadly to conclude :
"in many ways the plight of poor families is now worse than when the Labour Government took office."
Worse it was, worse and always it will be. Trusting the Labour party is not a matter of investing in risk. It is a matter of investing in certainty. All out. All up. All over.
The hon. Member for Bolsover asked a question about coal. I recognise, as will the House, that there has been much speculation in recent days about the coal contracts. Some progress has been made in respect of the base contracts. Work has continued now through several weekends. I hope that I am about to be able to report on
Column 636
the position. I hope that I may be able to do that in the not-too-distant future. However, as I have said many times, I have no powers to make people sign contracts. In the meantime, I have agreed that British Coal can extend the redundancy terms until the end of December this year.Increases in productivity are often accompanied by falls in employment. We have had to face that problem in the coal industry over many years. But we are familiar with the general trend throughout manufacturing industry. Indeed, manufacturing employment peaked as far back as 1966. That phenomenon is not confined to the United Kingdom. Some decline in employment in manufacturing is evident in most industrial countries.
Increased competition and continuing technical progress mean that many firms will reduce employment to stay competitive. That does not mean that those firms are in difficulties. Far from it. The vehicle industry in the United Kingdom is producing 300,000 more vehicles a year than 10 years ago, but it employs 100,000 fewer people. The paper, printing and publishing industries increased their output by more than a quarter between 1980 and 1991, but employment fell by 12 per cent.
In many industries, successful firms are cutting jobs as they invest for the future to stay ahead of the competition. New firms and new businesses were the key to employment growth in the 1980s and they are undoubtedly the area of the economy to which we must look for new jobs in the future. We have been more successful in job creation than other European Community countries. The work force in employment grew by almost 1.5 million over the last economic cycle, between 1979 and 1990, so it is of critical importance that we recognise that every degree of support that we can give to new companies is most relevant to creating new jobs and new opportunities in our economy.
The next matter of dramatic importance in what we seek to achieve and must achieve is support for our export companies. Our companies know that there is no such thing as a secure market. Overseas firms face the same pressure to win as we do. We are pushing forward with fresh initiatives to help exporters.
Last November the Minister for Trade announced an export strategy to maximise our strengths and minimise our weaknesses. I have invited British companies to second to my Department 100 men and women to help us in the promotion of our exports. I am extremely gratified by the response that I am achieving. I believe that we shall have 100 such people by the summer of this year. That will give us experts with first-hand knowledge of overseas markets who will aim to identify and promote opportunities to help our companies to fulfil their potential.
Mr. John Townend (Bridlington) : I am sure that my right hon. Friend agrees that our exporters are doing a fantastic job, but is not the United Kingdom's problem the fact that we import too much? Do we not have a cultural problem? A large part of the British buying public still believes that it is smarter or better to buy foreign, even when British goods are competitive and of the right quality. I give my right hon. Friend an example from my constituency. I represent more pigs than people. We produce the finest pigmeat in the world. British charter bacon is of top quality and is internationally competitive. Yet 50 per cent. of the bacon bought by housewives is from Holland or Denmark. Is not that a national disgrace?
Column 637
Mr. Heseltine : I understand my hon. Friend's anxiety. That is why I was delighted to notice the seminar which my right hon. Friends the Prime Minister and the Minister of Agriculture, Fisheries and Food, with leaders in both the retail and producing sectors of the food industry, held recently to address some of those difficult issues. As my hon. Friend says, that part of our economy is particularly important because it represents one of the largest deficits in our balance of trade.
The Budget of my right hon. Friend the Chancellor of the Exchequer will help business build on the achievements of the 1980s. It will promote the economic recovery by providing concrete benefits for business and a stable framework for business decisions. His Budget has successfully combined three aims, at least two of which were widely said to be incompatible before he rose last Tuesday and showed how it could be done. His Budget has avoided damaging the inevitably fragile early stages of recovery ; it has achieved a substantial improvement in the public finances into the medium term ; and it has done all this while keeping inflation within clearly defined limits. All three aims, and especially the continued control of inflation, are of vital importance to business.
We now hear less than we did two or three years ago about short-termism as a feature of our industrial and commercial life. To a large extent, this is because we have got inflation down, yet I do not doubt for one moment that deep-seated short-term attitudes are prevalent in our affairs ; or that this is one important strand in understanding why we as a nation have performed less well than many of our competitors.
