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Trade

Volume 894: debated on Monday 23 June 1975

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Concorde

1.

asked the Secretary of State for Trade if he will make a further statement about the introduction of Concorde into airline service with British Airways.

I currently expect British Airways to start commercial services with Concorde at the beginning of 1976 simultaneously with Air France.

Will the Minister say whether he is negotiating supersonic overflying rights in the Middle East in regard to opening a service to Bahrain and whether he has such rights in the case of India and Indonesia to enable the aeroplane to fly to the Far East? Will he say also whether the aircraft might be allowed to fly to New York, and a word about fares?

Discussions are progressing with all the countries which will be concerned with a view to obtaining the necessary clearances for overflying and the other matters to which the hon. Gentleman has referred. I do not think it would be helpful, in view of the fact that the discussions are progressing, if I were to add to that at this stage.

Will the hon. Gentleman say whether the question of rights to fly supersonic aircraft on various routes has arisen in any way during discussion of the new policy guidelines for civil aviation?

The hon. Gentleman will have to await the Questions which my right hon. Friend will be answering on the matter of the policy review. Therefore, he must be patient.

Will the Minister say whether the British Airways Concorde contract contains an escape clause which would apply should operating rights in the United States not be forthcoming?

I have no reason to suppose that those operational rights will not be forthcoming. The contractual question that would arise if we were disappointed in that respect would then have to be considered. I do not think it would be appropriate for me to add to that at this stage.

15.

asked the Secretary of State for Trade if he will seek a meeting with his French Government counterpart in order to ensure a co-ordinated Anglo-French approach to future negotiations concerning Concorde for which his Department is responsible.

There is already very close collaboration with the French Government in negotiations concerning Concorde for which my Department is responsible. Accordingly my right hon. Friend has no immediate plans to meet his French counterpart to discuss these matters.

is the Under-Secretary aware that Concorde has some powerful and unscrupulous enemies, particularly in the United States? Does he agree that recent congressional hearings have shown the lengths to which some American aircraft manufacturers will go to promote and defend the rights of their companies? Does he accept that Britain and France have an overriding economic and political interest in Concorde? On that basis, will he at least assure the House that the support for the project previously manifested by his right hon. Friend the Secretary of State for Energy, which was always self-evident, is still available and as strong from those members of Her Majesty's Government who now have responsibility for Concorde?

There is absolutely no reason to question the support of my Department and the Department of Industry, under its present Secretary of State, for this project. Indeed, I made this clear to the hon. Gentleman in a debate which he initiated some little time ago. Moreover, the representations of both the British and French Governments and industries at the hearings in the United States were very strong indeed. I do not think that it would be helpful to engage in name calling against the opponents of the Concorde project. Certainly neither I nor my right hon. Friend intend to follow the hon. Gentleman in that regard.

Does my hon. Friend accept that many hon. Members think that Concorde will be a gigantic financial disaster? Will he ensure that, in any cuts in public expenditure, education and social services take priority over this huge pit into which money is being poured so that the manufacturing capacity which is at present devoted to Concorde can be released to something more socially useful?

I do not accept the premise upon which my hon. Friend bases his question. I do not regard this remarkable aircraft, which involves great technological advance, as being a disaster. Cuts, of course, are not matters for me.

Is the hon. Gentleman aware that many of the 2½ million people living within earshot of Heathrow Airport would heave a sigh of relief if they were to hear that the Concorde project had fallen through, because of the appalling noise that it is expected to make? Will he ensure that Concorde is not allowed to fly in and out of Heathrow until he is satisfied that its noise levels are acceptable to the people of London?

I am sorry that the hon. Gentleman should have sought to exaggerate the situation concerning noise. He knows perfectly well that it constitutes no greater noise nuisance than the Boeing 707 and various other aircraft. The hon. Gentleman will have an opportunity, as will others, of testing the veracity of that claim when the endurance flying begins in July.

Exports (Non-Eec Countries)

2.

asked the Secretary of State for Trade what steps he is taking to encourage British manufacturers to increase exports to countries outside the EEC.

The Secretary of State for Trade and President of the Board of Trade
(Mr. Peter Shore)

My Department's export promotion services are being very heavily used by exporters. I am also seeking to assist exporters by ministerial visits to overseas markets and by strengthening the link between Government and industry through the British Overseas Trade Board and its new advisory council. ECGD facilities are also being extended.

I am sure that the whole House will congratulate my right hon. Friend on the energy with which he is pursuing his visits abroad to try to help firms to find and follow up markets. Does he not think, however, that as most of the CBI member firms put their eggs into the Common Market basket, and as the performance of many of the firms in the CBI is pretty poor outside the EEC as well as within it, he ought to have an investigation made of some of these firms, to see how their export departments are organised, how many people they have in the field and how many people are following up the work that he does? Does he not think that this is necessary?

