asked the Secretary of State for Trade and Industry what funds remain unspent to date in his Department's flexible manufacturing systems scheme.

Of the initial allocation of £35 million some £8 million remains uncommitted. My right hon. Friend the Secretary of State for Trade and Industry announced last week, subject to clearance from the European Commission, a further £20 million for advanced manufacturing technology.

I am grateful to the Minister for that reply. Although the figures are welcome, they are still relatively small compared to what needs to be spent to make British industry fully modernised and competitive. Therefore, will the Minister have another word with the Secretary of State and the Minister of State to see that the modernisation schemes are not excluded from the Cooperative Development Agency and Industrial Development Bill which we shall shortly be debating on Report, because the exclusion of those schemes from eligibility for regional aid will have a further, very damaging, impact on the type of modernisation which we know the Minister is most interested in promoting?

I shall consider the latter point. As to the amount, I emphasise that one has to multiply these figures by about four to get the value of the true investment. I do not agree that these are fairly small sums. They represent a substantial investment in advanced manufacturing technology, which is, after all, where Britain has to compete.

asked the Secretary of State for Trade and Industry what are the Government's plans and strategy for the British footwear industry.

The Government recognise the difficulties which the footwear industry has experienced in recent years and the need to invest in advanced technological equipment. Accordingly, this industry is included in the new measures of assistance which my right hon. Friend announced on 19 March.

I thank the Minister for that reply. As he recognises the importance of the industry for employment in areas such as Lancashire, will he assure the House that he also recognises that, compared with our partners in Europe, we have the lowest percentage of exports of footwear? Will he ensure that we have not only free, but fair, trade, and will he take steps to ensure that tariff barriers in the far east are on a reciprocol basis and far fairer to British industry than they are at present?

We are always talking to other countries about their import restrictions on shoes. The hon. Gentleman will know, because he is interested in the industry, that roughly half our imports from low-cost sources are subject to import restrictions of one kind or another. As to his point about exports, he will have noticed the good news that exports of shoes generally increased by 7 per cent. last year, and by 11 per cent. to the EEC.

Is my hon. Friend aware that the announcement of £20 million for the grant scheme, along with help for design, on top of the announcement by my right hon. Friend the Chancellor of the Exchequer that VAT is to be imposed on shoe imports, is the best news that the industry has had for 10 years?

I am grateful to my hon. Friend for his comments. He will know that the fortunes of the shoe industry have been improving. From February to September of last year the industry created another 1,900 jobs, and the number of people working overtime increased last year from 5,800 to 9,600, so generally things are looking up for the industry.

Is the Minister aware that many in the footwear industry believe that the key sector for Government assistance should be not so much the purchase of new machinery as the funding of assistance for new ideas and innovation? Why is it that on the one hand the Minister has found £20 million to help purchase new machinery, while on the other innovation grants have been cut to from 33 to 25 per cent. and the scope on project size has also been reduced?

The new scheme will apply specifically to advanced technological machinery, which is in itself helping innovation. The hon. Gentleman will know that we are giving aid to design, and design innovation is one of the most important things.

As my hon. Friend doubtless wears British footwear, would he like to take this opportunity to extol its virtues so that the rest of our fellow countrymen might likewise be discriminating and buy the best value that is available?

I am not sure that I ought to show off my shoes, as I think I have a hole in one of them, but I certainly wear British shoes.

Is the Minister aware that in areas such as Leicester, which rely greatly on the footwear industry, there has been a catastrophic drop in employment for so long that the Government's measures, while welcome are far too few and far too late? I seek an assurance from him that these are the beginning, and not the end, of the measures that the Government intend to take to assist.

I think that the hon. and learned Gentleman should live in the present as well as in the past. Output in the footwear industry has increased, employment has increased, and exports are increasing. That is not a bad situation.

Can my hon. Friend reassure us that he is not lurching into export subsidy and protection in the measures that he has taken, and will he make certain that the industry becomes far more efficient and pays attention to that aspect of its work?

I can give my hon. Friend that assurance. The help announced by my right hon. Friend is specifically for capital investment. It is not an operating subsidy.

Is the Minister aware that this scheme has been received with far less enthusiasm by the industry than it has by some of his hon. Friends because it falls far short of what was required, and because it excludes the major companies such as K Shoes, C and J Clark, Start-rite Shoes Ltd. and BSC, which employ over half the work force in the industry? Those companies are excluded, although, like the rest of the industry, they are facing the same cash flow problems, resulting from the 30 per cent. increase in leather prices, and are facing intense import competition, which will become even worse if later this year the United States introduces quotas and so leaves the Common Market as the only open market in the world.

