asked the Secretary of State for Trade and Industry when he last met the chairman of the Ford Motor Company (UK) and what subjects were discussed.

My right hon. Friend met the chairman of Ford of Britain and some of his colleagues on 14 October. Discussion covered a wide range of topics.

Given the distressing news last week that Austin Rover's share of the home market is now below 13 per cent., has the Department any intention of reopening negotiations with the Ford Motor Company (UK)? That would be eminently sensible from the taxpayer's point of view and would protect perhaps not one or two Dumbos in management but the rest of the employees of Austin Rover.

I understand my hon. Friend's question, but the position remains as reported to the House on 6 February, namely, that the possibility of the sale of Austin Rover to Ford will not be pursued.

Does the Minister agree that the continual picking at Austin Rover does incalculable damage to that company's future?

I entirely agree with that observation. It is a fact that Austin Rover continues to compete against a substantial view cultivated by many people outside the House and by some hon. Members that seeks to diminish the company's prospect of succeeding.

I entirely agree with the hon. Member for Coventry, North-East (Mr. Park). Those of us who greatly welcomed the statement to the House the other day about having confidence in the future of Austin Rover very much regret the continual sniping at that company, which has enough difficulties to overcome in establishing itself as a niche marketer without that sort of additional difficulty.

I welcome my hon. Friend's observation. It is essential that all hon. Members on both sides of the House should recognise the realities of the situation.

When the Secretary of State next meets the chairman of the Ford Motor Company (UK), will he tell him that Pilkington Brothers of St. Helens is a major glass supplier to that company and that the best way of safeguarding its supplies for the future would be for the chairman to use his influence in the City of London to ensure that Pilkington remains an independent company?

I admire the hon. Gentleman's observations, but he will understand that I cannot comment on them, other than to say that Ford motors are produced in this country with a very high United Kingdom component level.

asked the Secretary of State for Trade and Industry how many representations he has received on the subject of product liability since 12 November.

Since 12 November the Department has received only five representations on the subject of product liability.

Is it correct to describe the Government's policy on this issue as a balance between introducing further rights of redress to injured consumers and containing industrial costs by allowing manufacturers certain residual defences? If so, many of us agree with that, as otherwise the cost of product liability insurance, if it is available at all, would increase considerably and ultimately so would the cost of products to the consumer.

I entirely agree with my hon. Friend. It is because we desire to continue to encourage innovation that the development risk defence has been retained. It is not only the cost but the availability of insurance that is important in that respect, as the Association of British Insurers recently confirmed.

Does the Minister accept that many believe that the acceptance of development risk liability has been created by powerful lobbying, particularly on the part of the pharmaceutical industry? Will he undertake to look at this matter again, especially as the insurance industry has indicated that it can be made available at relatively little cost? Does he accept, for instance, that those who suffered as a result of Thalidomide would not have received compensation under the development risk clause?

On the last point, the answer is no. A legal decision was never reached on the liability of the manufacturers of Thalidomide since the case was settled out of court. In the absence of that decision it is irresponsible for anyone to make judgments as to whether the Consumer Protection Bill would ensure compensation for victims like those of Thalidomide and I certainly do not intend to do so. Since then, the Medicines Act 1968 provides for a comprehensive system of licensing which makes it unlawful for medical products to be manufactured, sold, supplied or imported except in accordance with appropriate licences and clinical trial certificates. I am surprised that the hon. Gentleman, representing as he does a constituency in which the aviation industry is such an important interest, should call for the elimination of the development risk defence.

Why are the Government willing to allow manufacturers to escape paying damages by pleading the development risk defence when Belgium and France are making no such allowance, when Germany has made it clear that it will not allow that defence in relation to drugs, medicines and pharmaceutical products, and when the Law Commission for England and Wales and the Pearson commission, which was set up in the aftermath of the Thalidomide tragedy, said that the defence should not be allowed? Why have the Government surrendered to the industrial lobby and why have they abandoned the consumer, who, in future, could be left without any action for damages in any Thalidomide-type disaster?

I have answered the question on Thalidomide. It is important to recognise that the development risk defence places upon manufacturers the burden of raising and proving it. The defence is defined in very precise terms and it will be necessary for the manufacturer, if he is to rely on it, to show that no producer of products of the same description might have been expected to discover the defect. It would not be sufficient to point to particular testing difficulties encountered by him or even that he had followed procedures adopted by other manufacturers. He must have taken all the steps that he might have been expected to take by the informed observer. In those circumstances, it it is right that he should have that defence.

asked the Secretary of State for Trade and Industry what representations he has received relating to the introduction of amending legislation on copyright law.

