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Column 593and we have not spoken of the innumerable units now working on short time, which is the chronic curse of the cyclical nature of the industry.
The catalogue of general decline may paint a dismal picture for the prospects for the industry in Lancashire, Yorkshire and other such areas. I accept that these areas have been devasted, along with the area in my constituency to which I have referred. In theory, however, there is an industrial infrastructure in Lancashire and Yorkshire, for example, that could in future create alternative job opportunities. That is not the position in the area that I represent.
The current negotiations with China are extremely important to the industry in the Borders. China is now the second largest Community supplier. It has the potential to increase its exports rapidly and on a huge scale to the detriment of the entire United Kingdom industry, but especially that which is located in the Borders. That would be to the detriment also of smaller low-cost supplying countries. Therefore, China should be treated as a dominant supplier. I hope that the Minister will listen to the pleas which have been made by hon. Members on both sides of the House that China should be treated in the same way as Korea, Hong Kong, Taiwan and Macao, whose quotas have been limited by the European Community agreement, which took effect on 1 January 1987. Are the Government pressing the Commission and the other member states to treat China as a dominant supplier and to impose access limits? The industry will be reassured if the Minister says something about the issue today.
I ask the Minister to take into account the fact that the People's Republic of China is a state trading nation, with all the associated trading distortions that that means, including pricing policies that are dictated by political and not commercial factors. China's national policy of self- sufficiency is pursued rigorously by its Government departments. What regard is being paid to the long-term implications of Hong Kong's return to China in 1997? That year may seem a long way away, but a problem is looming large on the horizon. Is the Minister satisfied that the new inner limits for cashmere garments will be held at about their existing levels? That is a crucial matter for areas such as Hawick in my constituency. China is the sole supplier of cashmere and it could export finished garments to the United Kingdom at a lower cost than the cost of the yarn for the garments to the manufacturing industry in Hawick. The Minister has said that the negotiations have been completed. I understand that the details must be studied by committees at a European level before they are published, but it would be of considerable assistance to the industry in general, however, and specifically to the industry in the Borders, if the hon. Gentleman were to say something about the progress that has been made on inner limits.
Secondly, is the Minister satisfied that the Chinese, who have a monopoly of cashmere supply, are taking real and positive steps to eliminate the adulteration of their own material, which was referred to by the hon. Member for Macclesfield (Mr. Winterton)? Adulterated cashmere is not usable in the high-quality end of the market that is supplied by towns such as Hawick. Have talks taken place to resolve that matter through the Community economic
Column 594co-operation agreement with China? If so, what are the results of the talks? That is another important matter on which I hope the House will be advised by the Minister.
What representations have been made to the Chinese on the unilateral rejection of contract prices for cashmere over the past couple of years? The Government must make known to the Chinese the level of damage that conduct of that sort does to its own hard-won international reputation as an honourable trading partner, in addition to the dislocation that it causes to manufacturers, which see agreed deals and prices change in the middle of knitting up their orders.
The three questions which I have put to the Minister require urgent attention if confidence is to be retained in the Borders industry and the necessary investment decisions made to secure employment in future.
More generally, I am sceptical about arrangements for policing quotas agreed under the MFA. Knitwear import figures for 1983 to 1987 show that, over that period, their value rose from £578 million to £1,072 million. If that is true, it is an increase of 85.5 per cent. Either quotas are being breached or exporting countries are milking the agreement for all it is worth--using all the devices that we know exist to manipulate their quotas to the maximum allowed.
The MFA should eventually be taken back within the ambit of the GATT rules. Of course we must allow increasing access by Third world countries that are genuinely underdeveloped, but we must not be taken for mugs in the short term by countries such as Brazil, Turkey and South Korea. South Korea, for example, exports £2 of general goods to the United Kingdom for every £1 that we export to South Korea--but it exports £4,000 in value of knitted garments for every £1 that we export there. It pays a 14 per cent. tariff, but we pay 50 per cent., and that is clearly unfair.