We have of course made our concern very clear to the United States on the matter that the right hon. Gentleman mentions. I do not think that the right hon. Gentleman, in discounting the improvement that is taking place in the footwear industry, should ignore the considerable advantages that exist for operating business in this country. As to competition, France has inflation rates that are nearly twice as high as those in the United Kingdom, while those in Italy are 2·5 times higher, and those in Belgium 50 per cent. higher than they are here. One has to look also at the levels of interest rates. They are much higher in many EEC countries than they are here, which enables us to compete with the EEC as well.

asked the Secretary of State for Trade and Industry if he will ensure that the British Steel Corporation will hold such a share of the equity of any new special steels venture which will reflect the share of the assets provided by the corporation.

The capital structure of any such joint venture is a matter of negotiation between the boards of the companies involved. However, I know that both parties are concerned to ensure that any agreed arrangement properly reflects their relative contributions.

The Minister's answer is in part reassuring, but will he confirm that in the envisaged Phoenix 2 company three quarters of the assets will come from the British Steel Corporation, and that those involved in the industry, and those interested in it, are keen to ensure that, after three years of furtive plotting and corrosive anxiety, there will be no justification for an accusation of what might be seen in Yorkshire as daylight robbery even if it is not so seen in Whitehall?

I think that there are some curious ideas about daylight robbery in Yorkshire, if that is the hon. Gentleman's definition. What he has to take into account is the real value of the assets that are contributed, and the assets that are loss-making are not necessarily to be taken as being valued at their cost.

Is the Secretary of State aware that it is not only equity for BSC that is being looked for in the long-delayed statement about the outcome of Phoenix 2, but the public interest, and will he dismiss rumours that the reason for this long delay is that he is being looked to for a further £100 million for a new arrangement which eventually is to go private?

I am not responsible for the rumours, or for any dismissal of them.

What does the Secretary of State's answer mean? Does the right hon. Gentleman mean that if the British Steel Corporation contributes 75 per cent. of the assets to the Phoenix 2 project he is in favour of the Corporation holding 75 per cent. of the equity? If he is not, why is he not? Did he not hear the Prime Minister yesterday pay a glowing tribute to the British Steel Corporation and the workers in that industry? Why does he not share the same confidence in transferring that to the Phoenix 2 project?

The Prime Minister and I have considerable admiration for the strides made by the BSC under its new and more enlightened management. That does not mean that we do not also have regard for the private sector and its enlightened work force and management.

asked the Secretary of State for Trade and Industry how many grant applications were approved (a) in England and Wales and (b) in Scotland under section 8 of the Industry Act for the last financial year; and what was their total value.

In the last financial year, 106 offers of assistance totalling £11·1 million were made to companies in Scotland under section 8 of the Industrial Development Act 1982. The figures for England and Wales were 1,748 offers worth some £84·5 million in total.

Does the Minister acknowledge that a high proportion of those offers were made to firms and regions which already qualify under section 7? In the revised regional policy put forward in the White Paper, will the Minister give priority to section 8 applications from companies not in areas which already benefit so that projects will not be lost to the United Kingdom, as might otherwise happen?

Section 8 assistance is available on a national basis, using impartial criteria such as additionality and viability. There is no discrimination within that scheme against any region. Whether an application comes from an assisted area is not taken into account.

Does my hon. Friend agree that the figures show clearly that the Government are still pursuing a policy which means that Scotland is getting more than its share relative to the United Kingdom population?

My hon. Friend is absolutely right. Scotland has 8 per cent. of its population employed in manufacturing, it is receiving 13 per cent. by value of section 8 offers. Scotland is doing very well from section 8 facilties.

Is it not a fact that there are no clear criteria dealing with section 8? Do not the Government, therefore, always say that they reserve their position? What issues are involved when the Government talk about projects of national significance? How can authorities know if they come within the criteria?

The criteria are clearly documented and well known to our officials in the regional offices. They are communicated to all applicants, who are given impartial and objective guidance on their chances of compliance with the criteria.

Is it not true that the selective assistance under section 7 has been smaller during the most recent year than it was four or five years ago, both for Scotland and throughout Britain as a whole? What provision has been made — whether an increased provision, a static provision or a declining provision — in the public expenditure White Paper for sction 7 expenditure during the next three years?.

It is a question of a balance between automatic and discretionary assistance. Discretionary assistance includes sections 7 and 8. That will be tackled through our White Paper, which will be available for true consultation on the assisted area policy generally.

asked the Secretary of State for Trade and Industry whether he has received representations from the British motor component industry about the levels of United Kingdom content in British produced cars.

