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Oral Answers To Questions

Volume 33: debated on Monday 6 December 1982

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Trade

Cork Committee On Insolvency

1.

asked the Minister for Trade when he expects to announce his conclusions on the recommendations of the Cork committee on insolvency.

I understand the wish of my hon. Friend that the Government should make an announcement on the recommendations of the Cork committee. I shall do so as soon possible. I am still waiting for replies from several major bodies which have been consulted.

Notwithstanding what my hon. Friend may feel about the commercial sector bearing too heavy a burden of the rates, is it not grossly unfair that local councils should have the same preferential powers as the Inland Revenue and be able to bankrupt a company for the non-payment of rates and thus prejudice the position of unsecured creditors? Will my hon. Friend therefore pay particular attention to Sir Kenneth Cork's recommendation on that aspect?

Yes. The report contains complicated recommedations. I am trying to pull out one or two parts on which we can act to stop the various abuses. For example, I am seeing whether we can strengthen the powers to deal with directors who take advantage of their position.

Does not the Freddie Laker fiasco prove the importance of legislating quickly? That matter involved the loss of £250 million of other people's money and 17,000 Skytrain ticket holders were left in the lurch, despite what Tiny Rowlands said in public. Now Sir Freddie Laker, with Tiny Rowland's help, is able to set up in business again. Does that not make the present insolvency laws a welsher's charter?

It took the Cork committee a long time to report on this complicated matter. We must be careful, before introducing new legislation, to ensure that it benefits the people it is meant to benefit.

Order. I hope that hon. Members will find a word other than "welsher". It is a loathsome expression.

Manufactured Goods

2.

asked the Minister for Trade what was the value of exports of manufactured goods from the United Kingdom in the past six months.

In the past six months, exports of manufactured goods amounted to £18·4 billion.

Does my hon. and learned Friend agree that the figure would have been higher if exchange rates had been more stable? What action do the Government intend to take to reduce the fluctuations in exchange rates in the EC and the wider world?

My hon. Friend makes assumptions, and I do not know whether I am qualified to follow him into that uncertain area. My hon. Friend and the House will recognise that, at the end of the day, the stability of exchange rates is determined by market forces and that the Government's role can only be marginal.

Does the Minister accept that the figures that he has quoted represent a deterioration in the annual balance of payments on manufactured goods since 1979 of about £2 billion? Does he view that with complacency or alarm? Will he take the opportunity to say where he stands in the controversy between the Prime Minister, the Chancellor of the Exchequer and the Secretary of State for Industry as to whether exchange rates are to be added to the list of matters for which the Government abdicate all responsibility?

This is the first occasion on which the right hon. and learned Gentleman has appeared at the Dispatch Box in his new role. I congratulate him on his new responsibilities. I am sure that he will make a distinguished contribution to our debates.

When the right hon. and learned Gentleman becomes more closely acquainted with these matters he will find that this year, taken with the past two years, will show a record surplus in our current account. Therefore, he is taking an unduly gloomy view of Britain's trading position.

Does my hon. and learned Friend agree that the terms of trade on which we attempt to export our goods to Spain are grossly inequitable? When will the talks about renegotiation and doing meaningful things in the Community end and when will some serious action be reported to the House?

I know of my hon. Friend's deep concern about these matters. I know he feels that they have a particular effect on the area of which he is a distinguished representative.

It is undoubtedly true that there is a gross disproportion between the tariffs imposed by Spain on imports from the entire European Community—not only the United Kingdom—and those imposed on Spanish imports entering European Community countries. This is a matter of deep concern to the Government and to the European Commission. At my request the issue was placed on the agenda of the most recent Foreign Affairs Council meeting. I hope that we shall soon have an urgent report from the European Commission on the full implementation of the 1970 agreement, to which the United Kingdom was a party, and on how tariff disproportions can be redressed.

Heathrow Fifth Terminal

4.

asked the Minister for Trade whether his Department will give evidence when the public inquiry into the Heathrow fifth terminal moves to West London.

My Department has already provided evidence on the Government's airports policy during the Stansted phase of these inquiries, and have indicated that officials will give further evidence during the Heathrow phase if this is requested by the inspector or the parties.

Will the Department of Trade make it abundantly clear to the inquiry inspector that, although for technical reasons an inquiry into a fifth terminal had to be held and that a quasi-judicial position must be maintained during that inquiry, successive Ministers at the Department of Trade—including my right hon. Friend the Leader of the House, who is in his place, and my right hon. Friends the Members for St. Ives (Mr. Nott) and for Chingford (Mr. Tebbit), who are now the Secretaries of State for Defence and Employment—have repeatedly stated that it is Government policy that a fifth terminal at Heathrow should not be built and that there has been no change in Government policy?