Such attitudes have led us to invest less than we might in technology and advanced means of production. They have encouraged growth in companies by acquisition and financial engineering, rather than through organic development and building on products and markets. They have led us to place far too great an emphasis on comparisons of near-term financial results in judging our companies, instead of considering the strength of management and its underlying strategy.
Those attitudes are all of a piece. They reflect much that is cultural, and they can be changed only slowly. But they have one great mechanism of reinforcement--inflation. Inflation is an evil which narrows the focus of attention into the short term. Inflation must be kept low in the years to come if our performance is to be improved. The Budget measures will reduce burdens on business by £1 billion in the year ahead. They will assist small and medium enterprises to do what they do best--create the wealth on which the rest of the country depends.
Ms Liz Lynne (Rochdale) : On that specific point, can the President of the Board of Trade say why the Chancellor did not introduce a statutory requirement to pay interest on late payment of debt? That would have helped small businesses considerably.
Mr. Heseltine : We have no doctrinal view on that measure, but there are many doubts about whether it would have the effect that the hon. Lady suggests. We have discussed the matter. My noble Friend Lady Denton has exercised significant influence on late payment of debts. There has been a substantial improvement in the rate of payment. Not the least reason for that is that the Government have paid their bills in a timely way and
Column 638
encouraged large companies to do the same. My noble Friend has made it clear that she will take up specific cases if they are drawn to her attention.Mr. Robert Sheldon (Ashton-under-Lyne) : I wish it were true that Government Departments had been settling their bills promptly. The Public Accounts Committee took evidence from the Property Services Agency, which was only paying when it received payment, and I shall shortly be criticising that strongly.
Mr. Heseltine : I fully acknowledge the high position of responsibility that the right hon. Gentleman has in our affairs. If he has examples that my Department should explore, I assure him that we shall do so, as that is an important matter. We have tried to do what we can to speed up payments, but we are aware that a statutory process might not improve matters in the way that people think, and have therefore hesitated to move in that direction.
For the second year running, no business will face a real increase in its rates bill. The package of value added tax measures introduced by the Chancellor will also be welcomed by every small firm. Finance for small businesses--a subject of great concern--will also be given a boost by the changes in premiums and loan size limits, under the small firms loan guarantee scheme. I have no doubt that my right hon. Friend the Chancellor has thrown a challenge to the banks. The Government have taken an initiative and it is now up to the banks to judge business plans and to make their loans in a way that will help businesses to grow.
The changes to capital gains tax will encourage reinvestment by not penalising those who use their profits to start another business. I have referred to the need to help exporters. We are making available an additional £1.3 billion of cover for key markets. Together with the changes in the autumn statement that will mean that annual cover for United Kingdom exporters in priority markets will have increased by more than 75 per cent. in just four years. Premium rates have also been cut and are now more than 25 per cent. lower than in 1991-92. Those reductions will bring the average level of premiums charged in the United Kingdom down to around the average charged by the United Kingdom's competitors.
The Chancellor announced a special scheme in the Budget to help persuade foreign-owned companies to choose the United Kingdom as a location for international headquarters companies. The present advance corporation tax rules are an obstacle to their doing so. The new rules, which will be implemented next year, will remove that obstacle, which should attract new business to the United Kingdom, and bolster London's role as Europe's premier financial centre. I know that oil companies have always recognised the responsiveness and stability that our North sea tax regime offers. However, the petroleum revenue tax regime was introduced in 1975, with the last substantial amendment in 1983. In keeping the tax system under review, it was important to keep in mind the fact that the North sea was maturing as an oil province--new fields tend to be smaller, and older fields are gradually declining. The Chancellor has now reduced petroleum revenue tax from 75 to 50 per cent. for existing fields from 1 July 1993, and abolished the
Column 639
tax for future fields given development consent on or after 16 March. The Chancellor's proposals move the North sea from a high-tax to a low-tax regime.Conditions for recovery are in place. The United Kingdom has the lowest inflation rate for 25 years ; the lowest interest rates since 1977 ; and the lowest base rates in the European Community. Interest rates have fallen by nine percentage points since autumn 1990, knocking £11 billion a year off industry's costs.