I think there is a great deal of useful work to be done in firms themselves as to how they can best deploy their efforts, with particular emphasis on doing better in export markets, and I would certainly encourage firms to do that. One of the advantages of the planning agreement approach that we shall be developing soon will be to enable us to have a more structured discussion with firms about their export effort.

Concerning my hon. Friend's first point, it still remains the case that a very large part—indeed the larger part—of Britain's exports is to the rest of the world and only 35 per cent. goes to the EEC.

Does not the Secretary of State's answer to this Question smack of complacency? Is he really following up all the means used by other nations within GATT for increasing exports—for example, the Australian suggestion of double tax relief for money spent on export promotion? Does he agree that it is essential that more resources should be agreed for exports and less absorbed within our public sector?

I think I would accept that latter point that more of our resources must go into the balance of payments. That is undoubtedly the case, and that is the major strategy of the present Government. I can assure the hon. Gentleman that there is no complacency at all in the Department of Trade about the requirements of Britain's export drive—none at all. I am very willing indeed to study any relevant experience and practice that other nations have which could be of assistance to our own export effort.

Zambia

3.

asked the Secretary of State for Trade what discussions he has had with the Government of Zambia regarding trading arrangements between the United Kingdom and Zambia.

Neither I nor the Secretary of State has had direct contacts with the Zambian Government on trade matters. But there are, of course, constant contacts through our respective High Commissions on commercial matters of mutual interest.

When the hon. Gentleman or his right hon. Friend next meets the Zambian trade authorities, will he congratulate them on their trade policy in Southern Africa, especially the way that they have continued to trade with Rhodesia and South Africa? Will the hon. Gentleman and his right hon. Friend impress upon their Cabinet colleagues that it would be to the advantage of this country if we pursued a similar policy, especially in the case of the export of Nimrod aircraft to South Africa?

In reply to the second part of the hon. Gentleman's question, the Government's decision about the export of arms to South Africa was made clear by my right hon. Friend the Foreign Secretary in the House just before Christmas. As for the first part of the hon Gentleman's question, neither I nor my right hon. Friend has any plans for an early visit to Zambia, which does not figure as one of our major export markets.

Hosiery

4.

asked the Secretary of State for Trade what was the value of hosiery exports and of hosiery imports for the latest convenient period for which figures are available.

For the 12 months ended May 1975, exports of hosiery including knitted underwear and outerwear were £83 million and imports £133 million on the usual overseas trade statistics basis.

Is my hon. Friend aware that far too many of my constituents in Leicester who depend on this great industry, which has contributed so much and still contributes a good deal to business, are now working on short time? What is my hon. Friend doing about it, and what assurance can he give the House that the Government are aware of the crisis in this great traditional industry?

I can assure my hon. and learned Friend and right hon. and hon. Gentlemen on both sides of the House who share the concern of workers in the industry that something can be done to help this great British industry. The Government are taking action. I refer my hon. and learned Friend to the Prime Minister's statement on 23rd May when, among other things, he mentioned the possibilities of anti-dumping applications and said in particular that the Government would continue their powers under the Industry Act to ensure in this world-wide recession in textiles that jobs were not lost.

Will my hon. Friend accept that many people in Leicestershire and in my constituency are affected by these cheap imports, and will he recognise also that although the Prime Minister's statement was a portent of things to come in the future, nothing seems to have been done yet? Will my hon. Friend seriously re-examine the possibility of introducing anti-dumping measures and the possibility of import quotas and other action to stem the flow of imports as soon as possible?

Anti-dumping measures can be taken by the Government only on an application from a representative trade association. As for imports, we cannot take the textile industry overall. We have to look at it sector by sector. Taking two of the subjects of this Question—socks and tights—the import penetration in 1974 for socks was about 3 per cent. and for tights it was only about 10 per cent. We have to consider the problems on a central basis. Finally, my right hon. Friend the Chancellor of the Duchy of Lancaster, as recently as 12th June, met representatives of the textile industry in order to follow up the Prime Minister's statement of 23rd May.

Civil Aviation

5.

asked the Secretary of State for Trade whether he plans to publish the Government review of civil aviation policy; and, if so, what form such publication will take.

6.

asked the Secretary of State for Trade if he will now publish the result of his review of the policy guidelines for the regulation of civil aviation.

7.

asked the Secretary of State for Trade if he will make a statement on his proposed amendments to the guidelines for civil aviation.

8.

asked the Secretary of State for Trade when he expects to announce the outcome of the review of commercial civil aviation which has been taking place.