Yes. I am sure that any officials who are called to give evidence will make clear the Government's policy.

Will my hon. Friend have uppermost in his mind the terms of the policy that he has just confirmed—a determination to diminish aircraft noise over west London? Will he do everything that he can to ensure that that policy is implemented and that we do not have a policy that will have the opposite effect?

I know that my hon. Friend has fought extremely hard for his constituents, and I am glad of this opportunity to tell him that the Government will do everything that they can to preserve a proper balance in those matters.

Textiles And Man-Made Fibres (Imports)

5.

asked the Minister for Trade what is the estimated financial value of imported textiles and of man-made fibres in particular for the years 1980, 1981 and for 1982 so far; and if he will make a statement.

With permission, I will circulate the figures in the Official Report.

In the first nine months of this year imports of textiles were valued at £1,501 million cif, of which manmade fibres—staple fibre and continuous filament yarn—accounted for £254 million, or 17 per cent. of the total.

Is not the message from the Copenhagen conference of Ministers that unjust and unfair import penetration must be countered strongly and urgently? Does the hon. and learned Gentleman agree that the textile industry is still Britain's largest employer? What will the Government do to help this industry?

We are within measurable distance of completing the last bilateral multi-fibre arrangement. The only two countries waiting to sign are South Korea and Argentina. If and when the arrangement is completed—I have high hopes that it will be before the end of the year—we shall have a tougher MFA than the previous one. I hope that that will give some satisfaction to the hon. Gentleman and to the rest of the House. I am aware of the hon. Gentleman's concern.

Will the Minister confirm that there has been a deficit in textiles and clothing over the past few years and that it makes sense to negotiate some planned trading arrangement through the MFA, and also with the Common Market, to ensure that our textile and clothing industries—which, as my hon. Friend the Member for Flint, East (Mr. Jones) said, constitute the largest private enterprise employers in Britain—have a secure home base so that jobs in the industry are not diminished further? As the Minister knows, there has been a massive reduction of jobs in the textile and clothing industries over the past three years.

I repeat that the clothing and textile industries can look forward to certainty and a sound measure of protection under the new multi-fibre arrangement. Clothing exports, which have been doing remarkably well, amounted to £750 million in 1979, £808 million in 1980 and £691 million so far this year.

Does the Minister recognise that since 1979 210,000 jobs have been lost in the textile and clothing industries, which, with 580,000 workers remaining, are extremely important industries? Will the multi-fibre arrangement negotiations be concluded before next week's meeting of the Council of Ministers? If so, will the hon. and learned Gentleman make a statement to the House? If not, will he make a statement before the House rises for the Christmas Recess? It would be a tragedy for the workers and the employers if the House were to rise for the Christmas Recess without the fullest possible discussion having taken place.

I am conscious of the number of jobs that have been lost over the past few years in the textile and clothing industries generally. I have raised the issue constantly at the Council of Ministers in Brussels. It is one of the reasons that has led the United Kingdom to take a prominent part in debates on clothing and textiles and to press for a strong MFA. I hope that the House will be reassured about the likely outcome of the MFA. It is for my right hon. Friend the Leader of the House and the usual channels to decide whether a statement should be made by me or by my right hon. Friend the Secretary of State for Foreign and Commonwealth Affairs. I have no doubt that note has been taken of the hon. Gentleman's remarks.

Following are the figures.

£ million cif

1980

1981

(a) Textile imports of which:—

1,6361,861

(b) Man-made staple fibre and continuous filament yarn

273301

Source:

United Kingdom Overseas Trade Statistics,

  • (a) SITC/R2 Division 65, Groups 266 and 267, Item 847.11 and Subgroup 268.7 (part);
  • (b) SITC/R2 groups 266 and 267, Sub-group 651.4 (excluding Item 651.48) and Items 651.71, 72, 73 and 78.
  • Steel Exports

    6.

    asked the Minister for Trade if he will make a statement on the relative steel exports of the United Kingdom, France and West Germany.

    Steel exports for the United Kingdom for 1981 are estimated to have been 3·9 million tonnes, those for France 11·4 million tonnes and those for West Germany 19·1 million tonnes.

    Does the Minister agree that the figures are deplorable? Is it true that we have been losing ground over the past three weeks in the import and export of steel and that more imports have entered Britain than have entered West Germany, France and other member States? When will the Government do something to stop the destruction of the steel industry? Will it be left to suffer like the textile industry and other industries? I hope that the Minister will bear in mind that thousands of workers have been declared redundant in the steel industry and that the total will increase substantially until the Government take action.

