asked the Secretary of State for Trade what dis cussions he has had with the Chairman of British Airways about the purchase of new aircraft for the airline.

asked the Secretary of State for Trade if he will discuss with the Board of British Airways its plans to purchase foreign aircraft to renew its present fleet.

asked the Secretary of State for Trade if he will make a statement on the future purchasing policy of British Airways.

At this stage the evaluation of the relative merits of the various possible replacement aircraft is a matter for British Airways, but my right hon. Friend and I are arranging to meet the chairman shortly to discuss the airline's re-equipment position.

Does the Minister hold the view that British Airways should be allowed freedom to use its commercial judgment without interference in ordering any new aircraft? If it decides to buy American, can he say whether either the Boeing or Douglas or parts of it could be built under sub-contract by British Aerospace?

The second part of that question is clearly a matter for my right hon. Friend the Secretary of State for Industry. As to the first part, if I may say so with respect, the hon. Gentleman has put the matter a little simplistically because, whilst it is perfectly true that British Airways is entitled to and should use its commercial judgment in arriving at a fair evaluation of competing quotations, nevertheless the matter has to come to my right hon. Friend the Secretary of State, who must, of course, be able to look at wider interests too. But the commercial judgment of British Airways is obviously a very important criterion.

Will my hon. Friend have close consultations with the Department of Industry as it alone knows whether British Aerospace will be allowed to make proposals for new projects which are absolutely vital for work continuation in this country for many workers? I believe that this must be the main consideration for all of us.

Of course, consultations would take place with my right hon. Friend the Secretary of State for Industry, and there is nothing to suggest that British Aerospace will in any way be inhibited from making quotations where quotations are required from it. Indeed, nothing that has arisen in recent weeks suggests otherwise.

Is it not a matter of concern that the Deputy-Chairman of British Airways should have seemed to pre-empt this decision? Before the meeting, will my hon. Friend make sure that British Airways has had discussions with the Department of Industry and is fully briefed as to the potential of British Aerospace in this field?

The Deputy-Chairman of British Airways was attending an informal Press conference. He denies that any quotation, which has not yet been forthcoming in any event, has been preempted by what he has said. The matter is therefore open, and it will be for British Airways, I hope very carefully and fairly, to consider all the quotations that it receives on this matter.

Are not British Airways' requirements for aircraft, which will have to last well into the 1980s, already well known to British Aerospace? Would not the Minister's best contribution to this controversy be to make sure that the chairmen of both corporations engage in discussions, so that the chairmen of both corporations engage in discussions, so that hopefully an aircraft will be available which would come up to the standards required by British Airways?

I am sure that that sort of discussion would take place.

Is my hon. Friend aware of the concern expressed by British Aerospace about the morale of the people employed in the factories, particularly in relation to the statement made by the Deputy-Chairman of British Airways?

The morale of the work-people in the factories, I dare say, might have been adversely affected by a suggestion that British Aerospace was out of the running. The suggestion is now denied and refuted. Accordingly, I hope that British Aerospace will be able to tender competitively for this very important project.

What are the Government doing to make up for their mistake in neglecting to come in on the European airbus? In particular, what are the prospects now of getting involved in this so that we may have Rolls-Royce engines with it?

The hon. Gentleman knows perfectly well that that is not my responsibility but the responsibility of the Secretary of State for Industry.

asked the Secretary of State for Trade what is the latest estimate of movement in the amount of trade between the United Kingdom and Uganda.

United Kingdom exports to Uganda in the first 10 months of 1977 were £17·2 million fob and imports in the same period £29·9 million cif. Exports in the corresponding period of 1976 were £8·4 million and imports £29·1 million.

As it is now six months since the Foreign Secretary promised to do everything possible to stop the shuttle service from Stansted to Uganda, why is it still running four times a week? Will the Government take immediate steps to stop this immoral traffic of expensive luxury goods which the dictator Amin is using to buy the loyalty of his murderous henchmen?

That matter is still under consideration. As my hon. Friend will know, we have certain responsibilities and commitments under the Chicago Convention.

asked the Secretary of State for Trade when he next plans to discuss the subject of freight rates with the Soviet authorities.

Until the Soviet authorities have demonstrated their willingness to make progress towards resolving current practical problems, I see no point in engaging in any further ministerial discussion with the Soviet Government.

Is the Minister aware that great concern is felt by the shipping community here that he should make further representations to the Soviet authorities at the earliest possible opportunity? Will he tell the House when discussions with his EEC counterparts on an appropriate Western response to the Soviet behaviour will be established, and what he hopes that response will be?

I do not believe that that is the view of British shipping interests in this country. They are well aware that I met the Soviet Minister in Moscow, and it was clear that no progress had been made in a number of important issues which tested the good faith of the Soviet Government in seeking to resolve problems. The next move must be in the hands of the Soviet Government.

