asked the Secretary of State for Defence which naval establishments in the Portsmouth area are still scheduled for closure over the next two years.

On present plans for the reorganisation of naval training establishments HMS "Phoenix" will be closed during 1984, but the training simulators and other practical damage control training facilities will be kept on their present site. As to the rundown of Portsmouth dockyard, I have nothing to add to the remarks of my right hon. Friend the Secretary of State for Defence during the recent debate on 1 July.

What are the current proposals for HMS "Vernon" and Lee-on-the-Solent? Will Lee-on-the-Solent be closed or will the base be retained? It is HMS "Vernon" in which I am most interested.

We shall look at the lessons of the Falkland Islands over the coming months and publish a White Paper before the end of the year to see whether any changes are necessary within our broad stategy. At the moment there is no intention to change the proposals relating to HMS "Vernon", and I should be somewhat surprised if there were any radical changes.

I appreciate the interest shown in my constituency, which is unnecessary on this occasion. Does my hon. Friend agree that the Portsmouth-Gosport area proved of unique value as a one-stop shop for the Royal Navy during the Falkland Islands crisis? It is the only place where repairs, munitions, victualling and personnel services are readily available. Will my hon. Friend decide about the future of Portsmouth dockyard as soon as possible and confirm its enhanced role instead of the reductions that were previously intended?

I pay tribute to my hon. Friend's efforts on behalf of his constituents and the interest that he takes in the future of naval establishments in the Portsmouth area. I agree with what he said about the work done by every establishment in Portsmouth to get the task force to sea. It is intended that Portsmouth will remain a naval operating and maintenance base. We have said that there will be no redundancies until at least 1 January. We shall do our best to introduce certainty as soon as we can. We cannot do that until we have assessed what is necessary.

The Government's defence policy is in such a mess that the Secretary of State has had to take a full page advertisement in The Times today to show that he still loves the Navy. As the Government have already changed their mind about HMS "Invincible", will they change their mind about the dockyards and stop the closures of Gibraltar and Chatham and the rundown of Portsmouth? Is the Minister aware that there is growing doubt in all sections of the House about the wisdom of the Government's policies?

We covered the future of Chatham and Gibraltar in previous debates, and I have nothing to add. I have just explained to my hon. Friend the Member for Gosport (Mr. Viggers) that we shall be assessing the future shape of Portsmouth over the coming months.

Does my hon. Friend agree that, given Portsmouth's increased work load, it should be possible to reach the desired figures for the labour force by voluntary redundancies only?

At present it is impossible to say whether that will be so. We want to keep redundancies to a minimum and have as many voluntary redundancies as possible. I pay tribute also to my hon. Friend the Member for Portsmouth, North (Mr. Griffiths) for the work that he has done on behalf of his constituency.

Mr. Hooley to ask question No. 2.

No. 2, Sir.

Stand up.

I think that the hon. Gentleman called his question.

On a point of order, Mr. Speaker. Is it not usual for an hon. Member to stand up when he addresses the Chair?

Yes, it is.

asked the Secretary of State for Defence if he will take steps to end the provision of defence training to Malaysia.

No, Sir.

I am sorry, Mr. Speaker, that it is necessary to shout in the Chamber, but you can hear the racket being made by hon. Members on the Conservative Benches.

The figure is 80, not 30, and the answer is "Yes".

Will my hon. Friend be more forthcoming in defence of our relationship with Malaysia? Does he accept that, given the threat posed to the whole region by the Soviet Union and its Vietnamese acolytes, it is essential to do whatever we can to maintain democracies in that region, particularly Malaysia, which have long traditional ties of friendship with Britain?

Our defence relationship with Malaysia has long been friendly. Naturally, we regret that the Malaysian Government have temporarily made competition more difficult for British firms, but our underlying relationship remains good.

If we are to maintain defence commitments with countries such as Malaysia, should not the Government speak out against the three executions which are scheduled to take place in Malaysia on Thursday of this week and which cannot be justified in any way?

As the hon. Gentleman well knows, that is a matter for my right hon. Friend the Foreign Secretary.

asked the Secretary of State for Defence whether he is now in a position to make a statement about the future of HMS "Invincible".

asked the Secretary of State for Defence if he will make a statement on the size of the carrier force and the future of HMS "Invincible".

I have informed the Australian Government that we wish to retain HMS "Invincible", and the Australian Defence Minister is now communicating our wishes to his colleagues in the Australian Cabinet.

