House of Commons Hansard Debates for 1 Nov 1989

Mr. Ridley : I have received 370 representations following my request for views on the "no discrimination" rule, which requires traders to charge the same price for purchases made with credit cards as for those paid for by cash or other means. I am still considering these before reaching a decision.

Mr. Franks : I am grateful to my right hon. Friend for his statement. As and when a decision is taken, will he ensure that the interest of the consumer is paramount? In this context, the consumer is not only the individual who uses the credit card, but the supplier who looks to the credit card company for payment.

Mr. Ridley : I agree that the interests of the consumer are paramount. The difficulty in this case is to decide which alternative best serves the interests of the consumer.

Mr. Loyden : Would the Secretary of State like to comment on the suggestion that credit cards should be made available to 12-year-olds?

Mr. Ridley : If they have sufficient credit, it would be possible, but I doubt that they would have.

Mr. Ian Taylor : Does my right hon. Friend recognise that outstanding credit on a monthly basis in relation to credit cards equals only 6 per cent. in comparison with the total credit outstanding? Will he note, therefore, that the Labour party's attempt to penalise credit in relation to credit card holders is extremely marginal, like the rest of Labour policy?

Mr. Ridley : My hon. Friend is right. The point here is not credit control, but what is in the best interests of consumers, as my hon. Friend the Member for Barrow and Furness (Mr. Franks) said in his supplementary question.

North East Shipbuilders Ltd.

12. Mr. Clay : To ask the Secretary of State for Trade and Industry what are his latest intentions concerning the future of North East Shipbuilders Ltd ; and if he will make a statement.

Mr. Douglas Hogg : British Shipbuilders will continue discussions with those who have shown interest in purchasing parts of North-East Shipbuilders Ltd., following the statement by my right hon. Friend the Secretary of State for Social Security who was then Chancellor of the Duchy, on 13 July, with a view to a speedy resolution of the future of the NESL sites.

Mr. Clay : Does the Minister accept that it is nonsense for his Department to tell British Shipbuilders that in the case of the Anglo-Greek bidders, who are bidding for the North Sands yard for ship repairs and conversion, they have to sign a legally binding agreement not to construct ships there until December 1993 at a time when they require no subsidy from the Government to build ships, as they want to build them on their own account? Britain has a rapidly mounting trade deficit which will be made worse by the closure of our shipbuilding capacity. Given that the

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Minister admitted a fortnight ago to the Select Committee on Trade and Industry four different points that the Government had got wrong about this tragedy and farce, is it not time that he recognised that he has got the whole thing wrong and allowed people who want to build ships to get on with it, and to re-employ workers in Sunderland?

Mr. Hogg : Until the hon. Gentleman reached the penultimate and last parts of his question, he was doing rather well because he was asking a perfectly respectable question. It is nonsense to attribute four errors to me and it is even more foolish to attribute a total error to the Department.

On the substantive question, the hon. Gentleman will recall that I gave evidence to the Select Committee on Trade and Industry on 18 October and that I gave an extremely full response to questions such as the hon. Gentleman's. The plain fact is that I would not support any shipbuilding project in Sunderland in the next five years because it would result in an unpicking of the package of remedial measures put in place in December 1988. The future of Sunderland lies with that package rather than with a small shipbuilding venture.

Mr. John Marshall : Will my hon. Friend remind the House of the amount of money that taxpayers lost since the shipbuilding industry in Sunderland was nationalised?

Mr. Hogg : I do not have the exact figure in my mind, but I know that no contract has been built to cost in the recent past, and during the past five years Sunderland was losing 50 per cent. on each contract.

Mr. Henderson : Does not the Government's latest provision finally prove to the House that they have been trying to assassinate not only Sunderland but all British merchant shipbuilding?

Mr. Hogg : The hon. Gentleman does not do himself credit. If he had listened to the statement by my right hon. Friend the Chancellor of the Duchy in December 1988, he would recall that the remedial package that was put in place provided for about £45 million worth of expenditure or forgone tax, most particularly an enterprise zone, and £10 million for retraining for the assistance of small business. To try to characterise that as assassination is plain nonsense and does the hon. Gentleman no credit.

Regional Stimulation

13. Mr. Harry Barnes : To ask the Secretary of State for Trade and Industry if he has any new plans for stimulating industry in British regions.