As regards the EEC, I spoke at the Council of Ministers on this issue on 27th October and we hope that progress will be made early in the new year—perhaps at the next meeting, which I hope will take place in March.

Is it not clear that, while this delay is taking place, the Soviet Government are continuing to operate artificially low dumping rates for their shipping?

Of course that is true, and it is important that we should be able to co-ordinate a strategy. It is of little use seeking to exercise unilateral action in a situation of this kind. That is why I and the German Minister in particular have made an appeal at the EEC to try to arrive at a co-ordinated strategy at the earliest opportunity.

asked the Secretary of State for Trade what positive steps he has taken to protect British shipping from the threat posed by the Soviet merchant fleet.

I have urged our EEC partners to consider proposals for co-ordinated defensive measures.

Is the Minister aware that there is strong support for his move to seek prompt action against the Russians through the EEC? Although earlier today he suggested that he expected prompt action by the Commission, is he aware that it is talking of a period of 12 months for consultation? Will he therefore make sure that the Commission treats this problem with the urgency that it deserves?

I certainly have not been advised that the Commission contemplated taking 12 months. That would not be in the interests of the United Kingdom. I should hope for urgent consideration of this matter. I hope that even now, at this stage, the Soviet Union will show a preparedness to arrive at a reasonable accommodation rather than to engage in confrontation.

asked the Secretary of State for Trade if he will introduce new categories of companies in the forthcoming Companies Bill.

The Companies Bill will contain proposals for substantial revision of the definitions of public and private companies, and will require public companies to adopt a new designation.

In view of the Secretary of State's statement that, in effect, the Companies Bill will be limited to implementation of the second EEC directive on the reform of Company law, does he not agree that another opportunity to reform the framework within which business is required to operate in this country—most of which is now 30 years out of date—has been lost?

I did not quite say what the hon. Gentleman suggests. I said that I could give no assurance that it would be possible to incorporate in the Companies Bill that will come forward the matter covered in the White Paper that I have recently issued. I hope that it will be possible. I am not now certain of the position and, therefore, I can give no assurance. But certainly we are attempting to use this time to engender public discussion about a number of issues, including the position of small companies, which would be important in any such review of company law.

Is the Minister aware that the difficulties of small companies arise not so much from their status under company law as from the excessive and oppressive nature of legislation, particularly on taxation and employment protection, which has been piled upon them in recent years? Is he aware that, if that aspect can be put right, it will probably be unnecessary to jigger around with them and create a second-class citizen in our company law?

I note what the hon. Gentleman says. There is nevertheless an argument for considering the position of the small company under company law. We are in the process of doing so, and it may well be appropriate to issue a Green Paper on that subject.

asked the Secretary of State for Trade what is the estimated current annual value of British exports to and imports from Spain, Portugal and Greece as a percentage of current trade with non-Communist European countries.

In the 12 months to October 1977, United Kingdom exports to and imports from these countries together were £967 million and £751 million respectively, representing 6 per cent. and 4 per cent. of our trade with non-Communist European countries.

Could the hon. Gentleman have an assessment made of that trade, to indicate whether there are any particularly sensitive items which will require a protracted transitional arrangement should these countries be brought within an enlarged Community, and report to the House accordingly?

Yes, Sir. We shall certainly do that, but I can assure the hon. Gentleman that the transitional arrangements will include a reciprocal safeguards clause. However, perhaps the most sensitive item is textiles. There have been negotiations on that subject with all three countries, in view of the renegotiation of the MFA with the 30 low-cost countries.

What calculations have been made of the effect on the trade balance if Spain, Portugal and Greece come into the Common Market and on the effect of the common agricultural policy applied to those countries? Will there be wine, sherry and port lakes in Europe?

I cannot give my hon. Friend any precise estimates, but we are concerned about the effect on agricultural goods. There will have to be a Mediterranean agricultural régime, since present measures apply only to Northern European agriculture. Our concern for radical reform of the CAP will, in fact, be strengthened by the accession of the three new countries.

asked the Secretary of State for Trade if he will make a statement about Anglo-Polish trade.

asked the Secretary of State for Trade what calculations his Department has made of the long-term effect on the British balance of payments of the recent shipbuilding deal with Poland.

Poland is our second most important export market in Eastern Europe with a consistently favourable trade balance to the United Kingdom. Trade has continued to expand during 1977.

No detailed calculations have been made by my Department on the overall effect of the shipbuilding deal on the balance of payments, but I would expect it to be positive.

Does the Secretary of State accept that he is responsible for looking after the interests of British shipping lines? Are not their interests and those of the people who work for them likely to be affected adversely by the proposed British-Polish shipbuilding deal? In view of the practice of Communist countries of competing at unfair rates, and of the large subsidies which the British taxpayers will apparently have to pay towards the construction of the ships, what provision will there be that they will not compete in the cross-shipping trade between third countries?

