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Economic Affairs

Volume 728: debated on Thursday 12 May 1966

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National Economic Development Council


asked the First Secretary of State and Secretary of State for Economic Affairs what changes he proposes in the composition and functions of the National Economic Development Council; and to what extent it is the Government's policy that the Council will continue to be serviced by a National Economic Development Office of a size, professional standing and independence comparable with that which existed prior to 31st March, 1966.

My right hon. Friend—

Even if hon. Members are not interested in international affairs affecting this country, at least they ought to know that my right hon. Friend is representing Britain at the Ministerial Council of the European Free Trade Association.

As I was saying, my right hon. Friend is proposing no changes at present in the composition and functions of the N.E.D.C., which is agreed on all sides to have a major rôle in the drive for economic growth. The Council will continue to be serviced by the National Economic Development Office basically as it was before 31st March, but with some strengthening of the staff.

I suppose we must take some comfort from that Reply. But does the statement by Mr. Catherwood that the National Economic Development Council could not expect to remain independent of the Government represent Government policy? If so, it represents a considerable change.

What Mr. Catherwood said was that the responsibility for economic planning is today that of the Government and not of the N.E.D.C. But, of course, we shall continue to receive independent advice from the N.E.D.C., as in the past.

Does not the hon. Gentleman agree that, so long as Mr. Catherwood makes the kind of statement referred to, the N.E.D.C. cannot continue to command the support of both sides of the House?

We have no evidence that the N.E.D.C. does not continue to receive the support of both sides of industry. Indeed, I would say that that support is as strong as it has ever been.

Productivity, Prices And Incomes


asked the First Secretary of State and Secretary of State for Economic Affairs whether he is satisfied that sufficient progress is being made with regard to the productivity aspects of the Government's policy on productivity, prices and incomes and if he will make a statement.

No, my right hon. Friend would certainly not claim to be satisfied. But we are tackling the problem of increasing productivity with vigour and in many different ways.

Does not the hon. Gentleman feel that the time has come to broaden the main attack from the Prices and Incomes Board—which, in this context, is doing a useful job—to the "little Neddies", which could have a much more positive rôle to play in improving productivity in the industries for which they are responsible?

I agree that they have a very important rôle to play, but I think the hon. Gentleman is a little out of date and does not realise that they are already playing it.

How soon does the hon. Gentleman expect us to reach the 6 per cent. increase in national productivity which the Chancellor has promised?

Management And Planning (Workers' Participation)


asked the First Secretary of State and Secretary of State for Economic Affairs what steps he is taking in regard to the industrial and economic activities for which his Department is responsible, to encourage workers' participation in management and planning for greater productivity.

Trade unions already participate in the consideration of measures to increase productivity by their membership of the Economic Development Committees. I agree that there is also need for full consultation in these matters at factory level.

Is my hon. Friend still satisfied with that kind of answer? Is it not time that steps were taken to implement policies of industrial democracy rather than continue to talk about the desirability of having such policies?

I have considerable sympathy with my hon. Friend's point of view. I cannot pretend, however, that the trade unions have so far shown a very great interest in this subject.

On the subject of productivity—with particular reference to page 128 of the National Plan—what steps are being taken to get free access to London Docks?

The hon. Gentleman has mentioned the desirability of encouraging consultation at factory level. What steps are the Government taking to encourage it?

As the right hon. Gentleman may know, my right hon. Friend the Prime Minister proposes to call a conference on the subject this year. But, again, this is another of those matters which might well be dealt with by he "little Neddies".

Motor Car Accessories (Prices)


asked the First Secretary of State and Secretary of State for Economic Affairs if he will refer the pricing of motor car accessories to the National Board for Prices and Incomes for report and recommendation.

Not at present. But we are continuing to keep a close watch on the prices of these goods.

Will my hon. Friend agree to take an even closer look? Is it not time that a long, close study was made of the inflated prices being charged for motor car accessories? Would it not be more important to do this kind of thing than to concentrate so much on wage restraint? Let us get some prices down.

I have a great deal of sympathy with what my hon. Friend has said, but he is mistaken if he does not appreciate that my right hon. Friend the Minister of Technology has a special interest here which he will continue to pursue.

Has this matter not already been investigated by the Monopolies Commission? What is the level of tariff protection at present enjoyed by this industry?

