House of Commons Hansard Debates for 21 Jun 1989

Direct Investment

35. Mr. Bill Michie : To ask the Chancellor of the Duchy of Lancaster what is the balance of inward and outward direct investment ; and what it was 10 years ago.

70. Mrs. Dunwoody : To ask the Chancellor of the Duchy of Lancaster what is the balance of inward and outward direct investment ; and what it was 10 years ago.

Mr. Atkins : In 1988, net direct investment overseas by United Kingdom residents was £15.1 billion, compared with overseas net direct investment in the United Kingdom of £7.8 billion, giving a net outflow of £7.3 billion. The corresponding figures for 1978 were £3.5 billion and £2.0 billion respectively, giving a net outflow of £1.5 billion.

Sterling Exchange Rate

36. Mr. Menzies Campbell : To ask the Chancellor of the Duchy of Lancaster what advice his Department is giving to export industries regarding the exchange rate of sterling.

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Mr. Alan Clark : Our consistent advice to exporters on exchange rates has been that they should consider protecting themselves against the risk of exchange rate fluctuations and consult experts about the best way of doing this.

Eden Committee

37. Mr. Illsley : To ask the Chancellor of the Duchy of Lancaster when he proposes to introduce legislation to implement the recommendations of the Eden committee which were accepted by Her Majesty's Government.

Mr. Forth : Those recommendations accepted in the Government's response (Cmnd. 9850) to the report of the Eden committee which did not require primary legislation have already been implemented. It remains my Department's intention to introduce legislation to implement the remaining accepted recommendations when parliamentary time is available.

EC Consumer Affairs Committee

38. Mrs. Clwyd : To ask the Chancellor of the Duchy of Lancaster if he will make a statement on the outcome of the European Economic Community Consumer Affairs Council held on 1 June.

Mr. Forth : As I announced to the House on 12 June, the Council reached agreement on a number of issues, including amendment to the consumer credit directive on December 1988 and continued support into 1990 for the European home and leisure accident surveillance system. The Commission presented a proposal for a general product safety directive which was discussed for the first time by EC Ministers. Council also noted a report by the Commission on consumer education. The United Kingdom was unable to support adoption of a draft resolution for the relaunch of consumer policy because of its proposals relating to product quality, which would constrain consumer choice without benefit in terms of additional protection.

Goods (United Kingdom Manufacture)

39. Sir Russell Johnston : To ask the Chancellor of the Duchy of Lancaster what steps he is taking to encourage people to purchase goods made in the United Kingdom.

Mr. Alan Clark : The greatest encouragement to purchasing from United Kingdom sources is the availability of competitive United Kingdom products. My Department's policies are geared to helping businesses achieve this.

Natural Environment

40. Mr. Blunkett : To ask the Chancellor of the Duchy of Lancaster whether he has any plans to require the annual publication by firms of the effects of their business on the natural environment.

Mr. Newton : No. We believe the emphasis should be on increasing business awareness of environmental issues and helping firms to improve their environmental standards. This is what the DTI environmental programme launched last month is designed to achieve. Details of the programme are set out in the booklet, "Your Business and the Environment", copies of which have been placed in the Vote Office and Library.

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Motor Manufacturers (Investment)

41. Mr. Strang : To ask the Chancellor of the Duchy of Lancaster if he will estimate the level of investments in the last financial year by indigenous motor manufacturers.

Mr. Atkins : The most recent reliable estimate of investment is from the annual census of production for 1987. In that year it is estimated that net capital expenditure by the United Kingdom motor industry amounted to £612 million.

Class 35 of the standard industrial classification, revised 1980.

Trade Deficits

42. Mr. Hoyle : To ask the Chancellor of the Duchy of Lancaster which Organisation for European Economic Co-operation and Development countries are running a smaller trade deficit as a percentage of gross domestic product than the United Kingdom.

Mr. Alan Clark : According to the most recent OECD figures, of the 14 countries which recorded deficits on their visible trade in 1988, those of the following were smaller, as a proportion of their GDP, than that of the United Kingdom :

Austria, Turkey, Switzerland, Iceland, United States of America, France, Italy, Norway, Australia and Belgium.