As the hon. Gentleman says, I have a responsibility for British shipping. On the other hand, the rest of the hon. Gentleman's question is posited on the premise, which is totally untrue, that if we had not accepted the orders no one else would have built the ships.

How many British cars have been exported to Poland, compared with the number of Polish cars imported into this country? What barriers are there to the export of British cars to Poland?

I do not have the figures on the trade in cars. I shall look them up and communicate them to the hon. Gentleman.

Has the right hon. Gentleman received any undertaking that the Polish Government will not do with the ships precisely what the Soviet Government are doing with theirs?

I have received no such undertaking. However, once again, the question is posited on the premise that if we did not build the ships no one else would. That premise is totally false.

Can the Secretary of State tell us at what stage he was brought into the negotiations and whether, in fact, he was ever consulted about the terms before the Prime Minister's statement to the Labour Party Conference?

As the hon. Gentleman knows, the order has a long history, including discussions last December between the Polish and British Prime Ministers. I have been aware of the facts all along.

Will the Secretary of State confirm whether ECGD was forced to increase its limit per country vis-á-vis Poland in order to accommodate the shipping contract? Has ECGD gone beyond the normal, prudent, commercial insurance limit for the contract to be taken on?

The hon. Gentleman knows that Polish credit is good, and the ECGD terms are within the terms of the OECD arrangements.

asked the Secretary of State for Trade how many applications he has received to date seeking the release of information which the Civil Aviation Authority considers itself unable to supply by reason of the Official Secrets Act.

None, but in four cases I have been asked to permit or direct disclosures of information under Section 36 of the Civil Aviation Act 1971. I did so in three cases and the fourth is at present under consideration.

I thank the Minister for his reply, but will he bear in mind that under the Civil Aviation Act 1971 the Civil Aviation Authority is defined as neither servant nor agent of the Crown? Therefore, what authority has the CAA to invoke the Official Secrets Act?

The hon. Gentleman, when he served on the Committee, raised no question concerning the relevant clause at that time. If he consults the Act, he will find that his interpretation of the position is clearly wrong and that, in fact, Section 61 applies.

asked the Secretary of State for Trade when he expects to have a balance of trade surplus with the EEC.

Within the improvement in our overall trading position during this year, there has been a further reduction in our visible deficit with the EEC. But I cannot predict future trends.

Now that we have been in the Common Market for five years, is not the Secretary of State deeply concerned that the balace of trade has been running at about £2,000 million a year plus or minus a little, particularly in manufactures, which must be extremely worrying? Would it not help the overall balance of payments if we were now to purchase more of our food, which comes into the balance of trade, on the world maket?

As I have already indicated, we are certainly concerned to achieve radical reform of the CAP, to move nearer the objective that the hon. Gentleman raised at the end of his question. The latest figures we have in the past year show that our visible trade with the EEC fell by £239 million, whilst our visible trade deficit with the rest of the world rose by £219 million. Therefore, the ratio of United Kingdom exports to the EEC as against our imports from the EEC rose from 72 per cent. in 1975 to 88 per cent. in the third quarter of this year, which is the highest point since 1971. I think that this indicates a considerable improvement.

If I may comment briefly on the important point that the hon. Gentleman raised about the £2 billion trade deficit, this is based on our statistics. The Eurostat statistics, which are based on country of origin and not country of consignment, suggest that the deficit may be considerably smaller if that method were used.

Order. That was brief for the Minister.

Does not my hon. Friend agree that, if we take the Eurostat figures and eliminate the change that was made in 1974, there has nevertheless been during the past five years an annual deterioration in the trade in manufactures, which is what matters and to which he was referring, of £1,200 million per year? Does he not agree that that is a disastrous trend, and will he tell us what are the dynamic benefits that so many people promised us as a result of entry against that disastrous trend?

It is certainly a very serious trend. The point I was making is that, if this alternative series for calculating the size of the deficit were used—I am saying not that it is the right method but that it is an alternative method—the trend would be not only smaller but also becoming smaller in the past three years as compared with the British Government's methods of statistics.

On the general point, it is a very serious trend, but the answer to it lies partly in the Government's industrial strategy and partly in the fact that the results of joining the EEC in the form of full integration will take several years to have effect.

If the Minister wants to make some improvement in this position, will he give far more encouragement to small businesses and industries, which would help to clear unemployment and increase productivity and exports to the EEC?

It was precisely for that reason that the Government recently introduced the market guarantee entry scheme, particularly for small businesses.

Does my hon. Friend realise that all he has demonstrated in his answers so far is that things are getting worse slower than they were before? It is still a disastrous position. Does he realise that he does not have to defend everything at the Dispatch Box? Can he tell us one good thing in the sphere of trade that has come out of the Common Market?