Is my right hon. Friend aware that even those who were not critical of his recent statement on defence will welcome this indication of the Government's decision to maintain three aircraft carriers, which we hope will continue for the indefinite future? When the transaction is completed, will he encourage the Australian Government to order a British aircraft carrier with Harrier aircraft?

I shall obviously encourage the Australian Government to order more defence equipment from Britain. I had very useful talks with the Australian Defence Minister here a week or two ago. I hope to hear from him again shortly.

Will the Secretary of State confirm that three aircraft carriers will be in service until HMS "Ark Royal" becomes available in 1985? Has he yet estimated the effect of the announcement to retain HMS "Invincible" on the planned capacity at Portsmouth dockyard and on the number of redundancies among not only dockyard but naval personnel?

Recently, I announced that we would publish a White Paper in the autumn. In it we shall, of course, give the results of our consideration of naval numbers and of the future size of the dockyards following our reassessment of the ships that need to be repaired as a result of the Falklands campaign. At present, our plan is that there should always be two aircraft carriers operational. That means that we would need a third aircraft carrier in reserve, so that when one of those carriers is due for its first refit in the 1990s—HMS "Invincible" would be due for a refit in the 1990s—there would be two carriers operational in the Fleet.

Will the right hon. Gentleman give a thought to those of my constituents who built HMS "Invincible"? Will he consider a further through-deck cruiser order for the Tyne shipyards? In addition, will he step in and stop this humiliating public Dutch auction over the "Atlantic Conveyor" and give the men the work that they deserve? Is he aware that unemployment in that area exceeds 30 per cent.?

I am very well aware that Swan Hunter is short of work at the moment. If possible, we would be prepared to make some funds available from the Ministry of Defence budget to change the design of any replacement for the "Atlantic Conveyor", so that it could be used as a useful reserve asset for military purposes. These matters are under discussion. I have no doubt that my right hon. Friend the Secretary of State for Industry will wish to say more about this issue in due course.

rose—

Order. I allowed the Secretary of State to answer, but it was a very different question from that on the Order Paper.

I congratulate my right hon. Friend on the decision to retain HMS "Invincible". However, will there be three aircraft carriers in the active Fleet, or is one of them to be placed in reserve? Is the cost of retaining HMS "Invincible" to come out of existing planned defence expenditure, or has the Treasury shown a willingness to chip in?

As my hon. Friend knows, the Treasury is always helpful in such matters, but it is a little premature to decide how to finance the retention of HMS "Invincible". We shall have to give further attention to that in the autumn. We intend to have two, not three, aircraft carriers operational in the Fleet. The third aircraft carrier will have a standby capacity to ensure that we always have two carriers available in the Fleet when one of them is undergoing refit and to guard against the possibility of an accident.

The Secretary of State has rightly been careful to say that he has told the Australian Government that we want to retain HMS "Invincible", but he has been equally careful not to tell us the Australian Government's reply. Will he here and now undertake to give us a replacement if the Australians decide to keep HMS "Invincible"?

The right hon. Gentleman would agree that Mr. Malcolm Fraser's offer during the Falklands crisis to allow us to keep HMS "Invincible", if we so wished, was extremely generous and helpful. I would rather leave the matter there for the moment. The Australian Cabinet knows of our wish to retain HMS "Invincible" and I do not foresee any problems in that regard. However, I am awaiting a communication on this subject from Mr. Sinclair.

Obviously I do not want to prolong the issue, but did the Secretary of State see the statement in the Australian Free Press—I think, on the day that Mr. Sinclair came to London—in which Mr. Sinclair said that he wanted to retain HMS "Invincible"?

I have not seen the Australian Free Press. If that is what that newspaper said on the day that Mr. Sinclair came here, it predates our discussions on the subject.

asked the Secretary of State for Defence how many young people have so far taken part in his Department's adventure training scheme.

So far 2,295 young people have taken part in our youth adventure scheme.

In view of that encouraging figure, will my right hon. Friend congratulate the Service personnel who played a part in a remarkable initiative, which must have given great pleasure and constituted a great challenge to many young people? Will my right hon. Friend rest assured that there is widespread support for it and that it is disapproved of only by a few unrepresentative Left-wingers?

I thank my hon. Friend for welcoming the scheme. I understand that it is going extremely well. The vast majority of young people who have attended the courses have gained great benefit from them. As my hon. Friend said, it was an extremely imaginative and useful gesture on the part of the Services to arrange such a series of courses this summer.

