asked the Secretary of State for Industry what recent discussions he has had on future aircraft projects with representatives of Boeing, Lockheed and McDonnell Douglas; and if he will make a statement.

asked the Secretary of State for Industry what communications he has received from the Boeing company about possible collaborative ventures with the British Aerospace Corporation.

asked the Secretary of State for Industry if he will make a statement upon his discussions with United States aerospace companies.

asked the Secretary of State for Industry if he will make a statement on his recent discussions concerning the future of the British aircraft industry.

In order to secure first-hand information about the plans of the leading American civil aircraft manufacturers, I recently invited senior management of the Boeing, Lockheed, and McDonnell Douglas companies to visit London for discussions. Those discussions were for information, and not in any sense negotiations. The results will form part of the Government's current consideration of future civil aircraft policy. The timing of decisions on aircraft projects will depend mainly on commercial factors.

How are the conflicting interests and ambitions of British Airways, British Aerospace and Rolls-Royce to be reconciled in these matters? Does the right hon. Gentleman agree that any future decisions should be based upon commercial criteria and upon the size of potential markets, since that would be the best way of securing employment opportunities and the interests of the taxpayer?

I thought that I had made plain that the factors that have been taken into consideration are mainly commercial. Every corporation operates within the framework of its own legislation. We have to co-ordinate as best we can. However, the hon. Gentleman's point is very much borne in mind.

I shall call first those hon. Members whose Questions are being answered.

Will my right hon. Friend bear in mind that some very seductive offers can be put forward by American manufacturers for the short term in order in the long term to kill off the design capacity of the European aircraft industry? Will he also bear in mind that it is not necessary for us to go ahead on the basis of a launch order from British Airways on any of these collaborative projects, and that the sure test of the collaborative project should be British participation in design leadership and engine supply throughout the production run?

These are the factors which have been discussed with the American companies. British Aerospace has discussed them, too, with the European companies and interests. Tomorrow I shall be going to Bonn and Paris to take up these matters directly with German and French Ministers.

We think that it is right that the Government should have engaged in these discussions in order to ensure that no options are foreclosed by the passage of time while British Aerospace is engaged in Europe. Will the right hon. Gentleman bear in mind that if he takes notice of what the hon. Member for Derby, North (Mr. Whitehead) said, not only about the necessity for British leadership in the design of the airframe, but about the fitting of British engines, he will be foreclosing on the options for doing a deal with the French, who are excessively attached to their own engine?

I know something of the French aero engine industry, because in February I was able to go to SNECMA and take part in discussions. However, all these factors, particularly that just mentioned by the hon. Member for Chingford (Mr. Tebbit), will be borne in mind.

Is it not a simple fact that when airlines order aircraft they specify the engine just as they specify the airframe? Is it not, therefore, a dangerous delusion to believe that, merely because British Airways might specify an aeroplane with a Rolls-Royce engine, Boeing will insist on all its other customers fitting their aircraft with the same engine? Is not a Boeing partnership with British Aerospace rather like a partnership between the wolf and Little Red Riding Hood? Ought we not to consider the possibility that the Boeing 999 might be the number we should be referring to as a warning of what could happen if, as the hon. Member for Derby, North (Mr. Whitehead) said, we allow our industry to be seduced in this way?

I think that what we have to bear in mind is that no decisions have been taken at this stage, either by British Aerospace or by some of the other interests involved. I understand that British Aerospace is willing to discuss further with Boeing, but, of course, the top consideration of British Aerospace has to be given to the commitment that it has made to the European interest.

In view of the fact that every week we are given different accounts of what offers are being made to the British Government, and bearing in mind that the British Government have to finance these projects in any case, will my right hon. Friend give an assurance that a statement will be made to the House that will allay the fears of the workers before a final decision is made about this matter?

There will certainly be a statement made to the House in due course. As to consultations with the work force, it is our intention to consult the aerospace committee of the Confederation of Shipbuilding and Engineering Unions. We plan to do that within the next few weeks.

Will the Secretary of State ensure that in considering these matters and, for that matter, any shorter-term decisions on the future of the aircraft industry, the figures that are used to compare different projects are adjusted to ensure that they do not reflect the present disgraceful discrimination against British aircraft and in favour of American aircraft in the present set-up of our Customs duties?