We have a fiercely competitive exchange rate ; a set of Budget measures to boost confidence and stimulate growth ; and confidence is rising. The Confederation of British Industry, the chambers of commerce and the Institute of Directors show rising confidence in their surveys. Retail sales are at record levels ; car sales are up sharply ; manufacturing investment in the fourth quarter of 1992 was up by 5.5 per cent. on the start of the year ; the increase in average earnings is the lowest for 25 years and we expect a further decline in the coming months.
Rapid productivity growth means that United Kingdom manufacturing unit wage costs are lower than those in Germany or Japan, on recent OECD estimates, and they have fallen during the past 12 months. However, further pay restraint is vital to maximise the competitive advantages of sterling depreciation. This month's fall in unemployment is welcome, but too much should not be read into one month's figures, as the fall might not be immediately sustained and it may be some time before the underlying trend takes a downward turn. Unemployment is likely to be one of the last indicators to respond to any recovery in the economy.
Exports and productivity are at record levels and Britain is moving ahead. British business now has clear advantages in competing in the rest of the world.
Mr. Anthony Steen (South Hams) : While I agree with all that my right hon. Friend is saying, does he agree that the rules and regulations affecting small firms prevent them from competing with other countries on that famous level playing field? Something needs to be done to reduce the number of rules and regulations affecting small firms. Can he tell the House what the deregulation unit is doing about future and existing regulations, which are preventing the recovery that small firms so badly need?
Mr. Heseltine : As my hon. Friend knows, we have started to review proposed regulations and those already on the statute book and are applying the review to domestic and European Community regulations. We have been fortunate in securing the services of Lord Sainsbury and those of various other chairmen and significant figures from the private sector, who have helped us to establish seven task forces, to consider the 7,000 existing regulations, which obviously create the climate in which industry has to operate. I shall report to the House as progress takes place.
Mr. Peter Hain (Neath) rose --
Mr. Heseltine : I shall not give way.
I assure the House that in all those ways the Government will play their full part to help the private sector in difficult circumstances.
As I told the House in a recent debate, we live in a competitive world. As we export such a high proportion of our output, it is impossible to believe that we can operate as an island economy. We are broadly comparable with
Column 640
many economies in the world. During the past year industrial production has fallen by 2 per cent. in Italy, by 2.5 per cent. in France, by 6.5 per cent. in Germany and by 7 per cent. in Japan, but in this country industrial production has risen in that period. Japanese gross domestic product fell by 0.75 per cent. in the second half of 1992, output fell in France and Italy and there were three successive quarters of decline in Germany. Since 1981--the trough of the last recession--United Kingdom manufacturing output has risen by more than a fifth, manufacturing investment is up by nearly two fifths and manufacturing productivity by two thirds. Our export volumes are at an all- time high and by the end of 1990 there were about 400,000 more businesses operating in this country than in 1979.The underlying strength of our manufacturing base can also be seen from our ability to attract inward investment. In 1991, we attracted one third of all inward investment into the European Community. So, as we have said many times, despite the severity and length of the recession, Britain is in a strong position to take advantage of prevailing domestic and world economic circumstances. That can be done only by making this country's economy competitive, which can be achieved only by the relentless grind on costs and the pursuit of improved quality.
The Opposition are incapable of understanding those arguments, and view the British economy as an island apart from international pressures and the international marketplace. They keep peddling their view of an industrial strategy, which is simple and based on clear but irrelevant ideas : higher taxes to finance higher public expenditure ; bigger training budgets ; pushing up education standards ; helping workers with statutory rights ; and embracing the social chapter. They have pursued all those ideas in France, where their income taxes are higher and their education system renowned. They have extensive public ownership and have turned the social chapter into a Domesday book. What has happened under one of Europe's most substantial socialist Governments? The people living under it are sick to death of what is happening.
The French election result, if replicated in this country, would take a scythe to the parliamentary Labour party. It would be down to a rump of about 10 people ; the impregnable Labour strongholds might be all that would be left if we had a Labour socialist Government. What would that Government look like ? Perhaps the hon. Member for Merthyr Tydfil and Rhymney (Mr. Rowlands) would be Foreign Secretary ; the hon. Member for Rhondda (Mr. Rogers) would be Chancellor of the Exchequer ; the hon. Member for Liverpool, Riverside (Mr. Parry) would be Home Secretary ; and presumably there would be an early return to the Front Bench for the right hon. Member for Islwyn (Mr. Kinnock) as Secretary of State for Wales. We could count on the fact that the hon. Member for Bolsover would be there clambering on to any convenient barricade, searching for a starring role in "Les Miserables". What a brilliant piece of casting that would be, but it would be casting in the world of make-believe. The Budget contains real policies for the real world ; I commend it to the House.
