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Hi my name is Ross, I'm a car technician and I’ll help with your question.
Many early VW engines had the same problem, its usually the coil pack, you will have a spark sometimes but its very weak, when its put under compression in the cylinders its much harder for the spark to jump the gap and ignite the fuel which can cause a right headache when trying to diagnose as you find it has a perfectly good spark when you test it. I would try to substitute a known working coil pack from another vehicle or, they are available for as little as £20 online brand new so its not too expensive. This is such a common problem its not worth looking into other possibilities at this point until you have ruled this one out. If you have compression, and fuel, it rules out most other common problems anyway such as fuel pump relay and ignition switch etc..
thanks for that i have ordered a coil pack but the spark from the coil looks very good, and with all plugs connected to leads when cranked they also look good. fuel pump is running and fuel is being delivered (I have even poured a little fuel into inj unit! and still not even an attempt to fire.
Try the coil pack first, its such a common problem on these, if there is compression, its not going to be a valve timing issue, so unless the ignition timing has gone completely out it only really leaves the spark. Even if the ignition timing was out it would probably give the odd splutter or pop.