59. Mr. Eadie : To ask the Chancellor of the Duchy of Lancaster with which European Economic Community members Britain's trade is in deficit.

Mr. Alan Clark : In the 12 months to April the United Kingdom was in deficit on visible trade with Belgium/Luxembourg, Denmark, Federal Republic of Germany, France, Italy, the Netherlands and Portugal.

Inner-city Task Forces

43. Mr. Brandon-Bravo : To ask the Chancellor of the Duchy of Lancaster what further progress has been made in the 16 inner-city task forces.

51. Mr. Michael Brown : To ask the Chancellor of the Duchy of Lancaster if he will make a statement on the progress of the inner-city task forces.

Mr. Forth : The inner-city task forces have continued to make good progress in meeting their objectives of securing more jobs and training for local people and encouraging local enterprise. Since the task forces began their work in 1986 they have committed about £33 million in support of nearly 1,100 projects. These generate, or safeguard, nearly 4,000 jobs, facilitate over 23,500 training places and provide support for over 2,600 businesses. Over 450 private sector companies have supported task force projects.

We have always made it clear that task forces would not be permanently located in any one inner-city area. One of their aims is to promote the long-term capability of local organisations so that eventually these bodies can take over from them, thus releasing resources for task forces to be set up in other inner city areas. I announced on 9 March, as part of the Government's action for cities anniversary announcements, that the task forces would be withdrawing from Leicester, Wolverhampton and Preston ; and that new task forces would be opening in Bradford, Granby/Toxteth in Liverpool and Deptford in Lewisham.

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49. Mr. Patnick : To ask the Chancellor of the Duchy of Lancaster what estimate he has as to the number of firms which have now been assisted as a result of the activities of the inner-city task forces.

Mr. Forth : Task forces provide a variety of assistance to existing local firms and start-up businesses ; for example, by providing loans through task force development funds and by supporting local enterprise agencies and other organisations offering business advice. Through these and other ways, task forces are estimated to have assisted over 2,600 businesses.

Single Market

44. Mr. Malcolm Bruce : To ask the Chancellor of the Duchy of Lancaster if he will make a statement on the help which is being given to companies to enable them to take full advantage of the establishment of the internal market in 1992.

Mr. Maude : Our 24-hour "1992 hotline"--01-200 1992--provides business with access to a wide range of information and advice on the single market, including detailed factsheets, booklets on standards, and an action checklist. Practical help and advice is available through our enterprise initiative ; the consultancy initiatives and the export initiative are particularly relevant for firms seeking to take specific steps to prepare for the single market.

The CBI's "Initiative 1992" is a major private sector source of help on the single market ; whilst a number of trade associations, Chambers of Commerce and professional bodies are providing their members with guidance on how the single market will affect their activities.

45. Mr. David Evans : To ask the Chancellor of the Duchy of Lancaster what steps his Department is taking to ensure that British firms are made fully aware of the opportunity to become a member of an European economic interest grouping as a means of preparing for 1992.

Mr. Maude : Full details on the form of a European economic interest grouping are given in our main single market booklet "The Facts" and in an article in the current edition of "Single Market News", copies of which are available through our 24-hour "1992 hotline" : 01-200 1992. The rules on registering an EEIG in Great Britain are given in the statutory instrument SI 1989/638.

56. Mr. Hague : To ask the Chancellor of the Duchy of Lancaster if he will make a statement on progress with regard to arrangements made by his Department to assist British firms to take full advantage of the completion of the internal market in 1992.

Mr. Maude : Our "Europe Open for Business" information service is constantly updated and expanded to help business prepare for the single market. Recent additions include : a booklet and video on the decision- making process in Brussels ("Brussels Can You Hear Me?") ; new standards booklets ("construction products", "simple pressure vessels", "directives under discussion") ; a checklist on progress on single market legislation ("White Paper Checklist"). This material, together with our comprehensive single market information pack, can be obtained free of charge, through our "1992 hotline"--01-200 1992. Two new booklets--an action guide for smaller firms and a guide to public purchasing--will be available later on this summer.