The right hon. Gentleman will be aware that I am visiting HMS "Raleigh" tomorrow to look at the scheme. How many young people who are not members of cadet corps have taken part in the courses, how many of them are unemployed, and what is the breakdown of the sexes? At the end of the scheme, will the right hon. Gentleman produce a full report so that the House and the country can decide whether they would like to see such a scheme again?

It would be useful to produce a summary of what the young people felt about it and how it went at the end of the season. That is a good idea and I shall certainly do that.

asked the Secretary of State for Defence if he will publish a White Paper assessing the defence lessons from the Falkland Islands operation.

I have already informed the House that I shall be publishing a White Paper on the conclusions of our studies into the conflict in the South Atlantic and what these imply for the future.

Will the Secretary of State ensure that the published conclusions are as full and frank as possible and that the argument that certain things must be kept secret will not prevent the House from knowing what did happen?

I shall make the White Paper as full and as frank as possible. However, there will always be a number of highly classified aspects to equipment performance. I shall, of course, be as full and frank as possible. I know that the reports, when we have them, will be of great interest to the House.

Will the White Paper contain an assessment of the role of the Merchant Navy in the Falklands operation and draw relevant conclusions as to the size and composition of the future Merchant Navy?

As part of our studies we shall consider the part played by the Merchant Navy. In particular, we shall consider the enormously valuable way in which we were able to convert Merchant Navy ships for use in a military role. That will certainly form a part of the White Paper. I do not think that we shall be able to draw any particular conclusions about the size of the merchant fleet. I am in favour of the largest possible Merchant Navy for Britain, but, in the last resort, its size does not lie within my control.

Does the Secretary of State recollect that from 21 April, when I was given an invitation to meet the Prime Minister personally in the Tea Room—an invitation that she gave to every Member of Parliament—until 9 June when I specifically raised the issue with the Foreign Secretary at Question Time, at c. 193, I nagged Ministers about the activities of Aerospatiale Dassault? Has the right hon. Gentleman studied the report from Isabel Hilton in The Sunday Times that Monsieur Hervé Colen and his team were in Argentina giving their expertise on the fusing and computer technology which alone can launch an Exocet from the wing of an aircraft? Does he understand that those of us who have talked to Isabel Hilton believe that her story is true? What are the British Government doing about the French assurances that they were giving every help to the British cause?

From my personal experience, I can tell the House that the French Government were extremely helpful to Her Majesty's Government throughout the Falklands crisis. They went out of their way to give us every assistance as an ally. I have noted the particular allegations in The Sunday Times. We have no independent evidence that the allegations are correct, but I understand that the French Government are holding an urgent inquiry into those allegations. If they were to be true, I believe that the French Government would deplore them as much as ourselves.

Is my right hon. Friend aware that when the Select Committee on Defence was recently in Washington and the Far East, enormous interest was expressed in the equipment used by the British forces in the Falkland Islands? Bearing in mind that memories tend to be rather short, is he aware of the need to produce a report speedily?

I am aware that our companies producing defence equipment are anxious for the earliest possible information on the manner in which their equipment performed. Within the next week or two we shall be sending each individual manufacturer a full report on his equipment. We are considering a wider report, but many of these matters are commercially confidential to the firms that produce the equipment. We are in the process of providing as much information as we can to assist British industry. The Select Committee on Defence can play a useful and important role in this matter. We shall provide as much information as we can to the Committee on this subject.

The supplementary question asked by my hon. Friend the Member for West Lothian (Mr. Dalyell) is important. I think that everyone in the House and in the country needs to be fully satisfied about the issue. Without pressing the Secretary of State too much—I well understand the points—will he undertake to examine any evidence that Isabel Hilton may care to give him and to take a personal interest in the matter rather than to leave it entirely to the French Government?

The allegations are important, but it must be for the French Government to investigate them. With respect, it is not as easy for us to investigate the matter with French manufacturers as it is for the French Government to do so. I repeat that the French were good, staunch and extremely valuable allies during the conflict. If the allegations are proved correct, they will be as embarrassing to the French Government as they will be of great concern to ourselves.

On a point of order, Mr. Speaker. In view of the unsatisfactory nature of the reply, I beg to give notice that I shall seek to raise the matter on the Adjournment.

asked the Secretary of State for Defence if he will make a statement on progress made towards ordering type 22 and type 23 frigates for the Royal Navy.

I have nothing to add at this stage to the statements made on these topics by my right hon. Friend the Secretary of State for Defence during the defence debate on 1 July and my hon. Friend the Minister of State for the Armed Forces during the debate on the Royal Navy on 19 July.

