Motion made, and Question proposed, That this House do now adjourn.-- [Mr. Lightbown.]
[The following documents are relevant : European Community Documents Nos. 11580/86 and the supplementary Explanatory Memorandum submitted by the Department of Trade and Industry on 23 January 1987 on common rules for imports of textile products from Yugoslavia, 11621/86 and the supplementary Explanatory Memorandum submitted by the Department of Trade and Industry on 23 January 1987 on the arrangements for imports of textile products from Taiwan, 6104/87 and the supplementary Explanatory Memorandum submitted by the Department of Trade and Industry on 10 July 1987 on the arrangements for imports of textile products from Taiwan, 7207/87 on modification of the textiles agreement with Thailand, 6647/88 and 9562/88 on modification of the textiles agreement with Hong Kong and the unnumbered Explanatory Memoranda submitted by the Department of Trade and Industry on 16 December 1986 and 23 January 1987 on common rules for imports of textile products from third countries.]
The Minister for Trade (Mr. Alan Clark) : It is two and a half years since the House had an opportunity to discuss the multi-fibre arrangement. We have before us a number of European Community documents which the Scrutiny Committee has recommended for consideration since the subject was debated two years ago. Of course, we have had a number of Adjournment debates covering the subject during that period, and I know that the House will wish to take the opportunity today to enlarge the scope of the discussion in more general terms. I welcome that.
I also welcome today's occasion because I am mindful of the vigilance and commitment of many hon. Members in whose constituencies there are textile interests. Hon. Members frequently write to me on the subject--I have had more than 400 letters since my appointment as Minister for Trade. They always write with expert knowledge and set out their arguments in a lucid and constructive manner, with one possible exception who has not bothered to turn up. I may allude to him in the fullness of time. In response to their concerns, I have met delegations from industry and from hon. Members on a number of occasions and I have found those meetings useful and constructive. I am very conscious that the textile industry, with about half a million employees, is still our largest single employer of labour. The Governmnt attach great importance to the health and vitality of the textile and clothing industry. The industry is spread geographically throughout the United Kingdom--knitwear in Scotland, flax and man-made fibres in Northern Ireland, cotton in the north-west, lace
Column 556and knitwear in the east midlands, man-made fibres in south Wales, Humberside and the north-east, and wool in north Yorkshire, with clothing firms spread throughout the United Kingdom.
It is important to recall how important the textile and clothing industry is today and the extent to which it still makes a major contribution to our wealth creation, even after the retrenchment in size in recent decades. It comprises about 15,000 firms, employing about half a million people, equivalent to approximately 2 per cent. of total employment in the United Kingdom and almost 9 per cent. of manufacturing employment. Total output in 1987 was about £12 billion, making it the United Kingdom's fourth largest manufacturing industry. Exports in 1987 of textile and clothing products totalled over £3 billion, forming one of the largest exporting sectors in the United Kingdom. Our two largest textile firms are the largest in Europe, and amongst the six largest in the world.
By any standards, therefore, the industry is very large. It has achieved much and has shown considerable resilience. That is due to the industry's skilled and adaptable work force and strengthened management.
The increasing use of more sophisticated technology in all sectors has produced significant productivity gains. The critical importance of design, where good progress has been made over the past few years, should also be noted and the increasing trend towards specialisation, with companies identifying what they do best and adapting and developing for all they are worth.
All these are important if we are to have a thriving and competitive industry able to respond rapidly to the changing demands of the market place. None the less, we recognise the difficulties facing the industry and the concerns about closures and redundancies in the last year. I am always sorry to learn about those. Hon. Members are quick to write to me and my colleagues in the Department about their concerns, and I can assure the House that those issues weigh heavily in our consideration of future textile trade policies. More widely, the Department has a close relationship with industries through its contacts with individual companies and the trade associations. I have met those myself on 12 occasions since my appointment as Minister.