Again, this is one of the factors that is being examined by the Government in a co-ordinated way and by the interests involved, British Airways and British Aerospace.

Does not my right hon. Friend agree, however, that the Government could accede to the request of British Aerospace for permission to go ahead with the HS146 without in any way prejudicing the options on the larger aircraft, and is it not true that it is an important commercial factor that delay is extremely damaging to the market prospects for the HS146? If my right hon. Friend does agree, when may we have the "Yes" that we need?

I know my hon. Friend's interest in the HS146, and she will know, too, that proposals have been put to us by British Aerospace. These are under active consideration. A statement will be made in due course.

Does the Secretary of State agree that, in a complicated situation, the defence aspect is important? Bearing that in mind, does he agree that the Boeing Corporation does not seem to be the best of the American contenders, even assuming that one wants to have an American involvement at all?

That is another part of this complicated matter. I think that Boeing has 60 per cent. of the world's civil or commercial airline interests, and other American companies, of course, are much more oriented towards military aircraft. We know that our aerospace industry is weighted in the military field, too. But I think that we must look at all these options and come to conclusions which are in the best interests of the British industry.

I shall call one more hon. Member from each side of the House on these Questions.

Will my right hon. Friend say whether in considering the longer-term plans he has had any talks with British Airways about the BAC111 and the possibility of buying that aircraft instead of the Boeing, and whether failure to buy that aircraft could affect our plans to sell it to the Japanese?

I am not responsible for British Airways. As my hon. Friend knows, that responsibility lies with my right hon. Friend the Secretary of State for Trade. However, I can tell my hon. Friend that I engaged in discussions with my right hon. Friend at a joint meeting that took place between British Airways and British Aerospace, at which we asked them to take this factor into account. I understand that both corporations are talking to one another.

Why, in the meantime, is the Minister holding up finance for the development of the derivatives of the RB211 engine which will be needed in order to secure the future for Rolls-Royce in any case, whatever tie-up the Government finally agree with either American or European interests, or with both?

We are not holding up finance for the further development of the RB211–535. It is wrong for the hon. Gentleman to suggest that we are doing that. We have received proposals by way of the National Enterprise Board on the RB211–535. We are considering this. Of course, it is part of this whole question, as the House understands.

asked the Secretary of State for Industry whether he will make a statement on the progress of the Government's industrial strategy.

Encouraging progress is being made in the development of the industrial strategy. The key task this year is to obtain action at company level on the findings and recommendations of sector working parties.

Why does it remain part of the Government's industrial strategy to persist in trying to find ways of allowing trade unions to put nominees on the boards of British companies? Does not the Minister recognise that the continued threat of legislation in this field is damaging confidence among British management and deterring many foreign investors from putting their money in this country?

The hon. Gentleman should have spoken to the major multinational to which I spoke last week in the United States, which spoke glowingly of the prospects which it saw arising from the presence of worker representatives on the boards of its subsidiaries in Germany.

Does my right hon. Friend agree that a key element in the success of the Government's industrial strategy would be the success of the British-owned motor car industry? Does he further agree that its success is being gravely threatened by the growing level of imports from Japan, which seems to be in marked contradiction to the undertakings that the Japanese have given to the Government? Therefore, will he, together with his right hon. Friend the Secretary of State for Trade, take up this matter again with the Japanese and set up a system for monitoring shipments from Japan, because that is what will determine the level in the future?

My hon. Friend can be assured that the Department of Trade and my Department are aware of the problem. But I think that it has to be accepted that, because of the large existing levels of stock at the beginning of the year, it was perhaps inevitable that it would take a little time for the agreed figures to be attained. For that reason, we are doing exactly as my hon. Friend said. We are keeping a close check on shipments and on prospective future shipments.

When the Ministers consider the progress of the industrial strategy, do the right hon. Gentleman and his right hon. Friend ever reflect on the ease with which manufactured goods of foreign origin enter this country and the difficulties that are placed in the way of those who manufacture such goods in this country and wish to export them?

Of course we do. That is why we are taking part in the multi-trade negotiations—to try to ensure that tariffs and barriers are removed wherever possible. Indeed, on a recent visit to Japan we discussed with MITI this very point—that there needed to be better access for British goods to the Japanese market.