We have all read those debates. Will the Minister say clearly when an order for a type 23 will be placed? Is the design study being undertaken by Yarrow intended to indicate to people on the Clyde that they have a good chance of receiving that order?

The hon. Gentleman referred to the type 23. As we have already said, we expect to place the order for that vessel in 1984, the design contract having already been let. As Yarrow is co-operating with us on that stage, it would obviously be a front runner for that contract.

The House will accept that the equipment and ships to replace the Falkland losses will take some time to come through, but is it possible to place the orders in the yards because, presumably, they will be type 22?

This matter is at present under active consideration by my right hon. Friend. We have to take into account what has already been said on this issue and the particular lessons to be learnt from the Falklands campaign. I assure my hon. Friend that there will be no undue delay in the re-ordering process.

As the price of a type 23 frigate will now exceed the cost of refitting a Leander type frigate, whereas originally the intention was the other way around according to the Government's figures, does that not destroy much of the case for building disposable frigates and ending mid-life modernisation?

No, it does not. In one case we are getting a brand new ship and in the other case we are getting a refitted older ship. I should have thought that the advantage was obvious.

Has not an undertaking been given that the two destroyers and the two frigates lost in the Falklands will be replaced? When will the replacements be ordered?

My right hon. Friend has said that the replacement would not necessarily be on a like for like basis, but that all the equipment that has been lost would be replaced.

asked the Secretary of State for Defence whether he will make a statement on the progress of engineering and other reconstruction work by Her Majesty's forces in the Falklands.

In conjunction with the Falkland Islands' public works department, the Royal Engineers have been undertaking the necessary "first aid" repairs to restore water and electricity supplies in Port Stanley. Houses and roads have also been repaired and emergency work has been completed on the airfield. Although the main task of the Royal Engineers is to support the Armed Forces, they will continue to provide assistance to the Falkland Islands Government wherever possible.

I realise that there are difficulties, such as minefields, but does my hon. Friend accept that the British people expect their troops to be out of tents and decently housed as soon as possible? Will he make sure that every possible step is taken by the Ministry of Defence to provide the necessary logistic support to get the construction work done as soon as possible?

Yes, indeed. I give my hon. Friend and the House that assurance. It is right, on the other hand, to recognise that there are great difficulties facing the Royal Engineers in the Falklands, especially over accommodation. There are three times as many troops as civilians. There are only 350 houses in the whole of Port Stanley. Most of our troops, as my hon. Friend knows, are already under hard cover of some kind. There are 500 troops in tents at the airfield, where, unfortunately, there are no hard buildings which they can use. The troops have to remain at the airfield to protect it and to look after the Harriers, which are necessary for the defence of the Falklands. We shall get on with the job as soon as we can.

Has any thought been given to the provision on a temporary basis of inflatable buildings, which are easily transportable and which have proved effective under similar circumstances?

We have considered that suggestion, but weather problems on the Falklands lead us to believe that it is not necessarily the best solution.

Why are the Government not pursuing reconstruction with the same diligence as they pursued the war? Is it not the case that this illustrates the logistic difficulty of supplying any equipment to the islands without the assistance of the Government of Argentina?

No. I do not accept the latter proposition. We are pursuing the logistic problems with the utmost zeal. They are very difficult. We are giving first priority to getting the airfield open and lengthened so that we can provide fast jets for the protection of the Falkland Islands.

With great respect to the public works department of the Falklands, which consists of one and a half persons, I should have thought that there was a case for moving in some kind of task force to see that the work is done effectively and quickly. Does my hon. Friend not agree that outside contractors should be engaged to build the airfield as quickly as possible?

We have there the matting that is necessary to lengthen and strengthen the airfield. That work can be done by the Royal Engineers. My right hon. Friend mentioned a task force. There are nearly 1,000 Royal Engineers on the Falkland Islands. I think that they amount to a task force.

There is no lack of expertise in the United Kingdom on the creation of prefabricated buildings. Many people who are unemployed could supply that accommodation easily and quickly. We understand that temporary airport extensions will be provided by the use of alloy matting. When will a decision be made about the permanent extension of the runway? Is there any possibility of a second runway being built? Will these matters be the responsibility of the Minister for Overseas Development?

The shape and length of the permanent airport are matters for my right hon. Friend the Secretary of State for Foreign and Commonwealth Affairs. The revised Shackleton report will no doubt be relevant.

asked the Secretary of State for Defence what discussions his Department has had about new methods of maritime patrol for fishing protection; and whether these discussions included plans to purchase or use Coastguard 748s.