We live in a time when the consumer is regarded as sovereign, but I am well aware that the consumer is not much good at consuming if he or she is out of work. The MFA seeks to balance the interests of consumers and producers. The Consumers Association briefing arrived on my desk late last night, and I have it with me in case any hon. Members propose to base their arguments upon it.
As hon. Members know, the MFA was first established in 1973 in order to provide a breathing space for the textile and clothing industries in industrialised countries to adjust to low-cost imports from the developing world. It has been renewed three times since then, most recently in 1986, and during its life access has become more generous and the quotas enlarged so that in certain sectors we have already a virtually complete liberalisation.
The House debated the subject when negotiations to renew the MFA protocol were at a formative stage and again just before the Community agreed its mandate. In December 1986 we debated the outcome of the negotiations.
Since that time the agreement with Yugoslavia and the Council regulation applying autonomous import arrangements to Taiwan have become available. There have also
Column 557been some technical modifications to a number of the third country agreements. The need for those technical changes was foreseen when the original bilateral agreements were negotiated. In the cases of Taiwan and Thailand, up-to-date import statistics were not available. The Community agreed therefore to reconsider these agreements as necessary when full 1986 figures became available. In the case of Yugoslavia, the agreement takes a slightly different form, being an additional protocol to the EC-Yugoslavia co-operation agreement. In other instances, amendments have been necessary to take account of certain classification changes introduced this year with the harmonised commodity description and coding system. In some cases changes to tariff codings brought previously unrestricted goods within restricted categories and negotiations have been necessary to agree appropriate adjustments to quotas with the objective, to which I attach importance, of ensuring as far as possible that the effect on trade is neutral, in accordance with the terms of the bilateral agreements and of the MFA itself. Such alterations have occurred, for example, in the case of Hong Kong.
Further amendments of that sort are in train for the agreements with Hong Kong, Thailand, Philippines, Pakistan and India. The Community has exchanged letters with Colombia, Guatemala, Haiti and Mexico--I realise that those countries do not impact on United Kingdom trade--containing consultative clauses in the event of exports rising to disruption levels, but no restrictive levels. In all of that the industry has been kept closely informed.
We are also in close touch with it about the current round of the general agreement on tariffs and trade multilateral trade negotiations. The House is aware that the future of the MFA was one of the many issues under consideration in the negotiations. The United Kingdom, together with its Community partners and other GATT members, committed itself at Punta del Este to examining the "modalities" for the return of international trade in textiles and clothing to normal but strengthened GATT rules.
Mr. Clark : The hon. Gentleman is intelligent enough to know that, when language as obfuscated as that is deployed in a communique , there is wide scope for determined negotiators to achieve their objectives within its framework.
Mr. Graham Allen (Nottingham, North) : Before the Minister becomes too involved in modalities and other highly technical questions on the MFA, will he address the wider economic background in which the industry finds itself, particularly in the east midlands, where 111, 000 people work in the industry--20 per cent. of the total in the United Kingdom. There is great concern there about the
uncompetitiveness of sterling and the historically high levels of interest rates. Before he goes too far into his detailed comments, will he comment on the broad-brush economic background in which the industry operates?
Mr. Clark : I have referred to that. I recognise that the prospects of every industry have to be set in a general, as well as a narrow, context. It is not appropriate for me, particularly in the narrow confines of this morning's
Column 558debate, to digress. I shall certainly listen with great interest to the hon. Gentleman if he should catch Mr. Speaker's eye, but that is really a matter for my right hon. Friend the Chancellor of the Duchy of Lancaster.
The mid-term meeting at Montreal will be of interest to the House. The Community and the United Kingdom argued strongly that any return to normal GATT rules would have to be progressive and accompanied by a satisfactory liberalisation by all countries, including the less developed ones and particularly the newly industrialised economies, and by strengthened and more effective rules, especially those concerning safeguards, unfair trade, intellectual property and market access. However, final agreement on textiles proved impossible because developing countries sought a commitment to a specific timetable for the phasing out of the MFA without substantial progress on the other issues. The position in the negotiations therefore remains that agreed in 1986 when negotiations began--a commitment to find means by which textiles could eventually be integrated into GATT on the basis of strengthened GATT rules and disciplines. I hope that that further carefully worded statement goes some way to enlightening the hon. Member for Bradford, South (Mr. Cryer), who questioned me about the concept of modalities.