    I know of the anxiety of the hon. Gentleman and of others about events in the steel industry, which have been evidenced in many recent debates, including one last week. I remind the House that the penetration of the United Kingdom's steel market is less than that of the Federal Republic of Germany or of France. The penetration of the United Kingdom market is 25 per cent. compared with 35 per cent. in the Federal Republic of Germany and 43 per cent. in France.

    What estimate has the hon. and learned Gentleman made of the effect of various devaluations of the pound on steel exports? Will he consult the Secretary of State for Industry on what steps should be taken, pending devaluation, to save what remains of the steel industry from continued and unabated imports?

    The right hon. and learned Gentleman is not right to say that there are unabated imports. We have secured a much tougher regime against third country imports into the European Community. I cannot give the precise figures that result from varying exchange rates. Perhaps the right hon. and learned Gentleman will take comfort from the recent drop in the value of the pound.

    Does my hon. and learned Friend appreciate that the unnecessary steel strike last year has caused more imports to come into Britain? Is he aware that a number of firms in my constituency and in his are continuing to import steel, following their decision to import during the strike, when they had to get supplies from elsewhere?

    My hon. Friend makes a valid point, which I am sure has been noted by the steel unions and the British Steel Corporation. I hope that the restructuring operation will enable the steel industry to regain these lost markets before too long.

    Does the Minister realise that the steel strike was not the industry's main problem? Is he aware that the industry's problems are the result of Government policies? Does he accept that account should be taken of the number of steel workers who are now redundant and not likely to get other jobs?

    If the Labour Administration had faced the problem of restructuring the steel industry, we should not have had such grave problems from 1974 onwards, and the shock would not have been as great as it has been.

    Tariff Barriers

    7.

    asked the Minister for Trade what evidence he has that new tariff barriers to trade between the Western world trading nations and Japan may be erected, to the detriment of the United Kingdom.

    I thank my hon. and learned Friend for that encouragement. Bearing in mind that Japan has got away with a great deal in the past two or three decades in terms of free and fair trade, does my hon. and learned Friend agree that it would be wrong and tragic for the Western nations to retaliate by erecting new barriers? Should we not persuade Japan of the necessity and indispensability of opening its markets to us and to other exporters in the Western world?

    My hon. Friend makes a fair point. One of the Government's and the European Community's preoccupations is to persuade Japan to dismantle some of its trade barriers. Japan has been reducing its tariff barriers under the Tokyo round, and accelerated reductions will start in January. That may have been the result of the visit of my right hon. Friend the Leader of the House.

    Is it not a fact that we continue to bark at but never bite Japan? Following the Prime Minister's robust words in Copenhagen, will the Minister assure us that the Community will now put together a package on open trade which it will invite Japan to discuss, and that if that fails we shall take unilateral action?

    Many discussions have taken place with Japan, and modest measures of liberalisation have been forthcoming as a result. I assure the hon. Gentleman and the House that the Community is taking action against Japan under article XXIII of the GATT.

    I thank the hon. and learned Gentleman for his courteous reference to me earlier.

    In the first three quarters of this year this country had a trade deficit with Japan of £1,488 million. Does the Minister regard himself as having had anything to do with that? For example, has he noticed that at the Smithfield show the low-cost all-purpose tractor, for which so many small farmers are looking, is now on offer by the Japanese? Will he invite British manufacturers of agricultural machinery to discuss with him how the new challenge can be met, or is that not part of his job?

    I do not accept responsibility for every aspect of our trade. The right hon. and learned Gentleman must realise that Ministers have, not a marginal, but a limited impact on events of that kind. I am certain that tractor manufacturers will take note of what the right hon. and learned Gentleman has said. I suspect that it would be impertinent of me to tell them how to conduct their businesses.

    In view of what the right hon. and learned Member for Warley, West (Mr. Archer) said about the imbalance of trade, will my hon. and learned Friend confirm that in the past 12 months Japan has exported to us goods to the value of £2,000 million more than we have exported to it? As most of the imports that we take from Japan are not vital, should we not insist on fair trade between the two nations?

    There is. It is on the basis that voluntary restraint arrangements have been negotiated.

    Does the Minister agree that the covert barriers to trade between this country and Japan are the cause of greatest worry? Does he appreciate that the standards for cars exported to Japan are considerably higher than those required by the strictest state in the United States of America?

    We are constantly drawing the Japanese Government's attention to the barriers that we perceive to our imports. The Japanese have produced only modest packages of liberalisation measures over the past two or three years.

    Firms (Receivership)

    8.

    asked the Minister for Trade what has been the change in the number of firms placed in receivership between the periods January to September 1981 and January to September 1982.

    The appointment of 1,288 receivers was recorded during the first nine months of 1981. The comparable number in 1982 was 2,225.

    Why is the number of firms going into receivership this year nearly double that of last year? Will the Minister confirm that so far this year about seven firms a day have gone into receivership? Does he agree that the only businesses that appear to be booming in Great Britain today are those dealing with insolvency?

