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9.6 pm

The Minister for Trade (Mr. Richard Caborn): I begin by congratulating the hon. Member for South-West Bedfordshire (Sir D. Madel). I did not know that he would be retiring at the next general election, but I can say--I believe, for many people in the House--that he is a man of great integrity, and a person who has fought very hard for his constituency and his constituents from the Back Benches. He will be sorely missed.

In his usual style, the hon. Gentleman has put his case extremely forcefully on behalf of his constituents, and one agrees with him that any loss of jobs is a difficulty for those people who lose them, and who, obviously, have the Government's sympathy. However, against the background of an ever-changing world, we must now consider how we can manage the change that is inevitable in an ever faster-moving world and in the continued development of the global economy.

I say from the start that the Government are very supportive of manufacturing industry and, specifically, the automobile industry. In the automobile industry, especially around the Dunstable area, there are probably some of the best technicians, the best mechanics and the best designers. I believe that eight of the top 10 formula one teams are working in the United Kingdom--many around the area that the hon. Gentleman represents.

I agree with the hon. Gentleman that, in the wider context of manufacturing, it is important to put the automobile industry at the heart of our economy--the real wealth creation. To that end, since May 1997 we have been bringing forward a raft of initiatives to ensure that our manufacturing base not only continues but gets into the real value added and makes real use of the intellectual property that is in many of our academic institutions, in science parks and research centres.

I shall lay out a few of those initiatives for the hon. Gentleman. We have cut corporation tax to the lowest level ever. We have introduced a new 10 per cent. starting rate for small companies from April 2000, and that has benefited 270,000 companies. The temporary 40 per cent. first-year capital allowances for small and medium enterprises was welcomed; we have now made that permanent. We have introduced 100 per cent. first-year capital allowances for small businesses investing in information communications technologies.

We have introduced a research and development tax credit from April 2000 to boost the level of R and D undertaken by small firms. As the hon. Gentleman said, it is important that we encourage our small and medium companies to get involved in more R and D.

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We have revisited the whole of the skills base of the nation and, after wide consultation, we have introduced the Learning and Skills Council. I hope that it will work in conjunction with the university for industry, which is now being developed, and will reach out to many of the employees and companies to which the hon. Gentleman referred.

We have neglected in the past few years the need to sharpen up our ability to export. That is why we have created a new organisation called British Trade International, which is a marriage of the Department of Trade and Industry and the Foreign and Commonwealth Office. It is designed to give exporters the best possible service. It will make directly available to those who want to export the knowledge and information that the 200-odd embassies and high commissions around the world hold. We shall do that by electronic as well as other means. We have to be seen to be managing change, which is inevitable. We have to see how we can equip the people to whom the hon. Gentleman referred and many others with the necessary skills to go into high-tech industry.

I have looked at the statistics for the hon. Gentleman's constituency. While I accept that when individuals are declared redundant, they and their families suffer, since 1997 unemployment has been brought down by 30 per cent. in south-west Bedfordshire, which is a considerable achievement, as a result of the Government's policy not only to tackle the problems of unemployment, but to manage change further along the supply chain, where real value is added.

As the hon. Gentleman knows, we are also trying to adopt a more sensible approach to regional selective assistance. Within the stringent constraints set by the European Commission, we have tried to make sure that all the facilities available to assist industry are used to best effect. That is why the hon. Gentleman welcomes the fact that 90 per cent. of the population in his constituency is covered by the assisted areas map. I hope that he and his constituents will use that facility in the most effective way. It can be used to do exactly what the hon. Gentleman was asking for--to assist companies that want to bring new investment into the area. There is a facility there that can aid and abet that.

The hon. Gentleman referred to his regional development agency. He is a sensible Member, so I hope that he will tell some of his Front-Bench colleagues not to propose to scrap the agency in the event of their gaining power. That is a long way off, but to undermine the development agencies in the job that they are doing would not be good for the region or the problems of Dunstable. So we have developed the regions and business-led boards that can look strategically at some of the problems to which the hon. Gentleman has referred.

I suggest that some of the ideas for development in Dunstable and the surrounding area are brought before the development agency. I am sure that not just the financial facility of assisted area status, but the agency's wider powers will be utilised. Last week, the comprehensive spending review showed clearly that the Government have confidence in the regional development agencies both by the amount of money that we are dispensing to them to carry out social and economic regeneration in their area and by providing flexibility in budgets, which my right hon. Friend the Chancellor outlined and discussed with the RDAs last Friday when he met all the chairmen of

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the agencies. In the lifetime of the comprehensive spending review, the RDAs will have about £1.7 billion a year to dispense in a fairly flexible way.

The Small Business Service is now coming on stream along with the local learning and skills councils. The RDAs will be influencing them, so they are important bodies with which the hon. Gentleman ought to set up a dialogue to tackle the specific problems that he has raised this evening.

I am not able to answer in detail the hon. Gentleman's questions on transport links, but I assure him that I will convey his concerns to my right hon. Friend the Deputy Prime Minister. I can refer him to what my right hon. Friend said when he answered the hon. Gentleman's questions during the statement on the Government's plans for transport. Clearly, the answer offered a chink of light in terms of restoring railway links and taking a sensible approach to bypasses.

I assure the hon. Gentleman that, when my right hon. Friends the Deputy Prime Minister and the Chancellor of the Exchequer met the chairmen of the regional development agencies, the wider issue of the economic well-being of the region was discussed. My right hon. Friend the Deputy Prime Minister told the chairmen that he wanted them to become involved in the decisions that

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we shall take on transport and land use planning issues. Their advice will be factored into the decision-making process in the Department because my right hon. Friend recognises that it is extremely important that land use, transport and economic planning work together. If they do, we shall achieve the best results. Therefore, the RDAs will have a major influence on how the money is dispensed and, more important, on the evolution of land use and planning issues.

The hon. Gentleman referred to a site that might be vacated as a result of a company's reorganisation. That site could well be considered by the regional development agency, and I hope that it will be able to find a better use for it.

The facilities that the Government have put in place will assist in managing the change that is inevitable and necessary in the hon. Gentleman's constituency. I believe that that change can be managed. Reducing unemployment by 30 per cent. in the constituency in the past three years is not a bad result. The hon. Gentleman's constituents will be better-off in terms of their disposable income and they will have a future to which they can look forward.

Question put and agreed to.

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