Industrial Policy and Manufacturing

Debate between Adrian Bailey and Gerald Howarth

Thursday 22nd November 2012 Commons Chamber

[Sir Gerald Howarth (Aldershot) (Con)]

I am delighted to follow the hon. Member for West Bromwich West (Mr Bailey), for it was in 1984 that I made my maiden speech in the House as the newly arrived Member for Cannock and Burntwood on the subject of manufacturing in the west midlands, so I yield to no one in my enthusiasm for manufacturing industry.

It has been a mistake in this country that for the past 40 years there has been an over-reliance on financial services as the salvation of our prosperity. The bust of 2008 has blown that apart and revealed that there is a pressing need for the United Kingdom to have a much more diversified economy. As a former international banker, I like to tell people that I am now going straight—I am a politician. For some curious reason, they think that is rather funny.

The point has been made about the decline in manufacturing industry in Britain. Let us look at the figures. In the case of Germany, 20% of its output is now manufacturing. It has maintained its position, and of course it is benefiting from a thoroughly depressed exchange rate. Nevertheless, it has seen that manufacturing can contribute, whereas as my hon. Friend the Member for Burnley (Gordon Birtwistle) pointed out, in the United Kingdom manufacturing has declined from 18.4 % of our national output in 1997 to 10.8% last year. I hope that the Opposition will not constantly deride those on the Government Benches for the decline in manufacturing industry on our watch, as it pretty well halved on theirs. I hope we can attain a consensus on the need to do something for manufacturing. There is good reason why we should be confident.

[Mr Bailey]

I think I know what the hon. Gentleman means, but he has not reflected that. Manufacturing did not halve under the previous Government. As a proportion of the economy it may have done so, but it actually grew. That has been acknowledged in the Government’s policy.

[Sir Gerald Howarth]

It is important to make the point that the contribution of manufacturing to output halved. That is a figure that the public will understand as indicative of what was happening.

I want to be positive, because the United Kingdom has historic and current industrial manufacturing flair and capability. I single out just two companies—JCB, a brilliant private family company in Staffordshire, and Dyson, the inventor of the bagless vacuum cleaner. [Interruption.] Indeed, Hoover too, as my hon. Friend the Minister says. Formula 1 as well has been a stunning success for advanced United Kingdom manufacturing, as has aerospace, which I shall come to in a moment.

I remind the House that JCB employs 10,000 people worldwide, of whom 6,000 are employed in the United Kingdom. JCB’s revenues rose last year by 37% to £2.75 billion. Dyson sold eight out of 10 of its appliances abroad, with revenues of £770 million and profits of £206 million—a serious success story.