asked the Secretary of State for Wales by how much unemployment in Wales has risen since May 1979.

Between May 1979 and May 1980 seasonally adjusted unemployment in Wales rose by 11,800.

Do not those serious figures point to the need for an urgent change in Government policy so as to prevent Wales from suffering even more widespread and heavier unemployment? What, for example, will the right hon. Gentleman do to help the town of Flint, which is to suffer another 120 textile redundancies immediately, in addition to the existing 36 per cent. male unemployment rate in that town? What assistance, in the form of new jobs, will the right hon. Gentleman give Flint to help, for example, the 266 adolescents currently on the dole?

Of course unemployment in the town of Flint is serious, but the town is part of a wider travel-to-work area in which the figures are not as serious as in the town itself. The hon. Member will be aware that there are about 3,000 jobs in the pipeline in the Flint and Wrexham travel-to-work areas and that we have launched a major programme of remedial actions in the area.

Does the right hon. Gentleman realise that 520 people, mainly men, joined the dole queue in Caernarvon only last week because of redundancies in three companies, putting the male unemployment rate up to almost 20 per cent? This is something that the Secretary of State has known was coming for a long time. What will he now do about it?

I am aware of the serious situation in that part of Wales. I have recently discussed it, as the hon. Gentleman knows, with the local authorities concerned and will shortly be writing to them. We are at the moment urgently considering the regional policy decisions in that part of Wales, where the situation has changed seriously. However, it must be said that, in that part of Wales which concerns the hon. Member, the major problem lies ahead, when the Dinorwic scheme comes to an end.

Does my right hon. Friend agree that one of the major ways of assisting future employment in Wales is through the medium of advance factory building and that he is to be congratulated on the fact that 47 per cent. of new factory building in the whole of the United Kingdom will be in Wales? However, will he also look carefully at what the hon. Member for Caernarvon (Mr. Wigley) said, particularly about the ending of employment in the Dinorwic pump storage scheme, since that will have a significant effect upon the growth of unemployment in that area of North West Wales?

My hon. Friend is correct to say that a major programme of advance factory building is going on. It would be wrong to think that there are easy solutions for the problems of North West Wales. No Government have found it easy to tackle the problems of that area. However, we are pressing on with the improvements to the A55 as an urgent priority. That is one major step that we can take to help that part of Wales.

Is the right hon. Gentleman satisfied with his first year in the Welsh Office—a year which has seen unemployment in Wales rise by 14,000? When can we expect some improvement in the unemployment figures as a consequence of Government actions? When are we likely to have an announcement about the uprating of those steel areas which have been badly affected? Finally, will not the right hon. Gentleman at least consider joining the "wets" in the Government who are now apparently contemplating urging the Government to make a U-turn—a U-turn which is essential if Wales is to be saved?

The last time that the right hon. Gentleman stood at that Box and urged action at Welsh Question Time, it was to urge the lunatic course of the action taken on 14 May. I do not pretend to take his advocacy any more seriously this afternoon. It ill becomes the right hon. Gentleman to lecture us when unemployment under his Government went up by 15,500 in their first year of office and by 21,000 in their second year.

As for the right hon. Gentleman's only serious question, regional policy areas, that matter is being urgently reconsidered by the Government. However, we still have not reached a final settlement on the Llanwern redundancies.

asked the Secretary of State for Wales how many miles of motorway and dual carriage road are at present under construction in Wales.

A total of 16.2 miles of new motorway and 21.8 miles of dual carriageway trunk roads. In addition, work has started on widening 2.6 miles of the M4 at Newport.

Is my hon. Friend aware that the visible progress in the dualling of the A55 in my constituency is a source of great reassurance at a worrying time? Can my hon. Friend give me an assurance that he will do everything possible to protect the major items in the road programme from any cuts?

Priority is to be given within the programme in Wales to the proposed dual carriageway improvement of the A55. I hope that, within 12 months, work will start on three important A55 bypasses at Bangor, Colwyn Bay and Hawarden. This is subject to the satisfactory completion of statutory and contractual procedures.

What are the expected completion dates of the two remaining stretches of the M4 apart from the Baglan-Lonlas stretch?

It is hoped that the Coryton-Castleton section will be open this summer and that the section bypassing Bridgend will be opened next summer.

Is my hon. Friend aware of the correctness of what my right hon. Friend the Secretary of State said a moment ago about the need for the A55 and the provision of employment prospects in Gwynedd in North-West Wales? Will my hon. Friend give an absolute assurance that there will not be any slippage from the dates given by my right hon. Friend and that every priority will be given to ensuring that that programme goes ahead?

We stick firmly to our target of completing the improvements by 1987 or 1988.

When we consider South Wales is there not a need to give the highest possible priority to the completion of the road scheme for Newport in order to ease traffic congestion in residential areas, to ensure that freight can be moved efficiently and to attract new enterprises to the town? Will the hon. Gentleman's Department now provide the funds for this very necessary work?

These are county schemes and they will be given proper consideration.

asked the Secretary of State for Wales what is his latest information on the net income derived from sheep and beef rearing in Wales; and whether he will make a statement.

For the year ending February 1979, the farm management survey for Wales shows an average net income of £7,686 for hill and upland farms concentrating on sheep rearing, £7,835 for hill and upland farms with mixed cattle and sheep enterprises, and £4,855 for lowland mixed cattle and sheep farms. The survey results for 1979–80 are likely to show a reduction in net income mainly because of lower returns from the sheep sector.

Since we are facing a reduction in income in the most recent year obviously my right hon. Friend will pin his hopes largely on a successful European settlement. May we also expect that he will be closely monitoring the clear squeeze between inflation on the one hand and the reduced revenue being experienced, particularly, by sheep and beef breeders?

It would, of course, be wrong for me to anticipate the statement to be made by my right hon. Friend later today. I can say that if the agreement reached by the Agriculture Ministers were agreed by the European Governments collectively it would be of considerable benefit to both sheep and cattle breeders in Wales.

Can the Secretary of State give an assurance to the sheep farmers of Merioneth, and throughout Wales, that the present system of income support for the sheep industry will not be sold out in any European deal and that the traditional form of the guaranteed price which has served the sheep industry so well will be maintained?

I do not wish to anticipate the statement that will be made in the House this afternoon. However, I think that from what the hon. Gentleman has seen of the agreement among the Agriculture Ministers he will understand that that agreement could be of considerable benefit to Welsh sheep producers.

Can the Secretary of State give some idea of the progress being made in the survey of marginal land and give an assurance that the survey will not be held up by any reduction of staff in the agricultural department of the Welsh Office?