How many more factories have to close and how many more people have to be put on the dole before the Government finally act and introduce a policy of import controls, as put forward by the Cambridge Group of economists and backed by the trade union movement? Does not my right hon. Friend agree that, whether it be in cars, electronics or steel, in Britain's present economic circumstances a policy of free trade is no good for Britain?

I think that my hon. Friend should understand one simple fact. A retreat from free trade would be in the worst interests of Britain, because Britain relies essentially on clear access to overseas markets. Action has been taken in relation to imports of cars and colour television sets from Japan. These actions have been taken at an industry level, and the Government are quite convinced that they will be satisfactory.

Is it not humbug for Ministers to prate about an industrial strategy when excessive Government spending leading to excessive Government borrowing and excessive marginal rates of direct taxation, at all levels, is doing such savage harm to jobs and activity in the economy?

I admire the right hon. Gentleman's dedication to the gospel that he continually preaches. I would only point out that, in contradiction to the trends that one would expect if his gloom were justified, investment and production are rising, and inflation and unemployment are falling. That is not a bad attainment.

asked the Secretary of State for Industry whether he has reached a decision on his renewal of the operating licence for the Hull telephone department; and if he will make a statement.

Discussions have been taking place between Kingston upon Hull City Council and the Post Office on detailed matters concerning the question of a long-term licence. A decision will be taken when we have been able to consider the outcome of these discussions.

As the continued independence of the Hull telephone department is a considerable asset as a test of efficiency and service to the public, by comparison with the nationalised monopoly, will the Minister ensure that a favourable decision is reached at the earliest opportunity to avoid further uncertainty and prejudice to forward planning?

I am glad that the hon. Gentleman supports the Labour-controlled council's views. We are considering these matters carefully and shall announce a decision when we are ready.

asked the Secretary of State for Industry if he will make a statement on the recognition of trade unions for collective bargaining purposes under the Aircraft and Shipbuilding Industries Act, stating which unions, either at national or local level, have been recognised, the grades of employees covered in each case, the date when the agreement was made, and the grades of employees in each industry as yet not covered by agreements but where recognition has been sought, either for all employees or for members of particular trade unions.

The recognition of trade unions is a matter for British Aerospace and British Shipbuilders.

That is excellent advice—that it is ultimately a matter for the boards of the industries concerned. However, may I take it that that is subject to the ever-ready advice of the Advisory, Conciliation and Arbitration Service?

I take careful note of my hon. Friend's kind remarks. He is of course right. I should add that my right hon. Friend has no power to issue directions on this matter.

What has happened to all the promises given by the Government about industrial democracy throughout the debates on the Bill which nationalised these industries? Is the hon. Gentleman aware that throughout the aerospace industry the shop floor is shocked that it is not being consulted on any future projects and that it feels that it is neglected by the Government that it put in power?

The hon. Gentleman is a bit out of date. We have already received one report on industrial democracy, on 6th December, which was placed before the House. My right hon. Friend expects the second report before 30th June.

asked the Secretary of State for Industry when he next plans to meet the chairman of the British Productivity Council.

My right hon. Friend the Secretary of State has met the chairman of the British Productivity Council on a number of occasions, but there are at present no plans for a further meeting.

Will the hon. Gentleman agree, in spite of the slight upturn in productivity, that there is an essential need to increase this nation's productivity, which is falling sadly behind? In his discussions with the chairman of the council, will he discuss wage costs per unit, which are now escalating alarmingly in a way which will affect productivity and wage costs?

I hope that the hon. Gentleman will recognise that our wage costs per unit are among the lowest in Europe. I hope that he will also take into account the fact that, with inflation down to 8 per cent., manufacturing investment up 14 per cent., our decline in the share of world trade halted and employment in manufacturing actually rising until February this year, that is not a bad record.

But, in view of the important contribution to productivity made by sector working party reports, will my hon. Friend accept that there is some disappointment on both sides of industry and there is a feeling that the Department is passing the buck, since it has now suggested that many of the recommedations of those working parties should be worked out in the companies rather than being given a direct departmental lead?

