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Volume 933: debated on Monday 13 June 1977

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Civil Aircraft


asked the Secretary of State for Industry whether he has yet made any decisions upon Government support for civil aircraft construction.

I have nothing to add to my answer to the hon. Member on 25th April.

Does the Minister understand that at the Paris aerospace salon during the last fortnight one of the main talking points among manufacturers, politicians and civil servants from countries abroad has been that the British Government have no policy whatever towards civil aerospace? Has he yet made up his mind whether it is the Gov- ernment's intention to produce a new design unilaterally or in collaboration with other countries, and, if so, with whom?

The hon. Gentleman obviously attended a different Paris air show from the one I did, because the British Aerospace stand under public ownership, and the British Aerospace chalet under public ownership, attracted admiration and support from all over the world. When I attended the French Prime Minister's lunch on Saturday I also noted that France has now found it necessary to extend public ownership in its aircraft industry in order to deal with the problems. Discussions have been taking place—they took place on Friday and again today—between British Aerospace and its Continental partners to explore the possibilities of sensible, commercial, profitable collaboration.

Is my hon. Friend aware of the desperate employment situation in British Aerospace at Hatfield? When are the consultations which he has mentioned likely to come to fruition, and when are we likely to have a decision about the HS146?

In general the consultations should come to some initial conclusions next month. I made it my business to discuss the HS146 in particular with one of the members of the board of British Aerospace in Paris on Saturday. I can assure my hon. Friend that the possibilities of the HS146 are being examined in a particularly positive way.

My hon. Friend the Member for Chingford (Mr. Tebbit) asked the Minister not who owned the aerospace industry but what his policy was. The Minister gave about one line of waffle at the end of his statement. Can he tell us what the policy is?

The one line of waffle was rather succinct waffle at any rate. It is our intention, now that we have the largest aircraft industry in Western Europe under one ownership, to maintain an independent, viable, British aircraft industry that will provide maximum employment in our factories and also profit for the British taxpayer—something which has been lacking over many years under private ownership.

Can the Minister say how the Government intend to deal with the apparent divergence of policies between the British and French aircraft industries in wishing respectively to develop an improved version of the BAC111 on the one hand and an improved version of the Airbus on the other? Will he assure the House that any discussion of these matters will be based on a realistic assessment of the market and the capability of the aircraft rather than on political problems of employment in both industries?

The one thing I have made absolutely clear is that we are not interested in political planes. We are interested in commercial planes which provide employment and make money. The conflict would not be between the X11 and the Airbus; it would be between the X11 and the A200. What British Aerospace has made clear to me is that, if possible, provided it is commercially sensible, it wants to assemble the compatible features of all contenders to make commercially the best plane. There is no amour propre. It wants the best plane.


asked the Secretary of State for Industry what action he is taking to encourage the British aircraft industry to produce aircraft that are both quiet and economical.

My Department continues to encourage the development of quieter aircraft technology with funds provided under its aircraft and aero-engine general research and development programme. Expenditure on noise research in 1976–77 totalled £2·7 million, going both to Government research and development establishments and to industry. In defining these research programmes, my Department lays due stress on the need for them to lead to aircraft that are economical, both for the manufacturer and for the operator. The Government also continue to work for international agreement on improved noise standards for civil aircraft. These negotiations are the responsibility of my right hon. Friend the Secretary of State for Trade.

What are the Government doing to encourage the industry to accept that the production of quiet and economical aircraft is likely to lead to better export performance, and to act accordingly?

I can only presume that the hon. Gentleman knows that the 747, the Lockheed Tri-Star and the DC10 are already examples of quieter aircraft with quieter engines in production. I hope he also recognises that the latest versions of planes like the BAC111 are themselves examples of quieter engine technology.

Is the hon. Gentleman aware that the WOR radio station in New York has alleged that the Port of New York Authority is suppressing a report that the Boeing 707 at New York is far noisier than the Concorde and far more numerous in its nights? In view of the fact that this aircraft seems to be about the noisiest civil aircraft flying, can the Minister say what steps he is taking to suppress this aircraft's anti-social noise?

I am sure the hon. Gentleman realises that this subject is a bit more complicated than hearing a report on one New York radio station. I hope he will also take into account that this matter is currently the subject of an appeal in New York and that it is probably best to await the outcome of that.

Are any steps being taken by British aerospace industries, perhaps in conjunction with United States and French aerospace industries, to begin to explore the possibility of a Concorde Mark 2 which, while continuing to be a supersonic aeroplane, would carry more passengers and tend to conserve fuel more than the Mark 1?

That is an ingenious way for the hon. Gentleman to ask another specific question. I hope that that will encourage him to table a specific Question about it.