Hon. Members are well aware of the high tariff and non-tariff barriers which face our exporters in many parts of the world, while the countries in question enjoy more open access to our markets. I cannot emphasise strongly enough our determination to press in the negotiations for a better balance of rights and obligations among GATT partners.
Hon. Members will make their own points. I shall be present throughout the debate and, with the leave of the House, I hope to summarise those and respond to the best of my ability at the conclusion of our debate.
The current agreement between the European Community and China runs out at the end of the month. After lengthy negotiations between the EC Commission and the Chinese authorities, a new agreement was drawn up yesterday. It is expected that this will be initialled by the Commission shortly and then submitted to the Council of Ministers for approval.
Several Hon. Members rose--
Will the Minister say how soon we shall see the detailed terms of the Chinese agreement, particularly the new negotiated inner limits on cashmere garments coming into the domestic EEC market?
Mr. Clark : They will be put before the Council of Ministers and at that time they will be public knowledge. It may be possible for me to digress further in general terms at the conclusion of the debate when I have heard what hon. Members had to say.
Mr. Max Madden (Bradford, West) : Speaking from the moderate centre, may I ask the Minister to make it clear whether China is regarded as a dominant supplier? Judging by China's production, imports and potential, it is
Column 559regarded by everyone as a dominant supplier. Is that the position of the Government and the international community?
Mr. Clark : The hon. Gentleman makes an important point. I regard China as a dominant supplier in all but name and think that that is a realistic assessment of her present status. As the hon. Gentleman knows, the manner in which these agreements were written and in which they operate prevents us from identifying China formally as a dominant supplier until the agreements are renewed or rewritten. I am aware that China's dominance is increasing. I am not entirely happy with the trend in the agreements that are being considered with China, because they do not reflecct that point as much as they should. We are examining this matter closely. Like many in the Community, I think that the sooner China is accorded that dominant status, the better.
Mr. David Tredinnick (Bosworth) : The import of cheap Chinese underwear is threatening my constituency in the east midlands. This matter is raised many times. The issue of whether China is recognised as a dominant supplier is crucial to the prosperity of Hinckley and the east midlands as a whole.
Mr. Clark : I remember taking action to restrict that access. I should like to give my hon. Friend a considered answer on this point, which he may develop later. We are all aware that certain thresholds must be reached before action is possible.
Mr. Tredinnick rose --
I turn to the more vexatious subject of Turkey. The House has already debated the concern felt by the industry in the acrylic yarns spinning sector. As the House knows, when the voluntary textile restraint arrangements were renewed last year between the Turkish textile producers and the Community, we were able to secure a new restraint limit on acrylic yarn exports, although the level was higher than the industry had wished. However, at the time of the negotiations there was insufficient evidence of disruption to United Kingdom industry to justify tighter restraint. I know that that statement irritates hon. Members. I have made it before and it is a matter of fact. It is not possible for me to take the action that I should like or to argue for it until there is evidence of serious disruption.
Mr. Cryer rose--
Mrs. Elizabeth Peacock (Batley and Spen) rose--
It is relevant to know that imports of Turkish acrylic yarn have fallen sharply in the first nine months of this year compared with the same period last year. They represent only about 25 per cent. of the agreed restraint level.
Mr. Cryer : Can the hon. Gentleman give a better and tighter definition of the disruption that is necessary before an agreement to restrain imports can be reached? The trouble is that the industry does not have much idea of the sort of damage that can be done. Is it a matter of the number of people unemployed, or is it simply the level of imports? As the hon. Gentleman knows, imports have increased from a low base to a high base and have declined from a peak. That peak has caused, is causing and will cause damage.