The resources employed on offshore patrolling, including fishery protection, are kept under continuing review in consultation with other interested Departments. My Department has no plans to procure aircraft for the task additional to those already committed to it.

Will the Minister accept that the 748 in its coastguard version is an excellent aircraft, that many foreign Governments are interested in purchasing it and that if the British Government were to give a lead that would set the seal of approval on the aircraft? Is it not ironic that the Government seem to be enthusiastic about encouraging other countries to buy weapons of destruction, but give little support to aircraft such as the 748, which has a purely defensive role?

The aircraft in question has been extremely succesful. More than 300 have been sold around the world. The hon. Gentleman will be aware that the Ministry of Agriculture, Fisheries and Food is carrying out an evaluation of the aircraft in the role that he has described. The hon. Gentleman should address his question to that Ministry to see whether it is interested in acquiring the aircraft.

Does my hon. Friend agree that it is expensive to use the Nimrod maritime aircraft for fishery protection and surveillance work? Is he aware that the experience of the Royal Hong Kong Auxiliary Air Force shows that the operating costs of a smaller twin-engined aircraft make it a viable proposition? Does he agree that it can also be operated by auxiliary and reserve personnel?

As the bill for this sort of operation is being paid by the Ministry of Agriculture, Fisheries and Food, that is precisely the kind of consideration that it will no doubt bear in mind.

Is this not a case where Government procurement can lead the way? As the Minister says, the aircraft has proved to be versatile and the technicians at Woodford have found another task for it to perform. If, however, it is to achieve the necessary sales, the Government will have to give a lead through their procurement policy.

I am familiar with that argument. It contains much force. The Government include the Ministry of Agriculture, Fisheries and Food, which is responsible for carrying out the maritime surveillance role.

asked the Secretary of State for Defence if his Department will produce a film to explain the nuclear defence strategy of Her Majesty's Government.

We have already provided a short audiovisual presentation entitled "A better road to peace", which is available through the Central Office of Information, and we hope to have a film ready later this year. The aim of these is to explain why we need to possess nuclear weapons, how our defence policies preserve the peace and why we believe that multilateral and not unilateral disarmament is the right course to follow.

Is my hon. Friend aware that the news that he has announced will be warmly welcomed by the vast majority of people, who recognise that Britain's nuclear capability is solely to maintain peace? A film such as that will correct the impression given by the CND and like-minded organisations which only serves to confuse and mislead the public.

I agree with my hon. Friend that there is a great deal of misinformation in this area. It is the primary purpose of these two productions to correct that misinformation and to give the true facts.

Has the Minister seen the recent statement by an eminent American nuclear physicist, Dr. Richard Garwin, who denounced the Trident plan as unnecessary, useless and unrealistic? How can the Government justify such a plan for school children or anyone else? As Trident 2 is only in the research and development stage, how can the Government justify the claim in their recent White Paper about the cost of the Trident project?

The Government justify the Trident programme on the same basis as the previous Government justified the Polaris programme. I commend to the hon. Lady the excellent full-page advertisement issued in 1969 by her right hon. Friend the Member for Leeds, East (Mr. Healey) extolling the merits of Polaris and nuclear deterrence.

asked the Secretary of State for Defence when he hopes to introduce legislation regarding the future status and organisation of the Royal ordnance factories.

It is the Government's intention to introduce legislation as soon as the parliamentary timetable allows to enable the Royal ordnance factories to operate under the Companies Acts. I cannot at present forecast when this legislation will be introduced.

Is the Minister aware that his reply is very unsatisfactory, particularly to employees of the Royal ordnance factories, who, year after year, have to accept uncertainty and procrastination while the Government decide what to do? Will legislation be introduced next Session? When will we see further details of the privatisation plans which he promised nine weeks ago would be produced as soon as possible?

I cannot anticipate the content of the Queen's Speech on the legislative programme. We do not wish to prolong any more than is necessary any uncertainty in the minds of employees. That is why we made the recent announcements about the future of the Royal ordnance factories. We believe that the future of those employees would be better served if they were part of a viable and commercial organisation.

Is my hon. Friend aware that manual workers at the Royal ordnance factory at Blackburn in my constituency welcome the opportunities afforded by the new freedom that this legislation will give them, and also the possibility of more capital and more opportunities for selling their excellent product?

I welcome what my hon. and learned Friend has said. He obviously agrees with me that the work force can see the benefits of the proposed reorganisation.

