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Mr. Maude : I know that a great many people are seeking to find a way to my hon. Friend's constituency. I shall certainly speak to my right hon. Friend about whether steps can be taken to enable them to find their way to it more easily.
Cordless Telephones
12. Mr. Wood : To ask the Chancellor of the Duchy of Lancaster what progress is being made in discussions between his Department and the industry in connection with the development of the next generation of cordless telephones.
Mr. Forth : We have issued some 2,000 copies of the consultation document "Personal Communications in the 1990s" and held initial briefing meetings with a number of companies. We are asking for responses to the document by 28 April.
Mr. Wood : I thank my hon. Friend for that response. Will he ensure that the discussions are sufficiently brisk and that the aims are sufficiently straightforward to enable us to have successful competitive manufacturing in that sector, without undue Government or other bureaucratic delays that could adversely affect our competitive position?
Mr. Forth : I can give my hon. Friend that undertaking, but I believe that he will agree that we have already demonstrated as a country remarkable success in that area due to the liberal regime allowed by the Government. We will continue with that policy in the hope that we will continue to be world leaders in what will be an important industry in the future.
Mergers and Acquisitions
13. Mrs. Fyfe : To ask the Chancellor of the Duchy of Lancaster what information he has on the percentage increase in expenditure on mergers and acquisitions since 1979.
Mr. Maude : Expenditure on acquisitions and mergers by industrial and commercial companies within the United
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Kingdom in 1988 is estimated to be about £22 billion. In current prices, that is about 13 times greater than the 1979 total of about £1.75 billion.Mrs. Fyfe : Does the Minister agree that, if Scottish industry did not have to spend so much effort in fighting off mergers and takeovers, it could create new work, which might help a constituency such as mine where the official unemployment rate is 22 per cent.?
Mr. Maude : The idea that merger and acquisition activity reduces employment is manifestly absurd. Over the period when merger and acquisition activity has been at its height, unemployment has come down and employment has risen to record levels. The premise on which the hon. Lady bases her question is utterly absurd.
Mr. John Marshall : Does my hon. Friend agree that the Government should be congratulated on not allowing the bid for Scottish and Newcastle Breweries? Scottish Members should congratulate my hon. Friend rather than indulge in negative comments.
Mr. Maude : My hon. Friend is right to draw attention to the careful scrutiny of that bid by the Monopolies and Mergers Commission. As a result of the commission making an adverse public interest finding, the bid was not allowed to proceed. I did not hear all that many cheers from the Opposition when that happened.
Mr. Foulkes : Does the Minister think that it is wise for former holders of his ministerial post subsequently to take up paid appointments as advisers on mergers and acquisitions? Is that not a misuse of the information and knowledge gained in that post?
Mr. Charles Wardle : Precisely because merger activity has increased so much would it not make sense, particularly because of the conflict of interest that exists between investment management and corporate finance, to bring the role of merchant bank advisers under the aegis of the Financial Services Act 1986, as some of us recommended in the debate on the financial services White Paper four years ago?
Mr. Maude : My hon. Friend was lucky enough to be privy to discussions on that Bill at which I was unable to be present. I suspect that his proposal to extend the scope of the Financial Services Act into an area which, at the moment, it does not cover would not be at all welcome. There are proper mechanisms for making sure that conflicts of interest do not arise and that proper interests are preserved. It would not be right to extend the system in the way that my hon. Friend suggests.
Hosiery and Knitwear Industry (Leicester)
14. Mr. Janner : To ask the Chancellor of the Duchy of Lancaster if he will make a statement on the current state of the hosiery and knitwear industry in Leicester.
Mr. Alan Clark : The hosiery and knitwear industries continue to make a major contribution to Leicester's economic and industrial development. They continue to adapt to technological and other changes, to the further benefit of local and national economies.
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Mr. Janner : While noting the Minister's tribute to the hosiery, knitwear and textile industries may I ask him whether he recognises that there is still grave concern in those industries about the continuing recession and that there is also concern in my constituency about the redundancies in Coras? How many jobs have been lost in Leicester in the hosiery and knitwear industries in the last few years and what is the Minister proposing to do, if anything, to help those industries to survive in the light of the increased water charges that are now on the way?
Mr. Clark : The hon. and learned Gentleman sometimes reproaches hon. Members for not addressing him as learned, although I do not think that he aspires to the sobriquet of gallant. As a man of the law, the hon. and learned Gentleman will know that there are many international restrictions. Trade in textiles is governed by treaty, by arrangement and by restraint arrangements.
Mr. Skinner : And the Minister does not like them.
Mr. Clark : I would tighten them up if I could. The hon. and learned Gentleman well knows that any interference with the flow of trade outside those limits would lay one open both to judicial review and to legal action by importers.
Export Promotion
17. Miss Widdecombe : To ask the Chancellor of the Duchy of Lancaster if he will make a statement on progress on recent initiatives on export promotion.
Mr. Alan Clark : Since the launch of My Department's export initiative about 3,000 inquiries have been received in response to our advertisements in the press alone. I believe that the initiative has been well received by British industry and is succeeding in encouraging more businesses to export successfully.
Miss Widdecombe : Is it true that the initiative is costing about £100 million per annum? If so, what is likely to be the long-term effect on our balance of payments? Will it repay this investment?