14.

asked the Secretary of State for Trade when he expects to announce the results of the civil aviation review.

The report which has been submitted to me represents the advice of my officials. Meetings will now be arranged with the parties mainly concerned and I intend to make a statement in this House as soon as possible.

Will the right hon. Gentleman try to give the House some idea about when the statement may be made? Will he accept that many right hon. and hon. Members hope that the statement will not be dribbled out in the last few days before we go into recess at the end of next month? Does he agree that the absence of such a statement continues to generate uncertainty in the industry? Perhaps he will take this opportunity to re-emphasise his support for the second force airline.

I should regret it very much if parts or the whole of the review dribbled out. That is not my intention. We are studying it carefully, and I am anxious to make a statement as soon as I can. I am very much aware of the hon. Gentleman's points about taking full account of the inevitable uncertainties which exist until Government policy is revealed.

Would the right hon. Gentleman like to take this opportunity to answer the question which I addressed earlier to the Under-Secretary about the introduction of supersonic flying routes in this review? If the right hon. Gentleman finds himself unable or unwilling to publish the whole report, will he consider publishing the statistical data submitted by the parties on which he will reach his conclusions? Finally, does he agree that it would be the worst of all worlds if public money were used, either as an investment or by nationalisation, to finance the operations of the second force to compete with the public money already in British Airways?

The hon. Gentleman has asked a series of quite interesting questions. First, I cannot help him very much, for the obvious reason that the report has not yet been published and, like the hon. Member for Chertsey and Walton (Mr. Pattie), I should not want bits of it to dribble out. I shall consider the hon. Gentleman's second suggestion about the statistical data to see whether I can help.

As for the hon. Gentleman's point about Government money being put into the second force, as he describes it, and his views on that, I should prefer not to comment beyond making the obvious point that his view on this does not seem to accord with that of many people associated with the second force airline.

Will the right hon. Gentleman accept that I welcome his plans to consult those whom he calls interested parties? I hope that they will be not only us here in Parliament but the passengers who find themselves in Europe having to pay two or three times as much to travel by air as they would if they wished to travel in identical aircraft in the United States. Will the right hon. Gentleman assure us that these guidelines will look after the passenger and not only the Department?

Obviously I cannot guarantee to talk to a representative body of passengers. I am not sure whether such a representative body exists. But I take into account in all my thinking the interests of the passenger as well as the airlines involved.

Does the right hon. Gentleman accept that some of us are interested not only in the survival of British Caledonian Airways but in its future progress? When he considers this matter, will he accept that, if there were to be any question of revocation of the licences already granted to that company to such places as Toronto, Atlanta and Bahrein, that could lead to strangulation, which would only be confirmation of the policy which some of us suspect will be forthcoming from the Secretary of State?

That again would be to anticipate, and I am not prepared to do that. One of the central features that we have to consider is the role and future of the second force concept as it emerged some five years ago. I assure the hon. Gentleman that we shall give very careful thought to that.

Before the right hon. Gentleman comes to any conclusions, will he accept that the security guaranteed by public money, world-wide prestige and operational cross-subsidy are inherent advantages of State ownership, and that if conditions of genuinely fair competition are to be assured for a second force airline full account must be taken of this in his review?

I shall take account of all relevant factors in seeking to make what I hope will be the correct decision.

Will the review include consideration of the present position whereby an airline can obtain a licence for a route but is then denied designation on that route? Secondly, will the right hon. Gentleman assure us that the results of the review will not produce a fait accompli for this House and that we shall have an opportunity to debate the matter before final decisions are reached?

I cannot promise a debate before I make the statement. But I should be very anxious for the House to debate the matter on the basis of a statement and wish that to be done. As for the hon. Gentleman's other point about licences and designation, I think that there may be some observations on that matter, although I cannot accept the implication in what he said.

Arab Trade Boycott

9.

asked the Secretary of State for Trade whether he will now make a further statement on his policy toward the Arab trade boycott.

I have nothing to add to the statement of Her Majesty's Government's policy towards the Arab boycott of Israel which I gave on 5th May in reply to a Question from my hon. Friend.—[Vol. 891, c. 1012–13.]

I do not wish to be uncharitable to my hon. Friend, because I know his feelings on this matter, but is he aware that the boycott continues and that the pressure is mounting all the time? When does he feel that either he or his right hon. Friend will be in a position to make a far more detailed statement about the Government's policy, so that it will be quite clear to all concerned that a British Government will not tolerate these impediments to free trade?

It has already been made clear that Her Majesty's Government are opposed to and deplore the Arab boycott. I believe that more is to be gained in this matter by supporting policies and actions aimed at the resolution of the Arab-Israeli conflict in all its manifestations and also by discussing with firms any boycott problems they face—as my officials do from time to time—than by making statements in the House.