Although I take note of what my hon. Friend says, I cannot agree with him. I should not like him to think that my Department has in any way abandoned the sector working parties. It takes careful note of what they say and is anxious to ensure that their recommendations get down to company level.

asked the Secretary of State for Industry whether his Department is prepared to meet the combined shop stewards' committee of Lucas Aerospace.

asked the Secretary of State for Industry why his Department has consistently refused to meet the Lucas Aerospace combined shop stewards' committee in connection with job maintenance and job creation.

asked the Secretary of State for Industry why his Department has not directly discussed the Lucas Aerospace combined shop stewards' committee's corporate plan in relation to the recent redundancy announcement of Lucas Aerospace management.

I met members of the committee in a delegation brought to see me by my hon. Friend the Member for Birmingham, Yardley (Mr. Tierney) in December 1975. The recently announced proposals of Lucas Aerospace are being discussed with the proper negotiating body representing the interests of the Lucas Aerospace workers in all unions and at all sites, namely, the Confederation of Shipbuilding and Engineering Unions, with which Ministers are in frequent contact, and with which I have discussed the problems of Lucas Aerospace. Either side can propose topics for meetings and it is for the confederation to decide who will attend on its side.

Will not my hon. Friend agree that, since the management of Lucas has consistently refused to meet the shop stewards' committee, it would be a good idea and also in the interests of industrial democracy if he could intercede and meet them directly himself?

As I have explained to my hon. Friend, I have already met them myself. I have also interceded several times via the Confederation of Shipbuilding and Engineering Unions. The confederation, having met Lucas Aerospace last month, is due to meet it again next month. If it is appropriate for the combine to be represented there, of course the confederation will decide to do so.

Will not my hon. Friend agree that there is some difficulty with the confederation in relation to this? Will he not try to bridge the gap by getting the Lucas directors to meet the shop stewards and perhaps implement this socially useful plan? Does this matter not also point to the need for workers' democracy, when the workers can produce such a useful plan which can be faulted by no one?

I accept that these matters have not proceeded as satisfactorily as they might. However, my hon. Friend says that there are difficulties with the CSEU. He himself is an officer of one of the leading unions in the CSEU. The confederation has made it clear to Ministers time and again that it would very much resent it if its normal trade union machinery were bypassed. Indeed, only a short time ago, AUEW (TASS) issued a statement to its officials, in which it said:

"It is not in the interests of our common objectives to ignore the democratic procedures of our movement. Members of unions can win policies if they are prepared to use the democratic structures which exist in various forms, in every union."

Will not my hon. Friend recognise that, with the continuous threat of redundancy affecting the workers in Lucas Aerospace, it is the Government's responsibility to intervene, in spite of the usual institutional arguments that he now puts forward—that it might offend certain union leaders in the confederation?

The "usual institutional arguments" are the normal procedures of the trade union movement. Although my hon. Friend may feel that he can set those procedures aside, I, as a member of the Government, have to work every day with the confederation. It is not possible for me to set aside its procedures in favour of any body which wishes to set them aside.

Does the Minister understand that we do not want to intrude on this bureaucratic mumbo-jumbo of an argument between him and his trade union friends but that we would like him to come to the point behind these Questions? Does he think that the Lucas directors are perversely or malevolently throwing away the chance to enter into good business and make profits—or does he think that the truth is that those ideas are nothing more than another mare's nest dreamt up by his hon. Friends?

The hon. Member seems, like his right hon. Friend the Member for Leeds, North-East (Sir K. Joseph), to believe that private industry in this country operates in a state of perfect competition. If that were so, the kind of intervention for which his hon. Friends constantly ask would not be required from this Government. As it happens, when it comes, for example, to the question of proposed redundancies in Lucas Aerospace, we do intervene. I myself called in the management on that matter and made it clear to it that propoer consultation with the confederation and the work force was essential.

Will my hon. Friend concede that there are some occasions—perhaps not too many; some would argue about the balance—when the rank and file are just marginally in front of their progressive leadership? Looking at the matter from that angle, will he not concede the argument in regard to the Lucas proposals?

I know that my hon. Friend might take that view with regard to the NUM. I prefer the progressive leadership.

Is not the Minister aware that these proposals have nothing to do with the level of productivity achieved by the work force over the years at Lucas? If the workers want to produce a new range of supersonic caravans, surely it is up to the Government, who are so profligate with taxpayers' money, to give them everything they want.

