Inward investment targets slashed

THE DEPARTMENT of Trade and Industry has scaled back massively its projections of how many inward investment projects Britain will attract following the economic downturn in Asia and elsewhere, writes Michael Harrison.

Figures published yesterday show it has only set a target of securing 250,000 jobs from foreign direct investment by the end of this Parliament. By contrast, inward investment has secured 570,000 jobs in the past six years. In 1997-98 alone, 125,000 jobs were created or safeguarded through 618 projects. Although the Government is anxious to maintain Britain's position as the prime location in Europe for foreign investors, the latest DTI targets, agreed jointly with the Foreign Office, show the level of investment is expected to be much lower. Over the lifetime of this Parliament, the DTI expects jobs to be created at about half the rate achieved in the previous five years.

Sir Richard Wilson, the Cabinet Secretary, is meanwhile close to completing a review of trade promotion after a turf dispute between the DTI and the Foreign Office. He is expected to recommend a more unified approach between the two departments.

Peter Mandelson, the Secretary of State for Trade and Industry, said yesterday that there would be no takeover of the trade promotion portfolio by one department or the other, nor would it be handed over to a free- standing body.

Other figures yesterday show the DTI will pay pounds 408m over the next three years on miners' health compensation claims. They cover illnesses such as obstruction of the airways and vibration white finger, hearing loss and other health claims. Nuclear decommissioning costs, mainly related to the rundown of Dounreay, will be pounds 497m.