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57. Mr. Livingstone : To ask the Chancellor of the Duchy of Lancaster what recent estimates his Department have made of the effects of 1992 on each of Britain's regions.

92. Mr. Clelland : To ask the Chancellor of the Duchy of Lancaster what further estimates his Department has made on the effects of 1992 on each of Britain's regions,.

Mr. Maude : I refer the hon. Gentlemen to my reply to the hon. Member for Leicester, South (Mr. Marshall) on 19 April at column 177.

Consumer Credit

50. Mr. Simon Hughes : To ask the Chancellor of the Duchy of Lancaster if he will make a statement on the level of personal consumer credit.

Mr. Maude : At the end of March 1989 the amount of consumer credit outstanding on the broad definition, which includes bank lending, was £43.4 billion. The vast majority of household borrowing is accounted for by mortgages.

Sunderland Shipyards

53. Mr. Clay : To ask the Chancellor of the Duchy of Lancaster when he last discussed the future of the Sunderland Shipyards with the chairman of British Shipbuilders ; and if he will make a statement.

Mr. Newton : I met the chairman of British Shipbuilders on 5 June. A number of matters of current interest were discussed, including the disposal of the assets of North East Shipbuilders Ltd.

Toys (CE Mark)

55. Mr. Kirkwood : To ask the Chancellor of the Duchy of Lancaster what representations he has had recently from the toy trade about the length of time to dispose of stocks which do not have CE marks.

Mr. Forth : Representations have been received from various bodies about the length of time needed to dispose of stocks which do not carry the CE mark. The toy industry has sought a longer period than 1 February 1991 or that no cut-off date should be imposed. Consumer organisations are of the opinion that the proposed cut-off date in the draft regulations should not be extended. My Department will carefully consider all the representations received before making final decisions.

Regional Selective Assistance

58. Mr. Hind : To ask the Chancellor of the Duchy of Lancaster if he will make a statement on the levels of regional selective assistance to applicants in the north-west of England in 1988-89.

Mr. Atkins : In the year 1988-89, for the DTI north-west region, offers of regional selective assistance totalled £32.1 million and payments totalled £21.8 million.

China

60. Mr. Gow : To ask the Chancellor of the Duchy of Lancaster whether he will make a statement about trade with the People's Republic of China.

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Mr. Alan Clark : In the light of the recent events in China the Government have announced the suspension of ministerial and high level military exchanges and a ban on arms sales. The ECGD is maintaining cover for the China market, but awaiting clarification of the economic position before taking decisions on respect of new businesses.

Company Liquidity

61. Mr. McFall : To ask the Chancellor of the Duchy of Lancaster what is his latest estimate of company liquidity ; and when it was last lower.

Mr. Maude : The liquidity ratio for all large industrial and commercial companies is estimated by the Department's survey to be 72 per cent. at the end of the first quarter of 1989 on a seasonally adjusted basis. It was lower at the end of the third quarter of 1982.

However, profitability of non-North sea industrial and commercial companies has risen in each year since 1981 and the sector has been a large net saver.

Takeovers and Mergers

62. Mr. McAvoy : To ask the Chancellor of the Duchy of Lancaster what has been the expenditure on takeovers and mergers in the most recent year for which figures are available ; and what has been the spending on research and development, training and manufacturing investment on a comparable basis.

Mr. Maude : Expenditure by industrial and commercial companies on acquisitions and mergers within the United Kingdom during 1988 is estimated to be £22.1 billion. During the same period gross domestic fixed capital formation by industrial and commercial companies is estimated to have been £37.4 billion. No directly comparable figures are available for spending on training or research and development.

Shops (Closing Down Sales)

63. Mr. Gregory : To ask the Chancellor of the Duchy of Lancaster if he has any plans to introduce legislation to prevent shop owners from misrepresenting their closing down in order to attract customers.

Mr. Forth : Part III of the Consumer Protection Act 1987 makes it an offence to give misleading price indications. The code of practice for traders on price indications issued under section 25 of the Act gives guidance on good practice to help traders avoid giving misleading price indications. The code makes it clear that use of the term "sale" normally implies a price comparison and the basis for such a comparison should be made clear to the customer.