The hon. Gentleman's derision does no justice to a series of very constructive proposals put forward by the Lucas work force. The problem is to ensure that those proposals are considered within the proper structure between the union and the trade union movement. His derision of those plans does him no credit

asked the Secretary of State for Industry when he next expects to attend a meeting of NEDC.

I will attend the NEDC's next meeting on 7th June.

In view of the totally unsatisfactory and negative nature of the answers to the previous Questions today, when my right hon. Friend next meets the NEDC will he ask for the Lucas problem and the urgency of the situation to be put on the agenda, and for the matter to be placed in the sector working party system?

I doubt very much whether that matter will come up at the next meeting of the NEDC. I have nothing to add to the answers which have already been given by my hon. Friend the Minister of State.

Will the Secretary of State take the opportunity when next he meets the NEDC of correcting the problem mentioned by the Minister of State this afternoon in describing the industrial strategy? The Minister of State, in the optimistic view he advanced, based on the generosity of his American hosts, has confused the House and the country. Therefore, will the right hon. Gentleman define that industrial strategy?

I have done so on previous occasions, and it would take a much longer time than Question Time to do so again now. One of the great strengths of the industrial strategy is that it has been put on a tripartite basis. I, along with the right hon. Member for Leeds, North-East (Sir K. Joseph) and others, was present last week when the president of the Confederation of British Industry paid tribute to all those taking part. He said that the CBI, in common with the TUC, was totally committed to that strategy. It is trying to reverse the relative decline that has taken place for 20 or 30 years or more. What is more, these efforts are beginning to succeed, and I hope that the system, provided it is given a chance, will succeed and that Members of the Conservative Party will start to pay tribute to it—and at the same time will pay tribute to the many Conservatives who are contributing to that policy.

Will my hon. Friend bear in mind when next he meets the NEDC that it is damaging to economic development if important regions are allowed to suffer severe plant closures without Government action or remedial measures being taken to prevent such closures? For example, does he appreciate that in North Staffordshire we are threatened with steel closures and bakery closures and that thousands of men and women are liable to become unemployed as a direct result of Government policy? Will the Secretary of State undertake a special investigation into the serious problems of North Staffordshire?

Of course I shall take note of the serious problems of North Staffordshire. I know that there are further Questions on the Order Paper concerning the steel industry. I have had discussions with my hon. Friend the Member for Stoke-on-Trent, South (Mr. Ashley) and his colleagues in the West Midlands group of Labour MPs on the subject of Shelton and Bilston. I promise that the British Steel Corporation, in discussion with the TUC steel committee, will take fully into account the effect on the areas concerned.

asked the Secretary of State for Industry whether he is satisfied with industrial progress in the Northern Region.

We shall continue to do everything we can to promote investment and employment in the Northern Region.

Does my right hon. Friend agree that, despite the considerable amount which has been achieved, the Northern Region is still suffering from very high unemployment and severe structural problems? Is he aware that at the meeting of the Northern Regional Council Labour Party last weekend unanimous support was given to a report calling for better co-ordination of regional policy? Will he examine the proposals in that report?

I share and understand my hon. Friend's concern about the level of unemployment. I am encouraged by the fact that the rate of letting of Government factories has improved markedly in the Northern Region. Whereas only 11 were let in 1975–76, I understand that 21 were let in the following year and 41 last year. Already since 5th April nine of our factories in the region have been reserved. Clearly, I shall wish to examine the results of the conference to which my hon. Friend referred. If there is practicable action that can be taken to improve co-ordination, the Government will take such action. But we already have a planning board to co-ordinate the work of Government Departments in the region.

Does not the Minister realise that when he removed a large part of North Yorkshire from development area status he only aggravated the situation in that area? Does he appreciate that many people from Teesside work in North Yorkshire and that many companies are not now going ahead with development plans in that area? Therefore, will he reconsider his decision?

That is a completely different question. The Question relates to the Northern Region and not to the Yorkshire and Humberside Region. If the hon. Gentleman wishes to table a Question on that subject, he has the opportunity to do so. I have seen deputations from North Yorkshire and we have discussed in detail the area's problems. As yet, there is no evidence to justify the hon. Gentleman's statement that projects in the area are being turned away. I am convinced that the selective approach still available to us and the area's current status are adequate.