I have received several representations from hon. Members, individual companies, industry representative bodies and private individuals urging the Government to introduce legislation on copyright during the present parliamentary Session or inquiring generally as to when such legislation might be expected.

Is my hon. Friend aware of the urgency with which this legislation is awaited in many quarters, not least by the music industry? Is my hon. Friend still committed to the just and necessary levy on blank tapes?

Yes.

Does the Minister accept that the present law is wholly inadequate to deal with, for instance, the development of high technology? Is he aware that whereas one accepts the need to protect intellectual property, the present law allows huge corporations to sue for alleged breach of copyright by smaller companies which, before the case comes to court, are, of course, out of business? Does the Minister intend to introduce a Bill and, if so, when?

The hon. Gentleman will be aware from the White Paper that one of the proposals contained therein concerns the speeding up of processes of patent law and the introduction of new procedures which will make it easier, and therefore less costly, for smaller firms to have access to the patent procedure. The introduction of a Bill will be as soon as the parliamentary timetable permits.

Is my hon. Friend aware that the proposals regarding intellectual property in respect of the broad base of engineering design will endanger far more jobs in the component industries than it will safeguard in intial manufacturing industry and that the consumer's interest is wholly opposed to any such legislation, so the balance of advantage for Britain must be against it?

I am aware of the strength of representations on this. I assure my hon. Friend and the House that we have very much an open mind on this. We want to get the balance right. So far as we are concerned, the question is still open.

I understand the reasons for the delay, as it must be very difficult to translate the White Paper into legislation, but is the hon. Gentleman aware that the long-term development of two firms in my constituency will be inhibited by the delay? Cannot firms of that kind be told that there will be a delay of, say, 10 years—that would suit me—before such changes will take place?

I am not sure whether the right hon. Gentleman is referring to delays or to companies concerned about components in the motor trade. As I have just said, we are concerned to get the balance right in this very complicated issue. We are still discussing with the industry what the relevant procedures would be.

I congratulate my hon. Friend on having the courage to grasp this very prickly nettle, but will he ensure that he hits the right target and does not bring down small firms such as Moore's Pistons and Auto and General Electrical in my constituency, which would be especially hard hit, as the alternative to their manufacturing might well be greater import penetration?

That is precisely the kind of point that we wish to take into account.

Does the hon. Gentleman recall that when the Secretary of State was previously at the Department, on 22 December 1983, he promised effective and resolute action to tackle the problem of counterfeiting and issued a pamphlet on the subject? Is he aware that three years later, in the peak buying period before Christmas, our street markets are flooded with counterfeit perfume, after-shave, toys and tapes? In November last year the Under-Secretary of State said that he was convinced that no further action was needed. Is that still the Government's view? Do they intend to take any action at all to stop this multi-million pound rip-off of the British public, or will they simply issue another pamphlet?

The right hon. Gentleman will be aware of the recent EEC directive on this. We shall wish to harmonise our legal requirements with that directive. I believe that there is a better way forward under that regime, which the right hon. Gentleman and his party appear not to support.

We are grateful for the fact that my hon. Friend is prepared to consider this matter especially in relation to the automotive industry. May I emphasise how much hostility and strength of feeling there is in the components and automotive support industries, as shown in my letters to him from constituents and in representations from national organisations? Does he accept that to legislate in that specific area would cause enormous damage?

I accept what my hon. Friend said. His representations and others are being taken into account in this complicated and difficult matter. We hope to reach a decision before too long.

asked the Secretary of State for Trade and Industry what representations he has recently received on Government support for exporters.

I receive frequent representations from industry about specific business opportunities overseas, and about services provided by the Government through the British Overseas Trade Board, which also advises the Government on these matters.

Will the Minister look carefully at the CBI's "Business Manifesto", which expressly states that foreign Governments give their manufaturers far more support in relation to exports than is the case in this country?

The budget of the British Overseas Trade Board will rise next year and the year after to more than £28 million. In addition, some £100 million has been spent by the Foreign Office in the past two years through its commercial councellors in overseas posts.

Has my hon. Friend heard the news from the British Footwear Manufacturers Federation that exports in the third quarter of this year were 20 per cent. up on last year and are now at an all-time record? Although the Opposition may have their own reasons for running down those achievements, is it not a fact that important sections of British industry are now competing very well in the world markets? The best thing for my hon. Friend's Department would be to stay well clear of those industries.

I am obliged to my hon. Friend for his advice. If that is the wish of the footwear industry, I am sure that my Department, whose resources are necessarily limited, will be only too glad to comply.