Column 641
5.19 pmMr. Robin Cook (Livingston) : For the second time in a fortnight, the President of the Board of Trade has used a speech on the economy to make a statement on his energy review. For the second time, the statement that he made about that review consisted of things that he cannot do to save coal pits. The nation is tired of hearing what he cannot do to help the miners ; what we are still waiting to hear, after six months, is what he will do to help them.
Every time the right hon. Gentleman rules out another solution to the problem, as he did today, he confirms what we have always warned about : that the immense flaw in the structure of that review is that the man in charge of finding a solution that avoids closing the 31 pits is the same man who thought it was the right course in the first place. I must warn the right hon. Gentleman that he is coming dangerously close to admitting that he has wasted six months in coming to the conclusion that he was right all along and everybody else was wrong.
If the President of the Board of Trade wishes to be remembered as the man who closed down Britain's coal industry, the Chancellor will be remembered for his 1993 Budget. It was quite the most dramatic Budget since 1988, when Lord Lawson eyed up a overheated economy and poured petrol over it, creating a rip-roaring runaway boom which burnt itself out and left his successors sitting among the ashes--except for the President of the Board of Trade : he does not notice them.
As I listened to right hon. Gentleman's speech, as he fumbled among the ashes of the Government's industrial and economic performance, I heard him describe them as a bonfire of success. I started to convince myself that the trade gap must be a statistical error, that job losses from companies and manufacturing industry are a sign of their success. I must say that I was saved from giving in to the right hon. Gentleman once his speech finally orbited out of touch with ground control and reality and he blamed my hon. Friend the Member for Dunfermline, East (Mr. Brown) for the 1964 Labour manifesto.
I admire my hon. Friend and I have known him for 25 years--he was precocious even then, as a student--but I must admit to the right hon. Gentleman that, having known my hon. Friend that long, I know that he did not write the 1964 Labour manifesto. I predict that, 30 years from now, my hon. Friend will be sitting below the Gangway dignifying the Labour Bench and recalling to the House how the 1993 Budget swept him into the Treasury and Labour into office.
What makes this Budget dramatic is the admission of the damage the Government have done to the economy. No plea of guilty has been entered, and nobody has even said sorry, in three days of debate. No request has been made for 14 years of other offences to be taken into consideration.
But the admission was there in the lengthy speech of the Chancellor, which revealed the embarrassing and painful decisions forced on him by the severity of our economic recession. It is there in the thick Red Book that charts the bleak economic problems of the future. It was there in the admission of the damage that proved the curtain raiser to the Budget--the report specially commissioned by the President of the Board of Trade, which was leaked to The Sunday Times the Sunday before the Budget.
That report, from the competitiveness unit of the DTI, said that our industrial base is fundamentally weak, that
Column 642
our trade deficit will last for decades and that, instead of putting in place the conditions for recovery to which the right hon. Gentleman has referred, the Government have put in place low investment and low skills in industry.Many Opposition Members share the distress that the right hon. Gentleman must have felt at people employed by the Government talking Britain down in that way. For that reason, last week, I asked the right hon. Gentleman to publish that report in full, or at least put a chained copy in the Library. He said that he could not publish it because
"the report clearly reveals the devastating inheritance of 1979".--[ Official Report, 17 March 1993 ; Vol. 221, c. 282.]
That is why he could not publish it. He does not want to embarrass us ; he wants to spare our feelings. I must say that that is not a sensitivity I had associated with the right hon. Gentleman before. We know what the inheritance of 1979 was. It was manufacturing investment at 3.9 per cent., of GDP, a level the Government have never once returned to in 14 years in office. The legacy of 1979 was a surplus of £2.5 billion in manufacturing trade compared with a deficit of £7.5 billion last year. The legacy of 1979 was an unemployment rate of 1.1 million, which the Government have turned into an unemployment level of 3 million--and never in one month, in 14 years, have they got unemployment back to the figure with which they started. That is the inheritance of 1979.