In the meantime will my hon. Friend assure as that neither British Leyland nor any concern in which the public have a substantial holding will bow to this deplorable boycott?

The commercial policy of firms, whether or not there is a public stake in them, is primarily a matter for the management concerned. We previously answered a Question about British Leyland and the Arab boycott, and I believe that on that occasion I was able to satisfy my hon. and learned Friend that British Leyland's policies were correct.

European Community Countries

10.

asked the Secretary of State for Trade what plans he has for improving the balance of payments position in relation to other members of the EEC.

11.

asked the Secretary of State for Trade what steps he is taking to promote exports to the EEC countries.

33.

asked the Secretary of State for Trade what steps he has taken to promote exports to the EEC countries.

It is primarily for British industry to respond to the opportunities of this large and increasingly tariff-free area. As for all major markets, the full range of my Department's services for exporters are available to them and they are being used on an extensive and increasing scale.

I have the benefit of the advice of the European Trade Committee of the British Overseas Trade Board in the development of export promotion programmes in these markets.

Now that the referendum is behind us and there is no point in trying to make political mileage out of the worrying deficits in this area, does my right hon. Friend agree that the National Institute's opinion that the effect of our membership of the EEC on this matter was marginally probably a more correct interpretation of the figures than those adduced by my right hon. Friend?

I do not wish at present to go over the ground of the causes of our trade deterioration with the EEC. However, I am very glad that my hon. Friend acknowledged that this was indeed a very worrying deficit. I emphasise that it is extremly worrying, and, of course, we shall be doing our utmost about it. Indeed, the problem would have been substantially the same, although not totally the same, if we had had a free trade area. As I have often made plain to the House on previous occasions, the problem of our manufacturing industries' trade with the EEC was one which under either outcome of the referendum would have been a matter for us to concentrate upon and on which to seek to find a major improvement.

Does the Secretary of State agree that neither import controls nor any other form of protectionism will improve the productivity or efficiency of British industry, but rather the reverse? Will he confirm that the Government have firmly set their face against import controls as a means of eliminating our present trading deficit with the EEC countries?

I do not believe that import controls are the right way to proceed, and that is the Government's policy. We want to improve trade or change the trade deficit through the encouragement of our own exports. One point which I believe deserves to be stated here, as it was stated on behalf of the Government at the Paris meeting of the OECD, is that the opportunities that we and other countries have of exporting depend very much upon the kind of policies which are being pursued by major industrial countries. It is very necessary that countries which are in surplus in their balance of payments should not be running restrictive policies in respect of demand management.

On the EEC dimension, why has it been apparently impossible for successive Governments over the years to bring pressure on Denmark, with which we have had a deficit running over many years and which totalled £150 million last year?

I do not believe that our trade deficit with Denmark, certainly in the past year, has caused us particular concern. It has been much more even. However the pattern of our trade with Denmark has always been greatly influenced by the fact that we have been Denmark's major agricultural customer.

Will my right hon. Friend give us the export and import figures for the Common Market and compare them with the rest of the world? Do they not show that, although there was all this promise about our membership of the Market, it has to date benefited our partners in Europe more than ourselves?

I shall not give the precise figures because that would be to anticipate another Question on the Order Paper. My hon. Friend is quite correct. The magnitude of our deficit with the EEC stands out in sharp contrast to the progress that we have been making in reducing deficits with other areas of the world.

Is the right hon. Gentleman aware that if the current account of this country is brought into balance, it will be impossible for this country to borrow net from abroad? Does he view that prospect with equanimity?

I do not believe that that is a question that should be directed to a Trade Minister. It would be better directed to the Chancellor of the Exchequer.

16.

asked the Secretary of State for Trade what is his latest estimate of the balance of trade for the current year between the United Kingdom and the eight members of the EEC.

17.

asked the Secretary of State for Trade what is his latest estimate of the balance of trade in the current year between the United Kingdom and the rest of the EEC.

In the first five months of this year our crude balance of trade with the EEC, on an overseas trade statistic basis, was in deficit by £938 million. While I cannot forecast the outturn for 1975, the annual rate based on the first five months would produce a deficit of £2,250 million.

Does the Secretary of State envisage a substantial improvement in the balance of trade between the United Kingdom and other members of the Community over the next five years? Will he confirm that the question of import controls is no part of the policy of Her Majesty's Government, and neither would it accord with the policy of the EEC?

I have already dealt with import controls on an earlier Question. The hon. Gentleman rightly says that import controls are extremely difficult within the context of the EEC Treaty. As for his other question, I cannot anticipate the future course of Britain's trade with the EEC. As far as I am concerned, the present situation is very unsatisfactory. British firms must make an all-out effort to improve their trade balance with the EEC.