British Leyland


asked the Secretary of State for Industry what proportion of the public funds allocated to Leyland Cars so far and due to be allocated under the Ryder or any modified plan is for the production of components or purchase of component manufacturers, as opposed to the proportion allocated for facilities for the assembly of cars.

Public funds made available to British Leyland to assist in furthering the company's plans are not allocated in the way suggested by the hon. Member. They are provided as the public contribution to the total funding requirements of British Leyland after assessment of the performance, the prospects and the major plans of the company.

Can the Minister give the House an assurance that he understands the value of the components industry, whose exports overtook that of the vehicle industry last year? Will he therefore make certain that due protection is given in the British Leyland plans to the position of component makers so that our strength in this area is not weakened?

Since many of my own constituents work in the components industry, I can assure the hon. Gentleman that I understand its relevance. It is my understanding that any expansion of component manufacture by British Leyland will be financed out of the profits of that activity by British Leyland.

Is my hon. Friend aware that there is great anxiety among the work force of the bus and truck division because funds from Ryder have not been released to promote the programme in that area, giving rise to great anxiety about future employment prospects because of this delay? Is my hon. Friend further aware that within the last half-hour I have had a telephone call assuring me that workers will appear on these premises tomorrow in order to meet the Minister to discuss this situation?

I am a little mystified by what my hon. Friend says. The finance and the plans of the truck and bus division have not been affected by the review which has been carried out by the NEB of the car division. If my hon. Friend has some further details and cares to communicate them to me, I shall look into them.

Do the Government intend to add to the information available to Parliament and the public about the way in which the Government and the NEB have arrived at their decisions about financial assistance to British Leyland? Does he accept that, although we have realised that much of this information is commercially confidential and that this House is no forum for commercial decisions, the main information coming to Members and to the public at the moment about the options available to the Government is from well-informed Press leaks rather than from any other statement of fact?

I am not sure whether they are well-informed or ill-informed. But the hon. Gentleman has answered his own question by saying that a lot of this information is commercially confidential. In any case, I draw his attention to the fact that there is at least one Question on the Order Paper dealing with this specific matter.

Why should not British Leyland have a share of the profitable components sector when companies like Lucas, Dunlop and GKN pay more tax to overseas Governments than to our own? At least, Leyland's profits would stay in this country.

Certainly British Leyland is not precluded from components manufacture. In fact, before public money on a large scale was put into British Leyland the company was already a large-scale component manufacturer.

As the Minister and the NEB have chosen the most expensive new model in cash flow terms but the most profitable in the long term, does he anticipate having to provide more funds in the short term to Leyland, or will he find other ways, with the components industry, of getting the NEB to help?

The point about further finance for British Leyland and the provision of it was covered adequately in my right hon. Friend's statement on the 26th of last month, and that has already been discussed and debated at length in the House on many occasions.


asked the Secretary of State for Industry if he has received the review of British Leyland from the NEB.


asked the Secretary of State for Industry when he intends to publish the NEB's review of British Leyland.

I thank my hon. Friend for that answer. Is he aware that the employees and managers of British Ley-land are lobbying hon. Members to support Scheme A, when we do not know what the rest of the alphabet holds? Will he seek at an early date to publish the alternatives put by Leyland to its employees, on the basis of which they are lobbying hon. Members?

As my hon. Friend will appreciate, the report which has been made by British Leyland and upon which comments have been made by the National Enterprise Board contains so much commercially confidential information that to publish it in detail would disadvantage British Leyland at the hands of its competitors. When he made his statement on 26th May, however, my right hon. Friend the Secretary of State made it clear that he wished to give the House the maximum possible information so that it could come to sensible conclusions when these matters were debated in detail.

Will the Minister take this opportunity to assure the House that he is willing to put at least an abridged version of the report in the Library? That would be to follow precedent. Does he recognise that one of the main problems, resulting in our having so little faith in the whole Ryder approach to the subject, is that Ryder has given wildly optimistic premises on which British Leyland has been developed through him?

The hon. Gentleman has tendencies to speak spontaneously about Lord Ryder. His faith in Lord Ryder is not relevant to this Question. What I have said to the House, and have said in answer to the hon. Gentleman, is that we shall provide the maximum amount of information that can be made available to the House without damaging the commercial prospects of British Leyland as against its competitors.

When Leyland's total production of vehicles in 1976 was 60,000 down on 1975, itself a record low year, how does the hon. Gentleman intend to get the necessary very high levels of production for the new Mini project? That at least is something about which he should tell the House.

The question of production levels at Leyland has been one of great concern to the Government, and it is one of the reasons why we have decided, in agreement with the National Enterprise Board, that it is not appropriate at this time to come to a definitive decision about the development plans for Leyland. At the same time, it ought to be pointed out that since Leyland's return to full operation, following the dispute earlier this year, the output that the company has been achieving is outstanding and gives good promise for prospects in the future.