One result has certainly been that we have in the past had a surplus on our invisible trade. I admit that that is less at present than it was a few years ago, but the net effect is certainly that during the past four years there has been a surplus. Also, one of the other offsets lies in monetary compensation amounts, which are worth up to £400 million a year. My hon. Friend is wrong in saying that things are getting worse slower. They are slowly getting better.

Will the Minister be kind enough to tell the House exactly what he meant in replying to my hon. Friend the Member for Banbury (Mr. Marten), when he seemed to indicate that the Government were turning their attention to buying more foods from the world market? Will he say which place he has in mind?

I am saying, as has been said by several other Governments, that we are concerned to achieve radical changes in the CAP, in particular to prevent a further growth of surpluses and a further prevention of the distortion of trade with third countries, which is certainly very bad from the points of view of the Departments of Trade and Industry.

asked the Secretary of State for Trade if he will make a statement concerning the future control of aircraft noise around Heathrow Airport.

My right hon. Friend will use his powers to continue the range of noise abatement measures now in operation, and will seek to strengthen them whenever practicable in consultation with those concerned.

When the Minister decides on the Mole Valley flight path, following his consultation meeting last week, will he remember that he introduced the present flight path two and a half years ago as a 12-month experiment? Does he agree that it would be most unfair to penalise the people under the present route on the ground of route stability merely because they happen to be the last in line?

I cannot fail to remember the point because the hon. Gentleman has been at me incessantly for weeks on end, and in particular at the meeting on 5th December. I have given him the assurances for which he has asked, but I must look at the matter on the basis of finding a solution which adversely affects the fewest number of people, and that is not an easy solution to find.

asked the Secretary of State for Trade if imports of Japanese cars to date in the current year exceeded the voluntary limit imposed by the Japanese Automobile Manufacturers Association.

The Japanese predicted no significant increase for the calendar year. There will be an increase, but exactly how much is not yet clear.

In view of the increase, can the Minister tell the House what powers he has to ensure that any limit for next year is observed, and can he give us an assurance that those powers will be used?

My right hon. Friend has already made clear to the Japanese Ambassador our very serious concern about the trend in Japanese imports. In the light of the figures for the first 11 months—although there was a drop in October and November—we have made it clear to the Japanese Government that, in our view, this was a significant increase and that a more acceptable level of sales for the future is essential.

Our own industry is presently in discussion with the Japanese industry, and in deciding what to do—which is very much under consideration by the British Government at present—we shall look carefully at the December figures and Japanese forecasts for next year.

Is my hon. Friend aware that the Japanese Ambassador recently wrote to me in somewhat indignant terms asserting that the Japanese Government do not apply restrictions on the importation of foreign-made motor cars to Japan? Will he tell the House whether he believes that?

There are problems in regard to tariffs and non-tariff barriers for imports of foreign cars in Japan, but I believe that more serious than this is the custom and habit of the Japanese of buying, whenever possible, from their own industry. Getting a change in that is the most important thing.

Does the Minister agree that, unless and until our own motor industry starts to improve its performance, even if we are successful in limiting Japanese exports to this country, foreign cars from other countries will fill the void? The answer is for the British motor industry to perform better.

It is true that the productivity and performance of the British car industry has been one of the main reasons for a substantial increase in imports. However, the main thrust of the increase in imports comes not from Japan but from the EEC. Our own problems are partly a result of industrial disputes, but they must also be a result of marking down our targeted output, because there is no other way of explaining the fact that in 1973 we built 1·9 million cars and this year so far only 1·3 million.

asked the Secretary of State for Trade if he will make a further statement on the ways in which the Government intend to counter unfair competition from Japan, especially in the electronic components industry.

The EEC Commission is already investigating an allegation that quartz crystals from Japan are being dumped in the Community. If a United Kingdom industry has evidence that other electronic components are being dumped it should approach my Department's antidumping unit, which will be able to advise it on the presentation of its case to the EEC Commission.

Will the hon. Gentleman also undertake to publish in the Official Report the detailed criteria used by the Government when they try to establish whether dumping is taking place? Why will not the hon. Gentleman's Department make available to interested parties in British industry the data on which such decisions are made?

In the past we have consistently made available the basis on which we made our judgment. Since 1st July this year anti-dumping powers have been transferred to Brussels, but both the EEC's anti-dumping code and our previous code were based on the same authority, namely, the GATT anti-dumping code. Therefore, there is a close comparison between the two codes. If the hon. Gentleman knows of any industry that does not know the facts, perhaps he will approach us.

Is my hon. Friend aware that it is possible to bring Japanese money into this country and that the Japanese are willing to provide employment in this country by establishing a television factory in the North of England which would enable them to increase British exports of Japanese sets to other countries? Does my hon. Friend agree that we should all benefit by such a step?

