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Mr. Bercow: And for themselves.
Mr. Chidgey: From a sedentary position, the hon. Member for Buckingham (Mr. Bercow) clearly demonstrates that he has need of further training himself.
The pre-Budget report sets out plans for the long term. However, even if the Government provided the funds for those plans to work, it would take a generation before we started to reap the benefits in manufacturing industry. The crisis is now. The interesting thing is that we have a pool of skilled labour facing unemployment--up to perhaps 400,000 people in the next two years. Surely those people should be first in the queue for investment in up-skilling and retraining.
Mr. David Borrow (South Ribble):
This has been an interesting debate.
On a general point, we must judge the Opposition's motion against their record in government and their policies for the future to decide whether the two match and whether they could improve on the policies that the present Government advocate.
British manufacturing industry faces three difficulties. First, we are in the downturn of the business cycle. We cannot do away with that cycle, but the art and trick of economic management is to ensure that the peaks are not too high and that the troughs are not too low, so giving businesses the long-term confidence and stability to invest in the future.
The second problem, which is peculiar to British manufacturing, is that, although we have many first-class manufacturing companies which can compete with the
best in the world in terms of productivity, performance and quality, we also have a long tail of companies that have not yet reached world class. Part of the job of government is to assist in the preparation and development of those companies to make them world-class performers. In the past few years, the difficult exchange rate has exposed such companies' weaknesses and it has been more difficult for them to compete internationally.
Thirdly, we must not forget the extent to which specific sectors of the economy have been hit by the recession in the far east--they have lost both markets and competitiveness. Many job losses in the north-east have little to do with the first two factors but a great deal to do with the downturn and recession in the far east, and we must be realistic about that.
I am not an expert on manufacturing industry, but during my time as a Member of Parliament I have tried to get in touch with businesses in my constituency. I can compare the performance of the previous Government with that of the present Government by dealing with a number of local companies and with what is happening in my part of central Lancashire. I mentioned earlier the problems of Leyland Trucks. In the early 1990s, the company, which was then owned by DAF, went into receivership. Leyland's 100-year history of truck manufacture nearly went down the pan.
According to the local papers, my predecessor as Member of Parliament seemed more concerned about the performance of England's cricket team than about retaining those jobs in Leyland. The company was preserved, largely owing to assistance from Lancashire county council--which was then led by my hon. Friend the Member for Liverpool, Riverside (Mrs. Ellman)--through Lancashire Enterprise, which put together a package. The company brought in new production methods. It has now been taken over by Paccar--an American company which also owns DAF--and production of 4,500 trucks a year has been transferred from Holland and Belgium to my constituency. At the time of the crash in the early 1990s, the company employed 500, but it now provides about 750 jobs, and the figure will increase to more than 1,000 with new truck production. Those jobs have been clawed back and transferred because the company has developed a world-class competitive base and has been able to compete with Europe.
The aerospace industry, with its factories in Warton and Salmesbury, is the major employer in my constituency, even though the factories are not based there. I visited Farnborough this year and am a member of the parliamentary forum of the Society of British Aerospace Companies Ltd., which develops close links with parliamentarians. Clearly, our aerospace industry is enjoying a period of great success. The Department of Trade and Industry and the Government are playing a key role in forging the consolidation of that industry throughout Europe, which is crucial if the industry in Britain is to provide jobs for future generations. That is one way in which our Government can be and are being proactive.
More jobs are also being created in my constituency as a result. A few weeks ago, British Aerospace announced that it would transfer the production of Airbus parts from the Salmesbury plant to Scotland to make room for the
increased production of military aircraft at Salmesbury--in particular, Eurofighter, which is soon to go into production.
There are clear signs, however, of a skills shortage in the skilled engineering industry in central Lancashire. The local authorities and the training and enterprise council need to put in place packages to ensure that the skills base is there for the future to support the aerospace industry and the chain of small and medium enterprises that supply it.
On a different tack, Schwan's pizzas--an American company--is one of the major employers in my constituency, with 700 employees. I presented awards to members of staff at one of its gatherings earlier this year. At the time, the company was talking about changes in production and the possible closure of a plant in the south-west. I bumped into the managing director at a business awards ceremony a few weeks ago at the University of Central Lancashire and asked how things were going, expecting that if all the tales we were hearing about recession were true, he would be talking about laying people off. In fact, the factory in the south-west had not closed because demand was so high, and he had taken on additional staff in Leyland to meet production targets. Those may only be straws in the wind, but the picture of universal recession in manufacturing is not justified for all locations.
Since the general election, I have met South Ribble business leaders every three months at business breakfasts. I also have regular meetings with the Central and West Lancashire chamber of commerce. Indeed, I attended a meeting there last Friday. Again and again at those meetings, people have expressed concern about interest rates--the reduction last week was welcome--and exchange rates. We recognise that the exchange rate against European currencies is lower than it was at the time of the general election, but there are still problems in markets in the far east. Businesses in my constituency want stability. People have pointed out to me that interest rates increased from 5 per cent. at the general election to a peak of 7.5 per cent., but they are now down to 6.75 per cent., which is a favourable rate compared with the 15 per cent. that we had for a year in the early 1990s. We have not seen the big swings that took place under the previous Administration.
Business men are concerned about bureaucracy and the amount of paperwork facing small businesses. Some movement and change is necessary there. The important thing is that this Government will listen. The figures that the Secretary of State outlined at the beginning of the debate show that even though the Conservative party talks about doing away with regulation, they introduced more than they got rid of. Small businesses appreciate that fact.
Mr. Bercow:
The hon. Gentleman is making a considered speech and we are all listening with interest and courtesy, but I must pick him up on the point about regulation. Will he at least acknowledge the factual position, which is that in the last two and a half years of the previous Government--after enactment of the Deregulation and Contracting Out Act 1994--there were 37 deregulation orders, whereas in the first 18 months of this Government, there have been only five?
Mr. Borrow:
I shall not argue with the hon. Gentleman's statistics, but the business leaders to whom
As regards regional development policy, it is important to recognise that the economies of different parts of the United Kingdom operate differently. I have been greatly encouraged to see the communities of Preston, South Ribble and Chorley come together in a public-private sector partnership to develop the Central Lancashire development agency, with a view to working with the regional development agency for the north-west when it is established next year to develop an economic policy for central Lancashire. I am a CLDA board member, and I was encouraged at last Friday's meeting to see the way in which the business community and the private sector are working together to bring jobs to the area.
Two major sites in central Lancashire are primed for economic development. One--the former Royal Ordnance site--sits largely in the constituency of my hon. Friend the Member for Chorley (Mr. Hoyle). The second is in my own constituency, at Bamber Bridge. Both sites could provide thousands of jobs, and the community wants them to be developed to provide well-paid and highly skilled jobs. One benefit of having a development agency is that the community can have its say and play its role in the development of economic policy. Matters are not then driven entirely by market forces and by whoever buys the land for ad hoc development.
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