Is the Minister aware that no industrial sector has tried harder in the export field than the British power plant industry? As the Department of Trade and Industry is its sponsoring Department, what discussions does the Minister have with his right hon. Friend at the Department of Energy about securing a base domestic work load for that industrial sector?

I have periodic consultations with my right hon. Friend at the Department of Energy.

Bearing in mind the success of my hon. Friend's Department in supporting the British Overseas Trade Board, the regional development councils and the chambers of trade in helping, assisting and advising exporters, will he tell the House what steps the Department could take to assist those exporters based in areas that are not in receipt of such Government largesse, especially those in rural areas?

All the facilities of the British Overseas Trade Board are available, and they are especially geared towards assisting smaller firms—such as those in my hon. Friend's constituency—which might not have full first-hand experience of exporting but are none the less well placed by reason of their products and their competitiveness to penetrate overseas markets. It is precisely those sectors that the BOTB is geared to assist.

Has the Minister received any representations from NEI, bearing in mind that company's fine achievement in exporting submarine lifting gear to Libya? May I remind the Minister that that company is one of the biggest contributors to Tory party funds? It is also significant in the north-east of England and in Scotland. Has the Minister heard from that company?

I have frequent consulations with NEI. I am glad to pay tribute to the role that it plays in our whole overseas projects business. I am sure that it would reciprocate by acknowledging the help that it receives under the aid and trade provision.

Is my hon. Friend aware that the Weir group of Glasgow, which has been making considerable efforts to develop its pump exports in Asia, and which was recently visited by my right hon. Friend the Secretary of State for Trade and Industry, has expressed considerable gratitude for the support and encouragement the Department has given it in developing these exports? Is that not precisely the role that his Department should be undertaking?

I am happy to receive my hon. Friend's endorsement. As he said, the Weir group was recently visited by my right hon. Friend. I am glad that it is satisfied with the assistance that it is receiving, which is precisely along this lines that we hope to advance.

Is the Minister aware that during the time of the Government the number of staff in his Department working in exports has fallen from 1,200 to 700, that the number of overseas trade fairs has fallen by one seventh, the number of trade missions by a third, and the number of commercial counsellors attached to the Foreign Office by one sixth? Is not the outcome of that record that, having inherited a £3 billion surplus in manufacturing trade, the Government have successfully managed to convert it into a deficit of £4 billion? Why does the Minister not face that fact and admit that his Department's cuts have cut our exports?

I have already told the House that the budget is increasing for this year, next year and the year following. The hon. Gentleman referred to the decline in our manufacturing exports, but—as I hope to explain in answer to a later question, if we reach it—manufacturing exports have increased. The trend continues to be upwards.

asked the Secretary of State for Trade and Industry if he will introduce measures to regulate the sale of prepaid packages for touring abroad.

My right hon. Friend has no plans at present to introduce legislation to regulate package tours. The Government favour self-regulation by the travel industry provided that it operates effectively. The effectiveness of the Association of British Travel Agents' code of conduct is currently being reviewed by the Director General of Fair Trading.

Is my hon. and learned Friend aware that there are travel firms in Britain which try to persuade Britons to go to America by selling them hotel vouchers which purport to offer a discounted rate whereas, in the majority of cases, the vouchers are more expensive than the hotels would be if they were booked on the spot? Is he further aware that the majority of the hotels also require a surcharge to be paid and that, in this way, British tourists are being cheated? Does my hon. and learned Friend intend to look into this matter? Will he refer it to the Director General of Fair Trading?

This is not a difficulty which has previously been drawn to the Department's attention, but if my hon. Friend will send me details of the cases that he has come across, I shall certainly look into them.

Is it not clear that many ordinary working people get rooked and find themselves in great difficulty? They go on tours only to find that the hotel does not exist or that it is overbooked or that it is nothing like the brochure says. They get a pretty raw deal. Does the Minister listen to the excellent programme called "Breakaway" on BBC Radio 4 on Saturday mornings? Does he agree that if it was not for that programme, many people would not get a square deal? Is it not time that the Government did something about protecting ordinary people on package tours so that they can have a decent holiday, and, which is contrary to the Government's nonsensical philosophy, have proper protection?

I am a frequent listener to the "Breakaway" programme and I welcome the publicity that it can draw to the cases of people who need help. They have remedies under the law and under the arbitration provisions of the ABTA code of conduct. Those provisions should be drawn to the public's attention.

asked the Secretary of State for Trade and Industry if he will make a statement on the future of the engineering industry.

The prospects for the United Kingdom engineering industry are encouraging and I feel sure it will continue to make a vital contribution to our economic prosperity in the future.