Mrs. Peacock : Yes. As my hon. Friend is aware, recently I sent him a headline from my local newspaper which said that 92 jobs were to go. That is happening only because of the acrylic yarn that has come to this country from Turkey, with a little coming from Mexico. How can we obtain the information that will result in a level being imposed before the damage is done? By the time the level is set, it is too late and we are losing jobs that we desperately need.
Mr. Clark : I appreciate the points made by the hon. Member for Bradford, South and my hon. Friend the Member for Batley and Spen. I am ready to take action as soon as I have the evidence. It must be proved to the industry and related to cause and effect. As soon as that evidence is in a form that will be satisfactory to the Commission, we shall take the action. The industry is in close contact with my Department. I encourage that. Such contacts cannot be frequent and continuous enough for me because I am ready to make a move, provided the facts justify it. I accept the contention that this damage can be suffered in a period of high impact and that it is difficult to repair it. If imports have fallen and are only at 25 per cent. of the agreed restraint level, it is not possible to take this any further.
Mr. Keith Vaz (Leicester, East) : That is where the Minister spoils his case. He comes to the House, is courteous and charming and makes some good points about commitment to the industry. Last week in my constituency, Chilprufe, a firm that has been operating since 1906, and therefore is no fly-by-night, announced that 190 people were to be made redundant. The workers blame not GATT or the MFA but the Government, because they say that the Government have not taken sufficient action to protect the industry. It is not fair competition when other industries are being supported and given subsidies. The Minister has the proof from the hon. Member for Batley and Spen (Mrs. Peacock) and other hon. Members, including me. When we came to see him at his Department, we spent more than an hour explaining that there was damage. When will the hon. Gentleman take sufficient action to protect people such as the employees of Chilprufe?
Mr. Clark : The hon. Gentleman's intervention was couched in such a form that I can only assume that he will leave early for some social engagement or that he felt that he was unlikely to catch your eye, Madam Deputy Speaker. It was a kind of mini-speech, somewhat separated from the germane and effective points made by my hon.
Column 561Friend the Member for Batley and Spen and the hon. Member for Bradford, South which related directly to Turkish acrylic yarn. The hon. Member for Leicester, East (Mr. Vaz) asked when I will take action. I always take action, where I am allowed, within the parameters of our international agreements and the relationship to the Commission which governs the whole subject. The hon. Gentleman seemed to be moving into a "mode" where he was asking why I would not subsidise the industry. He did not explain why Chilprufe needs a subsidy and what subsidy its competitors enjoy that give them the advantage. If the hon. Gentleman can cancel his engagement later in the day and remain here, I shall look forward to listening to his speech, in which he will probably digress and deal with this subject.
Mr. Nicholas Winterton (Macclesfield) : To return to the point raised by my hon. Friend the Member for Batley and Spen (Mrs. Peacock) and the hon. Member for Bradford, South (Mr. Cryer), does my hon. Friend agree that the criteria upon which anti-dumping measures can be taken are inadequate and that something must be done to make them more effective? There is no point in saying that imports have fallen and that the Turks have not taken up all of their voluntarily agreed quota. Damage is being done by unfair competition to the textile and clothing industry. My hon. Friend has no love, rightly, for the Commission because it consists of ineffective bureaucrats who do not have the best interests of our industry at heart. The criteria upon which an anti-dumping request is made must be changed if they are to be in any way effective.
Mr. Clark : It is a fairly tall order to try to alter the definition of what constitutes dumping. One of the problems with anti-dumping actions is the interval between the injury first being felt and the judgment on the dumping case being implemented, and there may be scope for changes to that. The industry--and, indeed, other industries--might regret any drastic action to change the criteria. I should prefer action to be taken over the timescale. Those factors have created difficulties especially for the anti- dumping applications made by the industry against imports of acrylic yarn from Turkey. That complaint remains on the table and there appears to be no early prospect of returning to the Commission with a renewed request for action. We shall continue to monitor the position closely in conjunction with the industry. I very much hope that it will keep in touch with my Department.