The Department remains in regular touch with representatives of the component industry. The level of domestic business provided by car manufacturers in the United Kingdom is one of a number of questions addressed in these exchanges from time to time.

Is my hon. Friend aware that at present in Japan 18 major United Kingdom component suppliers are selling on quality, price and delivery? Is it not high time that some of the so-called United Kingdom car manufacturers in this country — General Motors and Ford—made use of the same component suppliers?

As my hon. Friend knows, we have discussed local content with the multinational companies operating in this country. We have also said in the House that we expect motor companies established in this country to maintain a broad balance in their activities—that is, to build vehicles and buy components in the United Kingdom at a level that is at least broadly equivalent to their United Kingdom sales. That is what we have publicly stated, and it is a matter that we shall continue to discuss with them.

Does the Minister agree that successive Governments have not put over £1 billion into British Leyland to see it proceed with widescale sourcing of overseas components. Will he look, in particular, at Dunlop in my constituency—the last remaining United Kingdom British wheel manufacturer—which has been mercilessly screwed to the ground by British Leyland and is unable to take up an investment allowance from the Government to proceed with a major modernisation scheme that has been pending for two or three years?

I have had many discussions with Dunlop and with the hon. Gentleman on this matter. Austin Rover is anxious to buy British wherever possible, and wherever it is economic, and to treat British suppliers on at least equal terms with those from overseas. However, Austin Rover has to be a competitive company. It is fighting for survival.

I appreciate the need to buy the best components at the best possible prices, but does my hon. Friend agree that a healthy components industry is a prerequisite to a healthy motor industry in Britain?

I agree with my hon. Friend. That is why we are talking to the multinational companies about local content, and that is why, with Nissan, we have imposed such a stringent local content. We still have a healthy components industry, because we have a substantial surplus in trade in vehicle components.

Does my hon. Friend agree that it is unreasonable to criticise Austin Rover or other parts of British Leyland which maintain an 85 per cent. United Kingdom content while having to compete with other manufacturers in this country which have a much lower utilisation and, at the same time import another half again of their sales? Would it not be more sensible to take the line that our components industry needs to be more competitive, and will he try to assist in that process?

I entirely agree with my hon. Friend. I sometimes suspect that, simply because Austin Rover is a Government-owned company, there is a tendency to try to get the Government to intervene in these decisions, which should be commercial decisions.

The Minister referred to the anxieties expressed by the British components industry, particularly about the Nissan deal, and he pointed out that the local content agreement was negotiated, presumably. to alleviate those anxieties. What is the use of a local content agreement when local content is defined not as United Kingdom content, but as Common Market content? What help is that to British industry?

I am not quite as pessimistic as the right hon. Gentleman about the merits of the United Kingdom components industry. With a 60 to 80 per cent. local content requirement — [Interruption.] — Yes, it is European, but I believe that British companies will get a large share of that, and I believe that as a result the United Kingdom content of Nissan cars will be far higher than that of some other assemblers in this country.

asked the Secretary of State for Trade and Industry what representations he has made to South Korea on the liberalisation of British imports into that country.

I took the opportunity when visiting Korea recently to press the Korean Government to liberalise their domestic market for imports, particularly for consumer goods. That includes the removal of quotas as well as tariff reductions.

I welcome my right hon. Friend's statement and ask whether he knows that Mr. George McWatters, the chairman of Avery the wine merchants in Bristol, is interested in selling whisky to South Korea? Can he tell me whether the South Koreans made a favourable response on the liberalisation of import controls on alcoholic beverages so as to meet consumer demand?

I raised this matter with the Korean Government and pointed out that this was a very important British interest. I hope that we shall make progress on this issue. The Korean Minister of Commerce is corning here next month and I shall make sure that my hon. Friend's points are drawn to his attention.

Does the Minister not realise how important this question is, not just for whisky, but for imports generally? Does he know, for instance, that South Korea has taken the bulk of the British cutlery industry, which was centred on Sheffield, and that imports coming to Britain now, which can be seen on practically every table, bear the mark "Sheffield plated"? That is printed on the cutlery before it comes to Britain, and it is only plated here. We now have about 4 per cent. of the cutlery industry that we had hitherto, and Korea is one of the worst offenders in this respect.

If the hon. Gentleman has evidence of counterfeiting, I shall be glad to take that up. On the general level of imports from Korea, it must suit British industry and the House if we increase our exports to Korea as Korea increases its exports to us. The House will be pleased to know that exports to Korea have virtually trebled in the past three years.

Is not the real problem of our trade with South Korea exactly the same problem that arises in our trade with so many other countries, namely, that our exports of manufactures remain static, while there has been an enormous increase in imports? Is the Minister aware that our trade deficit in manufactures with South Korea rose by almost 100 per cent. to £270 million last year? What will he do about that, other than making laughable statements about improvements in our competitiveness since 1979?