The Minister paints a rosy picture of the industry, but it is the same industry which has lost 1 million jobs since the Government came to power and the same industry which can no longer offer a future to young people in my constituency and many others. Do the Government intend to use the public sector to revitalise the engineering industry in the many areas where the public sector is an important purchaser, as that is what we have not seen in the past and why we are still losing jobs in Trafford and elsewhere?

I do not deny that there has been a substantial contraction in employment and a significant restriction on the number of apprenticeships available, as the hon. Gentleman knows from discussions that we have had previously. He will be aware, however, that public sector purchasing plays a vital part, especially in the power generation industry.

Does my hon. Friend agree that the opportunities for the engineering industry are very much greater than the growth forecasts that he quoted and that the proof of this is to be found by visiting any factory and seeing the vast quantity of imported machinery that is used? The challenge is therefore to British companies to identify what sort of equipment is imported and to get into the market and produce it itself.

My hon. Friend is absolutely right. There are many sectors of engineering in which there is a high level of import penetration and in which United Kingdom producers could meet the demand. With the reduced costs that many are now carrying, they should be able to meet such demand if they have a mind to do so.

Is the Minister aware that one indicator of the dreadful decline in our steel and engineering industries is that the Ministry of Defence has now invited Thyssen to tender for certain engineering steels required by Her Majesty's armed forces? Is the Minister further aware that the Federal Republic will not allow any other power to tender for similar supplies for the German services? Is that not an appalling example of the deplorable negligence of the past five years?

I shall look into whether we are able to tender for other European orders. The hon. Gentleman will be among the first to recognise that, with the wider Community market available for the full range of engineering products, the prospects for the British to compete are increasing.

In considering the future of the engineering industry, will my hon. Friend take note of the recent survey from the Birmingham chamber of industry and commerce, which showed that the two greatest inhibitors to growth were perceived by their members to be high local authority rates on the one hand and high interest rates on borrowing on the other?

I am sure that my hon. Friend is correct. With regard to his latter point, clearly the Government will do their best in the management of the economy to ensure that interest rates do not increase but continue to decline on average. With regard to the first point, my hon. Friend will be aware that yesterday we passed a Bill which shows the forecast way in which local authority financing will be conducted.

When will the Minister recognise the gravity of the position of the engineering industry, which has seen a decline of 30 per cent. since 1979? I draw to the attention of the Government the decline of confidence, because of all the takeover bids, which is having an adverse effect on the engineering industry. What will he do about it?

I hear the hon. Gentleman's point. I understand it, and I know that in the Manchester area there have been significant contractions. However, I was present at the awards given by the Jaguar company to many of its components suppliers, 44 of which have pursuit of excellence awards. The winners for the past two years have come from the hard-pressed area of Yorkshire, of which I am proud to be a representative.

I am a practising member of the industry which last week His Royal Highness Prince Charles described as being not quite all that we would like it to be. Will my hon. Friend confirm that the measures that the Government are introducing should ensure that our engineering industry has every opportunity to take advantage of all the new technologies?

My hon. Friend is right, and the take-up of computerisation in the engineering industry is a good example of what has happened. There is now much greater take-up of computerisation in the engineering industry, and this has shown a growth that is four times more than that which we inherited in 1979.

Is the Minister aware of the enormous opportunites in advanced electronic engineering which the GEC-Nimrod project offers? In view of the crucial role that the Secretary of State for Trade and Industry may play in the ultimate decision, may we be assured that he will fight for Britain's interest when this matter is discussed in Cabinet?

My right hon. Friend the Secretary of State will have heard what the right hon. and learned Gentleman has said. It would not be for me to comment on what my right hon. Friend would say, but obviously the matter is of great concern and will be discussed fully in Government before a decision is made.

asked the Secretary of State for Trade and Industry what proportion of his Department's current expenditure goes to support nationalised industries; and what was the comparable proportion in 1979.

In 1979–80 about a half the Department of Trade and Industry total expenditure was used to support the Department's nationalised industries. For 1986–87, the figure is more like one tenth.

Do not these figures throw into dramatic relief the success of the Government's policies of privatising the nationalised industries and insisting that nationalised industries are more competitive? Will my right hon. Friend confirm that this must mean that around £900 million is available for health and education and the social services, which would otherwise be squandered on inefficient industry if we were to follow the prescriptions of the Opposition?

I entirely agree with my hon. Friend. The success of privatisation and of turning most of the nationalised industries round to be better run and more efficient, with many of them making profits, is a major achievement for the Government. It has had the effect of releasing resources that can be used better elsewhere.

I have noted the Government's hostility towards nationalised industries. How will our economy be helped by allowing Leyland Trucks to be taken over by an American or Dutch company? Would not such action lead to a loss of jobs and to the destruction of the indigenous lorry industry?