The reason that the President of the Board of Trade is afraid to publish that report and shrinks from doing so is that it spells out the legacy of 1990, which they inherited from themselves. It confirms that, after 14 unbroken years in office, they have achieved industrial production with the lowest growth rate in Europe except for Greece, a manufacturing investment level lower than when they started in 1979, and a proportion of the work force with skills at half the level of other countries. That is the background aganinst which this Budget must be judged.
Dr. Keith Hampson (Leeds, North-West) : The hon. Gentleman is always very selective with his memory. Does he not remember that, in 1978, the previous Labour Government, against a backdrop of doubling unemployment and the collapse of manufacturing industry, commissioned the Finniston inquiry, which highlighted all our long-term failings to compete with our continental partners in the manufacturing and engineering industries?
Mr. Cook : My breath is taken away from me when I hear a Conservative Member complain that the previous Labour Government doubled unemployment. When they left office, the unemployment rate stood at 1.1 million and was coming down ; the Government have twice taken it up to 3 million.
If the hon. Gentleman wishes to accuse me of selective use of statistics, it is particularly interesting that, in his selective use of them, he did not choose to express concern about the 68 per cent. rise in unemployment in his own constituency since the Prime Minister took office. If he is worried about rising unemployment, why does he not do his constituents the justice of expressing some concern on behalf of the 3,000 constituents who are now unemployed?
Dr. Hampson : That is the wrong Leeds constituency, mate.
Mr. Cook : With respect to the hon. Gentleman, in the event that we have the wrong figure, I assure him that I will give him the correct figure very shortly.
Column 643
We have dealt with the inheritance of 1979 and 1990. What this Budget must be judged against is the background of 14 years in which the Government have run down industry. Judged against that background, the Budget fails to meet the test of what is needed by industry. Industrialists have already returned their verdict. Neil Johnson, the director general of the Engineering Employers Federation, said : This Budget does nothing to bring about the massive switch to investment which is essential for lasting recovery."The representatives of the Machine Tool Technologies Association have said :
"This Budget fell short of directly encouraging UK companies to invest."
We do not need to look outside the Government for those who tell us that the Government's policies in the Budget are failing industry. We can see the verdict returned in the Red Book. We only have to look at the contents of the Red Book to see the extent to which the Budget does not stimulate industry. My hon. Friends should handle the Red Book with caution, as it has never yet got it right. It has always erred on the side of unsupported cheerfulness and presented a best case scenario. Whatever the Government say in the Red Book, experience always turns out to be worse than the promises, which are bad enough.
If the President of the Board of Trade wishes to tackle me about talking Britain down, he should note that it was not me who made the forecasts-- they were deposited by the Economic Secretary. If the President fears another fit of moral indignation coming over him about people talking Britain down, he should take out his feelings on the Economic Secretary instead of me
Before I turn to the financial statement and the Red Book I shall correct the hon. Member for Leeds, North-West (Dr. Hampson). He was wrong--the increase in unemployment in his constituency since November 1990 is 68 per cent., and unemployment currently stands at 3,264. I now fully understand why the hon. Gentleman did not refer to unemployment in his constituency-- he does not even know the unemployment figures for his constituency.
Dr. Hampson rose--
Mr. Cook : No, I shall not give way to the hon. Gentleman, as it was perfectly clear that I was referring to the increase in unemployment since November 1990. If the hon. Gentleman does not know the increase in unemployment in his constituency since November 1990, I suggest that he does us all a favour, returns to the jobcentres in his constituency tonight and gives us an extra chance to beat the Government.
Dr. Hampson : On a point of order, Mr. Deputy Speaker. For the record of the House, the hon. Gentleman chose a particularly--
Mr. Deputy Speaker (Mr. Geoffrey Lofthouse) : Order. What is the point of order for the Chair?
Dr. Hampson : For the Official Report to be accurate, I should say that the hon. Gentleman chose a particularly good year, when unemployment was low.
Mr. Deputy Speaker : The hon. Gentleman knows full well that that is not a point of order for the Chair.
Column 644
Mr. Cook : I chose the month in which the present Prime Minister took office, which was not a particularly good month for Britain, but that was the base that was inherited.