Finally, speaking for my constituency. I believe that the MFA, with all its imperfections, has helped to prevent even more closures. It is important that it should continue--and if circumstances do not change, the Government may need to consider its renewal in 1991. We know that there will be pressure from several Third world countries for an immediate end to the MFA, and no doubt it will increase during the GATT negotiations in Montreal. All sectors of the industry in my constituency argue that the Government must resist such pressure and refuse to countenance any progressive or gradual integration into GATT, however desirable that may be as a longer-term goal, until such time as the United Kingdom industry enjoys genuine, reciprocal access to those markets that currently present such substantial tariff and non-tariff barriers that they make impossible any kind of free trade on fair terms.
Mrs. Elizabeth Peacock (Batley and Spen) : To many right hon. and hon. Members, a debate on the intricacies of the multi-fibre arrangement may seem unattractive and unimportant, and perhaps that is reflected in the small number of hon. Members present in the Chamber. However, those of us who represent constituencies in which the textile industry plays a great part in providing employment know that the opposite is true and that it is an extremely important industry.
Column 595Although it is often an arcane and frustrating area of international relations, the MFA, under the umbrella of the GATT, is vital to businesses throughout the country, and particularly to those in Yorkshire and in my constituency. The hon. Member for Roxburgh and Berwickshire (Mr. Kirkwood) almost apologised to the House for making a constituency speech. I often do so, and will continue that tradition today.
Before referring to the problems that have arisen over MFA renewal negotiations, I remind the House, as other right hon. and hon. Members have done, of the importance of the United Kingdom textile industry. Earlier, we heard that it provides much of the country's wealth--the spending of which the House often devotes much time to debating--and long may it continue to do so. Textiles and clothing represent the United Kingdom's fifth largest industrial sector. Although that point has already been made, there is no harm in re-emphasising it. It is bigger than the computer and aerospace industry in terms of export earnings, having an annual turnover of about £9 billion.
The industry continues to provide nearly half a million jobs throughout the country--in east Lancashire, west Yorkshire, the east midlands and Scotland. In some of those areas the prosperity that the Government have generated in recent years is beginning to have an effect. In my part of Yorkshire, investment in manufacturing industry is tremendous. Factories are growing like mushrooms there, and we welcome that. Against that background, all countries are trying to regulate the flow of exports and imports, which in 1985 totalled a mammoth £100 billion.
Before dealing with the MFA in detail, it is important to note that Britain's exports have done reasonably well in recent years. In 1987 they rose by 8 per cent. to £3.3 billion, and productivity also increased by 8 per cent. The vital investment that is needed in new technology totalled about £387 million. I assure my hon. Friend the Minister that we do not all think that today's textile industry is failing. It is a vibrant and successful industry, and I am sorry that my hon. Friend the Member for Holland with Boston (Sir R. Body), who told us about his suit, is not present. It is an excellent industry, and I could take him to many places in Yorkshire where he could have excellent suits made from excellent Yorkshire cloth. In my constituency there is a very good tailors, Sladding, who have been established for 100 years and whose ancestors trained in Savile Row. They still make good Yorkshire suits. Therefore, there is no need for any right hon. or hon. Gentleman to say that he cannot have Yorkshire suits made from Yorkshire cloth.
Wool textile exports continue to rise, and when the final figures are available they will show that 1988 was a record year. British companies continue to develop their export drive and many of them make regular trips to Japan and the far east. There is a steady demand for quality cloth in the fashion industry. United Kingdom companies continue to campaign for good quality school leavers who can be trained to provide a skilled work force for the 1990s. Already, companies in west Yorkshire are finding it difficult to attract sufficient 16 to 19-year-olds to maintain current standards. As the numbers of school leavers fall during the next 10 years, that problem will become more acute. The industry is responding marvellously, with video recruiting packages aimed at schools throughout west Yorkshire and the rest of the country. Companies consider it their responsibility to attract young people into a
Column 596thriving textile industry which uses high technology and certainly is not the dark Satanic mills industry of the past. Such long-term views about the health of the industry continue to pay off, with the Confederation of British Wool Textiles Ltd. winning one of the Government's prestigious national training awards for its much-admired career structure for skilled workers.
Hon. Members may wonder why such a go-ahead industry needs international regulations such as the MFA. Why should healthy companies have anything to fear from fair competition in an open market? I should emphasise "fair competition", as that is the purpose of the debate. The answer is obvious to many of us with textile companies in our constituencies. Some foreign competition is not in any sense fair. We have heard many examples of that this morning. The world market in some products is clearly distorted.