What I find absolutely astonishing about that question is that today of all days hon. Members should criticise the trade figures when a surplus of £800 million was announced yesterday. I should have thought that hon. Members would be cheering and congratulating us on that, rather than complaining as usual.

asked the Secretary of State for Trade and Industry whether he will invite representations from organisations or persons outside Government to the interdepartmental committee established to investigate means by which the current practices of house transfer can be made more efficient, cheaper and quicker, so far as they relate to matters within the responsibility of his Department.

Yes, Sir. My colleagues and I welcome contributions both to the committee under Professor Street on non-solicitor conveyancing and to the interdepartmental committee on house transfer.

I thank my right hon. Friend very much indeed for that reply. What sort of timetable is the Department working to, and what period will people and hon. Members have to contribute their evidence to that interdepartmental committee?

The interdepartmental group hopes to report to Ministers by the autumn. While there is no time limit at the moment on representations to the committee, we should be grateful if they were brought forward as soon as possible.

May we have an assurance that if building societies are given the right to convey they will not use their commanding grip on the transaction as lenders to require the borrower to use their services at perhaps an even higher charge than would otherwise be available outside?

The Lord Chancellor's consultative paper on possible conflict of interest among employed solicitors, as for example of building societies engaged in conveyancing, is expected to be published shortly, and that will also cover aspects of possible anti-competitive practices to which I think the hon. Gentleman is referring.

asked the Secretary of State for Trade and Industry what improvement in competitiveness would be needed to enable the United Kingdom to balance its trade in manufacturing.

Such an improvement as is necessary to cause customers to buy British goods rather than foreign goods.

Does the Minister agree that one of the many indicators of the Government's disastrous policies caused by their blind adherence to scientifically unproven monetarist policies is the massive trade imbalance in manufactured goods? Is it not true that the lack of ability to compete is costing us hundreds of thousands of jobs and leading to massive unemployment? In my constituency there is 30 per cent. male unemployment. What will the right hon. Gentleman do about that?

Again I have to say that I am absolutely astonished that the hon. Gentleman should put that question to me today. Exports by volume are 7·5 per cent. higher in the latest three months than in the previous three months, and 9·5 per cent. higher than a year ago. British industry, through its quality, reliability and delivery, is selling more and more abroad. Why are hon. Members so critical?

Did not Labour Members, when in government, substantially increase the costs falling on industry in one Budget after another? Did not we in the last Budget substantially reduce the costs on industry, a step that will do more than anything else to help us to be more competitive in our exports?

I entirely agree with my hon. Friend. The Budget will reduce by £900 million in the coming two years the total tax burden on the corporate sector. We are doing more to help industry than Labour ever dreamt of doing, and this afternoon we shall be discussing ways of removing the unfair burden of rates that so many Labour local authorities would like to impose.

What particular benefit is there to a nation in balancing its trade in manufactures?

That is a question that the right hon. Gentleman should perhaps address to those sitting near him. [HON. MEMBERS: "Answer."] It is perfectly clear, although the Opposition fail to recognise it, that it is impossible for this country to run for ever a surplus in manufactures — in oil and all other goods — unless Opposition Members are prepared to see a substantial outflow of capital, which is another aspect about which they complain.

How much damage does my right hon. Friend think Mr. Scargill and his apparatchiks are doing to our industries and balance of trade by their political bully tactics—

Order. That supplementary question goes very wide of the main question.

Will the Minister explain why, since the appointment of the Under-Secretary of State for Trade and Industry, the hon. Member for Coventry, South-West (Mr. Butcher), as the Minister responsible for the west midlands we have lost one job for every half hour of his appointment? Does he agree that his answer to my hon. Friend the Member for Houghton and Washington (Mr. Boyes) should have taken into account the fact that Britain, to be competitive with Japan, Germany or America in manufacturing, would require annually 40 times more investment in manufacturing industry than the right hon. Gentleman's mates in big business are prepared to make? When does he think that that position will be reversed and we can get the 5 million on the dole back to work?

The Opposition are scoring an own goal today. It is ridiculous that they should be putting such questions to me the day after figures have been published showing that last month we exported, in manufactures, the largest amount in value in British history.

Does my right hon. Friend agree that Government support of £200 million-plus for the Alvey programme and our support for the £850 million EEC ESPRIT programme will do much to increase the competitive base of our hardware and software companies, so enabling us to close trade gaps and provide jobs for our people?