    I do not accept everything that the hon. Gentleman says. This is a complicated matter. Since the beginning of 1979, 266,000 new companies have been registered, including 68,000 this year.

    Is not one of the reasons for so many companies going into receivership or liquidation the delay in the notification of information about companies to Companies House? Will the Minister do what he refused to do last Thursday and tell the House whether the Government are complying with the first and fourth directives of the European Community on the harmonisation of company law?

    I do not accept what the hon. Gentleman has said. During the debate I said that I would look at the point that he made, but I did not think it was relevant.

    The figures quoted by the Minister show an increase of 166 per cent. in liquidations. As the Government conducted their election campaign on the basis of giving a better deal to small companies, do they still hold the view that Governments are largely responsible for the climate in which small companies operate? Is the hon. Gentleman not troubled by the ever-escalating score of heartbreaks and lost jobs, or is it another matter on which the Government have given up trying?

    The right hon. and learned Gentleman knows that we are taking steps to improve the economy. The dramatic fall in inflation and the fall in interest rates will be of help to everybody. There are many new companies starting every day.

    Free Ports

    9.

    asked the Minister for Trade if he will list the organisations he has consulted with a view to promoting free ports.

    We have had useful discussions with hon. Members, local government authorities, airport managements and industrial organisations. Further consideration of this question will now take place under the chairmanship of my hon. Friend the Member for Knutsford (Mr. Bruce-Gardyne). Both these and other interested parties will have an opportunity to present their views.

    I thank my hon. Friend for that helpful response. As free ports could create prosperity and jobs, will my hon. Friend and the working party consider setting up at least one free port at Aldergrove, Prestwick or Southend-on-Sea before the next general election?

    We shall be going ahead with this inquiry as fast as seems reasonable. Within the scope of the inquiry we shall consider many places, including, no doubt, those mentioned by my hon. Friend.

    Does the Minister agree that Great Britain has been slow to realise the potential of free ports? They are already successful in Ireland and Germany, and Belgium is now looking at the possibility. In view of the evidence given by the hon. Member for Knutsford (Mr. Bruce-Gardyne) to the Select Committee on Scottish Affairs, does the Minister agree that to put him in charge of any examination of the matter is to give it the kiss of death?

    Not at all. I am sure that my hon. Friend the Member for Knutsford (Mr. Bruce-Gardyne) will be as willing to listen to wisdom as any other member of the Government. I have no doubt that we shall benefit from the comments of the Select Committee on Scottish Affairs when it reports soon.

    Does my hon. Friend realise the huge advantages that Harwich would have as a free port? Unemployment there has in the past year and a half.

    I am sure that Harwich will be one of the many places whose interests will be advanced by hon. Members on both sides of the House. We shall be delighted to consider each one.

    British Airports Authority

    10.

    asked the Minister for Trade what discussions he has had with the chairman of the British Airports Authority concerning that authority's future financial structure.

    I meet the chairman of the British Airports Authority regularly to discuss all aspects of its activities and I expect to see him again early next week.

    Does my hon. Friend agree that the BAA has nothing to fear—indeed, quite the reverse—from an injection of private capital and privatisation? Will he tell the chairman how much he agrees with me and many of my hon. Friends that that should come about sooner rather than later?

    The Government always have an open and sympathetic mind to privatisation. But the BAA is the subject of litigation by international airlines, at the heart of which is its ability to fix its charges. We are, therefore, restrained from going ahead as we cannot yet set out a prospectus when so much depends on its ability to fix the charges.

    May I ask my hon. Friend not to close his mind to the full-blooded privatisation of the BAA, and in particular the three London airports, nor the semi-privatisation and perhaps municipalisation of the regional airports under its control in Scotland?

    Japanese Imports

    12.

    asked the Minister for Trade whether he will introduce port of entry requirements for Japanese imports similar to those used by France and other members of the European Community.

    No, Sir. Such measures would almost certainly not be compatible with our international obligations or our current domestic legislation. The French requirements are already the subject of complaint in the GATT and are currently subject to challenge by the Commission.

    Have not the Japanese been getting away with blue murder in international trade for many years? Is it not time for the Government to do what the French Government have done, not to secure unfair terms of entry for our goods, but merely to give notice to the Japanese Government that we expect the entry of our goods to Japan to be treated in the same way as Japanese goods coming here?

    That message has been loudly and forthrightly given, as will emerge from a later answer. However, I do not believe that it would advance the case of the United Kingdom or the Community to adopt measures subject to challenge in international and national courts.

    Have not the French, as becomes them, found the most elegant method of, at one and the same time, pursuing strictly French national interests and, in theory, supporting an open trading policy? Are there not lessons for us all in that example?

