Economy: Business Investment

Baroness Williams of Trafford Excerpts

Thursday 27th March 2014 Lords Chamber

Asked by

[Baroness Williams of Trafford]

To ask Her Majesty’s Government what are the latest figures they have for the business investment component of the total gross fixed capital formation (GFCF); and what plans they have to increase business investment in the future.

[The Parliamentary Under-Secretary of State, Department for Business, Innovation and Skills (Viscount Younger of Leckie) (Con)]

Through industrial strategy and our structural reforms, we are setting the long-term direction needed to give businesses the confidence to invest, export and grow. Business investment was £123 billion in 2013, accounting for more than half of overall investment. The OBR forecasts that it will grow by 8% in 2014. At Budget, we announced further funding for innovation, including £42 million for the Alan Turing Institute and £74 million on cell therapy and graphene centres.

[Baroness Williams of Trafford (Con)]

I thank my noble friend for his response. Can he pinpoint the cause of the increase in investor confidence?

[Viscount Younger of Leckie]

My Lords, the economy is growing, and unemployment and inflation are down. This is supported by an improving outlook in our export markets. We are cutting corporation tax to 21% this April, and to 20% in April 2015. At Budget, the Chancellor announced measures to reduce business energy costs and doubled our export finance scheme to £3 billion. These and other reforms are improving the business environment and providing long-term certainty for businesses, investors and employees.