My hon. Friend puts his finger on an extremely important point. We want to see British industry being able to sell its goods throughout the world. We have already seen an enormous increase in British reliability, in our competitiveness and in the quality of the goods that we deliver. I only wish that hon. Members on both sides of the House would join in the general welcome that is felt throughout the world for Britain's performance.

I warmly welcome the change in trend in the British trade figures, as published today, and I hope very much that they will be sustained, because on our success in this area depends all our hopes for the future. Having said that, may I draw the right hon. Gentleman's attention to the figures that he provided for us yesterday? More than £400 million of the trade improvement in the single month is represented by our trade with the United States. To what does he attribute this welcome and dramatic change in our trade with America? Does he put it down to the continued effect of the massive depreciation of sterling against the dollar; to the fact that the United States economy is expanding more rapidly than any other economy in the Western world; or to the increase of 6 per cent. in productivity in the performance of British industry in the past year?

I am sure that all the factors mentioned by the right hon. Gentleman were involved in the British performance last month in the United States. I draw the right hon. Gentleman's attention to the fact that last month our exports to a great many other parts of the world increased dramatically. The House will not wish to read too much into one month's figures, but I am glad that the right hon. Gentleman pointed to the astonishing rise this year and last year in productivity in British industry. I hope that will long continue. As long as it does, British industry will do better.

asked the Secretary of State for Trade and Industry whether measures reforming the law of duty of disclosure in insurance contracts will be introduced in the present parliamentary Session.

No, Sir. However, it remains the Government's intention to introduce legislation to reform the law on non-disclosure in relation to insurance contracts affecting private consumers as soon as legislative time is available.

I welcome that assurance. When will the Department's current review of the law on material nondisclosure be completed? When does the Under-Secretary of State expect to have legislative time available to remove this totally unreasonable protection that is held by insurers, so that the people who are insured receive the cover they have bought when they most need it?

I am sure that the hon. and learned Gentleman will be encouraged to know that the Law Commission's report has been a basis upon which consultations have been held. A number of the matters, about which the hon. and learned Gentleman has been anxious will be incorporated in our legislation. We have said that we wish to introduce legislation as soon as possible, but the hon. and learned Gentleman will not expect me to pre-empt the contents of the Queen's Speech.

Does my hon. Friend accept that insurance contracts have always relied on the utmost good faith by both parties to the contracts and that, no matter how he seeks to alter the law, he cannot prescribe for every eventuality? In practice, therefore, the principle of utmost good faith by both parties must continue to apply, whatever steps he takes to alter the law.

The principle of good faith will continue to apply. A definition will be made of what is "reasonable" in terms of reasonable disclosure. The Government agree with the Law Commission that voluntary undertakings by the industry are not a substitute for reforming an unfair law.

As the Under-Secretary of State has no intention of introducing legislation, what action does he propose to help the victims of the 20 companies that collapsed and that had been offering extended guarantee insurance to their unfortunate victims? Will the hon. Gentleman confirm that thousands of consumers not only lost their premiums but, because of the availability of those phoney guarantees, have been conned into buying secondhand cars, which they probably would not have bought without closer inspection? They have been deprived of protection under consumer protection legislation. False representations were made about the relationship with Lloyd's of the bust companies. On top of all this, the victims are finding that many retailers are trying to evade their responsibility for the one-year guarantee, which applies regardless of the collapse of those firms. Why is the Under-Secretary of State doing nothing? Why is he not warning the public of the risk? Why is he not giving guidance about the bona fide firms?

Extended guarantee insurance is not pertinent to this question, although it is pertinent to a number of other questions tabled by hon. Members, which will be answered in due course. In my earlier answer I said that we planned to introduce legislation at the earliest possible time. The hon. Gentleman knows the considerations that must be borne in mind. I cannot and will not preempt the contents of the Queen's Speech.

asked the Secretary of State for Trade and Industry why he will not make a statement on the recommendations of the Gower report on investor protection before 30 April.

The report is open for comment until 30 April, and I prefer to consider the comments made before rather than after making any statement.

I agree with that general proposition. Can my right hon. Friend confirm that the large number of interests involved in this exercise will not lead to any delay in implementing the report? Has my right hon. Friend not yet ruled out the possibility of including the necessary legislation in the next Queen's Speech?

I, too, shall refrain from pre-empting what may or may not be contained in the Queen's Speech. I have not yet made decisions on the Gower report. I have asked all those involved to consider Professor Gower's proposal in a constructive and positive spirit. I have said that his proposals may show a way forward, but there is a good way to go yet before we reach our conclusions.

But is it not more likely that, after receiving the representations that the Government have asked for by 30 April, they will wish to issue a White Paper setting out their own broad lines of thought? As that White Paper is unlikely to be produced until later in the year, the balance of probability is that legislation will not come before the House until the 1985–86 Session.