On the contrary, by transforming the capital grant arrangement we are making the staff available to proceed with the survey. But it is a complicated matter, particularly in England, where the ground is not distributed in so convenient a form as in Wales around the hill line and the survey will take considerable time. However, we are undertaking a number of pilot schemes on the Welsh border to see whether certain methods can be adopted which will speed up the whole survey.

asked the Secretary of State for Wales if he will take steps to allocate more funds for the provision of industrial sites in Newport, Gwent.

On 4 February I announced a special allocation of £48 million over the next two years for industrial development work in the broad areas of Port Talbot and Newport. It is not possible to allocate further additional funds.

Does the Secretary of State appreciate that the development of new sites in Newport is imperative if the town is to withstand the massive loss of jobs caused by steel closures? Does the right hon. Gentleman also appreciate that it is vitally necessary to attract new industry to the area, not only for Newport itself, but for the whole of South-East Wales? Will the Secretary of State at least give a bit of hope to the people there in these dismal times?

As the hon. Gentleman is aware, we have announced a major programme covering the whole of South-East Wales. I am glad that he referred to it in those terms because the development that we have announced at Cwmbran is relevant. There are about 100 acres being acquired and developed immediately in Newport and almost 200,000 sq ft of factory space is being developed in the Newport area by the WDA under this programme.

As well as recognising the particular needs of Newport will my right hon. Friend also press on with the search for industrial sites in the great region of Blaenau-Gwent?

Order. That is a separate question altogether. It should be on the Order Paper.

Does the Secretary of State recollect that it is now a full six months since I and some of my hon. Friends met him and the Secretary of State for Industry to ask for an upgrading of assisted area status as a result of possible redundancies at Margam and Llanwern——

Order. The same ruling applies to the right hon. Gentleman. This question deals with industrial sites at Newport, Gwent. If there is a question about Margam, it should be on the Order Paper.

On a point of order, Mr. Speaker. May I make the point that the industrial sites at Newport are highly relevant because I am talking about the link between Margam and Llanwern?

Order. The right hon. Gentleman is wrong. My interpretation is that this is Newport, Gwent. Margam is a separate question and must be put down on the Order Paper.

Llanwern is not.

The right hon. Gentleman did not say Llanwern; he said Margam.

Further to that point of order, Mr. Speaker——

Order. I am not taking points of order during Question Time. I shall take points of order afterwards.

asked the Secretary of State for Wales if he will take steps to protect householders in Wales from high levels of water rates.

I regard it as one of my duties to see that water charges in Wales are no higher than is necessary.

Is the Minister aware that the average equated rate poundage for domestic properties in Wales was 25.3p in the pound for this year compared with only 13.2p in the pound for the United Kingdom and only 8.7p in the pound for the Thames area? These figures will get substantially worse when the equalisation provisions are abandoned next year. Will not the Government think again about this and ensure that there is fair play for Welsh ratepayers over water?

I need hardly remind the hon. Gentleman that the Welsh ratepayer is particularly favoured because Wales receives domestic support to the tune of 36p in the pound compared with the 18p support that the English receive. That cannot be disregarded. In the last three years the Welsh water authority's charges have increased by 26 per cent. compared with an increase of 43 per cent. in the retail price index.

The Minister says that he is endeavouring to ensure that water charges are no higher than necessary. How can he reconcile that with the Government's declared intention to abandon the Water Charges Equalisation Act which is worth £3 million to domestic water consumers in Wales? When that Act is abolished, does he accept that Welsh domestic water consumers will have to find the extra £3 million, and that the gap between water charges in Wales and those in England will rise by about 44 per cent.? Does he accept that that is outrageous behaviour towards Welsh water consumers?

The Act is of diminishing value for Wales. We have made an announcement about it and we have set up an inter-departmental committee to consider water charges equalisation. We are giving it urgent consideration. No decisions have yet been taken. The committee is made up of officials.

asked the Secretary of State for Wales what recent representations he has received in connection with his policy on the future of the Welsh language.

We have received 10 specific representations. In addition, I have heard much favourable comment on my right hon. Friend's statement on policy for the Welsh language in his speech at Llanrwst on 15 April.

I am grateful to my hon. Friend for that reply. Will he confirm that Government expenditure on the Welsh language next year will be about three times that spent last year? Does he agree that that is a remarkable achievement in view of the financial constraints, underlining the Government's commitment to the Welsh language?

My hon. Friend is right, it does indeed underline the Government's commitment to the Welsh language. The resources being devoted to the language are to be trebled. The £1. million that will be spent next year does not include expenditure on such items as the £245,000 to be spent on bilingual road signs.

Does the Minister accept that one speech does not amount to a policy? Does he accept that neither his Government nor the Labour Government have had a coherent policy towards the development and increase in use of the Welsh language in administration and public life in Wales? Does the Minister accept that it was a mistake for his Government to withdraw the services of the Council for the Welsh Language and to replace it with nothing?

I disagree strongly with the hon. Gentleman. Everybody in Wales will agree that my right hon. Friend's speech was a clear statement of policy. It has been much appreciated in Wales on that account. My right hon. Friend spoke about the Council for the Welsh Language. We do not want to set up another expensive quango. A unit in the Welsh Office is capable of dealing efficiently with the anticipated expenditure. We certainly do not lack advice from Wales on the way in which the money should be spent.

Are not the problems of the language developing so rapidly that the Minister will have to be even more generous? Does he accept that the blitz that the Government have mounted against council house building, particularly in North-West Wales, militates against the development of the Welsh language?

That is a separate question. We have taken precautions in the Housing Bill to ensure that the viability of rural communities is protected within our policy of selling council houses. The building, improvement and rehabilitation of council houses and spending of housing allocations is a matter for the local authorities.

Does my hon. Friend agree that successive Governments can take pride in the positive steps that they have taken to aid the Welsh language? Does he agree that a considerable onus is placed upon parents and others to take advantage of the Government's generous assistance?

I agree. It is fair to say that my right hon. Friend's speech and statement of policy give every possible encouragement to voluntary bodies which are dedicating themselves to the promotion of the Welsh language as a living tongue.

What representations have the Government had about the abandonment of their election commitment that the fourth channel should be allocated to the Welsh language, since that was universally approved by the Welsh people? Will the Minister make a statement about the future?

I cannot say precisely how many representations we have received, but there have been remarkably few. We believe that the Government's plans for transmitting Welsh language programmes on BBC and ITV, as opposed to a single channel, offers a safer and more secure future for Welsh language programming on television.

asked the Secretary of State for Wales what response he has received to the specific provision in the Education Act for the extra cost of bilingual education in Wales.

This provision has been very widely welcomed. The necessary regulations will shortly be laid before the House and a circular explaining the operation of the scheme will be issued. In advance of this several bodies have already applied for assistance.

