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Al Shifa
Q10. [73868] Mr. Tam Dalyell (Linlithgow): If he will apologise to the Government and people of Sudan for his endorsement of the bombing of the Al Shifa factory; and if he will hold discussions with President Clinton about giving all possible assistance for the rebuilding of the Al Shifa factory.
The Prime Minister: Last August, I gave my support to the United States action. It was action against international terrorists. The US told us at the time of the strike on Al Shifa that it had compelling evidence that the plant was being used for the production of chemical weapons materials.
Mr. Dalyell: Have the Government any hard evidence that Al Shifa manufactured VX precursors or any other chemical weapons-related compounds, or have they not?
The Prime Minister: Yes. The US was quite clear: it had compelling evidence that Al Shifa was involved
in chemical weapons production. Terrorist organisations operating out of those places caused the death of more than 100 totally innocent people by acts of terrorism in Africa. The assault on Al Shifa was retaliation for that; no one was killed in it, but we gave a very clear signal--and I think the right one--to those who engage in international terrorism that we are prepared if necessary to take action in retaliation.Engagements
Q11. [73869] Jackie Ballard (Taunton): Does the Prime Minister agree with the Chancellor who last November predicted that there would be no recession in British manufacturing, or the Chancellor who yesterday admitted that there would be a fall in output of between 1 and 1.5 per cent. this year? Does he agree that last November's prediction was the worst forecast since Michael Fish said that there would be no hurricane?
The Prime Minister: That latter part is wrong, since the worst time for manufacturing industry was in the
early 1990s, when output fell by 7 per cent. and 1 million manufacturing jobs were lost. The single most important thing for manufacturing industry is stability for the long term. That is best guaranteed, first, by policies that are disciplined on public finances, which is a lesson that the Liberal Democrats would do well to learn--if I may attack them for a moment--and, secondly, by lower interest rates. As a result of the action that this Government have taken and the independence of the Bank of England, we have managed to get the lowest interest rates for 30 years.
Mr. Paul Tyler (North Cornwall): Boom and bust.
Mr. Bob Russell (Colchester): Boom and bust.
The Prime Minister: Quite right. The other thing that we must avoid is any return to Tory boom and bust.
Madam Speaker: On that note, we should now move on.
Enterprise and Competition
3.32 pm
The Secretary of State for Trade and Industry (Mr. Stephen Byers): With permission, Madam Speaker, I wish to make a statement on enterprise and competition. Yesterday, my right hon. Friend the Chancellor of the Exchequer delivered a Budget for Britain to succeed in the new knowledge-driven economy and to promote prosperity and fairness. Today, I wish to announce a number of complementary measures, which will boost enterprise and competition.
First, I am publishing a detailed implementation plan for our White Paper, "Our Competitive Future: Building the Knowledge Driven Economy". For each commitment, we have set out a series of targets, a timetable and the contact details of the officials in my Department who are responsible for delivering those commitments. That unprecedented step demonstrates our belief in open government, our desire to work closely in partnership with business and our determination to deliver on our commitments.
I am also publishing today a strategic framework for the Department of Trade and Industry, setting out the objectives for my Department and the work that we will undertake in pursuit of those objectives. Copies of both documents have been put in the Library and the Vote Office.
The policies in the White Paper that we published before Christmas apply to all sectors: traditional and high-tech, manufacturing and services. Work is well under way on many of the proposals contained in the White Paper. I have established a review of bankruptcy and insolvency law, to examine whether we can encourage responsible risk-taking while coming down hard on those who set out to defraud creditors. It will report to me next month. Separately, I am reviewing arrangements for business rescues to find out whether the law should be changed to give businesses in difficulties more chance and more time to turn things round. I shall announce our conclusions in the summer.
This afternoon, I want to announce four new funds to support business. First, we will be providing £20 million to achieve our target of high quality support for10,000 business start-ups by 2001. The programme will be launched this summer.