That is a matter, as my hon. Friend knows, for my right hon. Friend the Secretary of State for Industry. I believe that the Minister of State has made clear his views on that matter.

Does the Minister have any evidence that Japanese cars are being dumped on the United Kingdom market?

If evidence is available to suggest that, it should be brought to our attention by our own industries. So far they have not done so.

Does my hon. Friend agree that the establishment of the proposed Japanese television factory in the North would have had disastrous consequences on employment in the components sector and on indigenous industry?

Certainly. The strength of the United Kingdom electronics industry as a result of this inward investment had it occurred was one of the central factors which would have had to be taken into account by the Government in balancing the considerations.

asked the Secretary of State for Trade what was the value of imports from: (a) Nigeria and (b) South Africa in 1976 and the first half of 1977.

Imports from Nigeria were valued at £317 million in 1976 and £133 million in the first half of 1977. The corresponding figures for South Africa were £613 million and £468 million respectively.

Does my hon. Friend agree that his reply illustrates that the pattern of trade is changing and that other parts of Africa are becoming more important sources of raw materials for this country? Might it not therefore be a good idea to diversify our imports away from South Africa, which is a region of high political instability?

My hon. Friend is right: there is a marked shift in trade. Indeed, by the end of this year it is likely that our exports to Nigeria will be nearly twice the level of our exports to South Africa. On the question of diversion, I am sure that many companies will inevitably draw the conclusion from the recent trend of events that South Africa is likely to be an increasingly risky proposition.

asked the Secretary of State for Trade what representations he has received from tourism interests concerning the alteration to the constitution of the British Tourist Authority proposed in the Scotland Bill; and if he will ensure that the board retains a membership adequate to represent all the interests of tourism.

I have received representations from the British Tourist Authority and one of the regional boards. But members of the BTA board are not at present appointed in a representative capacity, and I am sure that the smaller board will be able to maintain its close links with the tourist industry.

I thank the Secretary of State for that answer, but is he not aware that the reduction of British Tourist Authority board membership from five to one, as proposed in the Scotland Bill, will reduce the scope of the board to include the varied commercial interests involved in the tourist industry? In view of the fact that there is now on the Order Paper an amendment signed by representatives of the Scottish and Welsh nationalists, the Liberal Party and the Conservative Party to increase this number from one to three, will he give the amendment his support?

Obviously the House will have to consider the amendment, but it was thought that within the context of devolution it was sensible that the chairmen of the national boards should have a decisive influence on the operations of the British Tourist Authority, which acts as an agent for them. The constitution was designed to achieve that effect. I think that that is the best solution.

In view of the importance to Scotland of the tourism industry, does the Minister agree that once we have the devolved siutation the Government should do all they can to encourage the airlines to make direct flights available between Scotland and other countries abroad?

There are many routes between Scotland and other parts of the world. It is also a matter for the airlines to discuss the commercial viability of particular services.

Does not my right hon. Friend agree that tourism is perhaps the fastest growth industry we have, and would it not be better, whether in Scotland or anywhere else, to have a Minister in office directly responsible for tourism? Would the Minister be opposed to that?

I am the Minister directly responsible for tourism, and I am in office.

Is it not an unjustifiable consequence of the devolution proposals that England, which attracts the vast majority of visitors from overseas to Britain, should be left at a disadvantage?

I do not believe that England is at a disadvantage. I hold strongly to the view that this is a United Kingdom and that each part of the United Kingdom benefits from the promotion of any other part of it.

I fully agree with the right hon. Gentleman's last statement, but is he none the less aware that it would be extremely difficult to satisfy legitimate Welsh requirements on the basis proposed in the Bill?

I hope that is not the case. I think that this is a sensible solution to a problem in which the interests of Wales and Scotland are keenly involved, as well as those of England. I think that the system will work well, and on this basis the British Tourist Authority is able to act as the promotion agent overseas for the three national boards.

asked the Secretary of State for Trade what are his Department's estimates of the contribution made by overseas visitors to Scotland to the United Kingdom balance of payments.

I regret that estimates of this sort are not available. The Scottish Tourist Board has estimated that in 1976 expenditure by overseas visitors in Scotland amounted to £115 million.

Does the Minister agree that it is high time that he agreed with the Scottish Tourist Board Chief Executive, Philippe Taylor, to the effect that that board should be allowed to advertise the tourist potential of Scotland overseas? Does he not think it is a disgrace that the STB should be forbidden by statute from advertising overseas the tourist interests of the very country that it is supposed to represent?

Under the provisions of the Scotland Bill now before the House, a Scottish Administration would be able to make funds available to the British Tourist Authority to promote overseas visitors going to Scotland. I should have thought that that met the hon. Gentleman's point.