Is the Minister aware that this area of commercial confidentiality is causing concern to the work force and trade union representatives? To what extent will the workers be allowed to participate in the activities of British Leyland if they are not involved in this area?

We want the workers to be involved in this area, and that is why we have been seeking to engage them in a dialogue with management over the preparation of a planning agreement with Leyland. Unfortunately, not all the workers are prepared to take part in the participation machinery. I urge all hon. Members to encourage the workers to do so in order that they can be given the information to which they have a right.

Does the hon. Gentleman accept that it is not just a matter of producing cars but that the cars must be sold? Will he give an assurance that the NEB and the Department will take account of the views of distributors, particularly about quality of production and the model mix?

Those are important matters, and, understandably, distributors make these points to us. There is a paradoxical situation in that when there is a demand the output is not satisfactory and that when the output is satisfactory lack of confidence has reduced demand. It is a sad situation, and that is why we must look carefully at further financing.

Industrial Development Advisory Board


asked the Secretary of State for Industry whether he proposes to make any changes to the powers or the constitution of the Industrial Development Advisory Board.

I welcome that reply. Can the Minister explain why the Government rejected the advice of IDAB on the use of taxpayers' money and made a further grant to the Kirkby workers' co-operative despite its advice that the fresh application for assistance to that co-operative did not accord with the Government's criteria? Is not that an example of political pressure overriding sensible commercial advice on the use of taxpayers' money?

Since its inception in June 1972, the Board has considered 367 cases. In only seven cases did the Government conclude differently from the Board. The hon. Member must accept that the final decision rests with the Government. In the case of the workers' co-operative at Kirkby, severe unemployment factors rightly influenced the Government.

It is interesting that the hon. Member should raise this question. The Government took the advice of IDAB into account and decided to rescue 700 jobs in Kirkby. Are the Opposition saying that the Government should have put 700 people on the dole? Are the Opposition opposed to this type of assistance, which will help towards a solution of the unemployment problem.

Can my hon. Friend confirm that not far from Kirkby, in Skelmersdale, Courtaulds—the industrial giant which has had £6 million from the taxpayer in order to continue with its factory and employ people in the textile industry and which made a profit of 9 per cent. generally over the last 12 months—is now discarding its employees and throwing them on the dole? Would it not be better to have more worker enterprises of this type fostered by the Government to keep more people in employment?

That is an interesting point. The Opposition did not raise the question of taxpayers' money being given to Courtaulds when that company announced 4,500 redundancies. Significant sums of taxpayers' money have been advanced. Some of that money has been the subject of recovery action. Courtaulds made a commercial judgment which resulted in 4,500 redundancies. There is strong political prejudice on the part of the Opposition spokesman. He fails to raise questions about Courtaulds but seems only too eager to raise the question of a workers' co-operative which has saved 700 jobs in an area of high unemployment.

Greater London


asked the Secretary of State for Industry if he will now take steps to encourage new industries to move into the Greater London area.

The forthcoming White Paper will contain proposals to encourage industry in inner urban areas, including those of London.

Will my hon. Friend consider liaising with the London boroughs to establish a register of industrial sites to see that they are protected so that industry can return to them? Will he ensure that they are not used for the construction of warehouses which will prevent industry from returning to the Greater London area?

That is an interesting suggestion which I shall consider. We have already had approaches from individual boroughs within the Greater London area. Where we can intervene to assist in the preservation of sites and to release sites which would otherwise be moribund, we shall do so.

Will my hon. Friend consult his colleague the Secretary of State for Employment on the question of the serious youth unemployment in London and see what he can do, in consultation with his right hon. Friend, to bring some relief to this problem?

My right hon. Friend the Secretary of State for Employment has been very much involved in the review of all the factors affecting youth unemployment, and I shall take my hon. Friend's points into account.

May I ask the hon. Gentleman whether, ahead of the publication of the White Paper, he agrees that another manifestation that urgent action is needed is that unemployment in the Greater London area in the last two years has for the first time become deep-seated and will become long-term unless the old traditional discouragement policies are discontinued?

The Government have great regard to unemployment in the London area and have been taking action where possible. There are a number of factors that have produced unemployment in the London area. It is not regional policy that has produced this situation. Many other factors are involved. As the hon. Gentleman knows, we are having discussions about the matter, and a White Paper will be produced, which is evidence of the concern that the Government have shown.

Is my hon. Friend aware that there are parts of the Greater London area where unemployment is a good deal higher than in many of the development areas? Will he take steps not only to bring in new industry but to prevent existing industry in London from moving out, because it is still moving out under the pressure of the regional policies with which he is proceeding?