Is my hon. Friend aware that the enshrinement of the specific provision for the extra cost of bilingual education for the first time in history will be of great assistance to the education authorities which have to bear the extra cost? What provision is being made to encourage adults who do not speak the Welsh language to learn it?

I am grateful to my hon. Friend. A number of inquiries have been made about adult education. We hope to announce the distribution of resources for the present year in the early autumn.

Does the Minister accept that in areas such as Gwynedd Welsh language education cannot be regarded as something which will cost a few hundred thousand pounds on the side? Does he accept that such expenditure is the mainstream of the education budget? Will the Minister assure the House that, when rate support grant is calculated for areas such as Gwynedd, that will be taken into account?

A detailed study of a joint Welsh Office and local government working party shows that there are almost insuperable differences in the way of building a factor for bilingualism into the rate support grant arrangements, even when RSG is administered separately for Wales.

asked the Secretary of State for Wales what is his estimate of the success of the assisted places scheme in schools in Wales.

I have every confidence that the scheme will prove successful when it is introduced.

How many nursery places could be made available for the £750,000 being spent on the assisted places scheme?

In the year 1981–82, £100,000 will be spent on the scheme, not £750,000.

Does the Minister realise that it is unacceptable to Welsh parents that the Government should go ahead with the scheme and waste money in that way while the Secretary of State for Education is calling on parents to provide school books for the State system?

The last Government closed the direct grant schools in Wales and the rest of the United Kingdom. Many parents regarded those schools as important. They will welcome the scheme.

Is it not extraordinary that Labour Members should try to discriminate against bright children from poor families and prevent them from having the opportunity of a better education? Does not that prove that it is the Conservative Party that really cares about the people who are least able to spend money on education but who deserve a good education?

I am grateful to my hon. Friend. When the scheme is working people will recognise that it makes an important contribution.

asked the Secretary of State for Wales when last he discussed with the chairman of the National Coal Board the problems facing the South Wales coal industry.

asked the Secretary of State for Wales if he has discussed with the area director of the National Coal Board in Wales the effect of the British Steel Corporation closures at Shot-ton, Llanwern and Port Talbot on the South Wales coal industry.

My last formal meeting was with the area director, National Coal Board, South Wales, on 27 February. I have met the chairman of the NCB and the area director informally on a number of occasions. I have discussed with them the effects of BSC's plans upon the South Wales coal industry.

Does the Secretary of State recall that the Government's election manifesto promised the modernisation of the coal industry in South Wales? Is he aware that the Government's actions in driving the British steel corporation into importing foreign coal are inevitably forcing the National Coal Board to consider pit closures? How does he reconcile these two factors when it is already known that 12 pits have been named in the general colliery review and that one, Lewis-Merthyr, in my constituency, has been named for closure?

The right hon. Gentleman will be aware that there is a massive investment programme for the National Coal Board and that the board has reached agreement with the British Steel Corporation about imports of coal for the current year. The corporation is not being forced into an agreement on imports of coal. The industry believes that it is essential, in the interests of future prosperity and viability, that it gets coal from abroad at a competitive rate.

Will not the right hon. Gentleman agree that Wales takes the brunt of the steel cuts with the closure of Shotton and partial closures at Llanwern and Port Talbot, which will have a serious effect on the coal industry in Wales? How many pits does the right hon. Gentleman calculate will be closed? What action is he taking to get investment in the Phurnacite plant at Aberaman, another investment that could come to Wales?

The rundown of the British Steel Corporation's business in Wales will clearly have an effect on the coal industry in Wales, although there are other issues that have to be considered. The South Wales area director has recently given figures to the trade unions of the pits affected. The right hon. Member for Rhondda (Mr. Jones) has referred to them. I have nothing to add to what the Coal Board has said.

Is it not a fact that, if resources can be concentrated on pits where the geology is favourable, there can be many excellent, secure jobs in the coal industry in Wales for many years to come?

Mr. Weekes has pointed out that if some of the heavy loss-making pits and those with the worst geological difficulties were to be closed over a period of years, there would be a viable coal industry in Wales with a strong future. I believe that he gave evidence to that effect to the Select Committee recently.

asked the Secretary of state for Wales what recent discussions he has had with the chairman of the British Steel Corporation about the effects on employment in Wales arising from steel closures.

I have had formal meetings with the chairman on six occasions in the past year, most recently on 26 May, and have had a number of other conversations with him about BSC's plans.

Is the right hon. Gentleman aware of the feelings of apprehension that have been generated in Wales about additional unemployment arising from the statement by the chairman-designate of the British Steel Corporation in Wales last week? Will the right hon. Gentleman say whether he was given any advance warning or notice of what the chairman-designate was going to say? If not, since he is the Minister responsible for unemployment in Wales, will the right hon. Gentleman summon this gentleman to explain more fully what he said, so that hon. Members can, in turn, question the right hon. Gentleman about this statement?

I met the chairman-designate on his recent visit to Wales. He made clear to me—he is not yet in the chair—that he has taken no decisions about the future of the industry in Wales. He was asked at a press conference whether he could slow down the present closure programme. He pointed out that the situation in the steel industry on a world-wide basis had deteriorated since the original plans were made and that everyone would have to fight like fury to defend the present position, let alone slow it down and reduce the numbers involved.

Will my right hon. Friend agree that, although it is true that pressure on the steel industry from outside factors is even more intense than was thought, the programme of closures originally proposed none the less bore signs of hasty panic measures? Might it not be possible to achieve an equally slim-line steel industry by more carefully thought-out measures, if only the corporation was given extra time?

The chairman-designate made clear to me that he does not believe that time is on his side. He is operating in a world-wide market. He spent a good deal of time telling me about the world-wide conditions as he sees them. If the agreements at Llanwern and Port Talbot are concluded, we have perhaps, a basis for future operations in Wales on which we should seek to build.

Does not the right hon. Gentleman agree that, even without Mr. MacGregor, unemployment in Wales has reached calamitous proportions and that the policies of the Government seem to be leading to an even deeper recession? Is the right hon. Gentleman now prepared to make a statement about possible special development area status for steel areas, particularly those that have been most affected?

That issue does not directly arise from my conversations with the chairman of the British Steel Corporation. I can say that as soon as the Llanwern agreement is concluded—I understand that not all the unions have yet agreed—the Government will—indeed we are doing so now—urgently consider granting special development and development area status to the places affected and will make an announcement as soon as possible.

My right hon. Friend's remarks will be welcomed as a prospect for building in the future if the demand for steel should increase. Will he assure the House that he intends to continue to have frequent meetings with the chairman of the British Steel Corporation to ensure that the cutbacks now being achieved will not be so trenchant as to prevent any worthwhile expansion should the opportunity arise in the future?