Will my right hon. Friend reflect on the representations which he has already received on the establishment of a national boiler company? He will recognise that there is widespread concern in the Northern Region. Will he undertake to meet representatives from the region as soon as possible before further progress is made on these lines?

My hon. Friend was kind enough to convey to me the concern of his constituents on various occasions about the possible impact of the proposals. I have had meetings with the CSEU, and should my hon. Friend wish to bring a group of his constituents to see me I shall be only too happy to talk to them.

Will the Minister take note of the fact that in answer to a Question, in which I asked for the number of bodies other than direct arms of Government Departments in the NoNrthern Region receiving subsidies and how much they were receiving, I was told that no central information was available? Does he agree that, despite the amazingly high unemployment rate in the Northern Region, there is still a fantastic shortage of skills and a number of unfilled skilled vacancies?

I shall bear those points in mind, and I shall convey them to the relevant Minister in the Department of Employment. I do not recollect the parliamentary reply to which the hon. Gentleman referred, but I shall examine it to see whether there is any further information I can provide.

asked the Secretary of State for Industry whether he is prepared to support the development by workers at Lucas Aerospace of a powered wheel for aircraft which reduces noise and waste of fuel in taxi-ing operations in and around airports.

My Department is willing to consider any specific proposals for Government support for research into new technology, or the development of new products, in the civil aerospace field.

That is a rather disappointing answer. In the meantime, will the Minister pay his tribute to the initiative and constructive proposals in the Lucas shop stewards' corporate plan?

I thought I gave my hon. Friend a rather encouraging reply. If he examines the various aspects of work in the corporate plan, which I have studied in some detail, he will find that research and development work is already taking place in various Government Departments and organisations. These operations include solar heating, windmills, braking systems, electric vehicles, heat pumps, oceanics, applications of micro-processors, kidney machines, aids for the blind, aids for spina bifida patients, and powered undercarriages for aircraft.

Does the Minister know whether the Lucas aerospace combined shop stewards, who have featured so prominently in this afternoon's Question Time, have taken this proposed development to either the National Research Development Corporation or to the National Enterprise Board and, if so, with what consequences?

I cannot give an up-to-date report on that matter without notice.

asked the Secretary of State for Industry whether he proposes to take any new measures to increase investment in manufacturing industry.

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

Manufacturing investment, excluding iron and steel, has increased considerably and encouragingly in the last 12 months.

Does the Minister realise that the restoration of confidence in manufacturing industry and an increase in the demand for its products have far more to contribute to increasing investment in manufacturing industry than schemes involving the direct use of Government money? When will the Government take steps to improve confidence in manufacturing industry and to increase the demand for its products?

It is this complete lack of understanding of what is taking place in the economy that amazes me every time I hear the Opposition on this subject. They never seem to learn. The fact is that last year investment in the private sector increased by 14 per cent. In real terms—and the increase was in real terms—the investment was higher last year than it was under the Conservative Government in 1972 and 1973. If the guide is the way in which investment increases, I wish to make clear that the plans for the machine tool industry in the current year envisage a higher rate of investment than for any of the last eight years—in other words, since the Labour Party was last in Government. In the non-ferrous foundry sector, there are plans that will give a two-fold increase over the rate of investment in the last four years.

While one agrees that we need more investment in industry, and while the latest figures are to be welcomed, will not the result of investment in industry often mean in the long run that there will be less employment in industry? Is it not essential therefore, if we are to reap the full benefits of increased investment in terms of increased wealth, to have, in parallel with the programme of increased investment, a programme of expanding job opportunities in the public service sector and the development of non-work alternatives for unemployment such as shorter working lives and greater educational opportunities?

These alternatives are matters to which the Government have been giving attention; hence many of the proposals that have come from the Department of Employment. My hon. Friend is right in saying that implicit in many of these sectoral schemes is the proposition that productivity must improve and that therefore extra output may be attained without necessarily providing massively extra employment, though under the schemes that have been put forward so far 22,000 extra jobs will be created. More importantly, because of the difference that the schemes will make to the balance of payments, they will enable the economy to be operated at a higher level and thereby indirectly create jobs.