Estate Agents

67. Mr. Nicholas Brown : To ask the Chancellor of the Duchy of Lancaster what progress is being made in the regulation of estate agents.

Mr. Forth : Over the past 11 months I have carried out an extensive review of estate agency issues. In the course of this review I have had meetings with the major bodies representing estate agents and other interested parties.

The main objective of the review was to identify ways in which the practices of estate agents could be

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significantly improved to provide a better service. I have concluded that the best way to achieve this is through a combination of self-regulation and statutory provision. I have asked the Director-General of Fair Trading to discuss with the industry the introduction of a code of practice for estate agency to improve consumer protection and enhance standards of service. The code will need to include some form of disputes procedure and a system for monitoring compliance with its provisions. This should create a strong incentive, not least on commercial grounds, for estate agents throughout the industry to comply in order to attract public confidence. The director general has agreed to report to me early next year.

I have also concluded that we need to act against a number of undesirable practices identified in the review of the working of the Estate Agents Act 1979 recently published by the Director General of Fair Trading. I intend to do this by introducing an order under Section 3 of the Act which would define certain practices as "undesirable". I expect these to include, for instance, tie-in sales where the agent refuses to pass on bids unless the purchaser agrees to arrange finance or insurance with hin, "bidding-up", misleading advertising and unfair or misleading contract terms. If an agent is found to be engaging in "undesirable" practices, the director general will have the power to prohibit that person from doing estate agency work. The exact wording of the order will follow from how the code of practice is set out, and I hope to lay an order soon after the director general makes his report next year.

I have also asked the director general to review the arguments for extending the Trade Description Act 1968 to misdescriptions of property.

In the course of my review discussions of the problems and potential solutions have gone wider than estate agency, and have touched on other aspects of the property transfer system. I look forward with interest to announcements by my noble and learned Friend the Lord Chancellor on the subject of competition in conveyancing, and by the Secretaries of State for Scotland and Northern Ireland on the conclusions to their reviews on the position there.

Copies of my report have been placed in the Library and the Vote Office.

Interest Rates

68. Mr. Jack Thompson : To ask the Chancellor of the Duchy of Lancaster what representations he has received on the effects of current interest rates on industry.

90. Mr. Austin Mitchell : To ask the Chancellor of the Duchy of Lancaster what representations he has received on the effects of current interest rates on industry.

Mr. Newton : I have received a number of representations from business about the effects of interest rates on investment. Investment has continued to rise strongly and the DTI's June survey of investment intentions shows that a rise of 13 per cent. of total investment is expected in 1989, with a further increase in 1990.

Brewing Industry (Report)

69. Mr. Morgan : To ask the Chancellor of the Duchy of Lancaster what representations he has received regarding the Monopolies and Mergers Commission report on the brewing industry.

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Mr. Maude : I have had meetings with the Brewers Society and with a number of brewers individually. I have also met representatives of the National Licensed Victuallers Association, the Campaign for Real Ale, the Consumers Association and others. In addition, the Department has received a number of letters, representing a range of views.

Footwear Industry

71. Mr. Pike : To ask the Chancellor of the Duchy of Lancaster when he last met representatives of the British footwear industry ; and what issues were discussed.

Mr. Alan Clark : I attended, and spoke at, the British Footwear Manufacturers Federation's annual luncheon on 14 June. Various issues arose, including the EC Commission's investigation into imports of footwear from Taiwan and South Korea and United Kingdom objectives for the GATT Uruguay round.

Mergers and Acquisitions

73. Mr. Cox : To ask the Chancellor of the Duchy of Lancaster what has been the percentage increase in mergers and acquisitions since 1979.

Mr. Maude : Expenditure on acquisitions and mergers by industrial and commercial companies within the United Kingdom in the 12 months to March 1989 is estimated to be about £19 billion. In current prices this is about 12 times greater than the 1979 total of about £1 billion.

Inward Investment

74. Mr. Pawsey : To ask the Chancellor of the Duchy of Lancaster what was the level of inward investment into the United Kingdom in 1988.