The chairman-designate emphasised to me the importance of trying to seek fresh markets for the British Steel Corporation. He spent part of his conversations with me discussing ways in which that might be achieved.

Has the right hon. Gentleman any information about bids by Lonrho and others for the remainder of the BSC Shotton works? Will he be consulted?

I have no firm information about the inquiries made. At present I have no reason to think that a firm proposal is before the British Steel Corporation that is likely to lead to a deal being announced.

In view of the answer that the Secretary of State have to my hon.[...]port (Mr. Hughes) will he confirm that a full six months have elapsed since he met my hon. Friends and I to discuss possible pending steel redundancies in South Wales and the question of assisted area status? Will he assure the House that those six months have been used constructively in getting contingency clearance from Brussels for enhanced assisted area status?

In view of the time available to consider his response, will the right hon. Gentleman promise that there will be an immediate announcement—I mean, by that, during this parliamentary week—of the Government's intentions for these areas? Will he bear in mind that Wales expects full special development area status for all areas in which people travel to work at Margam and Llanwern?

We made clear at that meeting that we would not take a decision, or make an announcement, until final agreement had been reached at Llanwern and Port Talbot. I understand that final agreement has not yet been reached at Llanwern, although I am hopeful that it will be reached in the near future. We are in touch with the Community. We shall be taking a decision as a matter of urgency.

asked the Secretary of State for Wales what reduction he expects in local government employment in Wales in each of the next three years.

Over the next three years, all local authorities will need to reduce their manpower to achieve the level of expenditure which the Government consider acceptable. It is the responsibility of individual local authorities to examine critically their manpower levels and, in the light of their particular needs and circumstances, to make the necessary reductions.

Does the Minister remember those advertisements during the last election campaign—" Labour isn't working "—involving some paid actors and a long queue of "unemployed"? What does he now say about the unemployment figures in Wales that are being added to directly by the Government leaning on local authorities? In this [...] Steel Corporation, the Government cannot shuffle off their responsibilities for increasing unemployment in Wales

The hon. Gentleman is not right in thinking that local authorities have yet played their part in the reduction of public expenditure. Between December 1978 and December 1979, the reduction in manpower in local authorities in Wales was 0.2 per cent., compared with 5 per cent., between May 1979 and May 1980, in the Welsh Office. It is essential that local government plays its part in reducing public expenditure so that we may decrease interest rates and increase employment.

Does not my hon. Friend agree that it is most important that the taxation burden on the public should be reduced by cutting the number of public employees? Does not my hon. Friend deplore the fact that the worst trends among Welsh local authorities have been with authorities which have large Labour majorities?

My hon. Friend is right. His authority of Powys has reduced its manpower by about 3.4 per cent. The Local Government, Planning and Land (No. 2) Bill will require key information, including manpower statistics, to be provided by local authorities. Councillors and ratepayers will then be able to form better judgments.

Does the Minister recall the words that appeared in the North Wales Weekly News of 19 April 1979: Vote Wyn Roberts for more jobs "? Where are they?

If local government follows our policy of reducing public expenditure there is a chance of our reducing interest rates and then of creating truly productive jobs.

Does not the Minister agree that local authorities are in a better position than central Government to judge the needs of their areas? Therefore, should not decisions on manning levels, expenditure and services provided be left largely to the local authorities?

I think that local authorities can be assisted considerably by the publication of their manpower statistics. The fact that central Government have been able to reduce their manpower by wastage and increased efficiency means that local authorities could make similar reductions in their manpower levels which currently stand at a record high.

asked the Secretary of State for Industry what is his most recent estimate of the effect of interest rates on manufacturing industry.

I am unable to give any estimate of the effect of interest rates on manufacturing industry because the relationship between the two depends on many uncertain factors.

Did the Under-Secretary see the reports in the weekend press indicating a severe drop in the liquidity of manufacturing companies? Is he aware of the large number of companies, particularly the smaller ones, which are now facing bankruptcy, mostly because of the high rates of interest? Will the right hon. Gentleman press upon his colleagues the need to reconsider the question of interest rates in order to try to bail these companies out before they all go to the wall?

I am aware of the factors that the hon. Gentleman describes, but a premature move on interest rates would be at the expense of curbing inflation, and that still has to be the prime target.

Is my hon. Friend aware that throughout the country manufacturing industry is squealing with pain under the pressure of these high interest rates? Is he further aware that business men are looking to the Department of Industry to fight their corner for them against some of the other pressures that come from the Treasury?

I take note of my hon. Friend's point. In respect of investment and stockbuilding the problem he describes is real. However, premature movement would be at the cost of beating inflation.

Does not the nder-Secretary recognise that the combination of high interest rates, a high sterling rate and high inflation is presenting many manufacturing companies with a liquidity problem such as they have never faced before? Will he explain how the Chief Secretary, when in opposition, was able to describe the lower rates of interest then prevailing as usury and to claim that they would destroy jobs in manufacturing industry, and why he is unable to tell us today the effects of the current higher rates of interest upon industry?

In his comparisons the right hon. Gentleman should bear in mind that the Government of whom he was a member did not give these facts. There are many imponderables. If the right hon. Gentleman wishes to pursue the matter he may well wish to follow the advice that he gave as a Minister, which was to go to the House of Commons Library, put his input into the Treasury model available there, and see what conclusions he comes up with.

asked the Secretary of State for Trade what representations he has received from industry and commerce about the proposed EEC directive on liability for defective products; and if he will make a statement.

My Department has received over 300 replies from the organisations representing interested parties whom it invited to comment on the draft directive. My right hon. Friend the Minister for Consumer Affairs has also received a number of letters from hon. Members on both sides of the House enclosing correspondence which they have received from constituents about the directive. The Government will take full account of all the views which have been expressed before deciding their attitude to the draft directive.

Is my hon. Friend aware of the concern in industry and commerce that the directive could frustrate and curb product development and experimentation by saddling firms with a quite intolerable and unlimited liability? How many of the representations made have supported the directive, how many have been against, and what is the Government's attitude to the directive? Have we the power to stop it if we want?

I note the points made by my hon. Friend. It may help if I summarise the effect of the replies which have been received. The consumer movement welcomes the directive and accepts that prices would be increased as a result of it. The British insurance industry believes that it can provide cover, and that the cost of insurance is unlikely to have any significant effect on production costs. Many manufacturers, however, are anxious about the costs involved and urge that if we accept a system of strict liability we should provide a "state of the art" or "development risks" defence.

This defective directive has been going about for a very long time in one form or another. There is also the report of the Pearson commission on the same subject. When may we expect the Government to make up their minds on the subject?