Mr. Clark : The total amount expended in export promotion by the Government is £100 million per annum, or rather more. The initiative has a number of different headings, chiefly related to the giving of advice and information to would-be exporters. Export initiatives single market campaigns, such as Focus Germany and the Opportunity Japan campaigns have been extremely successful. During the year in which the campaign was in place, our exports to Germany increased by 17 per cent. compared with an international average increase of 3 per cent.
Mr. Dalyell : Is the Minister satisfied with the operation of the exchange equalisation account?
Mr. Clark : The exchange equalisation account is a matter for my right hon. and hon. Friends in the Treasury. In so far as it affects the exchange rate, plainly, one has to accept that it is a transient and temporary phenomenon. Many traders would probably prefer it not to exist or to operate at all.
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Information Technology
19. Mr. Eadie : To ask the Chancellor of the Duchy of Lancaster when he expects Britain to have a trade surplus in information technology.
Mr. Newton : It is not possible to make a prediction of the kind that the hon. Member seeks. What is important is that the Government's economic policies have led to record levels of productivity, output and investment and have helped to attract companies like Fujitsu, which will provide a major boost to our balance of trade in information technology through both exports an import substitution.
Mr. Eadie : I thank the Minister for his answer but would it not have been better, in all candour, for him to have said "unlikely"? Since, in reply to a similar question, the Minister made it clear that the Government policy was to make Britain attractive to foreign investment, and since we are told that there is a lot of footloose capital and industry in this country which apparently prefers to invest abroad rather than in Britain, how does that square with the Minister's policy that he has enunciated to the House?
Mr. Newton : I see no inconsistency whatever. Not only are a lot of people from overseas investing here, as has become clear in recent weeks, but there has been a substantial increase in the rate of investment by Britons in manufacturing industries and in other sectors. Our aim is to make the whole country a good place to invest in for foreigners and those already here, and we have succeeded in that.
Liquidations (Investor Losses)
20. Mr. Foulkes : To ask the Chancellor of the Duchy of Lancaster what information he has concerning losses to investors in financial institutions which have gone into liquidation over the last 12 months.
Mr. Maude : My Department only keeps records of those financial institutions in respect of which it has itself applied for compulsory winding-up orders. In the past 12 months such action has been taken against eight financial institutions. In these cases the losses to investors are estimated at £4 million. This figure does not include cases where winding-up orders were sought by the Securities and Investments Board.
Mr. Foulkes : Is the Minister aware that Greenan Investment Management in Ayr went into liquidation with a loss to investors of £1 million? Following this up, I find that some of those investors will not be fully compensated by the investors' compensation management scheme. Will the Minister look into the matter to see whether there are ways in which compensation can be improved? I understand from Sir Anthony Barrowclough, the Parliamentary Commissioner, that his report on Barlow Clowes, which was expected this month, will take several months more because of the complicated nature of the investigations into the affair, which he is supervising personally. In the light of that, does the Minister think that it is fair to ask investors to wait many more months before they have any chance of receiving compensation, or will he now consider some kind of scheme to help those who have
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lost very substantially indeed, some of whom are retired people, including retired miners in my constituency, who are now in great difficulties as a result of the collapse?Mr. Maude : I am very much aware of the distress and hardship caused to people whose money was not repaid to them following the liquidation of Barlow Clowes. I cannot comment on how long the Parliamentary Commissioner's investigation will take ; it is a matter entirely in his control and it is for him to draw it to a conclusion when he can. All I can say is that my Department has co-operated fully with his investigation at every stage.
As regards providing compensation at this stage, I must tell the hon. Gentleman that I see no reason now for changing the view that we reached in the autumn, when we concluded, on the basis of Sir Godfray Le Quesne's detailed and exhaustive report, that the Department's handling of the case had been careful and considered and that, on those grounds, there was no basis for making ex gratia payments.
Merchant Ships (Orders)
23. Mr. Clay : To ask the Chancellor of the Duchy of Lancaster what recent information he has on new orders for merchant ships.
Mr. Newton : Based on information from Lloyd's register, new orders as well as completions in 1988 were at the lowest level for many years. The most recent figures
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suggest that a period of recovery may be beginning, but there is little evidence that it will be lasting and it is expected that the world shipbuilding market will remain dominated by considerable excess capacity for several years.Mr. Clay : The Minister must also be aware of figures from Lloyd's maritime information service which I have sent him. They demonstrate conclusively from the most reliable source in the world that for the kind of ships built by British shipyards and, in particular, North East Shipbuilders in Sunderland, the last quarter of 1988 was the best for new orders for many years and that what we were told by the Government throughout last year and the year before, which was that there was no evidence of an upturn, has proved categorically wrong. We also now know that in 1988 prices for new build ships rose by 30 per cent. in one year. Has not the penny finally dropped that the Department of Trade and Industry has got this wrong and that this is a crazy time to close major British shipyards?
Mr. Newton : I have two comments. First, the hon. Gentleman puts more weight on the statistics to which he referred than they will bear. Secondly, whatever the state of demand for shipbuilding, it is necessary-- as it was, unhappily, in the case of North East Shipbuilders Ltd.--to consider the prospects against the background of those seeking to run the yards so that they will be able to build such ships in a competitive and commercial way.
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