    I would not challenge my hon. Friend's choice of adjective, but I am not sure that the French have substantially advanced their case by the methods that they are allegedly adopting. It is not elegant to be challenged in the European Court or before a GATT tribunal. Other methods can be just as effective to support the United Kingdom's interests.

    Does the Minister accept that, although the French method may not be elegant, it is effective, as they are applying 25 sets of regulations to stop Japanese penetration into their market and the Commission will not investigate all 25? Have they not been extremely successful in ensuring that Frenchmen are not unemployed because of excessive Japanese competition? Is not the Government's response of taking no step that might offend European rules and regulations extremely disadvantageous to our people?

    I should not like to comment in depth on the economic policies of a friendly power, but I point out that the French rate of inflation is considerably above ours and accelerating, as are its unemployment figures.

    Will my hon. and learned Friend reconsider his answer to the hon. Member for Huddersfield, East (Mr. Sheerman) and recall that the West Midlands has a number of eminently suitable sites for port of entry control and a large labour force with the skill, and only too willing, to analyse the nature of manufactured imports? May I particularly commend Aldridge-Brownhills as having all the necessary features?

    Should we ever be tempted to adopt the methods recently canvassed—I hope that we shall not—I shall bear my hon. Friend's suggestions in mind.

    Tourism

    13.

    asked the Minister for Trade if he will publish the evidence he receives in the course of his review of tourism in Great Britain; and if he will make a statement.

    11.

    asked the Minister for Trade if he will make a statement on the progress of his review of tourism as it relates to the responsibilities of central Government.

    I have received a wide range of views from organisations and individuals in the course of my review. I expect to complete the taking of evidence by Christmas. I have encouraged everyone who wished to give me their views to be frank in their comments. It would be wrong to publish detailed evidence given to me on this basis of confidence, but I would expect to state the main themes that emerged from my consultations when I am in a position to make known the conclusions of the review in the new year. Some of the issues that have been raised with me affect the responsibilities of other Departments, and I am pursuing them with my right hon. and hon Friends.

    In case some members of the British Tourist Authority board have not been as frank with my hon. Friend as they might have been, may I point out that with its present structure it spends an inordinate length of time on unprofitable arguments among representatives of England, Scotland and Wales rather than doing the job for which it is well suited? If the review shows that legislation is needed to improve matters, will that be undertaken in this Session of Parliament?

    I am well aware that others hold the same view as my hon. Friend. His point has been well taken into account in the review. We shall consider when legislation should be introduced when we see whether it is required.

    In this important review, will the Minister bear in mind the recommendation of the Stoddart committee to the effect that the Scottish Tourist Board should be free to promote Scotland overseas without going through the United Kingdom agency?

    I shall bear that in mind. I am seeing Mr. Devereux in the near future and doubtless he will put the same view to me.

    In his review, will my hon. Friend take into account the fact that the Yorkshire and Humberside tourist board has achieved a self-made operating income as a proportion of its total income that is higher than that of any other tourist board? Will he ensure that such effort is properly rewarded, by maintaining the level of grant from Government funds?

    The Yorkshire and Humberside tourist board has every right to be proud of its achievements. We shall bear what my hon. Friend says closely in mind in any conclusions that we reach.

    Will the Minister bear in mind the fact that regional airports are a key factor in promoting package tours.

    I certainly shall. I hope that Manchester feels pleased with the Department's recent decisions.

    Is the Minister aware that in the last year of the Labour Government the surplus on tourism was almost £700 million, while for the current year there will be a deficit of about £300 million? What is his explanation for the massive loss of £1,000 million? Does it not show that Britain on the dole is not the most attractive place to visit?

    It shows no such thing. The hon. Gentleman's figures are inaccurate. The figure for last year was £286 million. This year we hope to do even better, the main reason being the value of sterling. The hon. Gentleman will be pleased to hear that as a result of the strengthening of the dollar this year we expect a 7 per cent. increase in tourists from America.

    British Airways

    14.

    asked the Minister for Trade in what circumstances his consent is required for the disposal of assets by British Airways.

    British Airways do not require the consent of my right hon. and noble Friend for the disposal of assets, but the Government would expect to be consulted beforehand in important cases.

    When my hon. Friend is consulted by British Airways on, say, the proposed sale of TriStars to the Ministry of Defence as tanker transports, will he give the proposal favourable support, as it would merely be a book-keeping transaction and not a question of buying a new product from overseas—as is the case with its competitor—and it might be a more equitable way of reducing British Airways' debt than by writing off loans?

    It is for the Secretary of State for Defence to say whether his Department prefers TriStars or DC10s, but I have no doubt he has heard my hon. Friend's view.