My hon. Friend rightly points to some of the constraints that would be upon us in attempting to legislate in haste.

Having, perhaps unwittingly, unleashed the rapid, wide-ranging and unpredictable change in the financial institutions, which no doubt the right hon. Gentleman and the City both sought to avoid, how much loger can he leave the chaos and confusion to voluntary regulation, which can only work, if at all, if there is much more stability? Is there not an immediate need for action on the Gower report?

I think that the hon. Gentleman would do well to learn from the supplementary question of my hon. Friend the Member for Brentwood and Ongar (Mr. McCrindle). Surely he does not expect us to rush into legislation on such matters without due thought and proper consultation. His trouble is that he is more surprised than anyone by the extent of the changes that are taking place in the City. When my right hon. Friend the Member for Hertsmere (Mr. Parkinson) announced the proposals that led to the withdrawal of the Stock Exchange case from the courts, the hon. Gentleman and his colleagues sneered and said that it was a fix-up. They claimed that we were doing a favour to our friends in the City to prevent any change. The hon. Gentleman was wrong then, he is wrong now and he will probably be wrong for the rest of his life.

asked the Secretary of State for Trade and Industry whether he proposes to give encouragement to proposals to permit sub-post offices to be opened in partnership with other commercial activities such as petrol stations.

It is for the Post Office itself to make commercial decisions about where to place sub-post offices. I understand that a number of sub-post offices already operate from petrol stations, including some in my hon. Friend's constituency.

I recognise the difficulty, in rural areas especially, in maintaining the present number of sub-post offices, but will my right hon. Friend apply his considerable intellect to encouraging roving thought and unusual partnerships so that this benefit can be available to the community, especially to the elderly and those on modest incomes?

I thank my hon. Friend for the tortuous compliment that he paid me. The Post Office is prepared to be flexible when receiving applications from various trading entities and enterprises for the placing of sub-post offices. The only places where sub-post offices cannot be placed are betting shops. They are only rarely placed in pubs.

Does the Minister recognise that the sub-post office, which is so vital to rural areas, is in large 'Measure dependent on the survival of a network of retail outlets? Has he read the recent COSIRA report, which predicts that perhaps 50 per cent. of village shops might close? What steps might the Government consider taking to ensure that that does not happen?

I accept that in many instances the village shop with the post office attached is an essential part of village life. The proposals of the Post Office in the recent review of the sub-post office network will have no effect on the rural network. I can assure the hon. Gentleman that the Government are well aware of the importance of that network.

Is my right hon. Friend aware that his reply will be greeted with a welcome from those living in rural areas? Will he do everything that he can to encourage greater flexibility by the Post Office towards partnerships and encourage mobile sub-post offices in rural areas?

I accept what my hon. Friend has said. I re-emphasise that the Government fully accept the importance of the rural sub-post office. These sub-post offices are not merely places to buy stamps. They are where communities, especially the elderly, come together to buy groceries and to participate in what is almost a meeting place.

Does the Minister accept that most sub-post offices are not in rural areas but are in dispersed parts of urban areas? Will he give an absolute assurance that before any changes are implemented on a widespread basis he will encourage the Post Office and to look at this issue and have discussions with the National Federation of Sub-Post Masters and the Union of Communication Workers? Will he further assure the House that the practice of opening in partnership with other undertakings will not become widespread at the expense of Crown post offices and sub-post offices or the jobs that they provide?

As the House knows, the Post Office put forward proposals to the Government following its review of urban sub-post offices, which was necessary because of population changes and other considerations. I emphasise the long-established criterion that no one living in an urban area should have to travel more than half a mile to a post office counter. The Post Office has submitted proposals, and there is wide consultation taking place with sub-postmasters. I assure the hon. Gentleman that the Government must be satisfied that all interests have been taken into account, including those of consumers, before any decisions are made.

asked the Secretary of State for Trade and Industry if he will make a statement on the latest state of the orders and options for the A320 Airbus and the total cost of the project.

To date, 51 firm orders and 45 options for the A320 have been obtained from five airlines. The total development cost of the project is currently estimated at around £1,800 million.

I am sure my hon. Friend will agree that those figures show that the Government have backed a potential winner by approving launch aid for the A320. Might not the order book look a little better if Airbus Industrie adopted more aggressive marketing policies, along the lines of its American competitors? Is there not room for making the consortium more accountable both to its partners and the public who, as taxpayers, provide the largest slice of AI's funding?