As many visitors to Scotland come from England and Wales, does my hon. Friend agree that it would damage the Scottish economy if such people had to have a passport to visit a separate Scottish State, particularly if the hon. Member for Perth and East Perthshire (Mr. Crawford) were in charge of a special Scottish Treasury?

Certainly.

asked the Secretary of State for Trade what is the present position in relation to the renegotiation of the Multi-Fibre Agreement.

asked the Secretary of State for Trade how many bilateral textile agreements have been agreed between the EEC Commission and textile exporting countries; and if these agreements represent a satisfactory basis for renegotiating the Multi-Fibre Agreement.

The European Commission has completed its discussions on quota levels with 24 low-cost suppliers. We and other member countries are now assessing the results, and the EEC Council of Ministers will decide on 20th December their position on renewal of the Multi-Fibre Arrangement.

Is my right hon. Friend aware that, whilst welcoming the MFA, the textile industry is concerned about the transitional arrangement which will allow countries which already have quotas to ship for the whole of next year provided that they ship before 31st December and will allow those which do not have quotas, provided they ship before 31st December and provided the goods arrive before March, to escape the 1978 quotas? Will he bear in mind that in the past there has been disruption of the industry by arrangements of this kind?

We are at the moment giving consideration to the need for transitional arrangements, and that is one of the matters under consideration.

Can the Secretary of State say whether these arrangements have curbed the harmful effects of imports from Hong Kong, Taiwan and South Korea? If he were asked to give a Christmas message to the British textile workers about trading prospects in the year ahead, what would that message be?

The object of the renegotiation has been that the Christmas message should be for an improvement. On the other hand, at this stage I do not want to give my hon. Friend any assessment of the results of the bilateral negotiations so far completed. At the moment, the figures are under close study. During this week there will be consultation with the British textile industry, and the decision will be made next week.

Nevertheless, does this new position mean that the bad and deleterious practice of giving a 6 per cent. increase in the quota every year to overseas imports, irrespective of the state of trade, has completely disappeared in EEC negotiations?

The hon. and learned Gentleman knows that certain categories of products were established within these negotiations, with different degrees of penetration, different degrees of sensitivity and different rates of proposed growth. We are now just over a week from the day on which we make the decision, We shall be having consultations. We have in mind the intense anxieties of the British textile industry. I hope that we shall be able to make a decision that brings a happier future for that industry.

asked the Secretary of State for Trade whether he met the Governor of Hong Kong during his recent trade discussions in London.

Owing to commitments elsewhere, I was not able to meet the Governor myself. However, I met him in London on 29th September.

Is it still the case that Hong Kong, as one of the principal suppliers of textiles to the Community, is being asked to accept for 1978 an initial quota level for some products substantially below that of 1976 import levels?

It is certainly true that for certain sensitive products there will be a cutback from the 1976 levels.

As Hong Kong supplies two-thirds of the cheap textile imports to this country, does the Secretary of State agree that it is in any way unfair or unjust to ask Hong Kong to adopt a fairer attitude towards the British textile industry?

We thought it was right to ask Hong Kong to accept a certain reduction in the trade flows. Of course, we run a large balance of payments deficit with Hong Kong. If in the Multi-Fibre Arrangement discussion we were to achieve the overall result that we want, it was essential that Hong Kong should accept that position. There is now bilateral agreement, which fulfils the point in respect of which I have just answered my hon. Friend.

What consideration did the Secretary of State give the Governor's representations on the argument that Hong Kong's quota should be cut back further than required by the needs of the trade, to make way for other third country suppliers?

The Governor certainly made that point when I met him on 29th September, but I indicated that in a difficult negotiation of this kind it was necessary to make arrangements for new suppliers—sometimes suppliers poorer than Hong Kong—which might wish to enter the market. If we were to meet the requirements of the mandate, the renegotiations, as the European Community as a whole saw them, would require certain action to be taken. That action, I hope, is now embodied in the bilateral agreement. At the moment, I do not wish to judge that bilateral agreement any more than any of the others to which hon. Gentlemen have referred.

asked the Secretary of State for Trade what is the United Kingdom balance of trade with China and Japan, respectively, for the last 12 months to date.

Figures on a balance of payments basis for trade with individual countries are not compiled. Our crude trade deficit over the last 12 months up to October was £49 million with China and £593 million with Japan.

Does the Minister have some progress to report on boosting exports to these two countries?

The decline in our exports to China is the result of the completion of past contracts, particularly in aerospace and mining machinery. But I hope that the recent visit of the Chinese Minister of Foreign Trade and the Vice-Minister in charge of the State planning commission will lead to the United Kingdom's becoming a new major source of supply.

In conjunction with the EEC and the United States, we have repeatedly pressed Japan to increase its import of manufactured goods from the West. I understand that the new Japanese Cabinet has now agreed a package of advance purchases and administrative measures in advance of action on the multilateral trade negotiations, for which I am hopeful.