Only 9 per cent. of jobs have gone to development areas from London. As I said earlier, there are many other factors that have led my hon. Friend to make the points that he has made today. The travel-to-work area statistics, which are general statistics, hide pools of much higher levels of unemployment. The Government are very concerned about the situation and are entering into discussions and producing a White Paper as a precursor to discussion and debate to see in what ways we can improve the situation.

When the hon. Gentleman is preparing the White Paper, will he take into account the need for positive encouragement to be given to firms that are already in London and wish to expand? Will he give them encouragement rather than the discouragement that they have had in the past?

As the hon. Gentleman knows, we have made a number of industrial development certificate concessions about this. We have taken into account the representations that have been made, and I can reiterate that the Government's concern is exhibited by the partnership proposals with inner city areas that have been announced, together with the White Paper that will be published very shortly.

Industrial Products (Price Components)


asked the Secretary of State for Industry what are the problems and advantages of determining the United Kingdom added-value component in the prices of industrial products; and if he will carry out a study and make a statement.

I am afraid that the complexity and costs of making dependable valuations throughout industry far outweigh any advantage that might be found in such information.

Although I appreciate the enormous difficulties in this area, will my hon. Friend look at certain industrial sectors where the manufacturers believe that this is feasible, as the obvious advantage, for example, in public sector ordering in these areas would be enormous because of the very great advantage of anything providing United Kingdom added value in terms of the economy and the Treasury compared with the imported sector?

I have noted what my hon. Friend has said both today and in his letter to The Times. To apply this principle rather more generally is a very complex and costly operation, especially if we are to avoid some of the mistakes of double counting made in the past. However, if my hon. Friend has any speci- fic scheme in any specific sector in mind which he would like to put to me, I shall be happy to look at it.

Post Office Workers (Industrial Action)


asked the Secretary of State for Industry what plans he has to change the law in relation to organising Post Office workers to strike.

I intend to propose amendments to Post Office legislation so as to enable Post Office workers to take normal industrial action without the fear of incurring criminal prosecution.

Has the right hon. Gentleman consulted the Liberal Party about whether its Members will support such legislation? [HON. MEMBERS: "Where are they? "] Secondly, in view of the Lord President's obvious belief that the general posting public would like their mail interrupted so that Post Office workers may pursue political vendettas in other countries, can the right hon. Gentleman at the same time arrange for the Post Office monopoly to be broken so that those of us who wish our mail to be delivered may rely on other organisations to do it?

The Post Office monopoly will not be broken arising out of any changes which I propose to make.

As for the question of consultation, we shall be consulting a wide range of views, including the Post Office management and the Post Office Users' National Council. If the arrangements existing between the Government and the Liberal Party exist by the time that I bring forward proposals, I. have no doubt that we shall consult the Liberal Party too. I dare say that the hon. Member for Cirencester and Tewkes-bury (Mr. Ridley) will have views which he will express from time to time. I hope to bring forward proposals as soon as possible.

Will my right hon. Friend, who no doubt recalls that Post Office workers recently gave their support to people out on strike at the Grunwick Processing Laboratories, state what action he proposes to take, in view of the fact that at least 50 people have been arrested outside those laboratories today, to ensure that the ACAS recommendation is carried out, tht ACAS is recognised and that this bitter and unnecessary dispute is brought to an end?

I have heard that there has been difficulty at Grunwick today, although I have not received an authoritative report. The matter no doubt will be considered by my right hon. Friend the Secretary of State for Employment, who, I am sure, will take steps to see whether he can be of assistance.

Does the right hon. Gentleman intend to include the right of Post Office workers selectively to black or to refuse to deliver mail on political grounds?

I cannot understand why Conservative Members are getting themselves worked up into a lather about this matter.

If the hon. Gentleman will give me time, I shall try to do so. The hon. Gentleman should contain himself, be patient and not be so impetuous, because usually when he is impetuous he is extremely offensive. The decision of the Court of Appeal on the Gouriet case put in doubt the right of Post Office workers to strike, a right which we had always thought existed and which the previous Conservative Government thought existed. We are trying to remove the uncertainty.

As the Post Office has no monopoly in the collection and delivery of parcels and newspapers, will the right hon. Gentleman use the opportunity of the legislation to remove the monopoly in the collection and delivery of letters?

No, Sir. Our proposal will be laid before the House in due course to clear up the uncertainty. When there was a strike of Post Office workers in 1971, the previous Conservative Government took no action. No legislative changes were made then nor, as far as I can recall, did the Conservative Government take any action when there was a selective boycott of France in 1973. The Conservatives must not have double standards in this matter.

Folkestone And Hythe (Area Status)


asked the Secretary of State for Industry if he will now give development area status to Folkestone and Hythe.