Mr. Douglas Hogg : Changes in the focus of our regional policies were made early last year. There are no plans for further changes.

Mr. Barnes : In the Derbyshire, North-East constituency in recent years, there has been a decline in coalmining, which will be exacerbated by the ports Bills that hon. Members are due to discuss and a reduction in employment caused by declining railways. The decline in employment is due also to the steel industry in the travel-to-work area and the rationalisation that is taking place in the chemical industry. What has the Department of Trade and Industry done to help my constituents and similar constituents? The Government have cut regional funding by 72 per cent. since 1979. Will they alter their

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policy in the run-up to 1992, or are we to expect the same policy from the free enterprise fanatics on the Government Front Bench?

Mr. Hogg : Once again we have a case of an hon. Gentleman who has not reflected on his question before asking it. I was disappointed that he did not pay tribute to my right hon. Friend the Chancellor of the Duchy, who managed to get the Chesterfield travel-to-work area made eligible for European structural grants. It would have been at least charitable to reflect on that. The Government's substantial instruments of policy are selective and effective. The principal Department of Trade and Industry instruments are regional selective assistance, regional enterprise grants, the consultancy initiative and the ability of English Estates to build in deprived areas. That is a powerful and carefully targeted arsenal of policies.

Mr. Oppenheim : Does not the Opposition's pose as the friend of manufacturing industry in the regions wear a little thin when hon. Members bear in mind that the Opposition have opposed every one of the Government's supply side reforms aimed at increasing the competitiveness of manufacturing? Manufacturing output fell under the last Labour Government, whereas, under this Government, it has risen, particularly in Derbyshire, where manufacturing output and employment have risen faster than in most other regions.

Mr. Hogg : My hon. Friend is wholly right. It is because we have adhered to our policies that we have seen dramatic downturns in unemployment, which would have gone up had we accepted the policies of the Labour party. Between March 1986 and September 1989 in the northern region unemployment fell by 18.1 per cent. to 10.4 per cent. In the north-west region it fell from 16.6 per cent. to 9.2 per cent. In Yorkshire and Humberside it fell from 15 per cent. to 8.3 per cent. That is a tribute to the Government's regional policy.

Mr. Wigley : In view of the potential importance of projects in companies such as Nissan and Toyota, does the Minister accept that one way of trying to stimulate employment in manufacturing in areas of high unemployment is to encourage joint ventures between those companies and component manufacturers within the United Kingdom? Does the Minister accept also that it would be particularly helpful if there were positive incentives to locate such developments in areas of high unemployment?

Mr. Hogg : Such joint ventures are indeed, extremely valuable and they may well be eligible for, for example, regional selective assistance.

Mr. Riddick : Does my hon. Friend agree that one of the most destructive policies for industry in the regions would be if the Government were to impose economic sanctions on South Africa, a policy advocated by the Labour party? Does he realise that such a policy would throw hundreds if not thousands of engineering workers in Yorkshire on to the dole queue? Will he assure the House that the Government will never adopt such a destructive and counter-productive policy?

Mr. Hogg : This afternoon we have identified two policies of the Labour party which would be extremely damaging in that respect. The first is its policy on defence cuts and the second its policy of economic sanctions

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against South Africa. The mainstream policies of the Labour party would result in a substantial increase in unemployment.

Mr. Caborn : In the absence of any co-ordinated regional policy, is the Minister aware that all the reports from Europe clearly show that the industrial regions of the north will feel the winds of 1992 quite adversely? Is he also aware of the Audit Commission report "Urban Regeneration and Economic Development" which in its conclusion says :

"Government support programmes are seen as a patchwork quilt of complexity and idiosyncrasies. They baffle local authorities and business alike."

There are now 14 instruments in the urban and regional and regeneration programme which nobody can understand and their funding has gone down by 72 per cent. on the 1979 figure.

Mr. Hogg : The hon. Gentleman's longwindedness does not improve his argument. He and his hon. Friend's were clearly not paying attention when I identified the carefully chosen selective instruments of policy which we have put in place. The consultancy initiative in particular is directed to the problems that will arise in 1992 and thereafter.

Loss Adjusters

14. Mr. Nicholas Baker : To ask the Secretary of State for Trade and Industry if he will seek to regulate the conduct of loss adjusters.

Mr. Redwood : It is the responsibility of the professional associations of which they are members to maintain the professional standards of loss adjusters.

