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GE Lights

I congratulate my right hon. Friend the Member for Leicester, East (Keith Vaz) on securing the last debate before we adjourn for Christmas. I know from my discussions with him on the issues that he has raised that he is working extremely hard on behalf of his constituents to represent them and to try to save their jobs. It is somewhat poignant and distressing that at a time when families throughout the country are turning on their Christmas lights for celebration and joy, there are plans to switch off the lights at GE in Leicester. The facility has produced lights for more than 60 years and provided stability and prosperity for those who have worked in the factory. I completely understand the distress described by my right hon. Friend that is caused to individuals when they lose their jobs because a facility in which they have been working for a long time closes down. My right hon. Friend was right to draw our attention to the context in which the decision has been taken. The UK economy has been very successful over the past decade or so. We have had consistent macro-economic stability and 57 consecutive quarters in which there has been growth, which is unprecedented for any country in post-war times. That puts us at the top of the Organisation for Economic Co-operation and Development league for prosperity and economic success. We have also been one of the fastest growing economies in the G7, according to the latest statistics that I have read. The latest ““European Investment Monitor”” statistics show us that in 2005, the most recent year for which we have statistics, the UK was the top inward investment destination in Europe. GE is thus slightly bucking the trend. We had 559 investment projects in 2005 compared with 538 in France, which is next on the list. The recent World Bank report ““Doing Business in 2007”” examined where it is best to do business throughout the world. Again, the UK emerges in that survey as the best place in Europe in which companies could choose to invest. We are one of the top two EU countries on simplicity benchmarks for employment law. We are joint second in the EU for ease of paying taxes, and we are in the top two countries in which investors get the best protection. Overall, we come out top, so it is odd that a large company that will want to access the European market is choosing to relocate its business for what my right hon. Friend rightly described as short-term advantages. I travelled to China, Japan and Korea in September, and I talked to people in key manufacturing industries and growing sectors, such as information and communications technology, aerospace and car manufacturing. One of the really interesting things that came out of that was how many of those manufacturers see the UK as the location of choice when they are trying to find a base for a manufacturing facility that will allow them to do business in Europe and access the European market. I do not know whether discussions with General Electric will take us further, but I think that we should lay out the enormous advantages of locating here in the UK. Simply looking at short-term wage costs, which strike me as the only factor that the company has examined, is not a sensible way to plan the long-term business prosperity of a successful enterprise. The UK is often said to be a country that is not very good at manufacturing. That belies the truth. It is still an important part of our overall productivity, accounting for 14 per cent. of GDP. We have 3.7 million jobs in manufacturing and half of UK exports come from the sector. Three quarters of business investment in research and development is in manufacturing, so the sector plays a key role. One thing that has pleased me in the months for which I have been in this job is seeing success in areas in which, if one read the newspapers on any given day, one would think we were no good. For example, we are producing as many cars today as we were at the height of the car manufacturing age of the 1970s, with 1.6 million being produced now compared to 1.7 million in the ’70s. Aerospace, which is often portrayed as an industry in trouble, still produces £22 billion of wealth for this country and nearly £3 billion of investment in research and development, which means that we can stay at that higher added-value level. In biosciences, a real industry of the future, we have the largest manufacturing capacity in the whole of Europe. The other thing that I hope my right hon. Friend will be able to convey to the company is that the Government give manufacturing enormous support in every area that we can, trying always to compete by adding value, making sure that we are at the high value-added end of the sector. We set up the manufacturing advisory service to give peer-to-peer support, and in the couple of years for which it has been operating it has added nearly £250 million of value to the companies that have been assisted. There is enormous investment in research and development through the technology strategy, in which we are spending nearly £400 million a year, through the money that comes from the regional development agencies, through the R and D tax credit and through the research councils. We have a range of growth teams and sector councils, and I attended the electronics council not so long ago. Indeed, the future of light bulbs was, interestingly enough, part of our agenda. We were discussing climate change and how greater energy efficiency could be achieved by having long-life light bulbs. So there is support given by the Government there. We also spent about £30 million on setting up a number of industry forums, and their purpose is to help with lean production processes to drive down costs.