The MFA purports to regulate the annual growth rates of exports by state trading nations, developing countries and newly industrialised countries. The agreement deters any particular country from taking harsh unilateral measures that could lead to a disastrous trade war. It helps to iron out the regional imbalances in global trade in textile products and guarantees certain developing nations access to the markets of the developed world, and we need to ensure that that will continue. That access would disappear under the potential dominance of countries such as China in a world trade war. However, many countries frequently act in breach of the MFA or similar agreements such as the treaty of Ankara. As that has already been mentioned, I shall not dwell too long on it, but it is important. The flood of cheap imports of acrylic yarn continues, mostly from Turkey, but also from Mexico, causing significant problems for many companies in the north of England. My hon. Friend is well aware of my interest in that subject. Although there are job losses due to cheap imports, that is not a new phenomenon in the textile industry. My local newspaper has a column entitled "25 Years Ago", which said : "Employment in the town was another problem, as there has been a steady decline in the big three industries in the area since the war."--
so we are not talking simply about the past eight years under the Conservative Government--
"At least one woollen mill had closed each year, mining was declining sharply and the rag trade had been badly hit by the introduction of synthetic fibres."
Perhaps we have just moved on and we are now having problems with synthetic fibres coming in from other countries.
I referred earlier to the job losses at Thomas Burnleys in Gomersal. They are much to be regretted. Thomas Burnleys is part of the Coats Viyella group, which has been successful because of its policy of reinvestment and re-equipment. However, acrylic yarn imports have led to its beginning to suffer. I accept what my hon. Friend said about having done everything that he possibly could about acrylic yarn imports. As he has worked hard, but the right results have not been achieved, I suggest that he should consider taking action before job losses become even worse. The available evidence suggests to those in the textile industry that Turkey is granting export subsidies to its textile industry and shutting out imports by imposing high tariffs. In some cases the duty on textile imports into Turkey is about 122 per cent. There is also a mysterious contribution to the state housing fund. I am not sure what
Column 597that has to do with textiles, but perhaps my hon. Friend will consider adding such a subsidy here ; it would help to improve housing investment in this country. Many hon. Members will be aware of the fact that Turkey is not a signatory to the MFA. The problems of cheaper imports from and dumping by Turkey are a foretaste of what will happen if the MFA is not renewed. Unfair trade costs jobs in this country.
I apologise to my hon. Friend in advance for the fact that I may not be able to stay to hear his speech, but I shall read carefully what he says. There are occasions when I do not care to put off constituency duties, much as I should like to hear the Minister. I hope that he will press as hard as he can for fair trade between the United Kingdom and other countries, such as Turkey and Mexico. That is all that we ask. We do not ask for the introduction of special protectionist measures. I hope that the Government will campaign vigorously for the renewal of the MFA. I suggest that it should be a high priority. The agreement cannot be phased out when the reasons for its introduction remain. Unfair trade practices such as dumping can only lead to a suicidal trade war if they remain unchecked. If the Government say unequivocally that they believe that there is a future for a capital-intensive, highly-skilled and competitive United Kingdom textile industry--I believe that they have said that in the past and that they will continue to support such a policy--I hope that my hon. Friend will assure us that he is prepared to do all that he can internationally to promote that aspect of our industry. If he is unable to give such a simple undertaking, I am sure that many hon. Members and my constituents in particular will want to know why. The MFA is the most pressing of these negotiations. It must not become, as has been recently rumoured in the press, a bargaining counter for nations that are anxious to phase out the GATT agreement as a tit-for-tat step towards an unbridled market. Jobs in this country, particularly those of my constituents, must not become pawns in an international game.
The United Kingdom textile industry is successful. Since 1980 output per person has risen by a staggering 40 per cent. With such an output, how can we say that we are not an efficient industry? The industry wants fair trade from the MFA, not trade regulation. I cannot emphasise too much that we want fair trade and the right to compete on equal terms with our competitors. Yorkshire people have a reputation for not asking for help very often, but we are doing so now. We want to be given a fair chance to show that, if allowed to compete on equal terms with producers in other countries, we can be the best in world markets.