    As the Britoil flotation was a fiasco, as British Airways' results for the first half of the year are very poor indeed, in spite of the accounts being massaged, and as every other European country is proud to have a flag-carrying airline, will the Minister abandon his private peccadillo aimed at selling off British Airways, send Sir John King back to where he came from and let the professionals run British Airways properly?

    The short answer to all of those interesting and absurd questions is "No, Sir". I am sorry that the hon. Gentleman cannot join me and, I should have thought, all other reasonable people in giving a tremendous welcome to the fact that British Airways have turned in a net profit of some £80 million for the first six months of this year. That is an almost miraculous turn around—

    Does my hon. Friend agree that, notwithstanding the good management that BA now enjoy, unless the accumulated deficit is written off, there is no chance of BA becoming truly viable and able to float on the stock market? When does my hon. Friend intend to write off that accumulated deficit?

    I am acutely aware of the heavy burden of £1 million of debt that past mismanagement and misdemeanours have loaded on BA. It is an important matter, upon which we have not yet come to any substantive conclusion.

    Will the Minister end the uncertainty and confirm that he will not sell BA off before the general election? Does he agree that a time of slump, uncertainty and over-capacity is the worst possible time to consider selling off a large airline and that the move could result only in a cut-price sale of a valuable national asset? Have the Government learnt nothing from the Amersham International and Britoil sales? Cannot the Government begin to understand the Stock Exchange, even if they cannot run the economy?

    The answer to the hon. Gentleman's first three questions is "No, Sir", "No, Sir", "No, Sir". With regard to the lessons to be learnt from Amersham and Britoil, the hon. Gentleman may be absolutely confident that we have learnt all the wise lessons that it is possible to have learnt.

    Japan

    15.

    asked the Minister for Trade, following the recent general agreement on tariffs and trade meeting, if Her Majesty's Government will take steps to persuade the Japanese to open up their markets to British goods and services to the same extent as United Kingdom markets are open to Japan.

    The declaration of the GATT ministerial meeting explicitly recognised that imbalances are particularly detrimental to the stability of the international trading system. We and our EC partners will continue vigorously to press the Japanese to open further their markets to our exports.

    I thank my hon. and learned Friend for his reply. Does he agree that on past experience it is unlikely that the Japanese will voluntarily concede what Britain is asking for? Therefore, does he agree that his previous answers and refusal to accept the tactics of the French will be received with disappointment by hon. Members on both sides of the House? Will he consider, rather than going to Aldridge-Brownhills, having safety checks on all Japanese cars at either Inverness or Caithness?

    I am not sure that those tactics would be of advantage to the British consumer. Nor am I sure that they would be compatible with United Kingdom domestic legislation. I assure my hon. Friend and the House that we shall continue to press the case against the Japanese until their markets are open to our products.

    What good reason is there, either theoretical or practical, to seek bilateral balance of trade between the United Kingdom and Japan? Do the Government intend to aim at bilateral balance with all our other trading partners?

    No. We believe in the multilateral system, but, as my hon. Friends have pointed out, there is a considerable imbalance in our trading relations with Japan. That does not depend on a fair exchange of goods, but, to a considerable extent, on the fact that the Japanese market is less open than ours. That is why I express concern and will continue, with my right hon. and hon. Friends, to press the Japanese for fairer access to their markets.

    Is the Minister aware of the increasing irritation of many large, respectable and reputable firms in Britain, especially in the electrical appliance industry, which are having their goods turned down by the Japanese on the ground that their machines do not meet the health and safety requirements set by the Japanese Government? Is he further aware that the Japanese Government seem to change their regulations depending on the country of origin and the type of product that is on offer? Will he therefore ask his advisers to look into this matter?

    This is obviously a matter for concern. If the right hon. Gentleman will give me details, I shall ensure that every case is investigated. I understand that the ombudsman that was set up by the Japanese Government to deal with alleged cases of unfair practices in these matters has received only two complaints from British companies. If the right hon. Gentleman would like to direct his friends in that direction, to make better use of the ombudsman, it is possible that jointly we shall achieve something worth while.

    Does my hon. and learned Friend agree that the imbalance has grown up over many years and that, whatever he may say about the actions of the Japanese ombudsman, British industry believes that the intransigence of the Japanese Government has been largely responsible for the adverse balance? Does he also agree that something positive must be done in the near future if employment opportunities at home are to be preserved?

    I understand my hon. Friend's anxiety. The Government and other Governments of the EC share it. That is why we have pressed, and will continue to press, the Japanese Government strongly. I must emphasis, however, that not all of the tariffs barriers are due to Japanese governmental intervention, if it can be so described. Many of the barriers are cultural. I must emphasise that the "imports ombudsman" has been going for only one year. It is a little early to judge whether he has succeeded.