I am not quite sure what my hon. Friend means by more aggressive marketing policies. Airbus Industrie has been very aggressive in its marketing, and extremely successful. I agree with what my hon. Friend says about internal management. The undertaking is large, so it is important that AI's management should be strengthened and that the organisation is equal to the enormous task that it has taken on. We are discussing that matter with the industrial partners.

Will the Minister approach his right hon. Friend the Secretary of State, with his undoubted charm, and ask him to persuade British Airways to buy the A320? Will the Minister take into account the need to increase the British share in the high technology of the V2500 and the need for a larger part of the avionics for the aircraft to be built by people in areas of high unemployment?

I am sure that the hon. Gentleman spoke of my charm, although his question was ambiguous. I assure him that British Airways will give full consideration to the A320 in assessing its future aircraft requirements. I know that it will consider it. With regard to components, we have been pressing the case with Airbus Industrie because we believe that the British components industry, which is very competitive, as is demonstrated by its record in America, might well play a greater role in the Airbus project. I agree with the hon. Gentleman that the Airbus will be offered with the superb V2500 engine, which will add to the quality of the aircraft.

Can my hon. Friend tell us whether one of the factors to be taken into account by British Airways is the availability of the V2500 engine? Will he assure the House that he is putting pressure on Rolls-Royce to bring forward the engine's development so that it can be offered for the first aeroplane that comes off the production line?

Rolls-Royce needs no pressure from the Government. The engine has already been launched. It is for the airline to decide which engine to use, but, as my hon. Friend knows, British Airways has been a large customer of Rolls-Royce.

asked the Secretary of State for Trade and Industry if he will report progress in his campaign regarding the importance of design in products.

Yes, Sir. The Government continue to give priority to their campaign to encourage a greater awareness in British industry and commerce of the value of good design, as is clear from the announcement made by my right hon. Friend the Secretary of State on 19 March. I shall announce further initiatives when I have completed my review of design activity.

Can my hon. Friend give the House some idea of the take-up rate for the design advisory service-funded consultancy scheme? I appreciate that it may be too early to form a considered judgment, but is there evidence that my hon. Friend's initiatives, which I applaud, have already had a beneficial impact on product design?

Since the design for profit campaign was started — it has now been concluded — the rate of application for help under the design advisory service-funded consultancy scheme has trebled. About 1,400 applications have either been completed or are in the process of being completed. According to our assessment of the scheme's efficacy, most of the applicants say that they are highly satisfied with the results.

Is it not true that the number of industrial design student places at faculties of industrial design in polytechnics and universities has been cut since 1979?

That question arises from the national advisory board exercise, to which no doubt the hon. Gentleman is referring. That is a matter for my right hon. Friend the Secretary of State for Education and Science. Some aspects of our consideration of additions to the design policy will affect the education service, schools, and further and higher education.

I warmly welcome the announcements by the Secretary of State about the textile, clothing, footwear and allied industries, related to design. Will my hon. Friend be more forthcoming about the aid that the Government intend to give to the textile and clothing industry with the promotion of design, which has made great advances in recent years? Will my hon. Friend deal at greater length with the valid question raised by the hon. Member for Workington(Mr. Campbell-Savours), which covered the problem that has been created by the reductions in design departments in our colleges of further education, polytechnics and universities?

A major part of my hon. Friend's question was met by comments made by my hon. Friend the Minister of State in an earlier question. As I said, the new appraisal of design policy will take those issues into account. Thus far my Department has committed resources to curriculum development in design for things such as design management at schools level and FE and HE levels. Of course an improvement must be made. I cannot tell my hon. Friend how we shall go about making that improvement.

Is not the high priority for design that the Minister states he gives to it a comdemnation of the fact that in the past few years the Government have systematically cut back in training for design, as my hon. Friend the Member for Workington(Mr. Campbell-Savours) said?

British industry's use of our domestic design talent matters most of all. We could make better use of that national resource, which is as strong as the resource of North sea oil, if British designers working for British companies were making products manufactured in the United Kingdom. That is part of our initiative and a means of maximising our resource in that area.

asked the Secretary of State for Trade and Industry what further steps he proposes to take when his "micros in schools" schemes end.

The current "micros in schools" schemes will be completed at the end of this year. No decisions have been made on further steps that my Department might take.

I welcome this important and creative initiative by my hon. Friend, and its success. Will he assure the House that there will be a continuing commitment by his Department to ensure that schools remain abreast of new technology, and that school leavers are computer-literate and employable?

It is true that the scheme has been very successful, and it is widely recognised as such in the country. All our secondary schools now have at least one microcomputer. I hope that by the end of the year all our 27,000 primary schools will have one. With regard to a general improvement in technology, I give my hon. Friend the assurance that he seeks. We are looking at other areas where we can ensure that the youngsters of today have a good technical background and grounding at school.