If it is hostile to nationalised industries to try to make them pay rather than lose money, that is a curious way to describe hostility. It is in the national interest that nationalised industries should pay their way. That must be good for the economy and for the people working in them, who want a secure future. I answered questions on the whole matter of Leyland and the truck industry the other week and I have nothing to add to the comments that I made then. The hon. Gentleman will know that talks are taking place.

Are there any publicly owned industries for which my right hon. Friend is currently responsible through his Department which he hopes will not be denationalised by the end of the next Parliament?

I certainly hope that we shall make substantial progress in denationalising during the next Parliament with the enthusiastic support of my hon. Friend. Let us put steel at the top of the list.

Leaving aside for the moment the question whether the general consumer has benefited from this move—particularly in the case of British Telecom—to convert public monopolies into private monopolies, will the Minister explain to the House why he has taken the money that he has saved and squandered it on this year's accounts instead of reinvesting it in Britain in the long term? Is this not simply a waste of the nation's assets?

I do not follow what the hon. Member is saying. I am usually attacked by the Opposition because my Department's budget is not sufficient, yet the hon. Gentleman has accused me of squandering the money. I do not know what the hon. Gentleman has in mind. I thought that the hon. Gentleman's party wanted to increase public expenditure rather than to reduce it. Over the past seven years the Department of Trade and Industry budget has rightly been reduced as we have cut down on wasteful expenditure on the nationalised industries. The money has been used to far better effect in the economy.

asked the Secretary of State for Trade and Industry if he will indicate the nature and size of the current deficit in the balance of trade in manufactured goods.

In October there was a deficit of £0·5 billion.

In view of the appalling figure that the Minister has announced to the House, will he acknowledge that one company that has always made a positive contribution to Britain's balance of trade is Pilkington Brothers of St. Helens, a world leader in the manufacture of glass? Does the Minister agree that there is no industrial logic in BTR's bid for Pilkington? Does he further agree that it is in the best interests of the work force, customers, the community of St. Helens as well as the shareholders that Pilkington Brothers remains an independent company?

It is impossible for me to comment on that matter until we receive the recommendation of the Director General of Fair Trading.

Does my hon. Friend agree that one of the ways that we can close the export-import gap is to produce goods of the right quality, at the right price and delivered on time? Will he therefore join me in congratulating all sections of the Rover Group on showing incredibly increased export potential? Will he further join me in congratulating the work force at the factory in Longbridge in Birmingham on drawing the first quality bonus issued under the present payment scheme? Is this not the way to expand into markets such as Japan and France, where the Mini sells so well?

My hon. Friend is right to draw attention to the exploits of the Rover Group. Of course, it is quality, price, delivery and after sales service in the manufacturing area that will allow us to increase the rate of expansion. Our manufacturing exports are increasing in volume and value, and that will allow the increase to be maintained and will close the gap.

Does the Minister accept that those of us representing constituencies that are heavily dependent on manufacturing industries want to know when the Government will get our trade in the manufacturing industries into surplus? Does he not think that the EEC regulations affecting country of origin labelling will have detrimental effects if introduced in this country?

It is not the Government's business or responsibility to get manufacturing trade into surplus. Exports of manufacturers have increased in volume and value for the past three years. The gap is accounted for by the vast increase in the level of imports. Imports are the sum of about 25 million individual decisions and preferences by the British people as consumers and business men, based on an assessment of the factors that my hon. Friend the Member for Birmingham, Northfield (Mr. King) drew attention to earlier—quality, price, delivery and the many factors that add up to individual choice in these matters.

Will my hon. Friend again emphasise the fact that, if they are to export successfully, businesses must have the right price, quality and delivery? It is no good for Governments to try to think that they achieve that success. It is up to the individual firm. In this respect, will my hon. Friend care to examine the success of Ruston Gas Turbines in my constituency? That company exports over 19 per cent. of its products because it meets these high specifications. There is one thing I should like to ask—

Order. The hon. Member has asked a question.

My hon. Friend is entirely right. The record of Ruston Turbines is exemplary. I know that that company continues to sell in extremely difficult markets around the world.

Given that it is the unique contribution of the Government that put Britain's balance of trade in manufactured goods into serious deficit for the first time in economic history, and given that we are heading for a deficit in excess of £5 billion in the balance of trade in manufactured goods this year, what action will the Government take to tackle this serious problem?

