Patricia Hewitt has told Labour that terrorism will not be allowed to destroy the economy. She also promised to hold a conference to examine the problems of the manufacturing industry.

"We have heard calls for a manufacturing summit. And I shall be holding a manufacturing summit, bringing together the development agencies, the TUC, the CBI, the devolved administrations," she said.

The latest figures from the Chartered Institute of Purchasing and Supply showed that manufacturing activity continued to fall in September, with companies experiencing the fastest fall in new orders since the start of 1999. Output also declined, though at a slower rate, while manufacturing employment also fell.