The answer to the first part of the hon. Gentleman's supplementary question is "Yes, it has". I cannot answer the second part of his question without notice.

National Plan Publication


asked the First Secretary of State and Secretary of State for Economic Affairs how many copies of the publication, "Upswing", have been published; to whom it has been circulated; and what was the cost.


asked the First Secretary of State and Secretary of State for Economic Affairs what will be the cost of producing the newspaper, "Upswing", what he estimates its circulation will be; and what are its purposes other than the explanation of the National Plan.

38,000 copies of "Upswing" were circulated to all branches of industry and trade unions on 24th February. To meet requests arising from this circulation, 112,000 additional copies have since been circulated. Orders are still coming in. The total cost of publishing and circulating the first issue is at present £2,513. The estimated circulation of future issues is 200,000. The estimated cost of producing and distributing six issues on this basis is £13,900. The purpose of "Upswing" is to explain the National Plan and to report on the progress of it.

Does the hon. Gentleman recall that, apart from a very unflattering photograph of the First Secretary, this document, published just before the election, is a very thinly disguised propaganda leaflet for the Labour Party and disastrous for the prices and incomes policy itself? Is it not time that this disgraceful waste of public money was stopped?

That does not appear to be the view of industry. Otherwise, we would not have had such a very substantial number of orders after the election. Out of more than 4,000 replies which we received after publication, only 15 letters were critical, and only a very small proportion of these criticised it as party propaganda.

Will the hon. Gentleman consider renaming "Upswing" "Stagnation" in order to correspond more exactly with the actual state of affairs?

I have no doubt that that sounds very clever and would have sounded even more clever during the course of the General Election. I do not know whether hon. Members opposite want us or do not want us to try to take steps to improve productivity on the shop floor, but this is one of them.

Quite apart from the undesirability of using a magazine like this for party purposes, would not the right hon. Gentleman agree that he is exposing himself to undue danger by having to explain the failure of the National Plan? Would he be good enough to assure the House that if the National Plan has these reverses they will be clearly explained in this paper?

We are continually being asked to give greater publicity to the National Plan and to national needs. I am certain that as they no longer have responsibility for them right hon. Gentlemen opposite are not interested, but it is our responsibility and we shall continue to discharge it.

On a point of order. In view of the very unsatisfactory nature of the Minister's reply, I beg to give notice that I shall raise the matter on the Adjournment.

On a point of order. I understood that you called my name, Mr. Speaker.

Unfortunately, just as I called the hon. Member for West Stirlingshire (Mr. W. Baxter) the hon. Member for Harrow, Central (Mr. Grant) used his right to give notice which precludes further questions. It is just unfortunate.

I should like your guidance, Mr. Speaker. As I understand it, once my name has been called I have the right to your ear. I understood that the intervention of another hon. Member, even on a point of order, did not supersede your having called my name.

Thank you very much, Mr. Speaker. As this seems to be a very important document which is in the possession of some hon. Members, will my hon. Friend see that other hon. Members get a copy of it so that we can intelligently follow the discussions which are now taking place?

Prices And Incomes Bill (Representations)


asked the First Secretary of State and Secretary of State for Economic Affairs what representations he has received from trade unions and associated bodies on the Prices and Incomes Bill.

Representations have been received from trade unions and trade union branches and the T.U.C. have raised a number of points which my right hon. Friend hopes to discuss with them very shortly.

In the light of these and other representations, do the Government intend to pursue the Prices and Incomes Bill, and will the new Bill contain the old Clause 14 which laid down substantial fines for those who struck or advocated strikes?

We made it clear that we intended to reintroduce the Bill, but I cannot anticipate any details.

Equal Pay


asked the First Secretary of State and Secretary of State for Economic Affairs how the universal application in the United Kingdom of the principle of equal pay for women for equal work will affect the volume of purchasing power in relation to the volume of goods and services available for consumption, while the 3½ per cent. norm of incomes increase is maintained.

The cost of equal pay depends on the extent to which its introduction affects women's pay as a whole and on the method and speed of implementation.

To what extent is the hon. Gentleman asking the Prices and Incomes Board to give priority to the claims of women for equal pay when the Board makes recommendations on wage increases and other matters referred to it?