Will the Under-Secretary assure the House that the consultative document on terms and conditions for employees under the new Companies Act scheme will be published on target and that it will contain a no-detriment clause? Does he agree that it is high time that the employees of these factories were decently treated by the Government, bearing in mind that many of them worked overtime to produce ammunition for the Falklands war, and that some of those who so worked were thanked by redundancy notices?

The intention is to publish the consultative document in the near future, and we shall notify the hon. Lady when it is available. It is not the intention to prolong the uncertainty in the minds of employees. I take this opportunity of once again recording our appreciation of all their efforts during the Falklands conflict.

asked the Secretary of State for Defence if he will make a statement on the timetable for work on Trident.

Planning and design work on Trident is under way to allow its introduction into service in the mid-1990s.

Does the Minister accept that the Trident programme represents an escalation in the nuclear arms race from 48 missiles per submarine to over 200, that it will not add to our defence capability in any sense, but will endanger the nation, and that is typical of a Government who put warmongering and belligerence before peace and reconciliation, and of a Prime Minister who wants to turn the Church of England into part of the propaganda machine for the war effort of the Tory Party?

A desire to defend one's country is not warmongering, and the possession of a nuclear deterrent, to which all Governments have subscribed since the war, is an essential part of our defence. Trident is not an escalation of the arms race.

It is.

When it is introduced it will form roughly the same proportion of the total number of missiles in service as Polaris represented when it was introduced.

Is my right hon. Friend satisfied that British companies are receiving a fair share of whatever offset agreements have been arranged? If he is not satisfied with the terms of the arrangements, will he make every effort to encourage the Americans to allow more British participation in this important project?

I am satisfied that we are making every opportunity available to British industry to compete in this programme. The Trident programme is well advanced in the United States, and British firms will have to fight hard to obtain subcontracts. My hon. Friend the Under-Secretary of State for Defence Procurement has discussed this matter in Washington recently and the Americans have changed the "Buy American" rules to make it possible for British industry to compete. The opportunities are there, and I believe that British industry will be successful in obtaining some subcontracts.

asked the Secretary of State for Defence when he expects to be able to estimate the total annual cost of maintaining Her Majesty's forces on the Falkland Islands.

asked the Secretary of State for Defence if he will make a statement on the continuing arrangements for the security of the Falkland Islands.

A number of options are currently being considered for the long-term defence of the Falkland Islands. No decisions have yet been taken, and it is, therefore, too early to say what the annual cost will be.

Do Her Majesty's Government intend going it alone in providing a fortress in the South Atlantic? Did the Secretary of State see the estimate in a national newspaper a week or two ago that £600 million a year would be needed to sustain such a fortress? How many hospitals and houses could be built in this country for that sum?

I have seen many estimates in the press, but the hon. Gentleman will no doubt feel that it is just as worth while to defend 2,000 British subjects from aggression as it is to defend a greater number. That is what we intend to do.

With regard to the future cost of the defence of the Falklands, will my right hon. Friend consider the overall role of British defence equipment and the way in which we shall need to select those items which have proved most effective in the Falklands? Will he express his appreciation of that equipment and of all those who work in our defence industry?

I shall do as my hon. Friend asks. Our first assessment of the equipment used in the Falklands was that it had performed admirably. It would be invidious to single out particular weapons, but we shall shortly be advising industry on the performance of individual weapon systems, so that they can be sold overseas.

asked the Prime Minister how many hon. Members she has seen on matters relating to factory closures since she last answered oral questions; and how many jobs were expected to be lost in the closures mentioned.

I have had no such meetings since 22 July.

As the right hon. Lady's industrial strategy unfolds and more and more companies and factories close, will she take time off during the coming recess to visit not only the winners in British industry, whom she tells us she has visited over the past months, but also the losers in the areas of greatest industrial recession? Will she come to the Northern region and speak to industrial managers who want to know why she has rejected the advice of the CBI, which demanded that £1·8 billion be pushed into the economy, because it knows that that is the only way to get British workers back to work?

I have no immediate plans to visit the North-West, although during the recess I shall, as usual, be visiting Scotland. The CBI wants, above all, as was reiterated today, to see a decrease in interest rates. We cannot have that if we add £1·8 billion to the PSBR.

Is my right hon. Friend aware that there was a gain of over 14,000 new small businesses last year after allowing for those that closed? Does she agree that that success is in no small measure due to the changes in the law introduced by the Government to encourage the start up of businesses?