Mrs. Alice Mahon (Halifax) : This is the second time within a few weks that I have spoken on the industry. I hope not to repeat the arguments that I made in the Adjournment debate on 31 October, but the Minister promised me a written reply to my questions. I have yet to receive it, so perhaps I shall have to repeat myself on one or two issues.
I should like to concentrate my initial remarks on the textile industry's employees. I say to the Minister--I hope that the message gets home--that we have listened time
Column 598after time, year after year, to phrases such as "retrenchment", "acknowledgment of the industry's skills and its good work force". We are asking for protection of the work force and some acknowledgment of its contribution to the country not only recently but for many years. When I listen to Ministers paying tribute to the skills and adaptability of the work force, I think how much better it would be if the Government rewarded it with some commitment and promises. Today, the Government have an opportunity to do so. Some of the fine talk that we have heard should be transferred into benefits. The work force has not been treated well over the past few years. Conservative Members have referred to its increased output and higher productivity. Often, that has been achieved at the expense of long hours and, as my hon. Friend the Member for Bradford, West (Mr. Madden) said, institutionalised overtime, low pay and insecurity. The work force is going through an insecure period.
Many thousands of the work force, of whom I have many in my constituency, were brought into this country from the Third world, but have been abandoned under various policies. The hon. Member for Keighley (Mr. Waller) said that I blamed the Government for that. I make no apology whatever for blaming directly on the Government what has happened to good firms in my constituency over the past 10 years. We have been down this road before, which is why Labour Members are again warning the Government. We recognise the same fears as were expressed in the early 1980s, when factory after factory closed and people were thrown on the scrap heap.
Mr. Greville Janner (Leicester, West) : May I say how much I welcome what my hon. Friend is saying? Does she realise that in recent months there have been 3,000 redundancies in the Leicester area alone, 2,000 of which were at the Corah factory in my constituency? The people of Leicester urge the Government to listen to my hon. Friend and take action, because it seems that there will be a great recession in the area, which relies much on hosiery, knitwear and footwear.
Mrs. Mahon : I received a letter from the National Union of Hosiery and Knitwear Workers, which confirmed what my hon. Friend has said and identified the loss of 5,000 jobs. I do not know whether my hon. and learned Friend is aware of this, but the letter says : "In addition to the 5,000 jobs which have been identified as lost by the Union because of the composition of the work force, 70 per cent. female, factories can reduce their labour force very rapidly by natural wastage without announcing redundancies. This has happened recently and would substantially increase the 5,000 jobs which have been lost."
There is an element of hidden unemployment, which is always present when we discuss female labour.
Conservative Members are in a position to bring some pressure to bear on the Government. Everything that is happening to the economy cannot be divorced from what is happening to the industry. The cost of energy has risen far higher than the rate of inflation, and we all remember the 10 per cent. tax that the Chancellor imposed to finance tax cuts. The industry has been exposed to excessive increases in the cost of water, which is used in many of the industry's processes, and it is feared that privatisation will further increase that cost. High interest rates cannot be ignored and hon. Members must draw the attention of the Chancellor of the Exchequer to that. It is a crazy system. It is a crazy way to run the economy and it is very damaging. I welcome the
Column 599point made by the hon. Member for Macclesfield (Mr. Winterton) about manufacturing industry creating the country's wealth. That is true, but, from being the workshop of the world, we are becoming an international supermarket and dumping ground for other people's goods.
I agree with the hon. Member for Batley and Spen (Mrs. Peacock) that we do not want special favours, although I would probably go further than she does in asking for favours. We at least want fair competition and, at present, we are not being exposed to such competition. There is no coherent policy for the industry. Will the Minister tell us today what he has in store for the industry? Philosophically speaking, we are not opposed to free trade, but we recognise the dangers. Opposition Members are not fools. Many of us have been closely associated with manufacturing industry. Most of my family worked in the textile industry. We all breathed a sigh of relief when the United States Congress failed to override the President's veto on the Textile Trade and Apparel Bill.
Will the Minister consider the inclusion of a social clause in the multi- fibre arrangement? There are dreadful abuses of human rights in Turkey, for example, involving people working in the industry there. A social clause could perhaps do something to help. After all, we are a trading nation and, as such, we are internationalists. When trade unionists in other countries with which we trade are imprisoned simply for belonging to a trade union, we cannot, and should not, separate ourselves from that suffering.