This matter is under discussion by my right hon. Friend the Minister of Labour, the T.U.C. and the Confederation of British Industry. We must await their conclusions.

Planning Regions (Wessex)


asked the First Secretary of State and Secretary of State for Economic Affairs whether he will establish a separate planning region for Wessex following similar boundaries to those of the Wessex hospital region.

Is the hon. Gentleman aware that due to post-war developments Wessex is once again becoming a distinctive economic region of the country? Whereas it is no doubt convenient to Whitehall to divide the region between the South-West and the South-East, if regional planning is to make sense on the ground he must create a distinctive region in that part of the country.

I agree that Wessex is now booming, but this is true of many parts of the country, and has been particularly so in the last 18 months. We have to get large planning regions to get the full advantages from regional economic planning and I think we ought to stick to those we have.

Does the hon. Gentleman recall an undertaking given to me by the First Secretary, who said that if the people of the South-West required a separate region he would consider establishing that as a sub-region of the main region? What progress has been made in the matter?

I remember the representations which the hon. Gentleman made, but we are now satisfied that the region we have created is doing a proper job of work. What matters is that the people of the South-West should have improved living conditions, and that is what we are trying to give to them.

Due to the thoroughly unsatisfactory nature of that reply, I shall seek to raise the matter at the earliest opportunity.

National Plan (Parts I And Ii)


asked the First Secretary of State and Secretary of State for Economic Affairs what proposals he has to revise the figures in Parts I and II of the National Plan.

I have nothing to add to the answer I gave to the hon. Member for Lewisham, West (Mr. Dickens) on 5th May.

Is it intended that there shall be any change in the techniques used to collect and compile the figures for the National Plan? If so, will the House be so informed?

Certainly we are taking steps to improve the methods of collecting information from industry. There was a very inadequate statistical service in the Government when we came to office. There will be opportunities from time to time for us to inform the hon. Gentleman and the House of the progress we are making.

Water Rate (Southend-On-Sea)


asked the First Secretary of State and Secretary of State for Economic Affairs whether he is aware of the large increase in the water rate for the county borough of Southend-on-Sea; and whether he will refer this matter to the National Board for Prices and Incomes.

As the reason for the increase is largely attributable to the last Bud get but one, will the hon. Gentleman refer the Chancellor of the Exchequer to the Prices and Incomes Board and so stop the price increase for which the right hon. Gentleman is responsible?

The hon. Gentleman has got it wrong. The company is having both to meet higher running costs and undertake heavy capital expenditure in order to meet the growing demand for water. That is why it has been found necessary to increase charges.

Departmental Reports (Publication Dates)


asked the First Secretary of State and Secretary of State for Economic Affairs by what criteria he decides on the publication dates of the reports issued by his Department.

I am not certain what reports the hon. Gentleman has in mind. Command Papers are published as soon as they are ready.

Is the hon. Gentleman aware of the appreciation on this side of the House for the very great skill with which he manages to arrange the times when they become ready? Is he aware that his Department is being increasingly regarded as a subsidiary of Transport House in many respects?

If the hon. Gentleman wants to make accusations of that sort, he must itemise them. It would not be possible for him to do so in a single case.

Scottish Teachers' Salaries (Report)


asked the First Secretary of State and Secretary of State for Economic Affairs when he expects a decision from the National Board for Prices and Incomes on Scottish teachers' salaries.

Would the hon. Gentleman give me a categoric assurance that no documents concerned with this report have been shown to the Secretary of State for Scotland or the Scottish Education Department?

I do not know whether the hon. Gentleman appreciates that, in the course of any inquiry by the National Board, there is constant discussion over many factual matters with the interested parties. This has happened on this occasion, following precedents. The independence of the Board is in no way affected.

Is it not a fact that the Prices and Incomes Board recommended 18 per cent. and this figure has been knocked down by the Government?

Will the hon. Gentleman answer the question asked by my hon. Friend? Is it or is it not the case that a draft of this report has been shown to the Secretary of State for Scotland or his Department? Will he give us an absolutely clear answer?

I thought I had given an absolutely clear answer—that in the interests of having an effective report, within the terms of reference given to the Board, discussions have taken place between officials on both sides. No report is available and, therefore, none has been seen by my right hon. Friend the Secretary of State for Scotland.

