By Anthony Gould
An industry-wide lobby group has called on the next Government to direct the majority of National Lottery funds towards manufacturing in order to halt the decline of Britain’s indigenous industry.
The group called for a multi-million pound investment fund to be supported by the lottery and managed by a National Industry Fund, headed in the first instance by industrialists.
It would invest in new start-ups or companies needing expansion capital. Some of the money could be recouped by the payment of modest dividends and City flotations of up to 45% of shares of the firms involved.
The Engineering Employers’ Federation said it had not seen the details of the proposal but it held the view that it was up to companies to create the wealth themselves and for the Government to create the right economic environment.
The report, Manufacture to Survive, was due to be published yesterday by the UK Industrial Group, which claims to represent over 5,400 manufacturing, engineering and process companies.
The report complains the British economy is falling into foreign hands. Global corporations have much to contribute here, the report concedes, `but if they are not accountable to Britain and could shut down and transfer plants as swiftly as they erect them, then the UK is potentially economically and strategically neutralised.’
Financing a national investment fund would not require calling on public funds, said David Turnbull, director general of the UK Industrial Group, established in October 1992 to raise the profile of UK industry and manufacturing.
The group proposes that the first three annual tranches of £800m towards the investment fund should be drawn from the National Lottery. It dishes out £1.4bn a year to good causes. During the proposed 10-year investment term, outside investors would be invited to subscribe.
Turnbull said each £800m invested would ultimately produce £800m of direct new industrial output and a further £400m of subsidiary output and the Exchequer would benefit from £324m in direct industrial taxes.
Over 10 years it would create 314,000 jobs and a balance of trade surplus.
City accused, page 6