Mr. Baker : Is my hon. Friend aware that loss adjusters acting for insurance companies frequently browbeat and bully innocent claimants? Will my hon. Friend remind insurers that their duty is to recompense people who have suffered losses that are covered by insurance policies? Does my hon. Friend agree that practices of the kind that I have outlined should be drawn to the attention of the Director General of Fair Trading?

Mr. Redwood : I am disturbed to hear my hon. Friend's accusations. If he has a particular case in mind he should refer it to the professional body concerned because such bodies have disciplinary powers over their members. If my hon. Friend thinks that the abuses are widespread, he should talk or write to the Director General of Fair Trading because he has powers to negotiate a code of conduct with the professions if he thinks that that is necessary.

Dr. Reid : Many Opposition Members would like to be associated with the genuine compliments paid to the Secretary of State for Trade and Industry by his Conservative colleagues because we have found out that such compliments are the political equivalent of the last meal of a condemned man. The Secretary of State is not only unique, he is quite brilliant. I would have said "unassailable" but I think that unsaleable--

Mr. Speaker : Order. I gave the hon. Gentleman a chance to ask a question about loss adjusters.

Dr. Reid : Is the Minister aware that if a loss adjuster visited the Clydesdale tube works in Scotland he would find that less damage had been caused over the past five

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years by accidental death, burglary and fire than by the absolute refusal by British Steel to invest in that tube works? Will the Minister encourage British Steel to put in some investment?

Trade Statistics

15. Mr. Alan W. Williams : To ask the Secretary of State for Trade and Industry which Organisation for Economic Co-operation and Development countries have a trade surplus or a smaller trade deficit as a proportion of gross domestic product than the United Kingdom.

Mr. Redwood : All OECD countries except Portugal, Greece and Spain were in one or other category in 1988, the latest year for which complete figures are available.

Mr. Williams : Is it not an appalling comment on 10 years of Thatcherism that we are almost at the bottom of the world league and that we have the largest balance of payments deficit of any advanced country and the largest in our post-war history? Why is the country so economically weak and defenceless against that invasion of imports? How will the Government's policy of high interest rates and an overvalued pound help us out of that mess?

Mr. Redwood : I am not surprised that the hon. Gentleman should highlight that particular issue rather than the many good issues that should be highlighted about the state of the economy. Is the hon. Gentleman aware that the latest figures show that the unemployment rate in the Carmarthen travel-to-work area is down to 3.5 per cent? That is a fine tribute to the success of the Government's economic policies and I should have thought that he would want to say someting positive about that.

The hon. Gentleman must look more carefully at the state of the British economy to see the many good things that are going on. Why, for example, does he make no reference to the fact that we have the highest stock of overseas assets relative to our GNP of any country? Why does he not refer to the largest invisible surplus of any country? Why does he not refer to the fact that export volume is now up 11 per cent. on-- [Interruption.]

Mr. Speaker : Order. We should have the answer to the question.

Mr. John Townend : How long will it be before the import penetration in the automobile industry is reduced as a result of the massive investment, particularly from Nissan, Toyota and Honda? What effect will that have on the balance of trade?

Mr. Redwood : I was hoping to come to that in answering the hon. Member for Carmarthen (Mr. Williams) more fully. Export volume has grown by 11 per cent. in the past three months. As my hon. Friend the Member for Bridlington (Mr. Townend) rightly says, major investments have been announced by three large Japanese motor manufacturers, which will make a substantial increase to car manufacturing capacity in this country in the early and mid-1990s. As a large element in the deficit on manufactured goods lies in the vehicle sector, my hon. Friend is right to look forward to much better trading conditions in manufactured motor vehicles as a result of that positive inward investment.

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It is a sign of the times that we are attracting a large amount of inward investment as people recognise the strengths of the British manufacturing base and the potential here for selling into 1992. A few years ago the Opposition were complaining when we were in the reverse position--when we had a surplus and were investing overseas. Now people are investing here to cure our balance of payments and trade deficit.

Mr. Gould : Given the appalling deterioration in our trade performance, which the Minister has been obliged to reveal in his answer-- incidentally, that gives the lie to the blusterings of his hon. Friend the Minister about the competitiveness of British industry--what explanation does the Minister offer the House for what has happened, or in common with his right hon. Friend the Secretary of State, does he have no view to offer?