Departmental Staff


asked the First Secretary of State and Secretary of State for Economic Affairs to what extent the staff of his Department will increase or decrease during the next 12 months.

In view of the fact that by his Budget the Chancellor of the Exchequer is already going to push prices through the roof during the next few weeks and is therefore making the work of the Department abortive in this respect, and bearing in mind the fact that the Minister of Labour is now, quite properly, taking back his own functions of wages, what justification is there for this increase in staff?

The hon. Gentleman may be very pleased to know that, in view of some of the considerations he has mentioned, it may not be necessary for us to increase our staff to this extent.

Mining Industry


asked the First Secretary of State and Secretary of State for Economic Affairs whether he is aware of the drift of manpower out of the mining industry in South Wales and Monmouthshire, and that insecurity of employment consequent upon the announced closures of pits is accelerating the drift; and whether, to re-establish confidence and ensure the availability of labour for economic pits, he will now set up an interdepartmental committee of the Ministers of Power and Labour, the Board of Trade and the Welsh Office, charged with the task of ensuring that no pit is closed without alternative employment being available for any redundant miners.


asked the First Secretary of State for Economic Affairs if, in view of the economic consequences to the nation of the rapid contraction of the coal mining industry and the lack of confidence in the future of the industry, he will consider the setting up of a co-ordinating committee of representatives from the appropriate Ministries with the task, among others, of considering the halting of pit closures until alternative and suitable employment has been found for the redundant personnel.


asked the First Secretary of State and Secretary of State for Economic Affairs whether, in view of the accelerating drift of manpower from the mining industry as a consequence of the insecurity of employment in the industry, he will make arrangements for co-ordinating the Board of Trade, Ministry of Power and Ministry of Labour to ensure that the present programme is delayed until suitable alternative employment is available in the areas affected.

As regards manpower trends in the coal industry, I would refer hon. Members to the Answer given by my right hon. Friend the Minister of Power, to the hon. Member for Surbiton (Mr. Fisher) on 3rd May. As regards security of employment, there is no shortage of jobs in the coal mining industry for men who will accept work in different pits. The Government have already taken a wide range of measures to ensure employment outside the industry for those miners who are unable to move to the pits which are short of labour. I can assure my hon. Friends that there are completely adequate arrangements for interdepartmental co-operation on these problems.

Is the Minister aware that one of the reasons why we have 5,000 vacancies in the South Wales pits is because the young dynamic miners feel a sense of insecurity about their present position and are rushing into other industries? Would he ensure, in order to gain the confidence of the miners and obtain the 60,000 or 70,000 new jobs required in South Wales within the next five years, that urgent talks take place with the Board of Trade and that what we in Wales regard as complacency about the present position is ended?

I can assure my hon. Friend that there is no complacency. Some of the matters to which he has referred are matters for my right hon. Friend the Minister of Power, but he can rest assured that within the Government we are taking this matter extremely seriously.

Is my right hon. Friend aware that the nation will require an abundance of additional skill for many years to come? Will he ask his right hon. Friend to bring his personal attention to this problem because of the very humane qualities which his right hon. Friend possesses? Will he ensure that he deals adequately with the disabled miners who are thrown out of work?

The position of the disabled miner is a special matter to which we must give special consideration. On the general question, I think my hon. Friend should refer to the Answer given by my right hon. Friend the Minister of Power.

Is my hon. Friend aware that the decline in manpower is creating difficulties and imposing very great hardship upon the disabled? Will he ensure that the Board of Trade and other Ministries are able to bring pressure to bear to see that alternative employment is available for them?

I am absolutely convinced that alternative employment will be available. As my hon. Friend knows, this is by no means entirely the whole of the problem. The problem is becoming a rather different one, which my right hon. Friend the Minister of Power is considering.

Will my right hon. Friend bear in mind that the serious problem of wastage of manpower is by no means confined to South Wales? Is he aware that it is taking place in the East Midlands and in the most productive coalfields. Will he bear in mind that if this goes on many of the premises of the National Plan will be entirely vitiated?

We realise this, and that is why my right hon. Friend is continuing his inquiry into the situation.

Can the hon. Gentleman help to reassure his hon. Friends by asserting that the Government will stand by the coal target contained in the National Plan?

Does not the Minister agree that the imperative need is for the Government to issue a national fuel policy for the country, giving the coal industry a clearly defined place?