I am amazed at the way in which the right hon. and learned Gentleman continues to ascribe responsibility to Government and to Government policy. [Interruption.] Very well. Does he attribute blame to the United States Government and to their fiscal policy, which is the very reverse of our own? Their deficit in manufacturing is over £100 billion and has increased over the past four years. They are two totally different Governments with totally different policies. In each case, are the Government responsible?

asked the Secretary of State for Trade and Industry if he will make a statement on the prospects for British Steel.

The British Steel Corporation's recently announced half-year profit of £68 million was encouraging and represents further progress towards sustained profitability. The corporation is now in a much better position to meet the competitive challenges presented by the market.

Does my right hon. Friend agree that that is excellent news? Do I understand from his answer to my hon. Friend the Member for Eastbourne (Mr. Gow) a few moments ago that proposals will be brought before the House after the next election if Government Members retain the confidence of the people of this country in regard to the privatisation of the steel industry?

Yes, I can give my hon. Friend that assurance. I look forward to seeing him serve on the Standing Committee that deals with the Bill.

Does the Secretary of State agree that the management and staff of the steel corporation deserve our congratulations on the success that they have had in recent times? Will it not impede further progress to have a great debate about the ownership of the corporation? Does the Secretary of State agree that the most important thing now is to wind down the Common Market structure of quotas and subsidies so that the steel corporation can compete for overseas markets on a fair basis?

In general, I agree with what the hon. Gentleman said, and particularly with what he said in the first part of his supplementary question. It reflects the greatest credit on those employed by British Steel. I am sure that all hon. Members will agree with that.

Following the last question, what action are Her Majesty's Government taking to hack down the quota system? Does it not hold back the ability of British Steel to get into export markets in Europe where other companies are not as efficient as British Steel?

I understand and have some sympathy with what my hon. Friend said. Our objective is the restoration of a free steel market. This can best be achieved gradually, without market disruption and with the support of all member states in the industry. That is certainly our aim. We have received one report and an analysis from the Commission. We shall receive more early next year.

Is there any commitment that the Government would or could give that a privatised steel industry would maintain steel production at the five integrated sites?

The position on the five integrated sites remains exactly as it has always been. An assurance has always been contained in the strategy up to 1988. The steel industry, like all other industries, is subject to risk. No Government would responsibly give an open-ended guarantee on the future of any works. As the hon. Gentleman knows, I stand by the assurances that have already been given.

Will my right hon. Friend improve on the answer that he gave to my hon. Friend the Member for Brigg and Cleethorpes (Mr. Brown) and announce that he will introduce the steel denationalisation Bill in this Parliament and not in the next?

That rather depends on the date of the general election, which is not entirely within my gift. I note my hon. Friend's equal enthusiasm to play a detailed part in the denationalisation of steel, whenever it may come.

asked the Secretary of State for Trade and Industry if he has any plans to seek further powers to investigate insider dealing.

My right hon. Friend the Secretary of State will in due course be bringing into effect those parts of section 178 of the Financial Services Act which could not be commenced on 15 November, because they depend upon other provisions of the Act, such as those relating to the authorisation of investment businesses, being in force.

Is the hon. and learned Gentleman aware that studies of takeover bids in the first half of this year often reveal dramatic increases in share prices ahead of the bid dates? Does he agree that the only conclusion that can be drawn from that and other evidence is that insider dealing is widespread and that a very nasty smell is coming from the City? Is there not, therefore, a need for rather more purposeful action to bring these people, who are often criminals, to book, or there will be a very bad reputation internationally for the City of London?

Whenever there are indications giving rise to suspicion, they are examined by the stock exchange, which reports appropriate cases to the Department. Any evidence of criminal activity will be investigated by the Department.

Does my hon. and learned Friend agree that anyone in the City who indulges in insider trading now, particularly after recent events, will know that, thanks to action by the Government, there is every probability that he will be promptly prosecuted?

Yes, Sir.

Does the Minister recall that in January the House was assured that extra fraud lawyers would be recruited by the Director of Public Prosecutions, with additional support staff? Did the hon. and learned Gentleman notice last week's press release which said that, instead of that assurance being fulfilled, a moratorium was imposed on the DPP? There are no extra fraud lawyers and the additional support staff has been cut. Was the Department of Trade and Industry consulted about that moratorium? Did the hon. and learned Gentleman express a view? Given that lack of commitment, is it any wonder that, although the stock exchange investigates a suspected case of insider dealing every working day, his Government have managed to secure a conviction once a year?

Responsibility for prosecution of offences of insider dealing, which is what the question is about, rests with the Department. The hon. Gentleman knows full well that the record of prosecutions between 1980 and 1986 bears no relation to the situation which now pertains following the new powers which are available to us and which we put into effect on 15 November.

