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7. Dr. Doug Naysmith (Bristol, North-West): What steps are being taken to ensure that products resulting from scientific advances made in the UK are competitive internationally. [2037]

The Parliamentary Under-Secretary of State for Trade and Industry (Miss Melanie Johnson): We are investing nearly £2 billion in the science base and about £250 million in strengthening collaboration between universities and businesses to ensure that scientific breakthroughs are turned into commercial success.

Dr. Naysmith: I thank my hon. Friend for that reply. I particularly welcome the work of the international technology service. What further steps is the Department taking to ensure that UK companies have access to worldwide knowledge and information?

Miss Johnson: We are developing a number of initiatives that will give further momentum to entrepreneurial education for science and engineering students. A £15 million fund is available for a further round of the university challenge to enable good universities to access seed funds, which will assist in the transformation of good research into good business.

In addition, we are doing more to make sure that scientists will be rewarded. We are working to produce a brain gain in the UK—[Hon. Members: "A brain what?"] A brain gain, as opposed to the brain drain that happened under the last Conservative Government. I am pleased to be able to tell the House that my noble Friend the Minister for Science will announce later today that five scientists will be rewarded in a five-year £20 million scheme to attract and retain the best scientific talent in the UK.

Mr. David Heath (Somerton and Frome): I am not sure about the phrase "brain gain", but I support the move that has just been announced. Does the Minister agree that scientific progress can be made only if we have free exchange of the benefits of research? To that end, can she tell me what progress has been made in securing international agreements to prevent scientific protectionism, such as the patenting of naturally occurring genetic material or genotypes?

Miss Johnson: I agree with the hon. Gentleman that that is an important issue, and we are in discussion with our European partners so as to make progress on it.

Brian White (Milton Keynes, North-East): Does my hon. Friend agree that clustering is one of the best ways to develop scientific breakthroughs? Can she assure me that where clusters, such as the Oxford and Cambridge

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technology arc, cross regional development agency and Small Business Service boundaries, artificial constraints will not inhibit technological development?

Miss Johnson: I entirely agree that it is important to make clustering work, and I am sure that those working in science are keen that it should. We have been emphasising the role of regional development agencies in technology, and my right hon. Friend the Secretary of State spoke to the chairmen of the RDAs earlier this week to stress their role in ensuring that business and science in the UK are successful.

Packaging and Production Waste

8. Bob Russell (Colchester): What representations she has received from the labelling industry as to what constitutes packaging waste and production waste. [2038]

The Parliamentary Under-Secretary of State for Trade and Industry (Miss Melanie Johnson): The Department has received six letters from businesses in the UK labelling industry which refer to the Environment Agency's decision to issue guidance noting that the backing paper of labels should be treated as a packaging material.

Bob Russell: If the Government want to be helpful to the packaging industry, may I say that that is a very unhelpful answer, and suggest a way to resolve the problem? The Minister, accompanied by a sufficient number of experts and advisers, should get out of London and go to a proper factory where labelling is going on. May I extend an invitation to her to visit Pago Ltd. in Colchester, where she can see at first hand the difference between packaging waste and production waste?

Miss Johnson: I am grateful to the hon. Gentleman for the invitation. I am aware that he has assiduously been pursuing such issues with my fellow Ministers and the Environment Agency, and I believe that they have been dealt with thoroughly to date. We have elegantly transposed the definitions from the EU directive into UK implementation with the result, I am informed, that the cost in the UK is markedly lower than in any other EU member state. We recognise the value of the industry in the UK and we shall continue to work with it to ensure that implementation is as effective as possible.

Mr. Eric Illsley (Barnsley, Central): My hon. Friend will be aware that timber and wood products are not included under the packaging waste regulations. A recovery target only is set for wood products because of the general feeling that timber cannot be recycled. However, there are companies, including one in my constituency, that recycle waste timber products and facilitate their further use. Unfortunately, such companies cannot take advantage of packaging recovery notes to generate income to help to establish the industry and increase the amount of waste wood that is recycled. Does my hon. Friend intend to look again at the regulations with a view to including such companies?

Miss Johnson: The Environment Agency is responsible for interpreting and producing guidance on the current directive, and now that it has done that it is

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probably not possible to accommodate my hon. Friend's suggestion. However, a requirement of the directive is that it be reviewed, so it might be helpful if he makes representations to the Department, which I shall take up through my officials during future negotiations.