The coal industry has a very clearly defined place in the national fuel policy. It has to sell as much coal as it possibly can produce at an economic price. This has been made absolutely clear, and there is not a shadow of doubt that we shall continue to require a very substantial output of coal for the foreseeable future.

Messrs Short Brothers And Harland


asked the First Secretary of State and Secretary of State for Economic Affairs what progress the Government have made with their plans for diversification of the activities of Messrs. Short Brothers and Harland; and if he will make a statement.

Sir Matthew Slattery, who was already acting for the company in a consultative capacity, and Mr. Derek Palmar, one of my right hon. Friend's industrial advisers, were invited in March to conduct the necessary negotiations. They are currently examining a number of possible propositions and progress is being made.

Is the hon. Gentleman aware of the seriousness and urgency of this problem as a result of the Answer to Questions given by the Minister of Aviation yesterday? In view of the many pledges given by the Prime Minister, the Home Secretary, the Minister of Aviation and the First Secretary, will he expedite matters, because the need for it must have been obvious, for over two years, since a decision to sell out to the cheaper aircraft industry of America?

We fully appreciate the urgency of this, and we are pressing ahead as fast as we can. We very much hope that there will be a successful outcome to the negotiations which are now proceeding.

Have discussions gone so far as to enable my hon. Friend to give some assurance that the numbers at present employed in these works will continue, at least for a few years?

It would be a mistake today to say anything which would anticipate the possible outcome of the work which the negotiators are doing.

Why were these appointments not announced in the House, despite a considerable number of Questions by myself and my hon. Friends in March?

We have certainly taken no steps to conceal the appointments. Our anxiety was simply to get on with the job as fast as possible and obtain the sort of results which I am sure the hon. Member wants?

Directors' Emoluments (Investment Trusts)


asked the First Secretary of State and Secretary of State for Economic Affairs if he will refer to the National Board for Prices and Incomes the emoluments payable to directors of firms subscribing to investment trusts on behalf of the directors without the shareholders being informed.

No, Sir. But as my right hon. Friend the Prime Minister told the House last week, my right hon. Friend the President of the Board of Trade is already considering what provisions might be included in the Companies Bill about these matters.

Does my hon. Friend not consider that this matter is rather more urgent and that it is important that the utmost light should be shone on the discreditable antics of the Garda and Second Premier Trust, and other instances of this kind? Would he not agree that, without this scrutiny, a national incomes policy would be unrealistic and unjustifiable?

I have great sympathy with what my hon. Friend says, but if we agree on the main object of any inquiry the question is what is the best possible means to achieve it. We think that the Companies Bill is the right way to go about it.

When will the Companies Bill be introduced? How much longer have we to wait for this really substantial amendment to company law?

Selective Employment Tax


asked the First Secretary of State and Secretary of State for Economic Affairs if he will undertake a survey in conjunction with the National Economic Development Council to examine the effect of the Selective Employment Tax on areas of high unemployment.

The Government remain concerned about the economic position of all the less prosperous areas of the country. No special survey is required.

Is the Under-Secretary of State not aware that the Selective Employment Tax is directly contrary to the Government's policy of promoting employment in these areas of high unemployment? Would the hon. Gentleman give the House some assessment of the damage which the tax will do in those areas?

The hon. Gentleman's assumption is false and, therefore, his conclusion is wrong. The important thing is that we have to keep an eye on all areas, and we are doing a great deal to change the structural balance of the country. As my right hon. Friend the Chancellor of the Exchequer has said, the new tax is a very flexible one and, over a period, may be used for a variety of useful purposes.

Would the hon. Gentleman reconsider the rather unsatisfactory answer he has just given? Would he not agree that in many areas of relatively high unemployment there is, for structural historical reasons, an imbalance between the service and manufacturing industries, and, therefore, in some areas the proposals may and probably will adversely affect those areas? Should he not make a special inquiry there?

May I make it clear that we are very concerned about what the incidence of the tax may be and to relate it to the needs of various parts of the country. In answer to the original Question, I said simply that no special survey seemed to be required.

As Northern Ireland has its own system of National Insurance, is there any administrative difficulty in excluding it from the tax altogether?