Mr. Frank Haynes (Ashfield) : The Minister has, rightly, been courteous this morning. I realise only too well the period that he has been in his post and the work that he has done, but it is not good enough. Mansfield and Ashfield have lost 1,200 jobs in a short time. That is why we are here this morning. We want to get at the Minister and find out what he will do about those jobs. There are problems in the industry and we want to know what the Minister intends to do. Matters are becoming worse as time goes on.
Mr. Clark : I reject that. I do everything within my power to defend those industries. The House well knows that the sovereign power of the United Kingdom in such matters is restricted by our signature to the treaty of Rome, our membership of the European Community and other international trade treaties and arrangements that govern the trade. It is a very good line for the local newspapers when hon. Members say, "What is the Minister doing about it?". Hon. Members who accuse me of inaction should say what they want me to do. Do they want me to break international agreements?
Mr. Haynes rose--
Mr. Clark : In that case, perhaps the hon. Gentleman will excuse me if I do not give way--[ Hon. Members :-- "Give way."] Of course I will give way to the hon. Gentleman, who I have known and respected for many years. He gave me a hard time in an employment Bill Committee when I had only just been made a Minister. I have respected him since then.
Mrs. Alice Mahon (Halifax) rose --
Mr. Haynes : The Minister should be careful with his words! It appears that he is protecting Turkey, China and all those places doing harm to our industries and our country. The Minister should be looking after British industry ; that is his job.
Mr. Clark : There is always a certain difficulty in not conveying some sympathy with such arguments. I am beginning to hope that there are some hon. Members present who have been briefed by the Consumers Association. I hope that they will try at least to offset the balance to some extent.
Mrs. Mahon : The Minister threw out the challenge that we should tell him what to do. May I offer him a helpful suggestion? The Opposition would have had a great deal more confidence in him had he not appointed Professor Silberston, who produced a flawed report on the state of the industry. We would have had more confidence in the Minister's desire to protect the industry had it not been for that appointment.
Mr. Clark : It is especially disappointing that Turkish taxes on imported goods have recently been raised again, adding to the already heavy burden of duties and other levies on exports to that country. I welcome the setting up, at last, of a group of experts from the Commission and representatives from Turkey who will try to resolve
Column 563distortions of trade within the framework of the European Community--Turkey association agreement. That group held its first meeting recently and my Department will be supplying relevant information to support the Commission's work.
There are implications for any future textile trade arrangements in the single market completion that is scheduled for 1992. The Commission believes that, if quota arrangements remain, they would have to be operated on a Community-wide basis after 1992. That line has been supported, in a non-textile context, by the European Court of Justice. However, with the MFA negotiations still in progress, it is too early to say what the outcome will be for textiles. I believe that 1992 will be an opportunity for our manufacturers and exporters, with their excellent trading record, to enter an unrestricted new market of 320 million consumers with high levels of disposable income. That opportunity will need to be grasped early or it will be lost. I hope that UK textile firms are planning now how best to meet that challenge. I know how much work they have put into restructuring their industry since the introduction of the MFA in 1974 gave them that incentive. I am confident that they will rise to the challenge. I wish to stress how important it is for all our trading partners, not least those who press most stridently for the abolition of the MFA, to consider whether their own restrictive policies sit comfortably with that request. Some, like Hong Kong, conduct their relations on a genuinely free trading basis ; others--and I have just been talking about Turkey--most emphatically do not. As 1992 approaches, there is talk and, indeed, apprehension about the prospect of a Fortress Europe developing, and that would not be in the interests of the United Kingdom. The atmosphere for its rejection is not improved by those countries, particularly the newly industrialised countries, which insist on unrestricted access to the Community market, yet seem to make so little progress in liberalising access to their own.
Mr. Doug Henderson (Newcastle upon Tyne, North) : The Minister said in his introduction that he was prepared to take up a number of points that my hon. Friends and other hon. Members have made. If the number of interventions is indicative of the complaints received by hon. Members, I suspect that the Minister will have to make a lengthy reply to the debate.