My hon. and learned Friend is right to say that this directive has received a good deal of attention. Of course, the version now being considered by the working party of the Council of Ministers is a revised draft. In view of all the representations which have been taken, the Government have reserved their position with regard to their attitude towards the draft until the text of the directive is more clear.

asked the Secretary of State for the Environment how many deer were killed or injured in Richmond Park through motor accidents in monthly total, covering the last 12 months during the years 1970 to 1979; and what action he is taking or intends to take in order to reduce the death toll.

A total of 56 deer were killed or injured in traffic accidents in Richmond Park in the year ending May 1980, compared with 27 in the previous year.

With permission, I will circulate some further statistics in the Official Report .

In autumn last year the Department displayed notices in the park, and increased the number of police mobile patrols. Wildlife warning reflectors have been installed, and accidents have since declined. We are keeping the situation under close review.

We appreciate very much the efforts that my hon. Friend and his Department are making to deal with this massacre of deer in Richmond Park. Will he give an assurance that during the summer months he will consult widely to make certain that next winter yet further steps are taken to ensure that this damaging reduction in the numbers of the herd does not continue?

I thank my hon. Friend for the keen interest and wise advice that he has given my Department over the last year. The important point about next winter is that the Petersham Road should be open from October this year and therefore the pressure on the park in the evenings should be reduced. However, I shall of course continue to take all possible steps and hold consultations between now and the winter.

Is my hon. Friend aware that in my constituency concern is not for the deer but for my constituents who have been killed as a result of the escape of Nilgai Indian deer from zoo parks in my constituency

I know of the case referred to by my hon. Friend, and a very sad event it was. However, I have written to my hon. Friend and he has received advice from his chief constable. He knows the limited steps that can be taken.

Following are the statistics :

THE FOLLOWING TABLE SHOWS THE NUMBERS OF ROAD TRAFFIC ACCIDENTS INVOLVING DEATH OR INJURY TO DEER IN RICHMOND PARK

asked the Chancellor of the Duchy of Lancaster what is the current credit balance of the national heritage fund.

The sum of £12.4 million was credited to the national heritage memorial fund on 24 April, £6.2 million from the Vote of the Office of Arts and Libraries and £6.2 million from that of the Department of the Environment. The fund is administered by independent trustees, and it is for them to decide how they invest the fund and what disbursements they make from it.

Does the Chancellor of the Duchy of Lancaster accept that, despite his answer, the well-being of the fund depends to a substantial extent on the good will of the Government? Will he assure the House that the Government will look sympathetically at claims for extraordinary acquisitions as and when they arise?

I assure the hon. Gentleman that the Government are extremely sympathetic to this fund, and to the work it is doing. This Government set up the fund during their first Session. It would be inappropriate for any Minister, either myself or the Secretary of State for the Environment, to attempt to interfere with the decisions of the trustees, because as the hon. Gentleman will recognise, it is the will of the House that these trustees should be completely independent of Government.

While I personally doubt the sufficiency of the moneys for the long-term purposes of the fund, would not the right hon. Gentleman agree that there are sufficient moneys available to save the Whistlers in the Glasgow university collection, once the Prime Minister makes up her tardy mind about the appointment of the Scottish trustee on the board?

First, may I say that the Prime Minister has given her consistent and full support to the setting-up of this fund, and she has been much quicker in this respect than the Government in whom, unfortunately, the hon. Gentleman was not included.

We shall rectify that.

Secondly, with regard to the question of the Whistlers at Glasgow university I understand that an application has been made to the fund, and that is a matter for the trustees.

asked the Chancellor of the Duchy of Lancaster what representations he has received in response to his consultation paper on the public lending right; and if he will make a statement.

I have received comments from over 60 interested representative organisations and individuals. As a result, a number of changes in our original proposals are being considered. I am having further meetings with some of the main organisations, and others are taking place at official level. I hope to be able to lay a scheme before the House early in the next Session.

My right hon. Friend's statement will be widely welcomed by local authorities, authors and libraries. Will he say a little more about the nature of the changes, and the provisional view formed by the Government in the light of the comments in the consultative document? In particular, will he say whether the danger of authors resident overseas—in countries where there is no reciprocal arrangement—sweeping a large proportion of the pool has been coped with?

We have received 62 sets of comments from local authorities, local library authorities, authors, publishers, librarians and their representative organisations. We are considering all those submissions carefully. With regard to foreign authors, I am sympathetic to the view that PLR should extend only to the books of those authors who live and work in this country. There are difficulties in defining that legally, and my Department is examining the matter.

Will the right hon. Gentleman give an undertaking that he will not present a public lending right scheme to the House until he has personally taken into account the detailed and reasoned representations of those who know a great deal more about these matters than he does, or even I do?

I can certainly assure the hon. Gentleman that all representations on this matter are personally considered by me. I claim no monopoly of knowledge is this respect, although I have taken an interest in the matter for many years. If I undertook to take into account the representations of all the people who have more knowledge that the hon. Gentleman, the coming into operation of PLR would be indefinitely delayed.

asked the Chancellor of the Duchy of Lancaster what administrative expense he anticipates during the current financial year in respect of the operation of public lending right provisions.

There is provision for £100,000 in the Estimates for the current financial year towards the cost of setting up the PLR scheme, which is planned to come into full operation during 1982–83. In the course of our preparatory work we have succeeded in nearly halving the previous estimates for the administrative running costs of the scheme, and we shall be looking for further savings.

Does my right hon. Friend agree that the latest official estimate was that it would cost £400,000 to set up the scheme, and £600,000 a year to administer it? Does it not, therefore, amount to a job creation scheme for administrators? If it should be necessary to delay the scheme, may I assure my right hon. Friend that he will be forgiven by many people?

Since I have managed to reduce the initial cost of the scheme to £100,000, and since the annual running cost of the scheme will be reduced from approximately £600,000 to half that sum, I feel that I am more deserving of congratulation than forgiveness from my hon. Friend. We hope, under the revised scheme that has been produced by my Office, that annual administrative costs in most years will represent between 13 and 16 per cent. of the sum available in the central fund. That is half the earlier estimate, but I shall try to find further means of reducing the cost. This scheme is intended to benefit authors, not bureaucrats.

Is the Minister trying to tell the House that one of the difficulties in trying to implement this scheme is that the Government cannot find the necessary definition of authors living and working in this country? In view of all the statements that were made prior to the general election about the wonderful way in which the Tories would encourage such people to flood back to this country as a result of tax cuts, why are they not back here?

We are making available for the financing of public lending right the same sum of money as did the previous Government, who were intermittently supported by the hon. Gentleman. That sum of money will be revalued to take account of inflation and other matters. We are keeping faith with the pledges that we made at the time of the general election. I am delighted that this scheme is coming into operation with the support of hon. Members on both sides of the House.

asked the Chancellor of the Duchy of Lancaster if he will make a statement on the progress made by the national heritage trustees in finding appropriate headquarters in a building worthy of restoration.

