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Mr. Byers: The hon. Gentleman makes an important and strong point about the wider implications of the announcement, not just for Luton, but for the surrounding towns and other areas throughout the United Kingdom. There are two ways in which we can address that. First, we need to ensure that individual employees who may be located outside Luton, in Dunstable or elsewhere in the hon. Gentleman's constituency, have the tailored advice and support that I mentioned in the statement.

Secondly, we need to give clear help to the supply chain. Many companies and businesses in the hon. Gentleman's constituency will have been major suppliers to Vauxhall at Luton. We know the first tier suppliers and, with the agreement of Vauxhall, we shall contact them to ensure that they are given short-term help to diversify and help with retooling and reskilling, if that is appropriate. We have very much in mind the needs of the businesses in the supply chain and we shall do all that we can to assist them.

There may well be a wider issue about how we can modernise the auto industry in south Bedfordshire, and I shall draw that aspect to the attention of the regional

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development agency and the other partners who are drawing together the practical proposals on how we can move forward.

Mr. Patrick Hall (Bedford): Will my right hon. Friend take it from me that the feeling of shock and uncertainty is being experienced in Bedford and Kempston, as well as in Luton, Dunstable and other neighbouring areas? People are asking where the problem will lead and where it will end. Despite the welcome announcement, as I understand it, of an extra 1,000 jobs for the Vauxhall-IBC Vehicles plant in Luton, will my right hon. Friend do his best to address that feeling of uncertainty? In particular, when will a programme of effective action be prepared, published and implemented to support companies in the supply chain and underpin the local economy?

Mr. Byers: That was one of the specific points made in the package of measures announced jointly yesterday by me and my right hon. Friend the Minister for Employment, Welfare to Work and Equal Opportunities. We are conscious of the vulnerable position into which many supply chain businesses will be put, often by cash-flow problems, which might hit them very quickly. The present situation involves a relatively slow run-down of production at Luton. The bulk of the jobs will be lost at about this time next year, so we have an opportunity to put in place some robust measures. I hope that those measures will overcome many of the difficulties and lift the uncertainty that must be felt by many people and businesses.

I am conscious of the wider implications, which extend to areas such as the constituency of my hon. Friend the Member for Bedford (Mr. Hall). The brief that we have given to the regional development agency states that although concentrated issues may need to be dealt with in Luton, the wider implications will also need to be addressed.

Sir Nicholas Lyell (North-East Bedfordshire): In seeking to alleviate the unhappy position of people whose jobs and businesses will be affected by the problems in Luton and in Bedfordshire more widely, will the right hon. Gentleman consult carefully with the Department of the Environment, Transport and the Regions? Will he also take note that infrastructure between the M1 and A1 in Bedfordshire is poor and ask for higher priority to be given to the roads programme to improve that infrastructure, so that businesses can build and develop?

Mr. Byers: I have no doubt that infrastructure must be one of the key issues when the groups that we have established consider the measures necessary for the economic regeneration of the area. The right hon. and learned Gentleman mentioned difficulties in relation to the M1 and A1. I shall draw that point specifically to the attention of my right hon. Friend the Deputy Prime Minister. As we consider the steps that are necessary to create further jobs and employment opportunities in the United Kingdom, the need for an infrastructure that can be responsive and meet the demands of business is becoming increasingly clear. I understand that my right hon. Friend the Deputy Prime Minister will make an announcement

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tomorrow about the roads programme. I believe that economic growth and stability will be a key theme in that announcement.

Mr. Tony Lloyd (Manchester, Central): My right hon. Friend's action in rapidly establishing practical steps to at least ameliorate the problem is welcome and is in sharp contrast with the outrageous behaviour of General Motors. Will that company now pick up any responsibility for the rescue package? It has an obligation to the work force. Also, my right hon. Friend mentioned information and consultation. It is obvious that General Motors has ridden roughshod over the natural rights that the Vauxhall work force should have had. He commented on the draft European Union directive, but will he reconsider the issue? It is clear, especially in comparison with other parts of Europe, that there is a huge lack in our law, which fails to protect British workers.

Mr. Byers: Clearly, there will be discussions with General Motors about what contribution it can make to help with the regeneration of Luton and with the consequences of its decision.

On the information and consultation directive, the Government's position is very clear. We believe that the directive is flawed and that it will not be applied in the United Kingdom in a way that will bring the benefits that some people have suggested. However, my hon. Friend makes an important point, which we need to consider, namely, how to improve our procedures in such a situation. The Government believe that, rather than looking at what may come out of Europe, it would be far better to examine what we can do in our domestic arrangements. That means looking closely at the collective redundancy situation and the European works council provisions. By doing so, and perhaps altering them to reflect the United Kingdom's national position, we will be in a far stronger position to deal with the concerns that were raised by my hon. Friend--but address them we will. That is why we intend to review those two areas.

Mr. Jonathan Sayeed (Mid-Bedfordshire): In Europe during the last quarter, GM lost $181 million. Such losses are not sustainable in the long term. A good part of those losses were incurred outside the United Kingdom, which demonstrates that the decision has little or nothing to with the weakness of the euro, and is not the fault of the work force, who have become increasingly productive--they produce good quality goods and have been extraordinarily flexible in their work practices. I trust that the Secretary of State will endorse those points.

During the past year and a half, I have talked to representatives of the manufacturing industry with greater frequency. It has become clear that they find that their costs are increasing dramatically. That is why inward investment in manufacturing is going down and national investment in manufacturing is going down--or, at least, it is not increasing at the rate that it has maintained in the past. The so-called environmental taxes, which are being imposed by the Government, are one reason for that. I say "so-called" because they have little to do with the environment and a lot to do with taxation. The non-wage costs of employing people is another factor. I ask the Secretary of State, in a non-party political way, to examine the costs of manufacturing and the costs of

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employing people. If we could reduce them, we could reverse the trends in this country involving a decline in inward investment and a decline in investment in manufacturing.

Mr. Byers: I agreed with the first part of the hon. Gentleman's question, about the work force at Luton. There is no doubt that they have been flexible and hard working and that productivity has improved as a result. Yesterday's announcement is no reflection on the commitment and motivation of the work force at Luton. Other factors came into play. As I said, General Motors conducted a worldwide review.

I regret, however, that the hon. Gentleman had to move into party-political mode in relation to costs. Examining yesterday's announcement makes it clear why General Motors moved to close car production at Luton--its decision was based on overcapacity and on models not selling as well as it expected them to do.

It is worth reflecting on the fact that if the situation in the United Kingdom was as bleak as the hon. Gentleman portrayed, why are record levels of investment coming into the United Kingdom--this morning's figures show that in terms of direct foreign investment--and why have we got a million more people in work now than there were when we took office in May 1997?

Mr. Andrew Miller (Ellesmere Port and Neston): I informed my hon. Friends the Members for Luton, North (Mr. Hopkins) and for Luton, South (Ms Moran) and those Opposition Members who represent seats in that area of the calls that I have received this morning from my constituents, who send their heart-felt sympathy to people in the Luton area. My constituents have known mass unemployment.

What discussions is my right hon. Friend having with his opposite numbers in other European countries to address the serious problem of overcapacity in Europe and elsewhere? On a more local level, is he aware that, unlike the rest of mainland Europe, all interplant transfers by GM in the UK go by road, not rail. Will he urge the Deputy Prime Minister to lean on rail companies to encourage them to put a decent deal together so that we can lower the cost of interplant transfers?


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