Does the hon. Gentleman realise that certain under-developed areas, including the South-West, are largely dependent on the tourist industry and that this tax will have a very serious adverse effect upon them?

We fully appreciate that it will have certain effects within the country, and we shall watch what happens in the South-West as well as in other development areas.

Is the hon. Gentleman aware that in the north-east of England, where there is still a long-term employment problem, business people are writing in great dismay about the effects of the tax to those of us on this side of the House who represent constituencies in that area? Is he aware that they will view the answer he has given today with great dismay?

As the representative of a constituency in the same part of the country, all I can say is that in my experience business men in the North-East are a great deal happier today that in any period over the last ten years.

In view of the very unsatisfactory nature of those answers, I give notice that I shall raise the matter at the earliest possible moment on the Adjournment.

Printing Industry (Discussions)


asked the First Secretary of State and Secretary of State for Economic Affairs whether he will make a further statement about the discussions which, on 10th February, he informed the honourable Member for South-West Hertfordshire that he was proposing to have with the Joint Manpower Committee of the Printing Industry.

The Joint Manpower Committee confirmed, on 25th March, that its terms of reference included the efficient use of manpower and decided that an independent chairman should be appointed. Both these points were in line with recommendations of the National Board for Prices and Incomes. Mr. Richard O'Brien has now been appointed and the first meeting under his chairmanship will be held as soon as possible.

Is the hon. Gentleman aware that recently, in the Statist, the Chairman of the Newspaper Proprietors Association, Mr. Cecil King, wrote that the high labour costs in the printing industry are due to excessive overtime, over-manning and a network of restrictive practices? Nothing can justify the present rate of earnings in that industry except increased production, and no such increase is taking place. What is he doing about it?

We want good will and common sense to prevail in all these things. What we should do now is leave it to the new Joint Manpower Committee, under its Chairman, to get on with the job of solving the problems of the industry.

Building Industry (Selective Employment Tax)


asked the First Secretary of State and Secretary of State for Economic Affairs if he will arrange a special meeting of the little National Economic Development Council for the Building Industry to consider the Selective Employment Tax.

A joint meeting of the Economic Development Committees for Building and Civil Engineering was held on 9th May, at the Chairman's suggestion, to consider the effects of the Selective Employment Tax. We expect to receive their views very soon.

Would the hon. Gentleman consider discussing with the "little Neddy" the problems created for firms undertaking fixed-price contracts in the building industry which may take several years to complete, because they have been considerably incensed by the Selective Employment Tax?

We have no evidence of their being incensed. I have no doubt that the "little Neddy" will consider matters of the kind to which he refers.

Is the hon. Gentleman aware that many firms entered into fixed-price contracts to assist the Government to try to stabilise prices and that they will be reluctant to do so again if this is how they are treated?

Of course, that is on the assumption that there is no possibility of increasing efficiency in the industry, and that I very much doubt.

Agricultural Manpower


asked the First Secretary of State and Secretary of State for Economic Affairs whether he is satisfied that the release of agricultural manpower resources is proceeding fast enough to satisfy the requirements of the National Plan; and if he will make a statement.

Does the hon. Gentleman agree with the Prime Minister that we should not have much trouble if the whole of our manufacturing industry did as well on labour productivity as agriculture? Therefore, from the point of view of his Department, would he agree that there is no justification for the penalties which the Selective Employment Tax, as proposed originally, will lay upon horticulture and agriculture?

The hon. Gentleman will be aware that these are matters which are at present under discussion. In any case, my right hon. Friend the Chancellor of the Exchequer made it clear that the cost would be recouped, if necessary, in the Annual Price Review.

Is the hon. Gentleman not aware that only part of the products covered by this additional impost are included in the Price Review, and that agriculture is being called upon to meet a great deal of the cost without a hope of recouping it?

It has already been announced that this question is at present under discussion.

Will my hon. Friend consider a proposal that, before these Exchequer contributions are introduced, tenant farmers shall be allowed to deduct them from their rents?

That is really a matter for my right hon. Friend the Minister of Agriculture.

Would the Minister of State recognise that the Annual Price Review is a hopelessly inefficient instrument in this case for recouping the cost of the Selective Employment Tax? How does he think that a national review can possibly take into account the many individual cases which will affect the farmers of the country?

I think we had better leave the matter until we see the result of the discussions which are going on at present.