The choice of headquarters of the national heritage memorial fund is a matter for the trustees themselves. I understand that the trustees are actively seeking accommodation and that they are aware of the point made by the hon. Gentleman when he raised this issue on 21 April.

If the cost of the headquarters does not come out of the £12.4 million, surely the Government have some say in the matter. Do the Government accept the criteria that the headquarters should be in a building that is worthy of restoration, and that the trustees should set an example?

I am sure that the hon. Gentleman is a sufficiently powerful advocate for me not to have to act as a messenger boy on this occasion. I am certain that the trustees will be more than aware of his point. I hope the theme that he echoed will be acknowledged by the trustees. He has made an important point, and I hope that the trustees will acknowledge it, and reflect upon it in the fullness of time.

Will my hon. Friend assure the House that in no circumstances will the trustees be given permission-even if they should request it—to base their headquarters in that appalling building in Marsham Street?

I am always happy to try to given an assurance, but I am sure the House will recognise that I do not have the authority or autonomy to give such an assurance in this case. I hope that the hon. Gentleman's point will be acknowledged and echoed by the trustees when they make their decision.

asked the Chancellor of the Duchy of Lancaster what is the proportion of the Government's support for the arts in Wales which is specifically allocated to activities that sustain the Welsh language.

Central Government support for the arts in Wales is administered by the Welsh Arts Council. It distributes its grants on the basis of the artistic needs and merits of the activities it supports, as distinct from the language content, although many of these activities will sustain the Welsh language. My right hon. Friend the Secretary of State for Wales disburses Government funds specifically to foster the Welsh language, principally through the education budget for Wales.

Will the Government nevertheless bear in mind that the Welsh language is the most distinctive part of the entire heritage of Wales and that, accordingly, special attention to the needs of the language is called for?

The request made by my hon. Friend has been acknowledged in two pieces of legislation in the past 12 months—the Education Act and the Broadcasting Bill. The points that he has made will be acknowledged by my right hon. Friend the Secretary of State for Wales.

On a point of order, Mr. Speaker. I wonder whether you have had any representations from the Prime Minister in regard to this statement, in view of the fact that she was closely involved in this matter both at Dublin and at the following summit, when she made claims to get rid of the whole of the burden with which we are now saddled in payment to the Common Market, and as she said that that package would not in any way be involved with any other commitment. It now appears that we are to be subjected to an increase of 5 per cent. on farm prices and that she has sent this lackey along to do her job.

Order. The answer is that I have not received any representations, except that the Lord Privy Seal is to make a statement.

With permission, I will make a statement on the meeting of the Foreign Affairs Council that my noble Friend the Foreign and Commonwealth Secretary and I attended in Brussels on 29 and 30 May. My right hon. Friend the Minister for Agriculture, Fisheries and Food, will make a statement on the Agriculture Council, which took place at the same time, both councils were the culmination of a long and complex negotiation which the Government began shortly after taking office last year, on the size of the United Kingdom contribution to the European Community Budget.

The Foreign Affairs Council, in which work continued throughout the night of 29–30 May, reached provisional agreement on a number of issues, as did the Agriculture Council, which was meeting in parallel. After a meeting of the Cabinet today, the Government have informed the Italian Presidency that we accept the proposals that emerged from both councils.

I should like at the outset to offer unstinted praise to Signor Colombo, the Italian President of the Council, for his outstanding chairmanship. His skill played a vital part in the work that was done.

At the Foreign Affairs Council on 29 May, the following arrangements were proposed to alleviate the United Kingdom's budget problem. The first element in the solution is the following formula for 1980, provided our net contribution, before the risk-sharing formula is applied, does not exceed £1,080 million, there will be a ceiling on our net contribution after adjustment of £370 million; for 1981, provided our net contribution, before the formula is applied, does not exceed £1,300, the ceiling will be £440 million. All these sterling figures are converted at a rate of 1.65 units of account to the pound. This would result in a total rebate to Britain over the two-year period of £1,570 million.

A further element of the solution is a risk-sharing formula. Should the amounts of the United Kingdom's uncorrected net contributions in 1980 and 1981, as estimated by the Commission, in fact be exceeded, the arrangement is that in 1980 we will bear only one-quarter of the cost of this excess. For 1981, a more complex formula exists, under which we would meet the first £12 million of any excess, the next £60 million would be shared between us and our partners equally, and thereafter we would meet only a quarter of the excess cost, as in 1980.

For 1982, it was envisaged that by this time the Council would have completed a radical review of the pattern of Community expenditure and the operation of the budget. However, if that had not by 1982 produced arrangements resolving the United Kingdom's budget problem, the Commission would put forward proposals along the lines of the 1980 and 1981 solutions and the Council would act accordingly. We can therefore be sure that for 1982 as well there will be similar restrictions on the level of the United Kingdom's net contribution.

The payment of these amounts to Britain will be brought about by improvements in the operation of the 1975 financial mechanism, bringing our gross contribution more or less into line with our share of Community GNP and, for the rest, through Community expenditure in the United Kingdom. There will be a new regulation under article 235 of the Treaty to provide for this expenditure.

Following the precedent of the financial mechanism, the credits under the new regulation will appear in the Community budget for the following year, but with the possibility of advance payments in the current year. For 1980, we would expect to be paid before the end of our financial year 1980–81.

In the long term, the most important part of the package is the commitment of the Council to review the development of Community policies and the operation of the budget. This, together with the restraints imposed by the 1 per cent. ceiling, will enable us to press for lasting reforms, which will, among other things, resolve the British budgetary problem. This review offers an opportunity that has never been available before, since we joined the Community, to work together with our partners for financial arrangements and Community policies that are to the advantage and interest of all the member States, as befits a Community of equals.

We agreed to a statement of general principles on fisheries, which leaves the substantive issues open for consideration on their merits in the Fisheries Council, which will next meet on 16 June. A deadline of 31 December 1980 has been fixed for agreement on a revised CFP. This is in the United Kingdom's interest. Her Majesty's Government have repeatedly urged rapid progress towards a satisfactory common fisheries policy settlement. I welcome the fact that the fisheries text recognises the need for this and for a settlement of all the outstanding elements of the CFP together. It in no way prejudices the vital interests of our fishermen, which we are determined to safeguard.

When my right hon. Friend the Prime Minister refused the offer that our partners made at Luxembourg, she made it clear that this was because the combination of amount and duration was not right. We have now negotiated better arrangements for the two years 1980 and 1981, taken together, than were on offer then, and we have also secured an arrangement for the third year, 1982, which was refused to us then. Furthermore, the Community has recognised that there will have to be a major review of the operation of the budget and the balance of Community expenditure and that the United Kingdom's budget problem must be resolved finally.