Despite the difficulties relating to the EEC Treaty, is it not quite clear that the time has come for the Government to negotiate a system of selective import controls with the EEC countries? This is preferable to a growing level of unemployment in industries which are badly affected by the present situation regarding imports. Is it not clear that the Government will have to think again about this matter, whether they like it or not, despite the vote which took place on the Common Market?

I thought that the earlier questions dealt with import controls across the board, and what I said previously applies. In view of what my hon. Friend has said about selective import controls, I should point out that there is provision, both within the Treaty of Accession and, indeed, under GATT, for certain uses of import controls relating to particular market disturbances and regional problems. We are prepared to consider particular cases on their merits.

Now that the referendum is over, will the Minister admit that the trade gap with Europe will not improve until the Government start to do something about inflation, allow the country to live within its means and stop the import of goods which the country cannot afford by curbing inflation rather than trying to make excuses in other directions?

I am quite certain that inflation is a very serious problem for the whole country and, indeed, the whole of our exports regardless of the markets to which they are directed. I should, however, point out, in case the hon. Gentleman gets carried away with the point, that we have managed to make a substantial improvement in our trade with virtually all other markets. Therefore, some very special effort is required, particularly by British industry, to deal with the trade deficit which now exists with the EEC.

Will the Secretary of State acknowledge the important role that the Development Corporation for Wales has played in developing exports from Wales to EEC countries? Will he, in conjunction with the Chancellor of the Exchequer, consider extending aid to the development corporation to enable it to increase the number of its full-time representatives in EEC countries?

I shall certainly consider any measure which would be of assistance to exporters in any part of the United Kingdom relating to the EEC market.

Will my right hon. Friend confirm that he is responsible for national policy on import substitution, and has he any policy or plan for assisting the development of specific British industries, such as footwear, which have the capacity to produce goods which are at present being imported in increasing quanties from Common Market countries?

I am equally concerned, because the other side of the coin of our balance of trade involves import substitution, and that applies not only to existing British industries but perhaps to the possibility of developing new British industries. Wherever possible, we shall encourage import substitution as well as giving assistance, and continuing to give assistance, to our export drive.

Shipping Safety (English Channel)

12.

asked the Secretary of State for Trade if he has any plans to introduce new safety regulations for supertankers and VLCCs operating in the English Channel.

Not at present, but the safety of large tankers operating around our coasts is being carefully studied. Improvements have been and continue to be implemented and we are in close touch with the French Government regarding Channel safety.

Is the Minister aware that many of the supertankers now passing through British waters operate under flags of convenience? As a result they sometimes tend to have inadequate safety regulations on deck as well as poorly qualified officers on the bridge. In view of the enormous environmental damage which could happen if a supertanker collision occurred in the congested waters of the Channel or the North Sea, will the Minister urgently seek to tighten up all the relevant safety regulations and will he also consider following the Canadian example of establishing a system of ship traffic control comparable to the air traffic control procedures which have been in operation for many years?

So far as the last part of the hon. Gentleman's question is concerned, we are certainly anxious to consider any constructive ideas wheresoever they may arise. So far as flags of convenience are concerned, my Department has said on a number of occasions that what it is really concerned about in this respect is substandard ships. Indeed, an initiative has recently been taken at IMCO in that respect, as the hon. Gentleman may be aware, in order to enable us to identify substandard ships and to take effective action against those that are identified. Certainly we are concerned about the adequacy of the training of those who serve on board tankers, and, indeed, any other ships. Regarding ships, I should add that a short while ago my Department established a study group designed to consider the construction and operation of tankers which might contribute to hazardous situations. In that respect it is considering the questions of hull strength, crew training and operational methods.

It is clear from the Under-Secretary's reply that he has gone into this matter in great detail, but there is one point about which I am not clear. As international law exists, surely our jurisdiction can operate only within territorial waters. Is the hon. Gentleman doing anything about that point?

This matter has certainly given us a great deal of concern, and I have been studying it with my officials. We have taken certain initiatives, but it would be premature at this stage to discuss how we shall seek to enforce our jurisdiction. It may have to be by voluntary arrangements. However, it would not be right for me to go into the matter in detail at this stage.

David Bainbridge (Manufacturing) Ltd

13.

asked the Secretary of State for Trade whether he will inquire into the affairs of David Bainbridge (Manufacturing) Limited, now known as Tool-Glo Limited, of Morrison Trading Estate, Annfield Plain, Co. Durham, following the company's failure to file its annual return.

Formal inquiries under the provisions of the Companies Acts do not appear to be justified in this case. If my hon. Friend has any additional information which he would wish me to consider, I shall be happy to do so.