Mr. Nicholas Winterton (Macclesfield): I have already raised this case with the Secretary of State for Trade and Industry on behalf of my constituency company, County Labels Ltd. of Adelphi Mill, Bollington, just north of Macclesfield. I have to tell the Under–Secretary that she really needs to come down to earth and get in touch with the reality of competition from Europe and elsewhere. In Europe, the backing paper on labels is not classed as packaging owing to its functionality and the fact that it forms an integral part of the manufacturing process—article 21, section 8 can be quoted in aid of my argument. Will the hon. Lady ensure that the backing paper on labels is not the subject of an additional onerous burden on our manufacturing industry?

Miss Johnson: I am impressed by the hon. Gentleman's grasp of detail—I congratulate him. We continue to work closely with representatives of UK paper and printing-related industries to resolve outstanding issues, but the fact is that the interpretation placed on the directive by the Environment Agency has been guided by a High Court decision and the agency is duty bound to give UK companies the best possible guidance in the light of legal decisions. May I also point out that the directive was agreed in 1994 by the then Conservative Government?

Steel Industry

9. Helen Jackson (Sheffield, Hillsborough): If she will make a statement on prospects for the steel industry. [2039]

The Minister for Employment and the Regions (Alan Johnson): The United Kingdom steel industry has experienced difficult trading conditions in recent years and many jobs have been lost as a result of restructuring and cost cutting. However, the industry has an excellent productivity record, a wide range of high-quality products and a well trained work force. All of that will help its competitive position.

Helen Jackson: I thank the Minister for his answer, but does he accept that there is widespread concern in the steel industry in my constituency and in south Yorkshire that very high energy prices and uncertainty about the euro are making the industry less than competitive in Europe? Is he surprised by the fact that, according to his written answer to me on 9 July, his Department does not even know or collect region by region import and export figures for steel and related industries? Will he ask the Department to sharpen up its act on behalf of the steel industry so that, as Members of Parliament, we can track properly exactly what is happening region by region with exchange rates, imports and exports in our core manufacturing industry?

Alan Johnson: My hon. Friend makes an important point. She has been a vigorous campaigner on behalf of steel communities, particularly in south Yorkshire. We are

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aware of the problems of the steel industry, but none of them can be solved instantly. They relate to issues which we are working hard to try to resolve.

On my hon. Friend's specific point, I fully expect not to get the award for best written answer this year. I will look at the matter again, although I have made inquiries of the United Kingdom Steel Association, and it told me that it does not keep figures other than for Customs and Excise. So, it is a mystery why its report to my hon. Friend differs from the information that it is feeding to us. We should be able to ensure that we have better figures that are based on regions, especially since, through regional development agencies and the thrust of our regional approach, we shall need them in future.

Mr. Graham Brady (Altrincham and Sale, West): With UK energy prices already higher than those of many of our European Union competitors, is it not insane to pile the climate change levy on the UK steel industry while it is struggling to compete?

Alan Johnson: We have already had a canter round the course on the climate change levy. Corus—and the UK steel industry in general—was very clear that the climate change levy did not lead to its recent difficulties. Indeed, we have negotiated an exemption for dual-use fuels. That is subject to a challenge because there was a complaint by a UK secondary steel manufacturer, but it was widely welcomed by the steel industry. We have struck the proper balance between pursuing environmental targets, on which hon. Members on both sides of the House agree, and ensuring that we have a competitive steel industry in this country.

Mr. Win Griffiths (Bridgend): Has my hon. Friend had any recent discussions with management and unions on the situation in south Wales, where we were particularly severely hit at Newport during the most recent reorganisation of British steel, in order to find out whether the Government can do anything further with Corus management and unions to promote the industry and ensure that there are no further job reductions in south Wales and in Port Talbot especially, which has a lot of good things going for it?

Alan Johnson: We announced a package of measures on 3 May to help steel communities throughout the country, but particularly in Wales. On my hon. Friend's specific point, I will of course be willing to talk to the Iron and Steel Trades Confederation and other unions, all of which have an excellent track record of taking a constructive approach to such problems. I would be delighted to talk to them to see whether we can assist further in the area that he has mentioned.

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