Will my hon. Friend bring his influence to bear upon his colleagues in the Department of Industry and let them know that the balance of trade between this country and Japan would be vastly improved if Japanese industrialists were encouraged to come to this country to invest, establish factories here and export goods to Japan?

We certainly make efforts in that direction, as my hon. Friend knows. We welcome more visits from Japanese business men and we also look to their doing their part to increase their trade by buying from us.

Is the Minister aware that, if we wish to do something about the adverse balance of trade with Japan, we must do something more to improve the climate to encourage investment in this country? Is he further aware that a great deal of the adverse criticism that has come from many people has turned away important Japanese investment in this country, which will be adverse to us?

Despite the recent case in respect of Hitachi, I fully expect the Japanese to continue to take a close interest in this country, particularly because of the low wages in Britain.

My hon. Friend mentioned aerospace. Can he deny allegations that negotiations of some kind for the sale of Harriers which were going ahead under the previous Government have slowed to a standstill under the present Government?

I have no such knowledge.

asked the Secretary of State for Trade how many times to date he has invoked his powers under Section 2 of the Export Credit Guarantees Act to withhold export credits.

These powers are frequently invoked. The day-to-day administration of Section 2 of the Act entails frequent judgment on whether or not in the national interest export credits shall be made available for particular contracts or particular markets, in the circumstances where such business is not considered suitable for cover on a commercial basis under Section 1.

As the right hon. Gentleman admits that the reason for refusing credits is that cover is not considered suitable for the creditworthiness of countries to which exports might be sent, what powers does he believe he uses when he refuses them for reasons of enforcing incomes policy? Should he not ask the House to legislate if he wishes to take powers of that sort, rather than misuse the powers given to him?

I am advised that under Section 2 I have powers to make a judgment in the national interest involving a variety of considerations, including the consideration of pay settlements.

Does the credit to be granted under the Anglo-Polish shipping deal come under Section 1 or Section 2? Is it within the prudential limits laid down for Section 1 or Section 2 or not?

I believe that it is under Section 1, but if I am wrong I shall tell the hon. Gentleman. It is certainly within our judgment of the prudential limits and, I repeat, it is within the OECD understanding.

Has the right hon. Gentleman any evidence that firms that are refused export credits have done any worse in consequence?

It is, of course, open to any firm that is refused a guarantee by ECGD to look elsewhere in the market to secure it. It may be that firms will discover that there are other opportunities.

asked the Secretary of State for Trade when the Government will publish a White Paper on the Bullock proposals for industrial democracy.

asked the Secretary of State for Trade when the Government will publish a White Paper on industrial democracy.

The Government's proposals will be published when the consultations in which we are at present engaged have been completed.

Will my right hon. Friend seek to persuade his Cabinet colleagues to give higher priority to self-government in industry rather than the constitutional measures relating to devolution and direct elections to Europe? Is it not as important for workers to have a say in the running of industry as for shareholders? Will the Government give priority to the public industries in setting an example to the rest of industry?

We have been trying to establish a consensus on this matter. My hon. Friend will remember that there was a certain change of emphasis, in my judgment, within the TUC's composite motion on this matter which suggested that the worker-director approach to industrial democracy was not the only approach to it. Certainly we believe that workers should be involved in the discussion of important decisions made by companies. We are also attempting to give an impetus to the development of industrial democracy in the nationalised industries.

As trade subjects are considered to be so important by the Liberal Party that it has not sent one representative to sit in the Chamber during the entire period of Question Time, will the Minister say what representations the Government have received from the Liberal Party on the Bullock proposals? We wonder how much notice to take of those representations when Members from the Liberal Party do not bother to turn up.

I have had discussions with the Liberal Party on the question of industrial democracy.

Will my right hon. Friend, in his consultations, give full weight to the evidence given to the Secretary of State for Employment by Glacier Metals, which for a quarter of a century has had a remarkable system of worker participation and has a number of reservations about the Bullock Report?

Yes. The experience of Glacier Metals is well known. I have found no lack of representations to me about the lessons to be learned from the experience of Glacier Metals.

Does the Secretary of State regard some paragraphs of his recent White Paper on the conduct of directors as taking the place of and substituting for the majority proposals of Bullock? Does he propose to legislate on those proposals this Session?

The White Paper deals with a number of the minor points which were referred to in the Bullock Report. To that extent, the White Paper fulfils those elements of the Bullock Report. But it does not address itself to the major question in the Bullock Report relating to worker-directors. I have already dealt with the point about legislation and research, and I cannot guarantee that legislation will be introduced this Session on the content of the White Paper.

Is it not true that much of British industry is at the moment in a kind of no-man's-land where traditional forms of authority have declined and newer forms of industrial democracy have not yet fully developed? Is it not therefore necessary and urgent that we press ahead with the encouragement of industrial democracy as quickly as possible?