Does my hon. and learned Friend recall that when insider dealing was introduced as an offence in the Companies Bill 1978 by the then Labour Government the Government proposed that it should be a civil charge? It was the Conservative Government in 1979 who introduced insider dealing as a criminal charge. Does that not show the Government's determination to stop this pernicious crime?

My hon. Friend is entirely right. It is important to recall that, during the passage of the Financial Services Bill, the Labour party did not suggest a single additional power related to insider dealing over and above the powers that are now contained in the Financial Services Act.

asked the Secretary of State for Trade and Industry what future meetings he has arranged to discuss investment in national infrastructure.

None, Sir.

Will the Secretary of State confirm that he is of the opinion that private sector investment in infrastructure projects should be matched by a corresponding decrease in public funds? Instead of offering that view, would it not be better to ensure that, in projects such as the Mersey barrage, in which private enterprise has offered to put up about £220 million, private funding is matched in partnership with public funding to ensure that some of the 400,000 building workers who are languishing on the dole are given a useful job or work to do?

The Mersey barrage is a matter not for me but for my right hon. Friend the Secretary of State for the Environment. In general, I am in favour of private sector spending, as well as public sector spending, on the infrastructure. The House will be well aware of the enormous amount of such expenditure, which has frequently been outlined.

Given that the private sector is to finance the Dartford bridge and is about to finance the Channel tunnel, is it not right to give the private investor the chance to enjoy the benefits of investing in these great opportunities and to save the taxpayers' money by encouraging the private investor rather than the public investor?

I agree with my hon. Friend. Private finance is certainly welcome, provided that it is cost-effective. We should consider specific proposals on their merits. The new bridge at Dartford shows that there are good cases. There are extra benefits, such as incentives to efficiency, from a wholly private sector project. My hon. Friend made a good point.

When the Secretary of State said that investment by his Department had rightly been reduced, did he understand that the impact of that reduction has been felt in my part of the country, west Cumbria, where industrial investment has collapsed? Is he aware that under a Labour Government factories were opening all the time every year, and now they are closing? Why does he not restore the industrial assistance that was available under a Labour Government—and to the level that it was in the 1970s—and once again seek the restoration of the west Cumberland economy? We are in desperate need.

The hon. Gentleman is a little unfair. He knows that since 1979 more than £770 million has been spent in the north-west on regional aid schemes which have created or safeguarded 72,000 jobs. There are also other schemes outside my Department. There is the Mersey basin campaign, the derelict land programme, the urban development grant and a host of other expenditures that have taken place. Of course, it suits Opposition Members to decry all that. We all know why they do it. They just do not want to hear any good news when it comes along.

Does my right hon. Friend agree that although the criteria for judging public sector infrastructure investment decisions have been much improved by this Government, those decisions are best made by private investors?

Yes, I agree, but there is also a place for public sector infrastructure. As my hon. Friend knows, there has been a massive increase in spending on infrastructure on such things as motorways and trunk roads, rail and housing. National Health Service spending is up 31 per cent. in real terms. Capital spending on housing renovation is now £1·4 billion per annum. Those are all massive amounts of public sector money spent on infrastructure.

Is the Secretary of State claiming credit for spending more money, or for spending less, because he is giving confusing replies? If, as he claims, investment in the north-west has safeguarded so many jobs, why does he not increase the investment and safeguard even more jobs?

I am not in any way giving confusing answers. I was asked a question about infrastructure in the north-west and I gave the House the facts about what has been spent in the north-west. The fact that the figures are creditable is something that the Labour party does not like.

Does the Secretary of State accept that channelling investment into such items will increase output and increase the number of jobs rather more—possibly substantially more—than tax cuts, which just go through to consumer expenditure and increase imports?

I hope that we can have both.

asked the Secretary of State for Trade and Industry if he will make a statement on his recent visit to Japan.

My talks in Tokyo with Prime Minister Nakasone and other Ministers covered a range of trade and industrial matters. In particular, I underlined the need for urgent action to correct Japan's massive trade surpluses and to remove trade frictions such as the discriminatory taxation of imported alcoholic drinks. I also discussed ways of increasing British exports and improving access to the Japanese financial markets.

I very much welcome my right hon. Friend's comments. Can he give the House any further reassurance about the steps that the United Kingdom Government or the European Economic Community can take to guarantee fairer terms and a fairer balance of trade between our country and Europe on the one hand and Japan on the other?

There are several things going on which lead to there being more hope on this front. I do not wish to overstate the case.

The right hon. Gentleman has been saying that for seven years.

Yes, and before then, too. It has been said for a great deal longer than that. The hon. Gentleman should not imply that it is all the fault of one side of the House.