Secondly, a new enterprise fund will stimulate the availability of finance for the small and medium enterprise sector. I have increased the fund to£160 million. It will lever in an additional £350 million from the private sector to ensure that more than£500 million is available to support loan guarantees for small firms and for support for regional venture capital funds aimed at the provision of small-scale equity and a national scheme to support high-tech businesses.
Thirdly, following the Chancellor's announcement yesterday of a further £20 million for high-tech venture capital investment, we will create a new fund operating across the United Kingdom, focusing on young high-tech firms that need small amounts of equity.
Fourthly, I can announce that we have decided to expand the successful SMART--small firms merit award for research and technology--scheme. From April, a wider range of individuals and businesses, particularly
those in the manufacturing sector, will be able to receive help to research or acquire technologies needed to turn good ideas into commercial reality. We shall increase annual spending by more than a third and provide almost £100 million over the next three years.
Science and the commercial exploitation of scientific research have a key role to play in improving Britain's competitive position. That is why we will develop a strategy to improve knowledge transfer, stimulate the flow of scientists and engineers into industry, and encourage knowledge-based industries. We shall publish proposals in that key area by the end of the year.
Today, following yesterday's Budget statement, we are publishing four documents on tax changes to stimulate innovation and enterprise, especially in smaller companies. The introduction of a tax credit for research and development will be a major step on the road to raising the UK's performance, giving real help to thousands of smaller firms that are working to introduce new products and processes. It will underwrite almost a third of research and development costs for small business, giving the sector a boost of £150 million a year.
Enterprise management incentives will allow smaller companies to give tax-advantaged equity remuneration. We shall also publish proposals on corporate venturing and tax reform for intellectual property. Together, these papers demonstrate our commitment to a framework in which small business can thrive.
Small and medium-sized firms need further help too. I intend to establish a new body--the Small Business Service--which will be specifically designed to meet the needs of smaller businesses. I can announce that it will have more than £100 million of new money to support its important work. The body, which will report to me, will be headed by a high profile chief executive. It will have two key responsibilities: to act as a strong voice for small business at the heart of Government; and to improve the quality and coherence of delivery of Government support programmes for small business and ensure that they address their needs.
The areas in which I expect the service to be involved include: the provision of a new automated payroll service for all new small and medium-sized enterprises; supporting the Revenue in providing business support to discuss problems within 48 hours; giving advice with Customs and Excise for exporters and importers; and, working with the Revenue on internet filing of tax returns. Consideration will need to be given to the relationship between the service and the newly established regional development agencies.
A modern, effective competition regime is necessary to reward innovation and enterprise, and to bring real benefits to consumers. The Director General of Fair Trading is already looking at a number of areas--including cars, supermarkets and private medical insurance--and he has referred over-the-counter medicines to the restrictive practices court for examination.
More needs to be done. I shall therefore exercise my powers under section 12 of the Fair Trading Act 1973 to give the director general directions indicating issues that he should take into account in determining his priorities. I shall also exercise my power under section 13 of the Competition Act 1980 to ask the director general to investigate particular prices.
In relation to prices, there is widespread concern that those paid in the UK for goods are higher than prices in other countries. I have begun today a study on international price comparisons, which will help competition authorities to identify markets that require their attention. It will be made public, so that consumers and others can comment. I will then decide which prices I will ask the director general to investigate.
We are also taking action to provide a modern framework for utility regulation. Electricity standing charges are a matter of pressing concern; they account for around 13 per cent. of a typical household bill and can rise to 20 per cent. for low volume users. Figures which I am publishing today show a wide variation in standing charges by region and by method of payment. I have today written to the energy regulator asking him to look at standing charges to ensure that pensioners and the poor, in particular, are not disadvantaged.
I also believe that the time is right to introduce a modernised merger regime. Businesses need stability and confidence that decisions in those important areas are not taken for short-term political considerations. I believe that the system could be improved if merger decisions were normally taken by independent competition authorities against a competition-based test. A small minority of cases will raise important and wider public interest issues, such as those involving the defence industries, and Ministers would continue to have a role in such proposals. I intend to publish a consultation document to begin a full debate on that important issue.
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