The House is grateful for the chance to consider the bilateral arrangements that have been made with countries such as Hong Kong, Thailand, Taiwan and Yugoslavia. A debate on those arrangements is welcomed by the industry, as it allows the House to comment on a number of wider issues. It allows us to comment on what is happening in the Uruguay round of GATT talks which is currently taking place in Montreal and which, as hon. Members present this morning know, is crucial to the future of the textile and clothing industry. The debate also allows us to review the state of the industry in the mid-term of MFA4.
In his introduction, the Minister pointed out the importance of the industry to our economy. We know that it is the fifth largest industrial sector, with an asset value of over £5 billion and annual sales of about £13 billion--the Minister said £12 billion but I shall not argue about the difference. The industry is a major exporter, with a value
Column 564of more than £3.5 billion per annum. As people throughout the country know well, it is also a major employer, employing 482,000 people, often in vulnerable areas of the economy such as west Yorkshire, the north-west, the east midlands, parts of
Scotland--particularly the borders--and Northern Ireland. We cannot ignore its importance in some areas of inner London, where the industry employs many people from ethnic minority groups. Hon. Members need little reminder of the main issue that relates to the textile and clothing industry in our country. I hope that hon. Members will agree that international trade agreements are essential to the future prosperity of the industry. The House will know that since 1974, all United Kingdom Governments have supported the regulation of trade in textiles and clothing through the multi-fibre arrangement. Since 1974, in various GATT talks, all Governments have emphasised the importance of the MFA and that it is important for MFA countries to conclude bilateral agreements with non-members--in our case, through the European Community.
The documents before the House this morning, which have given us the opportunity for this debate, relate to many of those bilateral arrangements. If the House does not know it already, it should know that alarming trends are becoming apparent in our industry. The textile and clothing industry's trade gap is deteriorating and is rapidly becoming a chasm. The United Kingdom market has been flooded by imports in the past year. The latest figures available show that after nine months the trade gap for the industry stands at £2.5 billion. That is equal to the level for the full year in 1986, when the multi-fibre arrangement was last negotiated. It is equal to 26 per cent. of the total trade deficit incurred by the country in the first nine months of the year. In a full year, the textile and clothing trade deficit is anticipated to be £3,416 million, or over £55 per person per year in this country.
Hon. Members will emphasise different aspects of the problem. I believe that there are three main reasons for the emerging crisis. First, the over- valued pound has caused enormous damage in two ways. It has cheapened the price of imports, particularly from other EEC countries which still constitute about 60 per cent. of textile imports. It has also priced some of our exports, especially in the high-value area, out of foreign markets. That proves to us that the textile trade gap is not solely caused by excessive imports from the developing world and that action that is geared only to curbing imports from the developing world will not solve the problem. I have received much correspondence this week from the industry. I have a letter from Peter Hargreaves who, appropriately, is the managing director of the Hilden Manufacturing Co. in Accrington. I do not know whether he is related to the Hargreaves who invented the spinning jenny, but he may be. He writes :
"While the Company is naturally very proud and honoured to have received the Queen's Award for Export achievement those eight years of investment and hard work are now virtually being destroyed in a matter of months by the government's present policy of maintaining a strong pound, and the Enfield Group has been forced, for the first time in its history, to adopt a non-recruitment/replacement policy in order to maintain employment".
New technology is being reflected in correspondence to the House. I received a fax last night from the Cumnock Knitwear company in Cumnock, Ayrshire. The manager of the company, Mr. John Liddell said :
Column 565"Our sector of the textile industry is going through quite the worst slump in living memory due very much to the strength of sterling, high interest rates and the importation of knitwear at an unprecedented level from the low-cost countries."
Other hon. Members will have received similar correspondence and I should be very surprised if the Minister had not received correspondence from employers throughout the industry, ringing the alarm bells.