Does the Minister appreciate that unemployment in Folkestone and Hythe has been well above the national average almost since the present Government came to power? Why should a district with such good facilities for commerce and industry be deprived of the opportunity to get people to move to it because of legislation introduced by this Government? How high must unemployment rise before the Government come to their senses and give us development area status?

The unemployment in Folkestone and Hythe is certainly regretted by the Government, but the area has a number of factors that are special to it in that it is a seaside area with seasonal variations in employment. The Government are concerned but can see no justification at this stage for altering the area's status as the hon. Gentleman requests.

Regional Policies


asked the Secretary of State for Industry if he is satisfied with the workings and effectiveness of the Government's regional policies, particularly as they affect the South-West assisted areas.

A recession tends to reduce the effectiveness of regional policies, but this should improve with an improvement in the economy.

But is not the Minister aware that over the past 12 months the South-West Development Area—Cornwall in particular—has had the highest level of unemployment of any United Kingdom development area? Is it not time that a more flexible approach was introduced to take account of the needs of companies in rural development areas?

The Government are concerned about unemployment wherever it occurs. We have faced extreme economic difficulties, but the Government have taken positive steps to try to redress the position in the South-West. For example, we have built 25 advance factories and another four nursery units for small companies are due to be completed in the near future. We have given regional selective financial assistance of nearly £7·5 million to create about 7,000 jobs. I am sure that the hon. Member and his hon. Friend the Member for Folkestone and Hythe (Mr. Costain) will bear in mind the restrictions on public expenditure. It is strange that Conservative hon. Members advocate cuts in public expenditure but when they speak on behalf of their own constituencies they always seem to want more.

Is my hon. Friend aware that there is a great deal of dissatisfaction, particularly at present, about the operation of the regional policies on Merseyside? For example, there is dissatisfaction that an additional 1,400 workers are likely to be out of work as a result of the redundancies at Plessey's. Can my hon. Friend say why Lord Ryder's report on this matter was not properly discussed and action was not taken before the redundancies were announced by the Government? What action will the Government now take to stop those redundancies and create more work on Merseyside?

Order. I must draw attention to the fact that this Question is about the South-West.

The Ryder Report is due to be published in the near future. The Government are concerned about the effects of regional expenditure and levels of unemployment, particularly in Merseyside and elsewhere, but I am sure my hon. Friend will accept that regional expenditure can remedy only one of the structural defects of industry. The largely private enterprise economy that we have in this country is going through a crisis. Although regional expenditure can help to obviate some of the difficulties, it cannot alter the basic system and the difficulties associated with it.

Will the Minister turn his mind to the European element of the Government's regional policies? Is it not the case that the Commission's proposals greatly to increase the Regional Fund are likely to be stillborn because of the British Government's comparative lack of interest in such proposals? Is the Government's main difficulty their reluctance to relinquish their political control over any element of regional policy?

As with other Common Market matters, we are engaging in discussions about the general regional position in this country with regard to the Common Market, so the hon. Gentleman is wide of the mark. The Government are concerned and are engaged in discussions on the matter.

Is it not the case that the Government's present regional policies are based on the 1972 Industry Act passed by the previous Government? Is it not clear from the representations made to my hon. Friend's Department from the North-East of Scotland that that Act is far too inflexible and does not allow the Government to deal with circumstances as they arise instead of having to deal with them in a purely automatic and mechanistic way?

My hon. Friend has made an interesting point. The 1972 Industry Act, passed by the previous Conservative Government, is the basis for current regional policies. We have tried to adopt a more selective approach to produce the sort of flexibility for which my hon. Friend asks. But the notion that the central Government have enormous powers of intervention in industry is not correct. Our powers of intervention are quite limited.

To what level must unemployment rise in any of the regions before the Minister revises the policy on the regions or resigns and returns to his erstwhile friends below the Gangway?

Regional policy is designed to deal with basic structural unemployment, as the hon. Gentleman well knows. What alarms me is the double standards displayed by the hon. Gentleman and other Conservative Members, who constantly talk about cuts in public expenditure which would greatly increase the level of unemployment and yet, when they speak for their own constituencies, always seem to want more and more public expenditure.

Cable And Wireless


asked the Secretary of State for Industry whether he will make a further statement about the remuneration of the directors of Cable and Wireless.

I have nothing to add to the answer I gave the hon. Member on 25th April.

Will the Minister pay tribute to Cable and Wireless, which made a profit of £28 million in 1975 and a substantially greater profit in 1976? Following the resignation of the managing director, Mr. Willett, and since the salaries of senior officials now substantially exceed the salaries of directors, will the Minister urgently direct his attention to the matter of directors' salaries?

