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Mr. Adrian Bailey (West Bromwich, West) (Lab/Co-op): I should like to start by welcoming the maiden speeches of my hon. Friends the Members for Burnley (Kitty Ussher), for Llanelli (Nia Griffith) and for South Swindon (Anne Snelgrove), and of the hon. Member for Wimbledon (Stephen Hammond). I particularly want to thank my hon. Friend the Member for Burnley for giving me an insight into a procedure that I had not realised existed. She told me that her impending maternity, and the pact that she had made with the Speaker, had enabled her to speak early in the debate. I now realise just where I have been going wrong in my four years in the House. My hon. Friend the Member for South Swindon mentioned roundabouts and circumlocution. Some years ago I stayed in Swindon. When trying to find my hotel, I experienced just what she was talking about today, so her words had particular resonance for me. I want to thank all those hon. Members because they clearly demonstrated the passion that they feel for the areas that they represent, and the dedication and commitment that they will display in the House when representing those constituencies.
I also want to thank the new Secretary of State for Trade and Industry, as well as those other Ministers who have appeared on the Front Bench at intervals today. They have already demonstrated their expertise in some areas and I look forward to working with them and lobbying them on issues that are particularly relevant to industry in my constituency.
West Bromwich, West is a heartland manufacturing constituency. Manufacturing industry still accounts for 30 per cent. of local employment there. It is also the constituency with the largest number of foundries. If ever an industry was symptomatic of traditional British industry, it is the foundry industry. Partly for that reason, I am the secretary of the parliamentary all-party group on cast metal.
The collapse of Rover has had an impact on my constituency. I do not want to rehearse the many arguments about that issue, but I want to make two points. Devastating though the collapse of Rover has been in some areasmy constituency is affected mainly in terms of the supply chain, rather than of people there being employed by the company, although there are some who werethat devastation would have been even greater had it taken place five years ago, before the supply companies had had the chance to diversify and refine their procedures in the way in which they have now done. I therefore pay tribute to the Department of Trade and Industry for the role that it has played in sustaining Rover for those five years. I am sorry that, in the end, it could be sustained no longer, but local employees attach no blame to the Government because they recognise the effort that the DTI made to keep Rover thriving and successful in the west midlands.
I have heard a lot of doom and gloom about manufacturing. The explanation put forward by the hon. Member for Havant (Mr. Willetts) was that the tide of regulation was to blame for the decline in
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manufacturing in this country. I would be the first to say that there is an issue about regulation, and I shall talk about that in a moment. However, to single out regulation without referring to any other pressures is a distortion of industrial reality. The doubling of oil prices has hit industry, as have the soaring raw material prices that have resulted partly from the huge acceleration in the economies of China and India. Another factor is the competition from low-wage European and other companies that are increasingly taking on the lower-skilled industries here. Those factors are having a far more significant impact on British industry than regulation.
It is a tribute to the Government and their macro-economic policy, and the low interest rates and benign local economic environment that they have sustained, that manufacturing industry is surviving despite all the difficult international economic pressures. We can only speculate on what would have happened if manufacturing industry, having been confronted with the situation that arose under the Conservative Government 13 or 14 years ago, with interest rates at 10 and 15 per cent., had also faced the combination of international economic circumstances that it faces now. We would have experienced economic Armageddon: that, I think, goes without saying. It is indeed a tribute to the Government's management of the economy that notwithstanding those difficult international economic circumstances, they have managed to sustain employment and output. Our economy is seen by the rest of Europe as the most successful in western Europe and the G8. Thirteen or 14 years ago, we were regarded as the sick man of Europe in the context of a far more benign international economy.
The gloomy remarks about manufacturing are not reflected locally. My constant dialogue with the foundry industry has informed me that the industry is doing better, is more optimistic and has better prospects than has been the case for nearly a decade. Only a couple of years ago it was confronted with soaring scrap metal prices, a dearth of coke supply and a rise in other raw material costs. Those pressures have now been alleviated, partly as a result of the DTI's work through Europe and the World Trade Organisation in negotiating with China, which is now releasing more coke on to the market. The deceleration in the Chinese economy over the past year has taken some of the pressures from raw material prices, as well. Industrial prospects are much better locally, partly because of those developments.
All the evidence suggests that where foundries are moving into specialist niche markets requiring higher skills, they are surviving. In the past year, Hitachi Metals has opened the first new foundry in this countryin my constituencyfor some years, producing high quality, environmentally friendly car exhaust systems. That is an interesting example of what can result from good investment and environmentally friendly quality techniques allied to traditional industry. We can survive, and I am confident that in my industry we will. Let me also make a general point. If foundries in my constituency are producing castings, other manufacturers must be using those castings and must be confident that their prospects justify the placing of orders. So it is not all doom and gloom.
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I must, however, mention an issue that has arisen in my constituency in the last few weekspartly because of the Rover situation, but partly because of a company that I can only describe as a rogue employer. RDS Automotive Ltd. and RDS Automotive Interiors Ltd. supply both Rover and Jaguar. They knew that they would be in some difficulty when Rover closed and they embarked on redundancy negotiations with the employees. However, they said, and it was accepted, that they still had secure markets with Jaguar and that they would continue.
Suddenly, on 4 May, RDS Automotive Ltd. went into administration. Workers were informed that some would receive no redundancy pay and some would not even get paid for the work that they had done. On 5 May, another company, RDS Advanse Ltd. from the same group, bought that company, so a company that went into administration was bought by another in the same group, laid off workers and did not pay them. It is now recruiting other workers, starting with a clean balance sheet. It has not met any of its obligations.
I flag that up as an issue that the Government must confront in their company law and insolvency policy. I will lobby the Government and the DTI to take action on that matter. It is wholly unacceptable in this day and age that a group of employers and directors should close a company, absolve themselves of all their responsibilities, commitments and obligations to their employees, and try to start afresh with a different work force. It is an important issue that I will take up with the Government.
Local employers mention that regulation needs to be addressed by the Government. I welcome the Secretary of State's comments on the matter. The prime concern is that there is not sufficient consultation before the implementation of some of the European regulations. It is not always done badlyone of the good examples that I have had quoted to me was the introduction of the aggregates levy, where there was consultation and the industry felt that the outcome was satisfactory. There is particular concern in the metals industry about European legislation that is known as REACH: the registration, evaluation and authorisation of chemicals regulations. That was a specific issue with the chemical industry. My understanding is that in the discussions and negotiations between the industry and the Government, a more or less satisfactory position was reached. What was not appreciated was that the regulations could have an impact on the metals industry. There is concern that European legislation that was designed just for the chemical industry could have an impact on the metals and foundry industry. I ask the DTI to carry out a thorough consultative exercise to ensure that the European legislation is proportionate to the problem and that it reflects the difficulty that it may create for that industry.
: Given that a former Secretary of State for Trade and Industry, the right hon. Member for North Tyneside (Stephen Byers), declared as long ago, I think, as 1999 his conversion to the idea of sunset clauses, whereby legislation would automatically lapse or expire after a given period, can the hon. Gentleman
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provide some good and compelling examples since then of when the Government have used sunset clauses in legislation?
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