As my right hon. Friend the Prime Minister made clear after Luxembourg, we also refused what was on offer then because we were being asked to accept agreements outside the field of the budget which were damaging to us. Since then, as my right hon. Friend the Minister of Agriculture, Fisheries and Food will make clear in his report on sheepmeat and CAP prices and related measures, we have secured changes in what was being suggested that give us substantial advantages. Taking the balance of these proposals together, the Government believe that they add up to a fair and advantageous outcome.

In a negotiation as complex as this, no one party can expect to get everything that he wants and to concede nothing. There should be no belittling of the concessions that our partners are making at a time when, whatever the impact on them of the Community budget, the general economic background is unfavourable. With this arrangement Britain can play her part in developing further the internal and external policies of the Community.

The negotiation has, morever, focused the minds of all member States on the unsatisfactory way in which the Community budget operates and, more clearly than ever, on the undesirable imbalance in the pattern of Community expenditure. With the review commissioned for 1981 and the proximity of the 1 per cent VAT ceiling, we have an unrivalled opportunity to bring about sensible adjustments to the operation of the CAP and to put the Community's finances on a sounder basis than ever before.

This Government came to office determined to make a success of our membership of the Community. The first task was to deal with the inequitable budget contribution. That we have now done. But Europe is about more than that. The challenges that face the Community both internally and externally are as daunting as any in its relatively brief history. None of us can find adequate solutions to them on our own. This agreement gives us the chance to solve them together.

On a point of order, Mr. Speaker. The Lord Privy Seal acknowledged that to judge his statement we must balance it with the statement of the Minister for Agriculture, Fisheries and Food. In order to know the price of the concessions that he has announced, we must know the prices that we shall have to pay on the food bill. Would it not be possible for the Minister for Agriculture, Fisheries and Food to make his statement now, so that we can question both Ministers together?

That would be against our custom. When a statement has been made, the Minister usually submits himself for questions.

The Lord Privy Seal made much of the fact that for 1980 and 1981—and perhaps for 1982—we will be permitted to keep back more of our own money—two-thirds of our own loaf—and thus become only the second largest net contributor to the EEC. Is he so insensitive that he cannot understand that a settlement that will further increase the price of butter, milk, sugar, meat and cereals for every family in the land; that will limit the export of New Zealand lamb to Britain and face that country with competition in third markets from subsidised French lamb exports; that will increase still more the huge financial cost and swelling food surplus of the CAP—which offers only a partial and temporary relief to the totally unjust budgetary contribution of the United Kingdom—will not be acceptable to the nation and will only intensify its already deep dissatisfaction with the EEC?

How can the Lord Privy Seal justify his retreat from the position of broad balance to an agreement to pay out no less than £1,500 million over the next three years to countries that are more prosperous than Britain, and for the sole purpose of increasing the already unmanageable food surplus? When will the Prime Minister cease playing Lady Bountiful to the Community—[ Interruption .] Those were her words. How can the Government justify the abandonment of their demands for a solution that would last as long as the problem, and substitute what amounts to a further three-year transitional period, at the end of which we shall still be left with a Treaty commitment to pay at least £1,500 million a year, or to endure the same haggle and confrontation that we have had over the past 12 months?

Above all, how can the Prime Minister agree to so wet a formula for the future—I quote from the official communiqué—to resolve the problem by means of structural changes when the next sentence in the communiqué explicitly re-endorses the basic principles of the CAP and the continuation of the bizarre tax system of Community own resources.

Is the Minister aware that with a little more nerve and persistence, by continuing our veto on price increases of foodstuffs already in surplus—which the Prime Minister assured the House as recently as 20 March, without qualification, that she would insist on, not to mention the statement in the Conservative Party's election manifesto to the same effect—and by backing the negotiating stance with legislation to halt the outflow of British money, the Prime Minister could have achieved what the whole House has twice resolved to achieve, namely, the elimination of our excess contribution and a fundamental and lasting change in the CAP?

We shall certainly wish to pursue the matter further. I hope that there will be an early debate.

The right hon. Gentleman's remarks this afternoon illustrate the disadvantages of instant comment. He loosed off on Friday before he knew what he was saying, and before he knew the full terms of the agreement. He is now compelled to make the same silly remarks this afternoon.

Why did the Lord Privy Seal keep the details to himself? Why did he not circulate them earlier?

Order. The hon. Gentleman must restrain himself. It is not fair to shout from a sedentary position.

On a point of order, Mr. Speaker. I apologise to you, but my emotions overcome me when I hear Ministers of the Crown complain, although they have not circulated certain statements earlier.

The right hon. Member for Stepney and Poplar (Mr. Shore) was, if I may use his words, insensitive to talk about food prices. Perhaps he would be interested to hear that over the coming year the total effect on food prices of the present settlement will be the same as the increase that took place in food prices every fortnight under the Labour Government.

The right hon. Gentleman mentioned certain commodities. Under the Labour Government, milk prices rose, on average, by 7.3 per cent. a year. Under our two years, net of co-responsibility levy, they have risen by 1.25 per cent. Under Labour, sugar prices rose by 8.5 per cent.; under the Conservatives, by 3 per cent. Under Labour, wine rose by 7.3 per cent.; and under the Conservatives, by 3.5 per cent. In those circumstances, the right hon. Gentleman would have been well advised to emulate the generosity shown in the remarks of the Leader of the Opposition when my right hon. Friend the Prime Minister returned from Luxembourg. He spoke in a different tone from that of the right hon. Gentleman this afternoon.

If the right hon. Gentleman complains in such terms about our achievements, we must reflect a little on what happened under the previous Labour Government. The Opposition party achieved absolutely nothing in seeking to reduce our budget contribution during the five years that it was in power. Its renegotiations were a complete waste of time. It wasted the opportunity that we gave it by our transitional arrangements. Yet the right hon. Gentleman has the effrontery to tell us to turn down a refund of £710 million this year and £860 million next year.

We have had a fine display of bogus indignation but not a single reply to any of the questions that I put to the right hon. Gentleman. I shall not repeat them all—[ Interruption .] I think that the House and the country would like to know why and, in particular, how, the right hon. Gentleman and his Government justify the total abandonment within weeks of the specific pledge to insist upon a price freeze on foodstuffs that were in surplus. That is the first thing that we want to know.

The second thing that we want to know is what is the right hon. Gentleman's justification, against the background of the words that have been spoken from the Government Front Bench about a totally unjustified system under which this country is being milked for the benefit of the EEC, for the continued net payment by Britain, as the second largest contributor, of no less than £1,500 million over the next three years.

I have already answered the second part of the right hon. Gentleman's question. As for the first part, perhaps I may quote his own leader to him.