I confirm what my hon. Friend has said. The Under-Secretary of State for Industry has been doing an analysis of the VAT registrations and the figures for 1981 show that more companies were born than went out of business.

I understand that the right hon. Lady received representations this morning from trade unions and others about the replacement for the "Atlantic Conveyor". Does she agree that it would be a disgrace if this replacement were built other than in a British shipyard? Will she give a clear assurance that the Government will take steps to ensure that the ship is built in a British shipyard?

As the right hon. Gentleman will be aware, the Government share the view that the replacement for the "Atlantic Conveyor" should be built in a British shipyard. We have been active for some days to try to bring that about on a reasonable basis. As I said to those who came to see me this morning, the Government are playing a considerable part in trying to bring that about. We hope that British Shipbuilders and its work force will do all that they can to reduce costs, which are extremely important if we are to continue to receive orders. I believe that Cunard will play a patriotic part if we can narrow the gap in costs.

I press the right hon. Lady to go further, particularly in view of the somewhat subdued and equivocal response of the Secretary of State for Defence, who did not seem to be clear about the matter. The Opposition do not want the House to depart for the Summer Recess without having this matter properly settled, which wi11 be in the interests of the workers in the shipyards. Does the right hon. Lady appreciate that when she talks about productivity she is comparing our productivity with that of Korea? Is she claiming that on that account we might allow the order to go to Korea? Will she undertake to settle this matter in favour of British shipyards before the House rises?

I strongly believe that the "Atlantic Conveyor" replacement should be built here. That is why the Government have been active and why the order was not placed earlier with the lowest bidder. Considerable subsidies have been offered, but in my judgment it is reasonable to have what I call a three-part package: first, aid from the Government on the best possible basis; secondly, as much constructive help as we can get from British Shipbuilders and the work force—and I believe that they are prepared to co-operate—and, thirdly, recognition of the problem by Cunard and Lord Matthews who, I am sure, if we can all work together, will take the patriotic view. It is reasonable to ask all the parties to co-operate.

asked the Prime Minister if she will list her official engagements for Tuesday 27 July.

This morning I had meetings with ministerial colleagues and others, including one with representatives of the Trades Union Congress. In addition to my duties in the House, I shall be having further meetings later today. This evening I hope to have an audience of Her Majesty the Queen.

Is my right hon. Friend not dismayed by the decision of the chief constable of Derby to accept 12 coloured youths into the service, without the normal minimum of four O-levels? Does she realise the righteous indignation of young people in my constituency and the adjacent Midlands who have eight or more O-levels and some A-levels and still cannot get into the service? Will she affirm that we are still the party of equal opportunity, and that that opportunity should be based on merit?

I understand that the suggestion of lowering either physical or education standards to recruit members of the ethnic minorities to the police was rejected by Lord Scarman. Nevertheless, he recommended that positive steps should be taken to reduce disproportionate obstacles to recruitment. The Home Office is considering the matter and a report will be produced shortly. I also understand that chief constables already have a discretion to recruit otherwise suitable candidates who are below the height limit, but I firmly believe that we should not reduce educational standards for any group.

Has the Prime Minister seen the report of the Institute of Economic Affairs, in which it is suggested that there might be as many as 5 million unemployed at the next election? Will she repudiate that report and say that it is as much a part of patriotism to recreate hope among young people in the desolated regions of this country who are currently unemployed as it is to support what our soldiers did in the Falkland Islands?

The report is not mine in any way. I have seen only reports of a report of an article that was written by one person. The Government are doing all that they can to help young people. That is why we have such an excellent scheme to help them to get employment. Beyond that, we have to keep industries competitive and produce goods that British people will buy in preference to the increasing imports that are now coming in.

Is the right hon. Lady aware of the agricultural equipment company in my constituency which won the Queen's Award for Industry—Newton and Chambers Engineering? Does she recall how she congratulated the workmen? Does she realise that those workmen are now redundant and that many other industries in the valley have gone down? Will she send sympathy to the people who have lost their jobs as a result of her Government's policy? When will they see the light at the end of the tunnel about which the right hon. Lady keeps talking?

The hon. Gentleman knows that the agricultural equipment industry is in difficulty, not only in this country, but in almost every industrial country in the Western world. That is part of the problem. We must get as large a share of the market as we can. The Government are doing as much as they can to reduce costs. The national insurance surcharge reduction announced in the Budget will take effect next week, and that will be equivalent to a cost reduction of £640 million for British industry.