Does not the Minister accept that there is no investor who is not willing and able to raise his money on the market for a project so long as he has confidence that he has markets for his products and a return on his investment? Does he not accept that it is the failure of the Government to create that atmosphere of confidence which makes his various sectoral schemes necessary?

My interpretation is different. My interpretation is that the level of investment under the Labour Administration is higher than it was under the Conservative Administration because business can see that we can run the economy better than can the Conservative Party. The Conservative Party should look at the facts. Under the industry schemes there has been E1·5 billion worth of new investment projects, and the Conservative Party is tonight to vote against more money for those very schemes.

If we are to have increased investment in manufacturing industry, will my right hon. Friend use the instruments of the National Enterprise Board and the Welsh and Scottish Development Agencies, which are doing a grand job in this respect? If we are to give huge funds to the industry, will the Government ensure that we get a share of the equity of those enterprises for the benefit of the people?

Where appropriate, equity participation is discussed with companies. My hon. Friend will see from forward projections of public expenditure that it is envisaged that the NEB and the Scottish and Welsh Development Agencies will continue to play a major role in the regeneration of industry.

Is it part of the Government's industrial strategy that the Government should have to increase interest rates almost to record levels in order to attract funds to the Government to fund their borrowing requirement and away from industry, to which otherwise the funds would have gone?

It is shattering to find that, while the Conservative Front Bench seems to have no understanding of the domestic economy, those on the Conservative Back Benches have no understanding of the international economy. I should like to point to what has been happening to interest rates worldwide, particularly in relation to the United States. Perhaps when Conservative Members have done a little elementary homework they may understand what is happening.

asked the Secretary of State for Industry when he next expects to meet the chairman of the British Steel Corporation.

asked the Secretary of State for Industry when he next proposes to meet the chairman of the British Steel Corporation.

On 26th May 1978.

Will the Secretary of State tell the chairman, when they meet, how much he approves of the recent joint venture between Redpath Dorman Long and the Dutch consortium which is to take over the metal oil platform erection business? Will he go further and say how much he would like the British Steel Corporation to seek more of these joint ventures, which will reduce the demand on the taxpayer and lead to a wider European framework of joint ventures for the corporation?

I can do no better than pass on the hon. Gentleman's comments to the chairman of the British Steel Corporation.

When my right hon. Friend meets the chairman of the British Steel Corporation, will he make clear that he is looking to the chairman, in the current negotiations with the TUC steel committee, to come out of those discussions with full agreement with the trade union side? Does my right hon. Friend agree that it is highly desirable that he does not at the end of the day simply adopt the British Steel Corporation's ideas but should involve the trade union movement and should continue the discussions, and that any workers fighting to save their plants or looking for investment in their plants should be given the opportunity to put forward their case so that they may have some of the confidence that has been sadly lacking in the plans of the British Steel Corporation since the end of the war?

I am not only meeting the chairman of the British Steel Corporation on Friday this week; I am meeting the TUC steel committee on Wednesday this week. One of the items on the agenda is the possibility of direct worker participation on the board of the British Steel Corporation in line with Government policy. I, like my hon. Friend, am keen that workers should participate.

Will the right hon. Gentleman arrange for me to receive a reply to the question that I asked in the Second Reading debate on the Iron and Steel (Amendment) Bill on 11th May, namely, what has happened to the British Steel Corporation's calculation that an expanded Port Talbot would supply Shotton with hot rolled coil a great deal more cheaply than Shotton could possibly make it, now that the exanded Port Talbot scheme is not to go ahead?

I recall the hon. Gentleman's speech on that occasion. I am sorry if he has not received a reply. I thought that during the debate I gave an undertaking to write to him. I will look into the matter. I have not been briefed on that aspect

Will the Secretary of State impress upon the chairman of the BSC that the policy of closures and redundancies cannot continue indefinitely and that the strategy of the 1960s might not be relevant to the late 1970s? Does he not agree that a policy of flexibility is now needed in steel strategy together with a major cut-back in the 5 million tonnes or so of steel that is still coming into the country?