No matter how admirable the scheme may be, will the Minister give an assurance that the massive cuts in education, which mean that teachers in every staff room in the country are worried, will not be intensified because of the scheme? Will he liaise with the Department of Education and Science to ensure that?

There is strong liaison between our two Departments. We have provided about £16 million for computer hardware over the past three years. The Department of Education and Science provides about £20 million for teacher training and electronic software developments—the textbooks of today.

Will my hon. Friend accept that one of the most serious potential bottlenecks threatening the future development of new industries is the availability of skilled people capable of carrying out high technology work? Is not the "micros in schools" scheme an important foundation for the provision of a skilled work force in future, and should it not be extended as a high priority?

My hon. Friend is absolutely right. Skilled, technologically literate people are needed at the ages of 16, 18, 21 and 24.

The Minister will be aware that the principle of providing micros in schools has the full support of the Opposition, for the reasons just given by the hon. Member for Elmet(Mr. Batiste). However, if we are to capitalise upon the good work already being done, further resources and a continuing programme are needed. Can the Minister assure us that he will sympathetically consider the setting-up of a further scheme once this scheme has come to an end.

The principal funding of schools must come from the Department of Education and Science. My own Department's role in making money available over the past three-and-a-half years has been essentially catalytic. We saw a need that had to be met. We have extended the scheme, and I am looking at other proposals to improve technology training at O and A-level.

asked the Secretary of State for Trade and Industry if he is satisfied with the progress of selling state-owned companies which are within his Department's responsibility.

Whilst I am always anxious to make swifter progress, I am satisfied that as many as possible of the public sector enterprises for which I am responsible are being transferred to the private sector as swiftly as practicable.

In the light of that reply, will my right hon. Friend confirm that, whenever possible, the Government will give priority to management buy-outs?

We always look with favour upon management buy-outs where they are in the best interest of the company, taking into account the interest of the taxpayer.

While the Minister is selling valuable state assets to his friends, will he consider whether he is legally entitled to do so and whether he is selling them at artificially low prices?

The hon. Gentleman would be right to assume that we are quite certain that we have the powers to undertake the sales, not least through the primary legislation that is being enacted. The sales are sometimes extremely welcome to all concerned, as is the Scott Lithgow deal, about which my hon. Friend the Minister of State will answer a question later today.

Could my right hon. Friend give the House some news about Jaguar? Does he agree that most sensible people wish to see Jaguar returned to the private sector as soon as possible? Like my hon. Friend the Member for Berkshire, East (Mr. MacKay), I hope that when that happens adequate provision will be made for the staff of that successful company to participate in its success.

I go further than my hon. Friend. All sensible people will welcome the return of Jaguar to the private sector. The discussions taking place within British Leyland and between it and my Department are concerned with the arrangements that must be made if Jaguar is to be returned to the private sector. I hope that that result will be achieved before too long. I hope that there will be appropriate arrangements for the work force to buy shares, as there have been in the case of other returns to the concept of true public ownership—by which I mean ownership by ordinary people holding shares, and not ownership by the state.

Is the Secretary of State aware of any other western European country that owns important industrial enterprises and is planning to follow the example of the British Government and simply sell them off? If he does not, I wonder why that should be.

I am interested to learn that the right hon. Gentleman thinks that wisdom is to be found among foreigners rather than among British people. I am also interested to learn that he is unaware that more of our industry is in the public sector than is the case with most of our commercial rivals. That might have something to do with our commercial failures.

asked the Secretary of State for Trade and Industry what steps he is taking to simplify formalities at frontiers within the European Economic Community so far as they restrict the movement of trade.

The Government have played a leading role in getting Council time devoted to reducing frontier formalities. We have concentrated, with some success, on better opening hours at customs posts, cutting down documentation and faster clearance of lorries.

Why are countries such as France and Italy still allowed to cripple the free flow of goods by bureaucratic customs procedures, and when can Darlington Hauliers, which was caught up in last month's strike, expect either compensation or faster action by industry Ministers to complete the market?

I entirely agree with my hon. Friend that it is strongly in British interests to reduce ridiculous administrative and other formalities at frontiers. We are making progress and there will soon be one form, rather than about 11, to fill in. I assure my hon. Friend that we shall continue to press for action on that front.

On a point of order, Mr. Speaker.

I shall take points of order after the private notice question.

On a point of order, Mr. Speaker.

Order. I normally take points of order after Question Time. I call Mrs. McCurley to ask a private notice question.

rose—

Order. I said that I would take the point of order after Question Time.