The Economy

Michael Connarty Excerpts

Tuesday 11th December 2012 Commons Chamber

[Gordon Birtwistle (Burnley) (LD)]

I congratulate the new hon. Member for Middlesbrough (Andy McDonald) on his interesting and excellent maiden speech.

I listened to the autumn statement with a lot of interest because I, a simple mere Back Bencher, was able to put forward a proposal to the Chancellor of the Exchequer and the Chief Secretary to the Treasury, suggesting that industry would blossom and grow if we included in the autumn statement something to help with capital allowances. I was delighted to see that such a measure was included in it. Industry needs confidence to grow and it needs confidence to start to invest. I believe that this major part of the autumn statement has not much been picked up around the country. Companies in Burnley, to which I spoke prior to the autumn statement, assured me that such a measure would help them to invest in brand-new plant and equipment, so I shall follow up to see if they have delivered on that.

Some plant and equipment could be made mainly in the UK, but some of it will come from abroad. The main point, however, is that the companies investing in this plant and equipment will need more people to work on the new pieces of kit. They will also become more efficient and deliver more profits—and hence provide more tax. That will obviously help the country along.

Another interesting feature of the autumn statement that was not published anywhere else was the increase from 100% to 120% in the Government Actuary’s Department rate for self-invested personal pensions. We have tied pensions to the triple lock, so that the vast majority of old age pensioners will receive an increase that is way above the inflation rate. However, this is a major step that will benefit those who have made their own arrangements through various SIPP and self-administered pension schemes. They will now be able to spend more of what they have invested in pension funds, rather than the Government’s holding it back, and that will create growth because they will start to enjoy spending money that they have saved over many years.

The main thing that we must do is invest in manufacturing. I used to be in manufacturing myself: I worked in the aerospace industry. Over the next 20 years, the airlines of the world will spend some $7 trillion on new aeroplanes and helicopters, and, as the second-biggest manufacturer in aerospace equipment, we must get involved. That will mean a growth of 5% in the industry every year, so over 20 years we will have to double our capacity to produce aerospace components. Well over 100,000 people already work directly in the industry, and the supply chain employs even more. The country must get involved, and in order to do that we must expand.

Another aspect of the autumn statement that was not picked up by any of the newspapers was the £100 million that the Chancellor has put into the aerospace supply chain. In Lancashire, the North West Aerospace Alliance has bid for a national aerospace supply chain centre to be built somewhere in the north-west. I hope that it is built in Burnley, but as long as it is built somewhere in the north-west, I shall be delighted. I am sure that you would love to see it built in Chorley, Mr Deputy Speaker, but I suspect that it will go to BAE’s new industrial park in Samlesbury.

We need a massive investment in the aerospace industry, but one of the big problems with the doubling of the industry over the next 20 years is the provision of staff with the necessary skills. Over the last 30 years, various Governments ignored apprenticeships—and the last Government were just as bad as their predecessors. I am glad that the coalition Government are investing in apprenticeships, but the wreckage of 20 or 30 years cannot be turned around in two years. Apprentices need to be given more time in which to learn the job, and I am delighted that that is happening.

The last Government wanted 50%, of students, or even more, to go to university and study subjects which, in the main, were no longer applicable. What we want is for young people either to go into apprenticeships or jobs or to go to university to study the subjects of the future rather than the past: subjects such as high-tech manufacturing, including high-tech food manufacturing.

When I visited the British Aerospace apprentice school in Warton, I met the apprentice of the year, a young lady who had been on BAE’s apprentice scheme. She had been told by her college not to be an engineer but to go to university and study something else, because she was far too clever to be an engineer. It refused even to advise her on what an engineer was.

[Michael Connarty (Linlithgow and East Falkirk) (Lab)]

I have been at a meeting of the all-party parliamentary apprenticeships group in the last couple of hours. About 30 apprentices were present. One of them, a woman who is now at Vauxhall, said that her school had spent all its time trying to persuade her to try to get into university rather than becoming an apprentice. It was clear from what she was saying that those at the school thought that it would be higher in the league table if people passed A-levels and went to university rather than entering what that woman said was a very fulfilling career. That seems to be the pattern in many schools today.

[Gordon Birtwistle]

I am grateful for that intervention, and I entirely agree with the hon. Gentleman. I am the chairman of the all-party group on apprenticeships. Unfortunately, I have been sat here in the Chamber today waiting to speak, instead of being at that all-party group meeting, and I am sorry I missed hearing from those apprentices.

The hon. Gentleman may recall that two Airbus apprentices came to a previous meeting. Both of them had turned down the chance to go to Oxford university in order to be apprentices at Airbus. Both of them said, “We’ve come to Airbus, and it has taken us through its apprenticeship programme and paid for us to go to university.” Both of them were proud to say they had bought new cars and were happy to pick up their friends, who had gone to university and now had not got jobs, and to take them out on a Friday night.

We must encourage young people to go to university via companies such as Airbus, Rolls-Royce and BAE Systems. I agree with the hon. Gentleman that it is wrong for schools to advise young people to go to university just to ensure that their figures for pupils attending university go up. That is outrageous, and it needs to be looked at. I have argued that case for quite some time.