We certainly wish that companies should press ahead. Of course, there is no reason at the moment why they should not now do so on a voluntary basis, and we would encourage such developments.

Is the Minister aware that many of us welcome the realism shown in the recent White Paper compared with the Bullock Report, because in the Bullock Report the training for directors seems to require something of the order of two to six weeks of part-time training, whereas in the White Paper it is recognised that being a non-executive director requires skill and experience and that most of those people should come from the ranks of senior management?

The hon. Gentleman should not underestimate the realism of the Bullock Report. The members of that committee addressed themselves specifically to the requirements of training for a director. In any case, the hon. Gentleman should also read the part of the White Paper which deals with the skills necessary under the laws of this country in a director. That section of the White Paper has already been the subject of some criticism.

asked the Secretary of State for Energy if he will make a statement on the first meeting of the Energy Commission.

The Energy Commission met on 28th November. In the course of a very useful meeting we examined in particular our Department's working document on energy policy, and we shall be incorporating many comments made by members of the Commission in the Green Paper which we hope to publish early next year.

Will the Under-Secretary confirm that all papers produced by the Energy Commission and its proceedings will be published? Secondly, will he give some indication as to whether he is satisfied with the composition of the Energy Commission, and at what stage he is prepared to review its membership?

To take the second part of the question first, we are hardly likely to review the membership as the Commission has just had its first meeting. Clearly, we shall bear in mind the need for other views to be taken into account. In that connection, the documents for the Commission are widely circulated, and even though people may not be represented with a seat at the Commission they can see and comment on the documents. I think the hon. Gentleman knows that Commission papers have been made available.

Whilst appreciating that these are early days, may I ask my hon. Friend to bear in mind the opinion which is widely held that the Energy Commission is biased too much towards what I will call the "special interests" and that expert opinion is not strongly enough represented on it?

I do not accept that comment. If my hon. Friend could be a little more specific, I might be able to answer his supplementary question. If he has in mind the representation by his own union, he will recognise that that is a matter more for the TUC than for the Department of Energy.

asked the Secretary of State for Wales what action he is taking following the criticisms of the Clwyd Area Health Authority made by the Parliamentary Commissioner in the case of Mrs. Ellen Hughes, deceased.

My right hon. and learned Friend has seen Lord Kenyon, the Chairman of Clwyd Area Health Authority. He told him that he is deeply dismayed and has asked him to ensure that no such case can arise in future. My right hon. and learned Friend has asked Lord Kenyon to convey his views to his authority.

Does the Minister agree that this is one of the strongest reports ever to have come from the Parliamentary Commissioner, using words like "inhuman conduct" and implying dishonesty on the part of officials of the health authority? Will the hon. Gentleman give a guarantee that there will be no cover-up following this report?

There will be no cover-up. It is one of the strongest reports, and I should like to tell the hon. Member that the Clwyd Area Health Authority is discussing the case today and will consider what action is necessary. Its meetings are open to the public.

Will the hon. Gentleman remember that, whatever the shortcomings of the Clwyd Area Health Authority in investigating this matter, the hospital concerned, in spite of this one unfortunate lapse, enjoys wide confidence and sympathy for the excellent work it does in the community?

The observations of the hon. Member speak for themselves.

asked the Secretary of State for Industry if he will raise in the Council of Ministers of the EEC the problem of the economic power of multinational companies, and its conflict with national obligations.

The Commission has already raised the issue.

In is communication to the Council, "Multinational Companies and Community Regulations"—COM(73)1930 of November 1973—the Commission surveyed the field and proposed a number of general measures which could help to alleviate concern which might be felt about its activities. Work is in progress on matters such as employment, competition, harmonisation of company law and taxation. Members of the EEC also play an active part in the work on multinational companies in the OECD, ILO and the United Nations.

Is my hon. Friend quite satisfied that the regulations or the action that it is intended to take will be strong enough to control multinational corporations? Is he aware that multinational corporations which carry on massive business are not directly accountable to any country or to any Government throughout the world? Does he not think, therefore, that strict control ought to be directed to multinational corporations to ensure that no harm is done to other countries?

I shall bear in mind what my hon. Friend has said, because I realise that there is a great deal of concern about some of the aspects which he has mentioned. However, the EEC's attitude towards multinational companies is based upon the same fundamental principle as that of the United Kingdom Government, namely, that there should be no discrimination on grounds of nationality. My Department feels that this is the best basis on which to make progress.

Is the Minister aware that the rôle of multinational corporations can be of considerable benefit to developing countries—a fact which has been recognised by the United Nations and by the OECD? What is the Government's approach towards the OECD code of conduct?

As I have said, the Government are playing their part in organisations like the OECD to make progress along the lines to which the hon. Gentleman has referred.