Will my right hon. Friend express regret that certain Members of the Opposition have chosen to make sweeping allegations about police corruption where many of us think it does not exist? Does she agree that it is time that people who make such allegations either prove them or shut up, because the police force does a good job and needs help, not blame, all the time?

I agree with my hon. Friend. If allegations, supported by evidence, are to be made, they should be sent to the Attorney-General.

asked the Prime Minister if she will list her official engagements for Tuesday 27 July.

I refer the hon. and learned Gentleman to the reply that I gave some moments ago.

Is the Prime Minister aware that today 25,407 people are registered as unemployed in Leicester, many of them youngsters who left school a year ago and who have never had a job? What will she do to help this great city, which has achieved unparalleled commercial success in the past, to come out of the worst recession that it has ever had?

First, we shall keep inflation coming down. That is extremely important. It is being reduced, but it is still twice the rate of inflation in Germany. It is extremely important to keep wage claims well within the increases in productivity. We are keeping interest rates on a downward trend. We are also making certain that the deficit does not rise, because if it did there would be a danger that interest rates would rise. We are also reducing the national insurance surcharge as from next week. Beyond that, it is for management and work people to produce goods which their fellow citizens will buy in preference to overseas goods.

Has my right hon. Friend had an opportunity to read in The Times today the news of the opening of the new container terminal in the north dock at Garston in my constituency? Does she agree that this is a marvellous boost for Merseyside and that it shows what can be done with effective management and a co-operative work force? Will she join me in wishing them well?

I agree that it is a wonderful boost for Merseyside, and I wish both management and work force prosperity in the future.

Has the Prime Minister noted the intense disappointment in areas of high unemployment at the announcement about Nissan? What will she attempt to do about the project on her visit to Japan? Is it not an indictment of her Administration that, with so much unemployment, so many people in Britain are seeking the Nissan development?

The hon. Gentleman will have seen the announcement by Nissan that it has not yet made a final decision but has agreed to defer it. It is, of course, a matter for the company to decide. The hon. Gentleman will also have seen the changes that we have announced on hire purchase, which I hope will help our car industry. I hope, also, that any increases in purchases will be of home-produced cars, not of cars from overseas.

Has my right hon. Friend noted the growing anxieties that are being expressed about the stability of the international commercial banking system? Before the annual general meeting of the International Monetary Fund starts in Toronto on 6 September, will the Government put forward proposals to the world's central banks to encourage even greater co-operation and stricter supervision of their commercial banks?

I am very much aware of that and of the danger that any default would produce, not only for one group of banks in one country, but, by a domino effect, for a number of banks. We are very much aware of what is happening, and the matter is frequently discussed at international meetings. We shall, of course, keep the matter very much in mind and make any proposals that we think fit at the time. It is vital not to lend too much, and undoubtedly a number of banks have been overlending, although not in this country.

asked the Prime Minister if she will list her official engagements for 27 July.

I refer the hon. Gentleman to the reply that I gave some moments ago.

I support my right hon. Friend the Leader of the Opposition in urging the Prime Minister to give further consideration to meeting the additional costs involved in having the "Atlantic Conveyor" replacement built in Britain. Does the right hon. Lady realise that there is overwhelming support in Britain for such a decision? In view of the fine phrases that the right hon. Lady used only a few weeks ago about our ships during the Falklands crisis, what possible justification can there be for the Government's narrow-minded and niggardly attitude, particularly when the Tyneside workers met every demand that was made of them during the crisis?

The Government have already offered a subsidy of 30 per cent. on the British Shipbuilders' price. That is a considerable subsidy. We are now considering what further can be done. It seems to me to be reasonable, both for the future of the shipbuilding industry, as well as to obtain that order, to ask for co-operation from all three parties involved. The Government are co-operating and will continue to co-operate, because we want that ship to be built in Britain. We look for some co-operation from Cunard, and we are entitled to look for some more co-operation from British Shipbuilders and all who supply it, particularly to reduce costs.

I beg to move,

That this House condemns Her Majesty's Government's economic, industrial and monetary policies which have led to a massive increase in unemployment, reaching a record 3·2 million in July 1982; and calls upon the Government to abandon policies that have clearly failed the nation and to introduce new measures to revive output, industry and employment.

I have selected the amendment in the name of the Prime Minister.

Today the House of Commons is debating the waste of a nation. We are debating the worst peacetime disaster to strike our country in modern times—the scourge of mass unemployment that afflicts every part of our land—and we are indicting the Government and, above all, the Prime Minister.

"there is nothing inevitable about rising unemployment".