Britain’s Industrial Base

Lord Hennessy of Nympsfield Excerpts

Tuesday 9th October 2012 Lords Chamber

[Lord Hennessy of Nympsfield]

My Lords, may I add my welcome to the noble Lord, Lord Marland, on his new portfolio? I am sure that I was not alone this summer when tasting the special delights of the Olympics and Paralympics in wondering whether there were wider lessons to be drawn from the glories we were witnessing. Our Olympics summer was a shining advertisement for what can be done through careful planning and a fruitful public-private mix, plus the energising effect of a wide and sustained political consensus in creating a remarkable collective enterprise. For those six lustrous weeks we were, to borrow from Abraham Lincoln’s 1861 inaugural,

“touched … by the better angels of our nature”.

Such thoughts triggered in my mind a memory of 1985, when the one-off Select Committee of your Lordships’ House on overseas trade reported under the chairmanship of Lord Aldington—of which committee the noble Lord, Lord Selsdon, was a member, as was the noble Lord, Lord Stoddart of Swindon. I was a journalist at the time and was struck by the urgency of the report’s tone. It struck me even more forcibly when I reread it last month. The committee was appalled by the shrivelling of our industrial base, particularly by the decline of manufacturing as a proportion of our national wealth and by a growing overreliance on services. This is the sentence that left the deepest dent in my memory:

“A principal theme of the Committee's report is that of the national attitude towards trade and manufacturing and their principal recommendation is that it needs to change—and change radically—if we are to avoid a major social and economic crisis in our nation’s affairs in the foreseeable future”.

We did not and we have not. In 1985, manufacturing accounted for 25% of gross domestic product. In 1947-48, my first year of life, that figure stood at 36.6%. By 2010, it had fallen to 9%.

Much has been achieved in renewing our industries and services since the mid-1980s. I am not this evening deploying what Edward Thompson called,

“the enormous condescension of posterity”,

to the work of far better men and women than me in science, technology, industry and commerce, who have applied themselves in the past to this problem and given it their absolutely best shots—far from it. I am also hugely sympathetic to the coalition’s industrial strategy, which seems to avoid both the excessive state interventions of the 1960s and 1970s and the excessive loss of confidence in what the state could do as an enabler in the 1980s. I have great hopes, too, for the review of competitiveness by the noble Lord, Lord Heseltine, which is due later this month, not least because of my admiration for the powerful public-private mix that he brought to the regeneration of Merseyside 30 years ago. I share, too, the analysis of the noble Lord, Lord Baker of Dorking, about our missed opportunities for transforming technical education since the exemplary White Paper on technical education of 1956.

I am, however, struck by the continuing resonance of the Aldington committee’s analysis of 27 years ago, when its report laid out the interlocking and mutually reinforcing changes that the UK needed to redress the balance between manufacturing and services and to achieve an enduring breakthrough in exports. These included improvements in the levels of investment, education and training, research and development, competitiveness and the pursuit of a co-ordinated strategy for recovery resting on as high a level of political consensus as possible. Every one of these factors continues to merit acute attention and the urgency is even greater in 2012 than it was in 1985.

This is a post-Olympics task for our nation, which requires the better angels of our nature and much, much more. Would it help a little if here in your Lordships’ House we found a way of deploying the sustained analytical application, realism and candour needed to assist in the improvement of our economic performance? Might a standing Select Committee comparable to Lord Aldington’s one-off committee be the way? I offer this suggestion at the risk of adding to that self-congratulation of which our critics accuse us, but we have in this House as rich a mixture of industrialists, financiers, scientists, technologists and economists as, I venture, any legislative Chamber in the world. There is no element of the condition of Britain that merits our sharpest attention more than the well-being of our industrial base and the prospects for generations to come.