Dr. Hampson rose--
Mr. Cook : I am sorry to disappoint the hon. Gentleman, but we cannot have a private conversation ; I must return to the debate. The Red Book shows that, in 1993 business investment is expected to fall for the fourth successive year. Ours is the only country in Europe in which business investment will have fallen for four consecutive years. Other countries worry about recession when the rate of growth in investment is not as fast as usual. The Government are so desperate that they claim a recovery when the rate of decline in investment is not as fast as usual.
According to the Red Book, the consequence of the decline in business investment means that, in 1994, manufacturing output will be growing more slowly than in the rest of the economy. Since 1990, manufacturing output has collapsed faster than the rest of the economy. Now that the Government are claiming recovery, the growth in manufacturing output is expected to be slower than the rest of the economy. So much for the Prime Minister's passionate belief in expanding the manufacturing sector. According to the Red Book, the manufacturing sector will continue to decline as a proportion of gross domestic product.
Any lingering hope that the Budget is a Budget for industry or that the Government believe that their Budget will stimulate industry vanishes when one turns to the Red Book predictions for the balance of payments. We already have a ballooning trade deficit of more than £1 million for every hour. The Red Book admits that that deficit will swell by half as much again. What is damning about the failure of the Budget to expand industry is that all that increase occurs in the manufacturing deficit. In 1993, the deficit in manufactured trade is expected to be as big as the deficit for the past two years added together--that is the measure of the Government's 14 years of failure.
I notice that no Conservative Member is rising to ask about the Labour Government's record on manufacturing trade, and I know why. It is because they know that, in every year under the last Labour Government, there was a surplus in manufacturing industry. That is the inheritance that the Conservatives have squandered.
Unlike the President of the Board of Trade, I do not believe in for ever talking down our inheritance. Britain has much to be proud of in its past. It should be proud of its inventions and the technology that it has given the world.
In the two centuries since the industrial revolution, Britain has repeatedly led the way. It led the way in railway technology. We had a surplus in the trade of railway vehicles until 1979, when it stood at £260 million. Under this Government, for the first time, we have a deficit in the trade of railway vehicles of £57 million. The pneumatic tyre was invented in Britain by John Dunlop, and we had a surplus in the trade in tyres until 1979, when it was £90 million. We now have a deficit of £38 million. The vacuum cleaner was invented in Britain and we had a surplus in the trade in vacuums until 1979, which has now, under the Government, been turned into a deficit.
Column 645
I go some way to agreeing with the President and say that we should stop talking down Britain's proud past. We should start pinning the blame on the people who have pulled Britain down and turned our trade success into trade failure.A fortnight ago, when the President was accusing me of talking down Britain, he produced as evidence of the recovery and the good things about Britain, which he said that I did not mention, the 400,000 small businesses that had started up and said :
"It is from the small and medium-sized company sector of the economy that jobs come".
The right hon. Gentleman was so proud of that figure that he repeated it again at Question Time last week.
The President is right to say that small and medium-sized enterprises are a vital source of innovation. He was also right in that, last year, 445,000 small businesses opened bank accounts for the first time. What the President did not tell the House was that, in the same year, 570,000 small businesses closed their bank accounts for the last time, and 125,000 more small businesses folded than started last year.
The right hon. Gentleman invited the House to congratulate the Government on their record in a year in which the number of small businesses that folded rose by 4 per cent. Is that the best that he can do in trying to talk up the Government's record--to admit that it is from the small and medium-sized company sector of the economy that jobs are disappearing?
Last Tuesday, Budget day, a bumper 110 of those small and medium-sized enterprises were advertised as going into liquidation, 19 of them in the manufacturing or engineering industry. They included MET Plastics in London, which were toolmakers and moulders. When asked why, the company said :
"Bad debts and the length of the recession".
HEE Equipment in Leeds made engineering machines, and when it was asked why it had folded, it said that it was because of bad debts. It was forced to make 100 people redundant. Hi-Spec Engineering in Nottingham made powered platforms and said that it had closed due to "The economic recession which resulted in an extended period of losses."
Action Work Force of Batley provided personnel to factories, and at one time employed 150 people in Batley. It failed because business in the factories "dried up".
When we rang up the companies, not one of them slammed down the phone accusing us of talking Britain down. Oddly enough, not one of those companies blamed the closures on the legacy of 1979 or mentioned how encouraged they were by the evidence of recovery around them. The President spent much time spotting that recovery. I understand that he is a noted bird fancier
| Next Section
| Home Page |