Is my hon. Friend aware that this company, which among other features owes thousands of pounds in unpaid wages to its workers, recently changed hands and no one seems to know who the present legal owner is? Will he look into this matter?

If my hon. Friend has any specific evidence to which he wishes to draw my attention, I shall be happy for him to do so, either orally or by correspondence, and I will look into any allegations which might justify the kind of inquiry that he is urging me to take.

Ussr

18.

asked the Secretary of State for Trade if he will make a state- ment on the renegotiation of the Anglo-Russian trade agreement when it ends in December.

Notice of termination of the 1969 Long-Term Trade Agreement with the Soviet Union will have to be given by the end of September 1975.

Is the right hon. Gentleman aware that the fact that the Russians tried so hard to save his job for him after the referendum, because they thought that the Anglo-Russian trade agreement was in the interests of Russia, gives further strength to the view held by many of us that in the past Anglo-Russian trade has been far more to the advantage of Russia than of this country? Will he submit to the independent group of persons a study whether Anglo-Russian trade has been worth while, when export credits and other things are taken into account, before concluding a further agreement?

I take it that the hon. Gentleman will expect me to ignore the first and slightly unworthy introductory part of his question——

—and I turn to the more serious part about the benefit to Britain of the Anglo-Russion trade agreement. I take the view, and I believe that other hon. Members would, that we have had an unsatisfactory level of trade and an unsatisfactory balance of trade with the Soviet Union, and my concern, which I hope would be the concern of any Secretary of State for Trade, is to improve the volume of our trade with the Soviet Union, to improve our balance of trade, and to make sure at the same time that there is mutual advantage. I believe that that can be achieved.

Is my right hon. Friend aware that our trade deficit with the EEC is about 20 times as large as our trade deficit with the Soviet Union?

I am aware of that, but our trade with the Soviet Union is a very small part—in my view, an unnecessarily small part—of our total trade.

Does the Secretary of State recognise that what is important is not only exporting but being paid for exports? Is it not a fact that the arrangements recently negotiated by the Prime Minister with the Russian Government enable the Russians to equip their industry on far better terms—given the rates of interest, the protection against inflation and likely changes in the exchange rate—than competitive industries in this country can have for their investment? That being so, and, in particular, given the difficulty of having any firm criterion regarding dumping from the Soviet Union into this country, is it not clear that on balance this agreement was not in Britain's favour?

I am sure the hon. Gentleman realises already that British concerns would not conclude agreements on a firm basis unless they thought that it was broadly in their interest to do so. That is how they normally make decisions in trade matters. Second, on the question of whatever credit arrangements are made with the Soviet Union, the principal factor here, as the hon. Gentleman knows, is what is internationally available to the Soviet Union, and our only aim in these matters is to see that British exporters are not put at a disadvantage.

29.

asked the Secretary of State for Trade what recent negotiations he has had with the Government of the USSR on the development of trade.

I led the British delegation to the meeting of the Anglo-Soviet Joint Commission in Moscow last month. My discussions at that time with Soviet Ministers clearly indicated that there are good prospects for a significant improvement in our trade with the Soviet Union.

Is the right hon. Gentleman aware that, with the onward march of inflation and the continuing deterioration in the exchange rate, to go on supplying goods on traditional terms means that we are effectively giving our goods away and subsidising the Russian economy? Are we not coming perilously close to the situation in which we are involved in free exports to Russia with love?

I think that the hon. Gentleman has got hold of the wrong end of the stick. The problem of inflation is undoubtedly real, but it is not so much a question of subsidising the Soviet Union through our inflation. The difficulty is that if we cannot contain our export prices more rigorously we will simply not get the business which is undoubtedly available with the Soviet Union. I hope that we are all interested in avoiding such a situation.

Can my right hon. Friend explain to the Conservative Front Bench that British industrialists are in the main pleased about the new trading arrangements with the Soviet Union?

I thank my hon. Friend for that suggestion. I thought that there was an uncharacteristically surly note in the supplementary question of the hon. Member for Uxbridge (Mr. Shersby). Surely the House welcomes expansion on reasonable terms of our trade with the Soviet Union. It is certainly the case that the CBI is very anxious that British firms should have a much larger share of the expanding Soviet market, and that is what I, too, want to see.

Will the right hon. Gentleman give an undertaking to the House to give a progress report on the Russian trade deal made earlier this year?

I am happy to report to the House from time to time on the progress of our trade with the Soviet Union and I hope that this year, 1975, the figures will show a significant increase over those of last year and previous years.

