Below is the text of Mr Major’s response on Manufacturing Investment, made on 26th January 1989 in the House of Commons.
Mr. Key To ask the Chancellor of the Exchequer what is his latest information on the investment intentions of manufacturing industry.
Mr. Anthony Coombs To ask the Chancellor of the Exchequer what is his latest information on the investment intentions of manufacturing industry.
Mr. Major The Department of Trade and Industry’s investment intentions survey published in December showed that manufacturing investment is expected to grow by 11 per cent. in 1989.
Mr. Key Does not that reply indicate that manufacturing industry understands far better than the Opposition the opportunities generated in the economy by this Government? Can my right hon. Friend say by how much manufacturing investment has grown over the past five years or so?
Mr. Major My hon. Friend is entirely correct. Manufacturing investment in real terms reached an all-time peak in the second quarter of 1988, and is expected to increase substantially next year.
Mr. Anthony Coombs I welcome the buoyancy of manufacturing investment intentions, especially as last year there was the largest increase in manufacturing investment for 25 years. Is my right hon. Friend aware of a recent survey on industrial space take – up throughout the country which indicated that more than one third of the total industrial space taken up last year was in the West Midlands? Does not that show clearly and unequivocally how geographically broadly based the economic expansion of this country has become?
Mr. Major Indeed it does, as does the fact that unemployment has fallen in all the regions in the past 29 months. The last CBI survey shows clearly that investment intentions remain strong for the future.
Mr. Win Griffiths Is the Minister aware that, despite high investment in industry, the CBI survey pointed out that, for the first time for three years, more exporters are gloomy about prospects than before, and that in Wales more than one in three manufacturers who export are reporting reductions in their orders because of the high interest rate policy? Are we not suffering because of the Chancellor’s desire to give money hand over fist to the wealthy?
Mr. Major Manufacturers in Wales and elsewhere recognise clearly that renewed inflation is far more damaging to them than is the medicine necessary to ensure no renewed inflation.
As regards the CBI survey, the hon. Gentleman quoted very selectively. The CBI said quite clearly that the figures indicate that strong manufacturing investment is set to continue.