Does the Secretary of State appreciate that Japanese industry has been successful because the Japanese have been wise enough to invest in their industry and in new techniques, whereas our steel industry, for instance, suffered years of neglect under private ownership? Is that not a good reason for the Secretary of State to have second thoughts about any rash privatisation scheme?

I agree with much of the first part of the hon. Gentleman's question, but I certainly do not agree with the second part. When I recall that when the Government came to office the British Steel Corporation was losing about £600 million a year, I find the hon. Gentleman's remark astonishing.

rose—

I call Mr. Beaumont-Dark.

God bless you, Mr. Speaker.

My hon. Friend will understand that I have made no rash promises to the House—[Laughter.]Nor do I think that is an especially funny remark. I am trying to be absolutely frank and realistic. My hon. Friend is entirely right to make those comments, which have widespread support in the House. As to the general position, we shall have to take action under the GATT, perhaps on a range of matters. As for the specific issues, we may have to consider ensuring reciprocity in financial services. I shall have reciprocal powers to deal with this matter early next year and I shall not hesitate to use them if we do not get proper access to the Japanese financial markets.

asked the Secretary of State for Trade and Industry when he next intends to meet the Trades Union Congress to discuss investment in manufacturing industry.

My right hon. Friend and I meet the TUC regularly at the National Economic Development Council, where matters relevant to improving industrial performance are discussed. I have no plans for a separate meeting on this subject.

If and when the Minister has a separate meeting on the subject, will he discuss the loss of manufacturing jobs at BICC in my constituency, especially the 55 jobs that have been lost in the high technology fibre optics unit—a unit which has a fine record of quality, price and delivery?

I suspect that that is the hon. Gentleman's first question in the House, and I welcome him warmly to Question Time. I note what he said about BICC and I fully recognise its substantial record of quality and delivery of excellent merchandise. I shall have to examine the details of the point that he makes and I shall write to him about it.

If my hon. Friend meets the TUC, will he point out that, among other things, only yesterday the Secretary of State for Scotland announced a substantial increase in the provision for regional development grants? That is a direct consequence of manufacturing investment being much higher than was forecast. Does that not demonstrate how misleading is much of the nonsense talked about deindustrialisation?

I am grateful to my hon. Friend. He is right. Investment decisions are essentially for industry itself. The real rate of return of 7 per cent. on manufacturing investment last year was the highest since 1973. The growth in manufacturing output has resumed and next year it is forecast to increase by 4 per cent.

When the Minister discusses matters with the TUC, will he inquire why an area such as Leicester, where industrial relations have always been very good, is still in the throes of industrial misery in manufacturing, especially in the traditional industries? Why does the Secretary of State say that it is not the Government's business to promote British industry when the revival of industry lies in the hands of the Government, who must decide how, when and where they will put money into it? Unfortunately, they are not doing that now.

I understand the hon. and learned Gentleman's anxiety about the traditional industries in Leicester, in which hosiery and clothing have played a large part. In the first six months of 1986, the export performance of the hosiery and knitwear industry has shown a significant growth over the same period last year. The hon. and learned Gentleman will also recognise the Government's achievement in renegotiating, largely through the efforts of my hon. Friend the Minister for Trade, a multi-fibre arrangement for a further five years. Those are the strategic changes necessary to help the hon. and learned Gentleman's constituents to resume their industrial growth.

Will my hon. Friend note that he could reasonably advise the TUC to ensure that the trustees of the pension fund of the trade union movement play their part in investing properly in British manufacturing and commercial interests?

I should very much welcome further investment by the TUC in British industry, but I also welcome some of the decisions that it took at its recent conference. My hon. Friend will no doubt share with me the joy that the secretary of the Associated Society of Locomotive Engineers and Firemen, Mr. Ray Buckton, has now been replaced on the executive by the secretary of the Musicians Union.

During the recent insider debate the Under-Secretary of State said that it was unfair to judge the failure of the Government's manufacturing investment programme by the 6 per cent. fall in the last quarter. A few moments later he also said that it was unfair to judge the Government's policy and failures by the fact that, in the long term, manufacturing investment remains 17 per cent. below the level that the Government inherited. Therefore, may I ask the Minister, in the spirit of good will that exists immediately before Christmas, to take his pick? Would he like to quote to the House any 12-month period since 1979 in which manufacturing investment has been even within 15 per cent. of the level which the Government inherited?

I shall respond to the right hon. Gentleman's yuletide thoughts, but I think he will recognise that all investment moves in cycles. The pattern of industrial investment is cyclical. All I would say is that the present climate, created largely by the Government's policies, has meant that industrial investment is now flowing into more fertile areas with a profitable and reasonable rate of return on it.