Many other hon. Members want to speak, but I wish to draw attention to our fears for the industry. Those fears are reinforced when we see that Professor Silberston has been appointed yet again to produce a report. I do not hold the Minister responsible for his appointment : we recognise that it was made by someone in another place. I shall not refer at length to the press release from the British Clothing Industry Association, the British Textile Confederation and the Knitting Industries Federation in criticism of the 1984 report by Professor Silberston, but those organisations stated that major flaws invalidated the conclusions of the Silberston report. They went on : "The Silberston report cannot provide a basis for the formulation of responsible Government policy."
They concluded :
"It is an illusion to suppose that the phasing out of the MFA on the basis suggested by this Report would lead to the vast international trade in textiles and clothing becoming either free or fair. The MFA brings order and stability to international trade in textiles and clothing, which is far preferable to the disorder that would take its place. Without the MFA, unilateral actions by individual countries would certainly provoke similar actions by others forced to protect themselves from the upsurges of diverted imports that would result. The evidence offered in the Silberston Report does not justify its conclusions. It cannot provide a basis for the formulation of responsible Government policy".
The cynical appointment of Professor Silberston leaves Opposition Members with little confidence to pass on to the people who lobbied us.
I should like to draw the Minister's attention to the proposal, which is all part and parcel of the free market philosophy, to abolish the export promotion levy. The National Wool Textile Export Corporation referred to its astonishment at the proposal and said that astonishment was perhaps
"not too strong a word"
Column 600I should like the Minister to give us a guarantee that that measure will not be thrown on to the altar of the free market.
We are asking the Minister to take a holistic view of the industry when he tackles his right hon. Friend the Chancellor and the Prime Minister about the future of the industry. Five thousand people in my constituency and 500,000 in the country rely on the industry for a living. That is how we will have to earn our living when the oil runs out, and it is one of the few ways in which we can get out of the horrific mess of the trade deficit.
I should like the Minister to give us a firm commitment about the MFA because that is part and parcel of the fight back. I know that the Minister is sympathetic, so I appeal to other Conservative Members who have textile industry interests in their constituencies to bring pressure to bear on the Government, the Treasury and the Chancellor to support the Minister. I hope that he will take into account one or two of the issues raised today.
left 12.55 pm Mr. Ken Hargreaves (Hyndburn) : I shall begin by informing the hon. Member for Newcastle upon Tyne, North (Mr. Henderson) that my constituent, Peter Hargreaves, to whom he referred, is not related to James Hargreaves, and nor am I, despite the fact that we both come from Oswaldtwistle, where the spinning jenny was invented. The only thing that I have in common with James Hargreaves is that he died a pauper and I expect that I shall, despite yesterday's announcement.
The reason for the timing of this debate remains somewhat obscure, given that the existing agreement lasts until 1991. Nevertheless, the debate gives us a chance to rehearse before the Minister the reasons for our support of the MFA and why we think it must continue after 1991. My only worry is that, although the MFA will be with us until 1991, the Minister may not. Ministers have a nasty habit of moving on, and it may well be that my hon. Friend's career will have reached even greater heights by then and we will have rehearsed our arguments and support in vain.
I am grateful for this opportunity to make a short speech. Not many years ago a debate on textiles would have resulted in a heavy post-bag from my constituents. That is not so today, and it is a sad reflection of the massive reduction in textile jobs in Hyndburn. Nevertheless, the textile industry is still important to north-east Lancashire as a whole, not least in Pendle, in which it is the largest single employer. My hon. Friend the Member for Pendle (Mr. Lee) regrets that because of ministerial duties he is unable to be present.
I have received only one letter urging my support for the continuation of the MFA, but my hon. Friend the Member for Pendle has received several. They make interesting reading. For example Thomas Mason of Primet Mills, Colne wonders who has had the benefit of the high street boom, commenting that the great British public are certainly not buying shirts. All the letters make basically the same three points.
