Oral Answers to Questions

Barry Gardiner Excerpts

Thursday 15th November 2018 Commons Chamber

[Graham Stuart]

I am glad to confirm to my hon. Friend that our stock of foreign direct investment has gone up. We remain the No. 1 destination in Europe and are seeing companies in so many sectors coming here. Investors have some concerns about Brexit but, as I have said, what they are really alarmed about is the prospect of Labour seizing their assets and destroying the job creation that investment brings.

[Barry Gardiner (Brent North) (Lab)]

May I associate myself with the Secretary of State’s remarks about Sir Jeremy Heywood?

I was delighted, if somewhat surprised, to see the Secretary of State at the Dispatch Box this morning. He and his Ministers have talked about a record number of FDI investments in the last full year, 2017, but he knows that, in value, it was actually the worst year for inward investment since 1994. Complacently, he celebrates the forecast by the United Nations Conference on Trade and Development for the first half of 2018, but he knows that the UNCTAD report states that this reflects

“a surge in intra-firm loans”.

These are loans that are often used to minimise tax by creating an artificial debt shield and they create no new jobs in the UK. How many such intra-firm loans are in the FDI statistics, and what assessment has the Minister made of the reduction in tax receipts to the Exchequer as a result?

[Graham Stuart]

The UNCTAD figures that measure foreign direct investment showed the UK moving above the United States into third in the first six months of this year, but the hon. Gentleman is entirely right to say that they include intra-company loans. Any figures around flow should be treated with caution; the most important thing is the stock of foreign direct investment in this country. As my hon. Friend the Member for Kettering (Mr Hollobone) said, if we had listened to some, we would have expected divestment. There was no divestment; there were increases in investment. In the last year, if I may deal with what is most important to me and my constituents, there were 75,000 new jobs created by foreign direct investment.