Examination of Witnesses (Questions 160-179)
RT HON
LORD MANDELSON
14 JANUARY 2009
Q160 Mr Hoyle: Of course.
Lord Mandelson: Waving the flag!
Q161 Mr Hoyle: Very much so. Can
you get the ministers to back them?
Lord Mandelson: However, I have
nothing against the other hybrid cars that they others have.
Q162 Mr Hoyle: Well, I have because
we both know that is the problem, is it not? It is built in Japan,
shipped to this country with no British parts whatsoever on it
and no British jobs. The fact is the Australian Government have
done a deal that you build hybrid in Australia. If the Australian
Government can do that, why can we not do it?
Lord Mandelson: We may well yet.
Q163 Mr Hoyle: It is too late when
ministers are already buying them. The answer is do not buy them,
then they will build here.
Lord Mandelson: This was either
before my time or above my pay grade or both, I do not know! I
just want to make this point. If you could have had more success
than I did in producing a major Royal Mail van order for Leylands,
I wish you had come to this earlier.
Q164 Chairman: I hesitate to direct
Lindsay, but he asked a very important question which he has not
asked before, unlike the one about procuring cars, about the tax
treatment of commercial vans, which is an interesting question.
Lord Mandelson: The Chancellor
made some adjustments at the time of the PBR on vehicle excise
duty to help. If there are further specific proposals, I suggest
you let me have them and I will pass them on to the Chancellor
personally as he prepares for the Budget.
Q165 Mr Hoyle: What can we do to
ensure that Government procurement does support the British truck,
van and car industry?
Lord Mandelson: We can juggle
the competing demands of hybrid, low carbon, environmentally friendly
and British first. The way to do that is to make sure the hybrid
environmentally friendly low carbon are being produced in Britain.
That is what Ed and I and others are working on a strategy to
help achieve.
Q166 Mr Hoyle: But there is a great
myth about the hybrid car anyway.
Lord Mandelson: I think you are
pushing me to the bounds both of my knowledge and Government policy
here.
Q167 Mr Hoyle: If a Jaguar is good
enough for the Secretary of State, let us see the rest of the
ministers in British built cars. Can you work on that?
Lord Mandelson: There are competing
pressures and obligations.
Q168 Mr Bailey: You touched earlier
on, I think the words were, examining or considering what could
be done to assist the finance arms of the motor manufacturers.
We have given billions to help the banks supply credit and we
are aware of the failure to do so and the issues which arise from
it. It seems to me totally illogical that we do not take steps
to help non-banking funders, such as the finance arms of the motor
industry where you could reasonably expect a very positive dividend
in terms of stimulus of demand for key manufacturing products.
I would welcome your thoughts on why we have not done it so far.
Lord Mandelson: This is one of
a number of issues raised with us by the car industry. I accept
one route for us to help could be to see how the motor finance
arms can be assisted in terms of their additional liquidity needs
and this is something we are looking at. However, this has to
be set alongside a number of competing requests from the car industry
and we need to decide where to target resources and where to prioritise.
We are not yet at the end of that consideration.
Q169 Chairman: There are more jobs
in the automotive distribution and retail sector than there are
in the manufacturing sector, so, in fact, supporting sales does
not just help the manufacturing sector.
Lord Mandelson: And 10,000 more
according to Tesco's yesterday and Sainsbury's the day before.
Q170 Chairman: No, we are talking
about the car sector in particular. There are a lot of jobs at
stake in the showrooms and the garages of this country.
Lord Mandelson: Of course, I accept
that.
Q171 Chairman: Can I ask two or three
final questions. Firstly, the possibility of looking at the whole
supply chain rather than just the tier one organisations. The
kind of R&D support we are talking about with Jaguar Land
Rover might also be appropriate further down the supply chain
because losing major suppliers, of course, decimates the ability
of a manufacturer to manufacture in this country.
Lord Mandelson: Okay, but how
far do you want Government intervention, bailing out and subsidy
to go?
Q172 Chairman: I think the industry's
view needs to be listened to very carefully on that point to make
sure they sustain their supply chains.
Lord Mandelson: Do you think it
would enjoy all-party support if we were to do so?
Q173 Chairman: Pass, I am asking
as a neutral chairman, I do not know! I will happily speculate
about that with you privately, Secretary of State. What about
what the French are doing, a scrapage allowance for older and
more polluting vehicles, for example. The French are doing that
on 10 year old vehicles.
Lord Mandelson: A possibility,
slightly overrated, tends to favour imports.
Q174 Chairman: One last question
from me. The industry came to see you in November. I have been
told by some members of the industry that they have had no formal
response to that meeting yet, they sense they have not had a closure
on that meeting yet. You told us they are having another meeting
later this month.
Lord Mandelson: Yes.
Q175 Chairman: That is when they
will get the formal response of that meeting in November?
Lord Mandelson: We have a continuing
dialogue with them. We are not some sort of command and control
organisation that receives the demands of the car industry one
day and presents our conclusions the next.
Q176 Chairman: It is nice to know
where people stand in the fast moving and very difficult environment.
Lord Mandelson: There are many
sectors, many companies in parts of the economy who are worried
and nervous and we have to think of them all, but I fully accept,
as I said at the outset, this sector is very important for Britain's
future manufacturing strength and our economic success.
Q177 Chairman: If you were to ask
for my view, my view is the importance of the R&D issues we
talked about earlier because keeping those kinds of jobs going
and supporting those kinds of jobs is much better than losing
them because you will never rebuild that expertise.
Lord Mandelson: If it were a choice
between prioritising the finance arms or help with R&D, where
would you put your money?
Q178 Chairman: These are difficult
decisions.
Lord Mandelson: It is a rhetorical
question.
Q179 Chairman: Secretary of State,
that concludes our questions.
Lord Mandelson: It has been a
great pleasure.
Chairman: Thank you very much, indeed.
We will see you again shortly.
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