Quote your own leader.

This is what the Leader of the Opposition said: I repeat very strongly that we shall support her in not giving way on the agricultural price freeze until the budgetary issue is settled."—[ Official Report , 29 April 1980; Vol. 983, c. 1154.]

Will the right hon. Gentleman accept from me that he has totally misconstrued the meaning of those words?

With great respect to the right hon. Gentleman, I find that sentence virtually impossible to construe in any other way, and I shall be interested to hear an alternative construction of what he said.

May I first congratulate Her Majesty's Government on the successful outcome of these negotiations, which have been conducted with skill and patience? Reverting to the observations of the right hon. Member for Stepney and Poplar (Mr. Shore), may I suggest—I ask my right hon. Friend to confirm this—that the truly wet formula was the formula negotiated by the Labour Government in Dublin in 1975, which is at the root of the present difficulties and has done so much to undermine the transitional arrangements?

I also express appreciation of the fact that now that the question of the budget has been settled and the farm price review has been agreed, British farmers will welcome the payment to them of a proper price for what they produce.

I am most grateful to my right hon. and learned Friend for what he said at the beginning of his question. Of course he is right to remind the House that we have farmers, too, and that they need proper returns. He is entirely right in what he says, in that the formula evolved in 1975 has proved to be virtually useless.

Is the right hon. Gentleman aware that however many pledges and prepared positions the Government abandon, there is in this country a deep and rising determination that we must be free, sooner or later, from the intolerable limitations placed upon our freedom of action by our membership of the EEC—[ Interruption .]—and that the statement that he has just made will prove to have been a step towards that end?

I think that that is extremely unlikely. Bearing in mind the right hon. Gentleman's previous views on the Common Market, I always live in hopes that he will return to them.

Is my right hon. Friend aware that the country generally will be delighted by the success of the Prime Minister and my noble Friend the Foreign Secretary in persuading the European Community to pay to this country during the next three years a sum in excess of £2,000 million? Is he aware that this agreement will be seen as yet another demonstration of the Prime Minister's extraordinary ability to make possible the seemingly impossible?

I entirely agree. This agreement is the culmination of negotiations carried out over a long period by my right hon. Friend the Prime Minister and my noble Friend. They have now been successful. It is unfortunate that so many Labour Members should appear to regret the successful outcome.

Does the right hon. Gentleman accept and agree that much credit for this settlement goes to our Community partners, not least the German Liberals—[ Interruption .]—in the very difficult political situation that they face? Does he agree that while confrontation may take us so far—I agree that it has done so—ultimately the success of the Community will depend on developing a spirit of co-operation? Will he assure the House that that will now be the priority of the British Government?

Of course, there can be no successful negotiations unless everyone taking part has played a useful part. As I tried to say earlier, no one party to the negotiations can claim everything for himself. As has already been said by our partners, the success of these negotiations has been a success for the Community as a whole. With respect to the hon. Gentleman, I do not accept the implication that we have been proceeding by confrontation. This was a very genuine difficulty and a grievance that needed to be settled, but we have not been proceeding by confrontation. I assure the hon. Gentleman, as I indicated in my statement, that our ambition and that of the rest of our Community partners is that the Community should prosper by the co-operation of all those concerned.

I congratulate my right hon. Friend on the budget package. Will he be a little more specific about certain issues concerning the fishing industry? For example, will British rights be preserved in the 50-mile zone, will the dumping of foreign fish below the cost of catching be ended, and will the British conservation values be maintained? Is he aware that these are very important matters to be resolved before a common fisheries policy is agreed?

I entirely agree that these are all extremely important matters to the fishing industry and to the country. However, my hon. Friend will be aware that they were not affected by the declaration agreed at Brussels, and they will be discussed in the Fisheries Council later this month.

Does the Lord Privy Seal agree that the agreement has not brought a broad balance; secondly, that in two years' time there will have to be another major renegotiation; and, thirdly, that in the meantime the CAP has been entrenched and not diminished?

The hon. Gentleman will have heard what I said about the future in 1981 and 1982. For the first time it has been agreed that there should be a fundamental restructuring of the Community budget. This will be enforced by the 1 per cent. ceiling, which will be hit somewhere around then. The new Commission has been enjoined to bring forward proposals to benefit the entire Community by restructuring the budget, which has been the fundamental aim of this country for some time before then.

What proportion of the estimated cost of £1,000 million a year that the accession of Portugal, Spain and Greece will bring to the Community does my right hon. Friend expect to fall upon the United Kingdom in addition to its present financial commitments under this agreement?

The figures for Greece are included in the figures that I have already given to the House. Spain and Portugal cannot accede to the Community before 1983, and therefore the consideration of their position will be included in the fundamental review to which I have referred.

Have not the German Government, particularly because of their domestic circumstances, made some remarkable concessions? Do Her Majesty's Government accept that there is a serious danger that the food price increases will fuel expectations in the current wage round, and that there will be a historic error, just as there was last June when the Government raised VAT?

I agree that the German Government have made concessions, as have all other Governments, including the British Government. The hon. Gentleman must get it right about food prices. The effect of the agreement on food prices will be small. It will increase the RPI by 0.15 per cent.

I congratulate my right hon. Friend on what has been achieved, but would it not have been better to stand out for a more permanent agreement, covering the difficult years from 1982 onwards? Will he say something about New Zealand, which is of great concern to many hon. Members on both sides of the House?

From one point of view it would be good to have a permanent agreement under which we paid nothing and everybody else paid us a great deal. I agree with my hon. Friend that it is possible to imagine a better agreement. I can assure him that in the present circumstances a better agreement was not open to us. As I said, I believe that the agreement that we have obtained is fair to all concerned. I have no doubt that my right hon. Friend the Minister of Agriculture, Fisheries and Food will be going into greater detail on New Zealand, but my hon. Friend will have noticed that the agreement fully safeguards New Zealand's interests.

Irrespective of the exchange of niceties across the Chamber on previous statements, does the right hon. Gentleman agree that the agreement is a retreat from the statements made by his right hon. Friend the Prime Minister that there would be no trade-off? There has been a trade-off. That is bound to have an effect on ordinary British people. They will have to pay higher prices for a range of products. Is it not clear that basically there has been a sell-out in reaching the agreement?

I have already told the House what the increase in prices will be. It will be an extremely small increase, namely, 0.15 per cent. on the RPI. The hon. Gentleman should remember that the agreement on sheepmeat is extremely advantageous to Britain. The external issues will help Britain.

Several Hon. Members rose ——

Order. The House knows that there is another statement to follow. I shall call three more bon. Members from each side of the House to ask questions on the statement that is now before us. When questions are asked on the following statement I shall bear in mind those who failed to catch my eye during questions on the present statement.