I paid tribute to the achievement of Cable and Wireless on 25th April and I do so again. The problems of the company have been aired by the hon. Member for Eastbourne (Mr. Gow) on several occasions. However, he does the company and its achievements no credit by the comments that he continually makes about the company. That was especially so when he introduced his denationalisation Bill for Cable and Wireless. I can say only that the whole matter of the salaries of the board of Cable and Wireless must be considered in relation to the salaries of the members of the boards of nationalised industries and that that is all part of the wider question of salaries in the next round of the pay policy.

I should be grateful if the hon. Gentleman would be kind enough to raise his point of order at the end of Questions.

In addition to worrying about the rates of pay in nationalised industries, will my hon. Friend take the trouble to investigate the disgracefully low wages of office cleaners employed in the headquarters of nationalised industries? Does he realise that they are given disgustingly low rates of pay to clear up all the rubbish?

My hon. Friend has brought to the attention of the House something that has been brought to the attention of hon. Members. I know that there is a great deal of sympathy for the point of view he has expressed, and I hope that he will raise the matter in the appropriate quarters.

If the directors of Cable and Wireless are underpaid or suffering, will the Minister suggest that they should stand for direct election to the European Parliament?

We all recognise those sentiments and the track record of the hon. Member for Banbury (Mr. Marten) on this matter. As far as I am aware—although I have not yet seen any specific details—there is nothing that would preclude them from standing for election.

Motor Industry (Productivity)


asked the Secretary of State for Industry what is the level of productivity in the motor industry expressed in percentage terms, compared with the level of productivity in the motor industries of West Germany, France and Japan, respectively.

I refer the hon. Member to the report on the future of the British car industry by the CPRS which concluded that, in terms of vehicles per employee, productivity in the British motor industry appeared to be approximately 30 per cent. below French and German levels and 60 per cent. below the Japanese level in 1973. I should remind the hon. Member that comparisons of this sort are complicated not only by product mix but by the degree of vertical integration, the relative level of labour costs and the amount and quality of capital equipment with which employees have to work.

We realise that the Minister would like to do his best to fudge the obvious message contained in those figures, but does he not agree that the reason for lower productivity probably has something to do with the level of direct taxation in this country, which seems to discourage people from working hard? Does the right hon. Gentleman agree with that point of view? If he does not agree, will he say what other Government policies are the cause?

There is another obvious answer, and that is that the private sector in this country has not done as well as the private sector in other countries.

Does my right hon. Friend agree that the only obvious message that arises from this Question is the desire of the Opposition to run down the British worker on every possible occasion, and that because of that the level of capital investment in the British motor industry is far below the level of investment in the industry's competitors in Germany and Japan?

My hon. Friend is absolutely correct. Little that is constructive comes from the Opposition Benches when we deal with industrial policy. Indeed, the question is perhaps typified by the dormant attitude of the Opposition Front Bench. We look forward to some maiden intervention from the Opposition Front Bench today.

Will the right hon. Gentleman stop siding with this senseless sniping of platitudes? Will he try to give a constructive answer and tell the House whether the plan for the new Mini provides for Japanese levels of production and productivity?

Obviously the aim of the industry must be to attain levels of productivity comparable to those of its major competitors. It is for that reason that the Government have been holding detailed discussions, in a tripartite environment, with the management and workers. We have been involved in order to find out what we can do to help, but the primary responsibility must rest with the industry.

Northern Region


asked the Secretary of State for Industry what recent representations he has received about the need for a Northern Development Agency.

This subject has been raised on a number of occasions, and views both for and against such an agency have been expressed.

Does my right hon. Friend realise that there is now growing support in the Northern Region for a Northern Development Agency along the lines of those in Scotland and Wales? Does he agree that if we now had a development agency in the Northern Region we might be less worried about what happens at C. A. Parsons?

I am not sure that my hon. Friend's conclusion in any way arises from his basic premise. An agency is not a magic formula. Unfortunately it is being seen as such by many people. We must bear in mind that the creation of an agency can do nothing in itself to further advance the cause of the North and that it would lead to demands for similar agencies from hon. Members who fight for Merseyside and the North-West. The demand would not be in only those areas. Similar demands would arise from most areas, and I suspect that the North would lose out to wealthier areas.

Can the right hon. Gentleman confirm that the regional policy—of which the proposed Northern Development Agency is but a part—has as one of its objectives the comparative discouragement of economic activity in once prosperous areas and that, therefore, regional policy can partly be blamed for the high level of unemployment in the West Midlands?

That does not follow. The hon. Gentleman will be aware that when world economic activity is at a normal level the West Midlands and certain industrial parts of London suffer a substantial inhibition on industry because of the lack of skilled labour. The correct economic objective, which has been recognised by both parties when they have been in office, is that we should get a better and more even distribution of industry, and that is what regional policy is intended to attain.