First, they say that the MFA is imperfect but that it offers the best protection for employment. Secondly, they say that in the long term jobs can be protected only by modernising plant, and that can be done only if the industry is confident that there is a market for its products. Thirdly, there is concern about the downturn in trading
Column 601activity over the past few months, which, the Blackburn and District Textile Manufacturers Association says, has resulted in a number of companies arranging, or considering, short-time working. There is no doubt that there is growing apprehension about the level of activity in the textile indusry. The considerable success in exports, not least by the Hilden Manufacturing Company in Oswaldtwistle, which won the Queen's award for export and industry, is threatened by the strength of sterling. At home the effect of higher interest rates is likely further to depress demand. In those circumstances, the need for a strong MFA is greater than ever before.
The fourth renewal of the MFA in July 1986 provided the supplying countries with considerable scope for increased access to the Community market, and those opportunities have been seized. Textile and clothing imports from MFA supplying countries have increased from 205,000 tonnes in 1985 to 331,000 tonnes in 1987--a 62 per cent. increase. Only the constraints of the MFA have held back an even faster and more damaging wave of imports.
In supporting the MFA, hon. Members from textile areas are asking, not for protection from fair competition, but for protection from unfair competition. I accept that the MFA has given the United Kingdom's textile and clothing industry more protection from the growth of the low-cost imports than any other United Kingdom manufacturing sector. Given the textile industry's history, it is no more than the people of that industry deserve.
Having lived all my life in a textile area, I have seen at first hand the problems caused to ordinary working people by job losses in textiles. Mill towns such as Accrington were devastated. I should not like that to happen in other areas. It was tragic to see skilled, hard-working people, with an industrial relations record second to none, who had readily accepted attempts to improve
competitiveness--shift working, job flexibility and low wage increases-- thrown on the scrap heap. It was a bewildering experience for them, and they were given no large redundancy payments. The textile industry and the people in it have earned our support. It is often said that by protecting our textiles we are hurting the people in the Third world countries. I want help to be given to those countries, but that help must come from the country as a whole. It must come from other countries as well, not just from one section of one country. The remaining textile workers in my constituency cannot be asked to accept an increased burden if workers in the United States, Japan and Australia are not prepared to do so.
As we have seen from the figures, the MFA has allowed European Community imports to grow, and by providing guaranteed and growing access to developed markets it has greatly assisted developing countries to advance their exports in an orderly trading environment. If we abandoned the MFA it would lead to chaos, not least in Third world countries. Political pressure would build up in each developed country to enact strong protectionist legislation, which would have serious and mainly negative implications for textiles and world trade generally.
For that and the other reasons that I have outlined, I support the MFA and its continuation in 1991. In the
Column 602meantime, I look forward with great interest, and not a little anxiety, to the further report by Professor Silberston. I hope that the major flaws which invalidated much of his previous report will not be repeated in the next one.
Mr. Bob Cryer (Bradford, South) : I understand that during my absence for a minute or so at the beginning of the debate the Minister referred to my absence. My pervasive presence in the Chamber--
Mr. Alan Clark : Who told the hon. Gentleman that?
Mr. Cryer : If that was not so and the Minister was merely missing me, I am happy to know that my absence, even for only a minute, is recognised. I thought that I would mention that because two or three people have raised it with me.
Hon. Members have mentioned the importance of the textile industry to more than 500,000 employees. Lest anyone be under an illusion, it is not an antique industry. It has much investment and is modern and up to date, and should be recognised as such. The MFA should be renewed, subject to a number of qualifications about its application.
I have been a supporter of the MFA since its inception because it is better to plan trade than to leave it to market forces. It allows ordered access for the developing countries. That access has been increasing since the MFA's inception, and I do not think that any group can say that it has been unfairly penalised. As my hon. Friend the Member for Halifax (Mrs. Mahon) said, we need a social clause for the MFA and the GATT--a sort of fair wages clause--by which we can ensure that there are trade union rights and health and safety standards for the countries which are seeking access through the MFA. That was the kind of request that was made in the 1970s during debates in the Chamber.
A letter from Initial Service Textiles states :
"We understand that there will be a debate in the House of Commons on Friday this week about the textile industry and the renewal of the Multi- fibre Agreement.
We believe that the renewal of the Multi-fibre Agreement is vital for the future of the British Textile Industry and also the European Textile Industry."
I imagine that it is referring to that section of Europe called the Common Market. It continued :
"We have been at the forefront in investing heavily in capital equipment to make our factories some of the most modern in the world. Our Company has been increasing its turnover by 20 per cent. per annum and has been expanding its export sales to the EEC year after year.