    Insurance Markets (Regulation)

    16.

    asked the Minister for Trade if he will seek to appoint a roving inspector to assist in the proper regulation of the insurance markets including Lloyd's.

    Is it not clear that, even if the recent Lloyd's Act had been operative in the past year, the latest stream of scandals would almost certainly still have been neither detected nor weeded out? Does that not suggest, first, that there must now be statutory disclosure of all documents as fully as is required under the SEC rules, since that alone brought the Howden scandal to light, and, secondly, that power to investigate prima facie evidence of malpractice quickly should now be invested in an inspector accountable to the Secretary of State, not to the Lloyd's council?

    The hon. Gentleman will realise, with regard to rapid inspections, that we inspected the Minet allegations extremely rapidly. The investigation was started in two days and within a few days after that inspectors were appointed. We now have an Act that comes into full operation in January. Meanwhile, my right hon. and noble Friend has made our general anxieties about the subject quite clear. At a meeting at which I was present last week, the chairman of Lloyd's assured us that he would keep in close and regular contact with us.

    Does my hon. Friend agree that the contribution of Lloyd's to Britain's invisible exports is too important for its image to be tarnished as it has been in the past few months and years? Will he make the seriousness with which hon. Members view the present activities in Lloyd's crystal clear to Sir Peter Green and other members of the council?

    I am well aware of that. We have made it absolutely clear. We should not forget that Lloyd's is the largest insurance market in the world. Every other insurance market does business with it because of its high standards of professionalism.

    Does the Minister agree that, as increasing opportunities exist for insurance frauds at international level, the public can be protected only by full international co-operation in detecting and prosecuting those who are responsible? Will the Minister therefore discuss with Sir Peter Green the allegation that Mr. Bill Allan made at the recent Dallas conference to the effect that he experienced a complete lack of co-operation from Lloyd's when investigating the Kenillworth scandal? Will he ask Sir Peter to assist those of us who want to retain international financial institutions in London by issuing a denial, an explanation or a promise of improvement?

    We received a warning just before the weekend about the Kenillworth scandal. I have carefully examined the reports that have been appearing in the press. The matter must worry us. I shall bear the right hon. and learned Gentleman's points in mind.

    Does my hon. Friend agree also that it is essential to restore confidence in Lloyd's by putting an end to the present shambolic atmosphere of leaks, rows and scandals? Does he agree also that probably the best and quickest way to do that is to follow the apparent advice of the governor of the Bank of England and to appoint an independent chief executive of Lloyd's who would do the job of regulation which the present chairman and committee are so manifestly failing to do?

    I agree with the general tenor of my hon. Friend's remarks. We should now wait until the Act if fully implemented, which, after all, is a matter of only about four weeks from now.

    Is this not an example of the Government's double standards? They are refusing to have any sort of regulatory device over Lloyd's, largely because about 100 Conservative Members are members of Lloyd's. Scandal after scandal breaks out in Lloyd's, yet very little is done. Government supporters went into the Lobby in support of the Lloyd's Act, which gives the council of Lloyd's massive immunities and at the same time attacked trade unions and, by means of legislation, tried to treat them in a highly discriminatory and savage manner.

    If I followed the hon. Gentleman correctly, I must say that I do not agree with a word of what he said. The 1982 Act was based on the belief of both the Government and the Opposition, as well as Lloyd's, that in principle the most appropriate form of regulation for a market as flexible as this Is self-regulation.

    Is it so important that it cannot wait 10 minutes, so that I can take it at the end of Question Time?

    In response to the remarks of the hon. Members for Keighley (Mr. Cryer), I wish to point out that no Member of Parliament who belongs to Lloyd's voted on the Lloyd's Act.

    Overseas Development

    Development Education

    40.

    asked the Secretary of State for Foreign and Commonwealth Affairs what representations he has received in the past 12 months about the level of Government funding of development education in the United Kingdom.

    Two organisations, one previously in receipt of a Government grant and the other still in receipt, have made representations. In addition, about 50 letters from members of the public about this issue can be readily identified from our records.

    Is the Minister aware that the British Government currently give three-tenths of a penny per-head of population to this activity, compared with more than twice that amount given by Italy and Belgium and six times that amount given by West Germany? Is he not terrified that, if British public opinion is made aware of the abysmal poverty in Africa and Asia, it will be more critical of the Government's stinginess in the overseas aid programme?

    Not in the least, but I do not want to divert aid funds that should be devoted to the developing world to educating the British.

    In the light of that remark may I ask whether it is the Minister's intention to end development education in 1984? Will that not do tremendous damage to aid prospects from this country in so far as voluntary societies will be less informed and less able to encourage their memberships to play an active part in assisting the poorest countries overseas, which is what they are doing at present?