The BSC must get its finances straight as quickly as is practicable. My hon. Friend will know that in the last financial year BSC, in common with many comparable steel companies overseas, lost money. It lost £440 million. Part of the Government's policy is that the financial objectives of the BSC should be to break even by the financial year 1979–80. We must approach these matters sensibly. One of the major factors is trying to bring demand into line with capacity. That will inevitably lead to some problems in some areas, but I think that the whole House will agree that we are dealing with the problem sensibly and humanely.

asked the Secretary of State for Industry when he next intends to meet Commissioner Davignon in Brussels to discuss problems affecting the steel industry in the EEC member States.

At present my right hon. Friend has no plans to do so.

Does the Minister of State agree that the problem of over-capacity in European steel can be solved only in the EEC context and that already the suggestions made by Commissioner Davignon have been helpful in taking all the member States' steel industries forward together in a difficult climate? Does he agree that if redundancies are inevitable they must be carried out gradualistically and in a humane way in a European context and not just nationally?

What the hon. Gentleman says is unexceptionable. We need to work within the Community for a sensible approach to the steel industry. The Davignon approach is helpful in many respects. I am glad about the hon. Gentleman's remarks about the need for generous redundancy payments where closures have taken place.

Is the Minister aware that he will be making a grave error of judgment if he condones the closure of Shotton steel works, because he will be defying steel workers, defying Members, of Parliament, defying the TUC steel committee and—because that steel works can be profitable with an arc furnace—defying logic?

These are not matters which we have discussed with Commissioner Davignon. We stated our position in the White Paper, and discussions are taking place on that basis.

Is the hon. Gentleman aware that if one has to choose between the Continental aristocracy there is more to be said for the free trade views of Count Lambsdorff than for the protectionist and cartel attitude of Viscount Davignon?

It ill becomes me to distinguish between one Continental aristocrat and another. They are all the same as aristocrats, but it just so happens that Commissioner Davignon's approach to the steel industry's problems has been helpful and we hope that it will continue to be so.

Is it not the case that, no matter from what source, there has been a great deal of progress in the last year or so? Could not that progress be even further encouraged if my hon. Friend's Department were a little more decisive in approving job evaluation schemes and other productivity deals, certainly in the South Yorkshire area?

I well understand the problem to which my hon. Friend has drawn attention. We are doing our best to expedite these matters, but he will know that they have to be conducted within the framework of the Government's pay policy.

asked the Secretary of State for Industry what is his Department's policy in respect of the Lucas Aerospace workers' proposals for product diversification in that company.

Ministers have consistently welcomed the initiative of the Lucas Aerospace shop stewards in preparing constructive proposals for the future of their company.

Does my hon. Friend agree that it is entirely unacceptable for Lucas Aerospace to be expanding abroad while it is contracting at home, closing plants in Liverpool, Bradford and Shipley and smashing up the foremost design teams in the world? Does he believe that such actions run contrary to the national interest, and will he intervene to point out the national interest to the firm and that it should act in a way that is consistent with our best employment interests?

I have done so. I have discussed these matters with Lucas Aerospace since it announced its proposals for redundancies, and I have drawn particular attention to the possible impact of those closures on areas of high and chronic unemployment in the North of England. As a result of my intervention, my officials are in discussion with the company to see if anything can be done to assist my hon. Friend's area and Merseyside.

Will the Minister agree that "pointing out" and "drawing attention to" are no substitute for the hard defence orders which would restore employment in this factory?

They are also no substitute for the Government having the ability, as we have in the case of nationalised industries, to have some close influence on what takes place. As always, the hon. Gentleman is drawing attention to the inadequacies of private enterprise.

Is my hon. Friend aware that the Lucas Aerospace directors recently told some of my hon. Friends and myself that the Opposition spokesman on defence, the hon. Member for Stretford (Mr. Churchill), was directly responsible for Lucas losing a contract in the aerospace field, which put workers out of work? Is my hon. Friend aware also that Lucas has a part stake in a workers' co-operative in Yugoslavia, where there is workers self-management, and that is not exactly reciprocated in this country? Will he put that also to the Lucas directors the next time he meets them?

I do not think that I could put it as well as my hon. Friend puts it, and I am grateful to him for drawing attention to the maverick activities of the hon. Member for Stretford (Mr. Churchill) and his lack of concern for the true interests of workers in Lancashire.