Is my right hon. Friend aware that in October a trade mission will be going from the north of England under the auspices of his Department and the North of England Development Council and that it is already over subscribed by business men from the North-East who are anxious to trade with Soviet Russia? Would he not agree that if there were a more pugnacious approach by British industry to this vast market, we should do far better than will result from the sniping that we have just heard from the Opposition Front Bench?

I am glad to hear of this trade mission from the North-East. I know that many trade missions are planned by British industry for the course of the coming year. Because I should not like there to be any doubt about it, I should like to emphasise that there is now a very good atmosphere in Anglo-Soviet relations and, therefore, opportunities for doing business on a more satisfactory scale than we have had hitherto

European Community Trade Ministers

20.

asked the Secretary of State for Trade what plans he has to visit other Ministers for Trade within the EEC.

25.

asked the Secretary of State for Trade when he next expects to meet the other Trade Ministers of the EEC.

I shall attend tomorrow's meeting of the Council of Ministers in Luxembourg, where I expect to meet some of the Ministers responsible for trade in other EEC countries. I also intend as time permits to have discussions on a bilateral basis with other European Trade Ministers.

Will the right hon. Gentleman make clear to the other Trade Ministers at the meeting tomorrow that he totally accepts the result of the referendum, and will he therefore make clear also, in expressing the British point of view, that we shall do our best to ensure that the EEC continues to prosper?

The first assurance is in no sense necessary. I shall not go round among my colleagues in the EEC telling them about my views on the result of the referendum—of course not. What I shall say, as they would expect, is that my task will be, as it has been in the past year, to support those efforts which make sense in terms of the EEC and the rest of the world and expanding world trade in a way beneficial to all. Secondly, I shall seek, as I have done in the past, to defend the United Kingdom's interests inside the EEC in a way which, I hope, will not be unacceptable to the others.

Will my right hon. Friend acknowledge that acceptance of the decision of the British people to remain in the Common Market does not mean that Ministers, or Members of Parliament who may go to Strasbourg, have to go on their knees to their colleagues in Europe but that the best interests of Britain and the best interests of the Common Market will be served by Ministers and Members of Parliament fighting for the interests of the British people within the Common Market?

I am certain that that is what most people in this country would wish their Ministers to do in attending meetings of the Community.

Does the right hon. Gentleman realise that his lukewarm answer to my hon. Friend the Member for the City of Chester (Mr. Morrison) about his attitude towards the EEC will not help us in our relations with the other member countries, and is it not now incumbent upon him to convince his fellow Trade Ministers that he is at one with the Government in being an enthusiastic supporter of the EEC?

Provocative questions deserve and receive lukewarm answers. I am reasonably well known, I assure the hon. Gentleman, in both Brussels and Luxembourg, and they will know very well what my position is.

Brazil

22.

asked the Secretary of State for Trade when he hopes to make a further visit to Brazil.

While no date has been fixed, I look forward to a further visit to Brazil in due course as part of the closer governmental consultation provided for by the memorandum of understanding between our two Governments which will be signed here next autumn.

What is the Department doing to promote joint industrial ventures in Brazil?

We have given all kinds of assistance, technical and financial, to British firms which are seeking, as indeed they must in the Brazilian context, to establish joint ventures or partnership ventures so that they can build up their trade with Brazil. I must say that I am considerably encouraged by the progress in the increase of our exports to that country.

Will the right hon. Gentleman go to Brazil as soon as he possibly can to study how the Brazilians have managed to control inflation in a quite remarkable way—a way which, one hopes, his own Government will very soon follow?

I went to Brazil last summer and took the opportunity to study many aspects of the Brazilian economy. Although I should not in any way seek to understate its achievements in containing inflation, I think the hon. Gentleman should be aware that the major result of Brazilian policy lies in how to live with inflation rather than how to abolish it, and I am not at all sure that that is the lesson we should wish to learn.

From his experience in Brazil, does not the right hon. Gentleman agree that the Brazilians were extremely successful in reducing their rate of inflation, from three figures down to a level which is, in fact, lower than the rate at which ours is now running? Is that not, therefore, an experiment which we should watch with care?

We should always be prepared to look and to learn from other countries, but, as the hon. Gentleman rightly said, the experience of Brazil 10 years ago was of inflation running at three figures—a quite fantastic rate—and Brazil's success was one of reducing inflation to a rate of 20 per cent. or 30 per cent. a year. That is an enormous relative achievement, but I hope that we shall be able to do far better ourselves.

Export Credits Guarantee Department

23.

asked the Secretary of State for Trade whether he is satisfied with the workings of the Export Credits Guarantee Department.

Yes, Sir. In the past 12 months our export credit arrangements have been reinforced by a number of new facilities. It is my intention that the services to exporters available from ECGD should, overall, stand comparison with those of any other country.