Does my right hon. Friend accept that one part of that even distribution is the even distribution of headquarters functions and senior jobs? Is he aware that there are now only six major companies based in the Northern Region compared with nearly 40 at the end of the war and that this decline is another reason why many of us are concerned about the future of C. A. Parsons and Reyrolle Parsons, which are locally based in the Tyneside area?

My hon. Friend is right in saying that there is a problem in all regions when there is a concentration of industry and headquarters functions move out. However, there is no evidence to suggest that at a time of closures there is greater vulnerability among branch units than among units in non-assisted areas.

Nationalised Industries


asked the Secretary of State for Industry when he next expects to meet the chairmen of nationalised industries for which he is responsible.

Will my right hon. Friend discuss with the chairmen the implications of the Daily Mail attack on British Leyland? Is it not obvious that this was a conspiracy against nationalised industries by the gutter Press, which used lies and forgery to try to topple the Labour Government in the hope of returning a Right-wing extremist Government headed by the Leader of the Opposition, whose silence over this whole sordid affair has been very conspicuous?

I have discussed the Daily Mail only with Lord Ryder, whom I asked to conduct an inquiry into the allegations. He has not reported to me yet, but he will do so in due course and I shall report to the House. I want to leave it at that.

Has the right hon. Gentleman discussed the NEDO Report on nationalised industries with the chairmen of the industries for which he is responsible? Are we to have the benefit of his Department's thinking on this matter, perhaps in the form of a White Paper?

I do not have ministerial responsibility for replying to that report, but I have discussed its wider implications with the chairmen of the industries for which I have responsibility. I have mixed views and there are mixed views generally about the recommendations. On the general question of industrial democracy, we have laid a Bill before the House that has received an unopposed Second Reading for an experiment in industrial democracy in the Post Office. The Aircraft and Shipbuilding Industries Bill included a clause laying a duty on the corporations to bring forward proposals within three months for industrial democracy, and Sir Charles Villiers has recently made proposals in respect of the British Steel Corporation. I understand that the Iron and Steel Trades Confederation and the TUC Steel Committee are likely to respond to them. Some good progress is being made.

Japanese Companies


asked the Secretary of State for Industry what representations he has received from Japanese companies to set up factories in the United Kingdom.

Three Japanese companies are at present discussing with my Department the conditions under which they might set up factories in the United Kingdom.

When my right hon. Friend considers the Hitachi application, will he take into account the effect that this will have on the electronics components industry in this country? Is he aware that it is causing a lot of dismay among workers, particularly as it seems that the tubes will come from Helsinki?

My hon. Friend was good enough to come with a deputation which made representations and expressed its concern quite clearly. I can undertake that we shall take into account the impact on British industry. I can assure my hon. Friend that the Finnish production will be a smaller unit than the Mullard unit and will be particularly aimed at the Russian market rather than the European market.

Is the right hon. Gentleman aware of the grave concern among both management and trade unions about the effect of the Hitachi assembly plant on United Kingdom employment because although a further 250 jobs may be provided another 5,000 may be lost? Is he aware that the United States consumer electronics industry has been ruined by what are regarded as unfair Japanese practices, and will he act robustly to ensure that this does not happen here?

That is why the discussions have taken so long. We want assurances before giving the go-ahead. We want assurances about exports and about the use of British components. It is encouraging to note that a spokesman for Hitachi made a public statement recently that the company would count any set in which there was more than 50 per cent. of imported components against sets that it would otherwise have imported into this country. To that extent, it would not have an adverse effect on British industry. However, we have not finished our consultations either with British industry or with Hitachi.

Power Plant


asked the Secretary of State for Industry if he will consult with the Chairman of the NEB and the Chairman of C. A. Parsons Ltd. with a view to forming an industrial unit to specialize in the design and export of small-scale electrical generating equipment, particularly to developing countries.

The United Kingdom has considerable manufacturing capacity for small-scale generating equipment but a request from any company for assistance in forming a unit to produce such equipment would be considered on its merits.

Would my right hon. Friend agree that the record of the electricity generating equipment industry in world markets over the past couple of decades has not been particularly impressive? Does he agree that it may be a good idea to establish a unit for producing equipment particularly with a view to penetrating world markets, especially with smaller equipment?

There is a great deal in what my hon. Friend says. A major part of the controversy surrounding the Government's attempt to restructure the power plant industry is whether we can have an industry that is internationally competitive. This is not a matter of a single power station order or anything of that sort. We hope that we shall be successful, because if we are not internationally competitive we shall lose out to some of the major giants of the world.



asked the Secretary of State for Industry if he is satisfied with the current level of investment in British industry.

Investment has generally been on a rising trend, and all the recent investment intentions surveys point to substantial increases this year and even larger increases in 1978.

Does the right hon. Gentleman agree that investment will not be satisfactory as long as our interest rates are 10 per cent. more than those in countries such as Germany and when individual incentive is completely lacking? What are the Government doing to rectify this situation?