    No. Development education can well be taught in school, which is the place to learn, as well as in the voluntary agencies, the Churches and so on. The Foreign Affairs Sub-Committee, of which the hon. Gentleman was then a member, was critical of our grant to the Centre for World Development. I have now changed this to a conventional accountable grant at the original maximum value of £150,000 this year and £100,000 next year. I still expect this organisation to be independent of offical funds by April 1984.

    Is this not a subject which even people of mediocre intelligence could study without the assistance of public money?

    I do not entirely agree with my hon. Friend, because the Centre for World Development is a place to which all intelligent, semi-intelligent and subnormal people can apply for advice on the education that it proposes to give.

    Is the right hon. Gentleman not the slightest bit concerned about the figures quoted by my hon. Friend the Member for Sheffield, Heeley (Mr. Hooley)? Does he not realise that development education is a vital aspect of education in this country, in the sense that people need education in unstable world economic conditions and the reaction that we ought to be making to them? Does he not also recall that the Heads of Government of the Commonwealth and the Archbishop of Canterbury, as well as the Select Committee, have criticised him heavily for withdrawing support for this aspect of policy?

    One gets criticised a lot by a variety of people for giving too much, too little and so on. Nevertheless, I still believe that it is up to our education system to educate.

    South America (Aid)

    41.

    asked the Secretary of State for Foreign and Commonwealth Affairs what proportion of United Kingdom overseas aid goes to South American countries.

    In 1981, 1·2 per cent. of the gross bilateral aid allocated to individual countries went to countries in South America. In addition, a proportion of our contributions to multilateral agencies such as the World Bank, the Inter-American Development Bank and the European Community, went to South American countries. Figures for these multilateral contributions are not yet available for 1981, but in 1980 we estimate they amounted to nearly 5 per cent.

    What is the estimated figure available in the Minister's Department for the cash that would have gone to Third world countries but did not because it was used for civil and military purposes in the Falklands?

    The best way for the hon. Gentleman to learn the answer to that question is to await the statement on aid for the Falklands that will shortly be made in the House.

    Bearing in mind our long and historic association with Guyana, will my right hon. Friend assure the House that every possible consideration is given to requests from that country for development and loan aid?

    Why is the proportion so extraordinarily low? Is the hon. Gentleman aware that there is great poverty in Latin America? Would it not be a good thing to give additional assistance to the needy countries in Latin America in order to improve our relationships with them, which have inevitably suffered as the result of the Falklands war?

    Our policy is to direct most of our aid to the poorest countries, and in general South American countries do not fall within that category. South America has a developmental need, and many of its citizens still live in poverty. It is also important to Britain, both politically and commercially, and we have great historical ties with that continent.

    On a point of order, Mr. Speaker. In view of the unsatisfactory nature of the Minister's reply I beg to give notice that, I shall seek leave to raise the matter on the Adjournment as soon as possible.

    Victoria Dam, Sri Lanka

    42.

    asked the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on progress on the United Kingdom funded Victoria dam in Sri Lanka.

    I am glad to report that work on the Victoria dam is going ahead well. The dam is now more than half way to completion; the drilling of the power tunnel, which is three-and-a-half miles long, was finished last month; and the construction of the power station is well advanced.

    I welcome that progress. Does my right hon. Friend agree that the Victoria dam project is a good example of how British aid can most effectively be employed, not only in its funding allocation, which is perceived by the people to have beneficial results, but because, as on this occasion, it is married to the expertise and skill of the construction industry? Will my right hon. Friend promote more such bilateral agreements?

    I cannot promise to promote more such bilateral agreements. This depends on demands from the various countries. I agree with my hon. Friend that this is a valuable project for the Sri Lankans, because the dam will provide 210 mW of electrical power, which will be a substantial contribution to Sri Lanka's power requirements. In addition, the irrigation benefits will be spread over 112,000 acres and will ultimately provide settlements for 50,000 farming families. Therefore, this project is of great benefit to the poorest people in the developing world.

    Asian Sub-Continent (Aid)

    43.

    asked the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on the level and quality of aid to the Asian subcontinent.

    In the last financial year we provided £188 million bilateral aid for countries in the area. We expect to provide about the same amount in the current financial year. All the aid is given without interest or repayment. In addition, those countries benefit from British contributions to various international funds such as the World Bank, the European Community and the Asian Development Bank.

    In view of the expertise that has been built up in Britain in the establishment of new towns, would my right hon. Friend consider using some of the aid to the Asian sub-continent for the creation of further new towns to house the outflow of migrants from Britain that is likely to occur during the next 10 years?

    It is for the developing countries to request aid for the creation of new towns. We always consider those requests.