What use is a first-class ECGD system when the Government from time to time ban exports to countries whose regimes they do not like? Cannot the hon. Gentleman realise that to be excessively doctrinaire in banning exports costs money and jobs?

I think that the hon. Gentleman is a little confused. We have banned the export of arms to certain countries. I am sure that the hon. Gentleman would think that appropriate in certain cases—for example, the Communist bloc countries. We have not banned the sale of any non-arms goods to anywhere, but there are certain countries where our exports are under restricted cover—for example, because of credit risks and so on.

Why was the new ECGD preshipment finance policy announced in the Budget when none of the major details had been worked out? Will this policy require new legislation? What is the likely total that it will underwrite on a yearly basis?

The change will not need legislation. Since the final details of the new policy have not yet been worked out, I cannot give the hon. Gentleman any forcast of the likely cost. At this stage I can add nothing to the reply which I gave last week to the hon. Member for Mid-Sussex (Mr. Renton). We have drawn up an outline scheme, but there are several financial problems and until our discussions with the banks are concluded—successfully, we hope—we cannot make another statement.

South Africa

24.

asked the Secretary of State for Trade what was the total of exports to and imports from South Africa in the most recent annual period for which figures are available; and if he will make a statement.

During the year ending May 1975 exports to South Africa were £616 million and imports £503 million on the usual overseas trade statistics basis. Our exports increased by 46 per cent. over the previous 12 months.

Does not the hon. Gentleman agree that these very good figures are one of the few bright spots in our gloomy trading position, and that trade with South Africa is good for this country and the preservation of jobs? Will he use his best endeavours to persuade his colleagues to avoid giving unnecessary offence to South Africa and its people in order to appease the extreme left wing of the Labour Party?

We would like to see our trade figures improve in every market, not merely South Africa. We have at long last lost our leading position as South Africa's major supplier, having been overtaken by West Germany. This has happened in a number of other countries and it is not necessarily related to the political feelings involved about the country concerned. Secondly, South Africa still remains one of our main markets. Thirdly, just before Christmas my right hon. Friend the Foreign Secretary made a forthright, clear and unambiguous statement about the political implications of trade with South Africa, and I have nothing to add.

Since they are relevant, will my hon. Friend give the comparable figures for our trade with the rest of Africa?

I cannot do so without prior notice, but I can say now that our trade with the rest of Africa has to be divided between trade with Nigeria—one of our great growth markets and a major oil producer—and a rather smaller quantity, both in exports and imports, with the rest of black Africa north of South Africa.

Will my hon. Friend tell the hon. Member for Glasgow, Cathcart (Mr. Taylor) that a great procession of our people view with utter repugnance the type of racialist society existing in South Africa, and that any economic or trade deal seen to be bolstering up such a corrupt and immoral society would not be acceptable to that opinion?

Will the Under-Secretary also explain that the vast majority of our people are interested only in keeping their jobs and conducting trade with everyone, whoever it may be, that trade with South Africa is of great importance to us and that Her Majesty's Government should stop taking steps to try to cut it down?

We have taken no steps to cut down our trade in non-military goods with South Africa. We have banned arms exports, and I believe that such a policy is generally acceptable in the country as a whole. We have taken no steps to hinder the expansion of our trade in both directions with South Africa.

Travel Security Precautions (Northern Ireland)

27.

asked the Secretary of State for Trade if he is satisfied with the effect of security precautions upon the comfort and convenience of travel to Northern Ireland; and if he will make a statement.

Security precautions inevitably cause some inconvenience, which I regret, but the first priority must be to protect passengers and crew. All measures are kept under review.

Will the hon. Gentleman take an early opportunity of making a personal examination of the working of these arrangements, particularly at Heathrow, where they frequently involve women with children having to stand for considerable periods because there is literally no sitting room for them? Will the hon. Gentleman take up this matter personally?

I will, of course, look into the matter. The right hon. Gentleman's observations will be conveyed by me to the British Airports Authority. Both my right hon. Friend and I have questioned passengers to various destinations, including Belfast, about the security precautions which are undertaken and the inconvenience which people inevitably suffer. So far as we can ascertain, there has been overwhelming support for the measures which have been taken.

Is the hon. Gentleman aware that on the other side, at Aldergrove, the security checks and so on are carried out with great courtesy but that there are also delays, whether for families or for individuals, and sometimes people passing through on their way to the baggage check have to stand for a while, perhaps in the rain or snow?

I am glad that the hon. Gentleman has confirmed that the searches are carried out with courtesy. That was my information. I will ensure that delays and inconvenience are investigated to see whether it is at all possible to mitigate the difficulties. I am sure that all appropriate steps will be taken.