Whilst we have no objection to fair competition, we need to ensure that effective controls are put on textile producing areas where there is, in our opinion, unfair competition. The use of Government subsidies such as in Turkey, Pakistan and India combined with wage rates in certain countries of £50.00 per month are hard to combat. We believe that the renewal of the Multi-fibre Agreement in some form is essential to ensure that this sort of competition is controlled."
I endorse that viewpoint, and am glad to put it on the record. One problem, which has been echoed across the Chamber, is that the application of the MFA is not in the Government's hands. The Minister must, to the best of his ability, use his influence to counter the indifference of the EEC. Although the Government may already be attempting to do that, the fact remains that the Government have capitulated time and again to the EEC.
Column 603The Single European Act is one example. I understand that a three-line Whip was imposed on that measure, which gave the EEC yet more power. The Government have virtually capitulated over origin markings, against the wishes of the textile industry. Consumers have the right to know comprehensively the source of products on sale in this country. The Common Market does not like that because it does not want individual member states to be recognised--it wants a universal Euro blur. We must recognise the pressures coming from the Common Market and the Government must be prepared to stand against them.
Mr. Alan Clark : The hon. Gentleman was a Member of the European Parliament and he knows how these matters work. He and I have our views about the Single European Act, but it exists and majority voting applies. To say that we must stand up to Common Market pressures is just an empty phrase.
Mr. Cryer : The Minister knows that the Strasbourg Assembly does not apply the MFA. That is done by the Commission.
Mr. Alan Clark : The Council of Ministers.
Mr. Cryer : I accept that the Council of Ministers makes decisions and that it has majority voting on a number of issues, including the MFA, but surely the Commission can be pressurised rather more effectively than has happened to date. I accept that it is a difficult process, but the Government could use the threat of a repeal of section 2 of the European Communities Act 1972. The Minister might have a sympathetic streak towards that, but he will not get far in the Government if he says so. Some leverage must be exercised against the Euro blur, which is too often favoured by the Council of Ministers and the Commission. When the MFA was renegotiated in 1978, the then Commissioner in charge--a Viscount--put forward views opposed to those of the Government and we summoned him to London to explain that. He was a little upset, but he was forced to come, and strong views were expressed to him.
As a nation, we must be prepared to recoup from the Commission, for example, our anti-dumping powers. I am not suggesting that we break agreements, but we should attempt to negotiate our way out of such agreements. We must be in a position where we can make better judgments. The problem is that, after receiving representations, the Minister's judgment cannot be exercised because he is bound by the terms of various agreements, the application of which is sometimes not in his hands. That is the difficulty. There are times when the nation needs to make a judgment about circumstances affecting manufacturing industry and then to apply that judgment. That includes trading relations with other countries, the rights of access for developing nations and the need to preserve sections of our manufacturing industry and the jobs that go with them.
In that context, I want to mention Turkey, which is not a signatory to the MFA, although strong elements in the Community want Turkey to join the Community. Turkey is in breach of the treaty of Ankara in a number of ways. It promised not to apply massive duties, but it does. I asked the Minister in an intervention about the question of definition under the agreement with Turkey.
Column 604It is a difficult one, but we need more information from the Minister. The industry has provided information and has an anti-dumping application in process at the moment.
Efforts could be made again to renegotiate the relevant section of the agreement, because it has proved damaging. Up to last summer, 600 jobs had been lost in the Bradford travel-to-work area as a result of the import of Turkish acrylic fibre yarns. Bradford has a slogan about "Bradford bouncing back". In view of those job losses, Bradford is bouncing backwards.
The textile industry has undergone a great deal of diminution. There are 500,000 jobs in the industry now, whereas a few years ago there were 700,000 jobs in textiles and clothing, and the erosion of jobs has gone too far. I hope that the Minister can develop the criteria for damage, so that they will be of greater advantage to our country. The Minister must recognise that once damage has been done, it cannot easily be reversed.