Mr. Atkins : Inward investment into the United Kingdom in 1988 was £11.4 billion of which £7.8 billion was direct investment and £3.6 billion was portfolio investment.

Trade Statistics

75. Mr. Orme : To ask the Chancellor of the Duchy of Lancaster if any changes are planned in the collection of trade statistics after 1992.

76. Mrs. Fyfe : To ask the Chancellor of the Duchy of Lancaster if any changes are planned in the collection of trade statistics after 1992.

Mr. Maude : A proposal for an EC Council regulation, which sets out a revised methodology for the collection of trade statistics between member states of the European Community after 1992 to replace the current procedure based on Customs documentation, has been prepared by the EC Commission and will be considered by EC Ministers later this year.

The Government are seeking to ensure that the collection of these statistics does not impose unnecessary burdens on businesses who are involved in trade between member states and who will be required to provide the relevant data. Recently, this Department has started a consultation exercise seeking the views of trade associations and industry on the possible impact of the proposal.

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Statistics of trade with countries outside the European Community will continue to be collected as at present.

Regional Initiatives

77. Ms. Primarolo : To ask the Chancellor of the Duchy of Lancaster if he plans to announce any new initiatives to benefit Britain's regions.

Mr. Atkins : Major changes in the focus of DTI's policies were made only last year. Regional policy now operates within a framework designed to encourage enterprise and economic growth in all parts of the country but with extra help available for firms in the regions.

Manufacturing Productivity

80. Mr. Wood : To ask the Chancellor of the Duchy of Lancaster what are the latest figures he has for the productivity of manufacturing industry ; and what were the comparable figures one year ago.

Mr. Atkins : In the three months to April 1989 manufacturing productivity, as measured by output per person employed, was at a level of 119.3, based on 1985 equal to 100. This is six per cent. more than the level of 112.5 for the first quarter of 1988.

95. Mr. Knox : To ask the Chancellor of the Duchy of Lancaster what is the most recent figure for output in manufacturing industry ; and what was the figure for the same month in 1973.

Mr. Atkins : In April 1989 manufacturing output was at a level of 118.5, based on 1985 equal to 100. This is 8 per cent. more than the level of 108.8 for April 1973. But my hon. Friend will appreciate that monthly data can be erratic. A firmer based comparison would be that in the three months to April 1989 manufacturing output was 9 per cent. higher than in the same period in 1973. Manufacturing output is now at is highest ever level.

Postal Monopoly

81. Mr. Bowis : To ask the Chancellor of the Duchy of Lancaster when he last consulted the chairman of the Post Office on the lifting or easing of the postal monopoly.

Mr. Newton : We have not consulted the chairman of the Post Office on the lifting or easing of the postal monopoly since 1981. In 1981 the monopoly was suspended for 25 years to permit time-sensitive mail to be delivered by private carriers, provided that they charge a minimum fee of £1 per letter.

Goods (Labelling)

84. Mr. Flannery : To ask the Chancellor of the Duchy of Lancaster if his Department is intending to make any new proposals for the labelling of goods.

Mr. Forth : Additional labelling requirements will come into force over the next year for furniture and furnishings, and toys.

Manufacturing Output

86. Miss Widdecombe : To ask the Chancellor of the Duchy of Lancaster what are the latest figures he has for the output of manufacturing industry ; and what was the comparable figure one year ago.

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Mr. Atkins : In the three months to April 1989 manufacturing output was at a level of 118.0, based on 1985 equal to 100. This is 6 per cent. more than the level of 111.0 for the first quarter of 1988.

British Shipbuilders Ltd.

88. Dr. Godman : To ask the Chancellor of the Duchy of Lancaster when he last met Mr. John Lister, chairman of British Shipbuilders Ltd. ; and what subjects were discussed.

Mr. Newton : I met the chairman of British Shipbuilders on 5 June. A number of matters of current interest were discussed.

Japanese Market

89. Mr. Yeo : To ask the Chancellor of the Duchy of Lancaster what representations he has received about improving access to the Japanese market for British exporters.

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