We are bringing down interest rates—a matter for which we get little credit from the Opposition—and beginning to attain the increases in investment that both sides of the House wish to see. Last year there was a 5 per cent. increase in investment in the fourth quarter of the year compared with the first quarter. This year the Department anticipates an increase of between 6 per cent. and 10 per cent., with an increase of as much as 20 per cent. next year. According to the CBI, we shall see an increase of 10 per cent. to 15 per cent. between mid-1977 and mid-1978. All these examples show the right trend. If our estimates are accurate, we shall attain a level of investment as high as that of 1970, which was a peak year that was never equalled by the Opposition when they were last in power.

Is my right hon. Friend aware that investment levels in Germany, France, Japan and Italy are far higher than in this country and that the main banks and insurance companies, which have been the principal sources of investment in those countries, are publicly owned?

I doubt whether public ownership is necessarily a major factor. We must look at the history of the development of financial institutions in all countries. My right hon. Friend the Member for Huyton (Sir H. Wilson) is heading a survey into the rôle of the financial institutions in this country. It is worth stressing that in our private sector about two-thirds of all investment is self-generated, and that is why we regard profitability as important.

Are not price controls and a tendency to overmanning as well as inflation and a low level of real profits relevant to levels of investment?

Price control may be relevant when it, rather than the market, is the major inhibition, but the major constraint on industry in recent years has been the market situation. Price con- straint is a necessary requirement if we are to achieve the victory over inflation, and it is equally important for industry and future investment programmes. Of course we want to avoid overmanning, and that is why we have sector working parties involved in about 40 considerations of ways to improve productivity in important parts of our industry.

Is not the truth of the matter that in the past 12 months company profits, at least for the last quarter, have increased by about 40 per cent., that the banks have money to burn and the profits of the four major clearing banks are up by 67 per cent., and that most major private companies are paying little or no corporation tax and pay tax only to overseas Governments? In this period of Labour Government has not as much as £10,000 million been provided by the taxpayer through means such as relief on stock and deferred taxation, and is it not clear that private enterprise is failing and that it is costing us too much money to keep continually propping it up?

I understand the vehemence of my hon. Friend's interjection. However, despite what he has said, it is worth bearing in mind that the private sector still needs profits in order to invest. It is a fact, whether my hon. Friend likes it or not, that on a historic basis profitability is at a very low level in British industry at present. Therefore, we must generate more profitability if the Government are not to find all the finance that is necessary.

Rhodesia (Sanctions)


asked the Attorney-General if he will publish in the Official Report the number of cases of alleged contravention of the Rhodesian Sanctions Orders which have been investigated by the Director of Public Prosecutions and the number of cases in which prosecutions have been initiated; and if he will make a statement on the effectiveness of the Rhodesia Sanctions Orders.

Yes, Sir. I shall arrange for the information requested to be so published. The effectiveness of the Rhodesia Sanctions Order is essentially a matter for my right hon. Friend the Secretary of State for Foreign and Commonwealth Affairs.

May I congratulate my right hon. and learned Friend on his appointment to the Privy Council? Is he aware that to the layman the decision taken by the Director of Public Prosecutions not to proceed to prosecute in certain sanctions cases defies any rational understanding? Since the DPP gives no reason for not prosecuting, is it not my right hon. and learned Friend's duty and that of his Department to monitor the decisions and to advise the Foreign and Commonwealth Office to strengthen the sanctions orders? Will he undertake to monitor these arrangements?

I am most grateful to my hon. Friend for his references to me personally. In relation to any specific decision by the DPP, when it can properly be done we are always prepared to discuss reasons in the House. My hon. Friend will be aware that in the case of Dovaston, in which the court held that there was no case to answer, serious consideration is being given to a reference to the Court of Appeal. The question of whether conduct not at present prohibited under the orders ought to be prohibited is a matter for my right hon. and learned Friend and ultimately for the House.

Can the Solicitor-General tell the House, since he is to publish the information, roughly how many of the allegations turned out to be the subject of prosecutions?

I am in a difficulty. I am happy to answer, but I should not earn the gratitude of the House if I were to reel off statistics. There have been five prosecutions in relation to the orders. In addition, the Director of Public Prosecutions has prosecuted in a further five cases. Her Majesty's Commissioners of Customs and Excise have initiated proceedings in 17 cases.

Why was the former Derbyshire man, who fought for this country in the war and who is now an MP in Rhodesia, refused entry into this country when he was coming here purely for a compassionate reason to visit his 85-year-old mother? Is not that sinking to the lowest depths of spite and malice, even for this Government?

Even if that supplementary question arose from the original Question, it would be a matter for my right hon. Friend the Secretary of State for Foreign and Commonwealth Affairs.