The Government's general economic policy is not a help. That is reflected in a letter from the British Clothing Industry Association, the British Textile Confederation and the Knitting Industries' Federation, that is, in the words of the employers, not the employees. The letter says :
"But we now share a growing apprehension about the level of activity over the coming months and beyond. On the export front, where we have had considerable success, the strengthening of sterling has made it difficult to maintain the pace of advance. At home, the effect of higher interest rates is likely to depress consumer and retail demand. The weak United States dollar has materially increased the competitiveness of imports, particularly from those countries in the Far East whose currencies are linked to the dollar, and this has had a twofold impact : pressure on the market place, and pressure on prices and margins, reflected in some areas of the textile industry by short-time working, closures and redundancies. There is concern about future orders across a growing area of our joint industries." That must be linked to the huge trade deficit, which has been growing under the present Government. Between January and September, in textiles and clothing it was £2.5 billion. It has been emphasised that workers in the industry have been co-operative over the years and in return for their co-operation in every improvement, with three-shift working and so on, many have been kicked in the teeth, with redundancies and mill closures. The workers in the industry deserve better.
The industry does not deserve the privatisation of water supplies, which will almost certainly lead to increased prices. The Confederation of British Wool Textiles Ltd. has expressed the view that it is opposed to water privatisation. Again, that is the view of the employers, not of the employees. Neither employers nor workers deserve the prospect of increased electricity charges. Electricity is a basic component of manufacturing industry. No matter how reasonable the Minister appears to be, he is part of a driving force that has the ideology of privatising virtually everything in sight. That is damaging for British manufacturing industry, and the workers must be warned never to put their trust in a Tory Government.
It is ironic, when we are talking about the textile industry and the need to retain jobs in it, that the current issue of CBI News contains a big advertisement saying :
"Just think Hong Kong and you've got it made."
The CBI is not backing British industry by giving space to that advertisement which does not seem to provide much benefit for workers. I hope that the Minister will take that point on board. We know that he has some sympathy for
Column 605the industry and we hope that he will try to translate that into practical action, in spite of all the difficulties that he faces from his colleagues.
Mr. David Tredinnick (Bosworth) : I want to argue the case, not just for the continuation of the multi-fibre arrangements, but for the continuation of an effective MFA after 1991. I do so, proudly representing 90 hosiery and knitwear companies in my Bosworth constituency, which employ about 16,000 workers, and against a background of the recent loss of 5,000 jobs in the east Midlands. These losses include 200 redundancies in my constituency, mostly in the dyeing and finishing trades, including 80 at Sunnydale Knitwear in Hinckley and another 30 at Trinity Dyeworks.
I will argue for an effective MFA because, when the MFA was renegotiated in 1986, many concessions were made that increased access from low-cost suppliers. I advise my hon. Friend the Minister for Trade that there should not be the same level of concessions in 1991, given the difficulties of the high exchange rate that the industry faces at the moment and the effects of the watering down of the MFA in 1986.
The first factor that reduced the effectiveness of the MFA in 1986 was the substantial uplift of quota levels in the first year of the new agreement. Secondly, the new annual quota growth rates were generally higher than under the previous agreement. Thirdly, the flexibility allowed to exporting countries to transfer quota from one year to another or one product to another was increased. Fourthly, quota transfer between EEC member states was allowed automatically, within limits--a new facility.
I shall dwell on that point for a moment as it is significant, because, if quotas can be exchanged and used throughout the EEC, there is nothing to stop a predator country or a low-cost producing country from targeting one particular country in one year, and knocking out its industry. This country --and London in particular--is an ideal target, because within 1 square mile of London a potential buyer could capture 80 per cent. of the market. To expand on that, 14 retail outlets account for 80 per cent. of the United Kingdom's garment sales. What a target that would be for a country such as China. What is to stop a country, under the new arrangements, saying, "Let us go for London this year. Let us wipe out the London market. Let us go for it." By London, I mean the hosiery and knitwear companies in Hinckley, Earl Shilton, Barwell and Anstey, which I represent and whose products are sold in the London market. We must be careful about that.
Hon. Members have referred to the textile and clothing trade deficit. I shall not dwell on that, except to say that the figures show that imports from MFA suppliers have increased sharply. However, it is clear that the MFA's strengths have held back what would have been a faster and more damaging wave of imports had the MFA not existed.
I turn briefly to three issues, two of which have been touched on in the debate. The first is China. In an intervention I referred to the damage caused to the industry in my constituency. I am grateful to my hon. Friend the Minister for allowing me to intervene in his