Another factor, apart from the high pound, that is causing damage to the industry is undoubtedly the dollar pricing by far eastern and south-east Asian producers--combined with artificially low exchange rates--which has created unfair trade. That is particularly unacceptable in the case of countries such as South Korea, which has a fairly substantial trade surplus. The relaxation of the rules in MFA4 in comparison with its predecessor, has also had an impact on our industry and that point has been given particular prominence by the British Textile Confederation. In correspondence this week, it has pointed out the damage done in terms of job losses. There is a long list of job losses, as the hon. Member for Batley and Spen (Mrs. Peacock) said when talking about acrylic yarns. The list of jobs lost over the past six months includes 96 in Bingley, 200 in Bramley, 50 in Bradford, 200 in Oldham, another 230 in Oldham, 160 in Bolton, another 80 in Oldham, 540 on Merseyside and 250 in Chinley. That is all in the list prepared by the British Textile Confederation. It is a reflection of the increasing trade gap, which will be seen in a number of ways in the industry, particularly in job losses. As my hon. Friend the Member for Ashfield (Mr. Haynes) said in an intervention, the main issue in the debate is Government action to halt the crisis. The Minister said that, in the general context, the responsibility lay with the Chancellor of the Exchequer. The Minister should take warnings from the House back to the Chancellor. Those warnings do not come solely from the Opposition because I am sure that many Conservative Members will identify the danger to the industry that is caused by the excessively high pound. Will the Minister confront his right hon. Friend the Chancellor directly on the Treasury's impact on our manufacturing industry? Too often the Treasury take decisions as though they were purely theoretical. However, this debate shows that decisions taken by the Treasury affect the real world, the real economy and real jobs in the textile industry.
Mr. Alan Clark : That point has been raised by hon. Members of all parties and was raised with me by one of my hon. Friends at Question Time on Wednesday. Neither hon. Members nor industrialists, when they complain about the high value of the pound, ever say at what level they would be comfortable and for how long. Will any hon. Member postulate a preferred dollar exchange rate, deutschmark exchange rate or basket exchange rate? I am not saying that I would endorse that, I am simply curious about opinions on it.
Mr. Henderson : If the Minister talks to the same industrialists whom I meet from time to time and if he reads the same correspondence from the CBI, he will recognise that many people in industry attribute the difficulty to the last Budget when unnecessary tax cuts were given to the richer sections of the community, which
Column 566caused-- [Interruption.] Conservative Members should talk to industrialists in the textile industry because they will say that they were very much opposed to those tax cuts and that they wanted protection for the industry. The House wants to know whether the Minister and his right hon. Friend the Chancellor of the Exchequer will accept that industry is facing real problems because of the Government's economic policy.
Mr. Cryer rose--
Mrs. Mahon rose--
Mr. Cryer : Last night we had a debate on water privatisation, for which all Tory Members voted. The Confederation of British Wool Textiles Ltd. has made clear its objection to the privatisation because of the danger of increased charges. Already electricity privatisation has been postulated on the basis of a 15 per cent. increase in electricity prices. Such factors must prejudice the position of British manufacturing industry, and specifically the wool textile industry, which depends on those two service commodities. The Minister's platitudes about being ready for the future and 1992 are being damaged by the Government's policy on privatisation.
Mrs. Mahon : I am grateful to my hon. Friend for allowing me to intervene. I am glad that the junior Minister at the Ministry of Agriculture, Fisheries and Food, the hon. Member for Calder Valley (Mr. Thompson) is in his place because I have received a letter that concerns both our constituencies. It is from a manufacturer, J. S. Taylor Ltd,. and states :
"We are finding reluctance to order with the continuing strength of the pound, which is also making our job of exporting very difficult. These factors also contribute to our imbalance of trade on cheap imported fabrics, which are in any case not sold to the United Kingdom at real market prices ... Another area however which is of great concern to us is the Government proposal to privatise the water authorities."
That is direct evidence and I am pleased that the hon. Member for Calder Valley has been here to hear it.