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Mr. Byers: I am sure that my hon. Friend is correct. There is a real sense of disappointment at BMW's decision.

Serious issues have been raised about grant aid being dealt with slowly. A comparable case concerned Volkswagen's application for aid. It notified the Commission last July, a month before we notified the Commission about Longbridge. The Commission opened proceedings last November, as opposed to December for Longbridge. We have already had notification in the Official Journal of the EC of the Longbridge proceedings being started, whereas the Commission has not, as yet, even notified the Official Journal about the Volkswagen case. That clearly demonstrates that the Commission is dealing quickly with the Longbridge application.

On grant aid, the position is that commercial confidentiality has applied to every application for regional selective assistance under this Government and the previous Government. In no case has approval been given by the European Commission before a deal was struck with the company concerned. Longbridge is being dealt with under a fast-track procedure because of the pressure that the Government have put on the European Commission. That is the reality.

It is worth comparing that with the record of the Conservatives when Rover was privatised. Under the previous Administration, illegal aid was paid to Rover on privatisation, and it had to be repaid with interest. The Conservative Government had to repay a total of £84 million because they had got their aid procedures wrong. It was as simple as that. That is the Conservatives' record on securing European approval for aid.

Mr. John Butterfill (Bournemouth, West): Will the right hon. Gentleman give way?

Mr. Byers: No, I will not. I have given way plenty of times. Members with a constituency interest want to take part in the debate--

Mr. Butterfill rose--

Mr. Deputy Speaker: Order. The Secretary of State has made it clear that he is not giving way.

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Mr. Byers: I have given way on many issues to Conservative Members.

Mr. Butterfill: On a point of order, Mr. Deputy Speaker. I had to run out of the Chamber to get some important information about Alchemy--

Mr. Deputy Speaker: Order. The hon. Gentleman is an experienced Member of the House. He knows, even from those few words, that that is not a point of order for the Chair; it is a point of debate.

Mr. Byers: I am grateful, Mr. Deputy Speaker.

BMW has been content with the way in which we dealt with the state aid application. That was not mentioned once in the statement with regard to the reasons behind the decision that has been taken today. The matter is a red herring, which has been introduced by the Conservative party.

Mr. Butterfill rose--

Mr. Byers: I am not giving way. I want to make progress. There are important issues still to be addressed.

It would be wrong for people to think that because of the difficulties being experienced by BMW, the car industry in the United Kingdom is facing similar problems. Since the Government took office, more than £2.4 billion of new investment has been made in the UK car industry, creating 8,750 new jobs.

Earlier this month, Audi announced a £45 million investment in its engineering subsidiary, Cosworth Technology, to expand its sites at Northampton, Wellingborough and Worcester, doubling its work force as a result.

Increasing capital expenditure is going into the industry--£128 million since April last year. That capital expenditure has brought 1,700 new jobs and safeguarded 4,700 jobs, many of them in the west midlands.

Today's announcement by BMW is regrettable. It is a great disappointment. It creates uncertainty for workers at Rover, their suppliers and their families. We must ensure that those people have opportunities and are given some hope for the future.

Miss Kirkbride rose--

Mr. Byers: That is why, later tonight, I am meeting Alchemy Partners, the new owners of the Longbridge site. We need to find out from Alchemy what its proposals are with respect to Longbridge. We will be asking difficult questions, to which Alchemy will need to give answers.

Miss Kirkbride rose--

Mr. Byers: Today, our thoughts must be with the workers at Longbridge, their families and their community. In Government, we face many difficult

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questions, but we must never lose sight of the fact that those are human questions, the answers to which will affect individuals, their families and their communities.

Miss Kirkbride rose--

Mr. Byers: The Government will discharge their responsibilities to the people of Longbridge and the west midlands. We will do so, even though the Conservative party will criticise us and introduce diversions.

Miss Kirkbride: Will the Secretary of State give way?

Mr. Byers: We recognise that the interests of the workers of Longbridge and the west midlands will be served by the Government. We will not return to the days when tens of thousands of manufacturing jobs in the west midlands were lost because of the Conservative Government's policy. We will continue to campaign for Longbridge. We believe that it has a viable long-term future. We will not be diverted by the Opposition, and we will discharge our responsibilities.

5.8 pm

Dr. Vincent Cable (Twickenham): I start by echoing the Secretary of State's closing words. All our hearts should go out to the thousands of men and women, many of whom have highly specialised skills, who must be in a state of high anxiety. That is probably common ground among all of us.

I sincerely hope that those workers will be well looked after by their new employer, Alchemy. I hope that they fare a little better than the outstandingly able secretary who works in my constituency office. Until a year ago, she worked in an operation that was subject to an Alchemy buy-out. She was made redundant and now works for me. That may be an unfortunate personal example.

Mr. Butterfill: I am grateful to the hon. Gentleman. Is he aware--and is the Secretary of State aware, before he meets Alchemy tonight--that Alchemy's investment preferences, as stated in its entry in the "British Venture Capital Association Handbook", is a maximum investment of £50 million? Its average current investment size is £15 million. Its total funds invested to date at cost are £304 million, and the total funds that it manages or advises are £255 million. In the light of that, one must ask how Alchemy will manage an operation of the size of Longbridge.

Dr. Cable: I am sure that the hon. Gentleman is asking the right question. It is clear that there is no experience of volume car making. The enterprise for which my secretary worked was a German brewery. The synergy between that and the car industry is not immediately obvious.

The motion is rather innocuous. I doubt whether any of us is opposed to clarifying the future. The Opposition are probably attacking the wrong Minister for the wrong reasons. I read the comments of the Conservative spokesman, the hon. Member for Tiverton and Honiton (Mrs. Browning), in the press this morning. She said that

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today there would be cross-party demand to guarantee the future of Longbridge. I think that the hon. Lady knows--[Interruption.] She wants to clarify the matter.

Mrs. Browning: I do not know where the hon. Gentleman read that, but they are certainly not words that I said yesterday.

Dr. Cable: I am delighted to hear that. Perhaps the Financial Times should take down the hon. Lady's comments rather more carefully in future.

I shall move on. There is a crucial area of policy and it is not that the Government are responsible for guaranteeing the future of Longbridge. No Minister can do that. We are discussing a competitive industry and a company that is in a difficult set of circumstances. However, the Government can guarantee macro-economic stability, and that is what they should be doing. The Labour amendment accepts that implicitly. It begins by saying that the Government have created low inflation and low interest rates. The first point is certainly true. The second is true only if we disregard what is happening in the euro zone, where interest rates are 2 per cent. lower than in the UK. That is rather important in this context because Rover is competing with European car manufacturers, which have the benefit of these conditions.

The real problem is the exchange rate, which neither the Conservative spokesman nor the Secretary of State mentioned. It is a serious issue that cuts across party boundaries. The hon. Member for Ochil (Mr. O'Neill) is not in his place, but only yesterday the Select Committee on Trade and Industry, which he chairs, produced a devastating report about the impact that an appreciating exchange rate is having on manufacturing industry. That includes not only the car industry, but Harland and Wolf, which was in trouble earlier this week, the coal industry, the steel industry and agriculture. All those sectors have been affected in precisely the same way.

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