Mr. Redwood : I thought that Opposition Members were complaining that I had too many views as there is a lot to say about the strengths of the British manufacturing economy. I repeat that it is a sign of strength that people want to invest here. We have had a deficit in recent months because demand has outstripped supply in the short term. My right hon. Friend the Chancellor of the Exchequer has taken the prudent course of raising interest rates to slow the rate of growth in the economy, so that the supply side can catch up. I am sure that, in due course, that policy will be successful. I am also sure that inward investment will make an important contribution to changing the balance of payments position.

Timber Industry

16. Mr. Gill : To ask the Secretary of State for Trade and Industry what representations he has received regarding alleged unfair competition in the timber industry as a result of subsidies to sawmills in Wales.

Mr. Douglas Hogg : Save for my hon. Friend's letter of 31 August, I am not aware of having received any other representations about unfair competition in the timber industry.

Mr. Gill : Does my hon. Friend accept that there is documented evidence that shows that elements of unfair competition have been introduced into industries, notably the timber industry in this case, as a result of decisions made under regional policies? Will he take this opportunity to deprecate those instances of interventionism?

Mr. Hogg : I cannot do that as I believe that there are powerful economic and social arguments in favour of our regional policy that I outlined in answer to an earlier question. I recognise that when deciding whether to grant aid in particular cases a number of criteria must be taken into account. One of them is, necessarily, the effect on indigenous industries.

Consumer Protection

20. Mr. Shersby : To ask the Secretary of State for Trade and Industry what proposals he has concerning manufacturers' obligations to provide United Kingdom consumers of motor vehicles and major household appliances with reliability and after sales service ; and if he will make a statement.

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Mr. Forth : The consumer contracts with a supplier, who is normally a retailer not a manufacturer, and it is against the supplier that the consumer has a right of action under the Sale of Goods Act 1979 for defects in the goods supplied. Manufacturers who provide consumers with guarantees of reliability or with after sales service, do so voluntarily and in addition to the consumer's statutory rights against the supplier.

The Government intend to implement by means of legislation recommendations by the Law Commissioners which clarify and strengthen the consumer's rights under the Sale of Goods Act.

Mr. Shersby : My hon. Friend's reply will be most welcome. However, will the legislation incorporate the proposals which have been prepared by the National Consumer Council and will those improvements be harnessed to serve the needs of the consumer?

Mr. Forth : I am grateful to my hon. Friend. I can certainly confirm that we are studying the recommendations of the National Consumer Council most closely, as we do all the work of that excellent organisation. I am not yet in a position to say what, if any, elements of its recommendations will be incorporated in future legislation. I am aware that when we legislate we should put together the most effective and up-to-date package in the consumer's interest, and that we shall do.

3.32 pm

Mr. Wareing : On a point of order, Mr. Speaker. You will have noticed that at the end of the list of questions to the Secretary of State for Trade and Industry there are no fewer than 14 questions about this country's trade deficit which have been transferred to the Chancellor of the Exchequer. I understand from a spokesperson at the Department of Trade and Industry that this is because the Central Statistical Office is now responsible for trade figures. First, hon. Members should have been notified, and secondly, these questions should rightfully be answered by the Secretary of State for Trade and Industry. This is yet another attempt by the Secretary of State for Trade and Industry to evade answering questions. When I received a written answer to my own question it was an answer about the deficit in the balance of payments, which was not what my question was about. Right hon. and hon. Members have a right to have trade deficit questions answered by the Minister responsible, the Secretary of State for Trade and Industry.

Mr. Speaker : I should like to be able to help the hon. Gentleman. I refer him to the 21st edition of "Parliamentary Practice" which has just come out. On page 286 it states :

"It is a long established principle that decisions on the transfer of questions rests with Ministers and it is not a matter in which the Chair seeks to intervene."

I am sorry.

Mr. Andrew MacKay : Further to that point of order, Mr. Speaker. You will have noticed that a significant number of Labour Members have put down questions on today's Order Paper and then failed to turn up. Would you be good enough to deprecate that because it is not only an insult to you in the Chair, but unfair to hon. Members from both sides of the House who, having seen a question

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on the Order Paper, hope to catch your eye on a supplementary question but find that the original questioner is not here?

Mr. Speaker : It is a courtesy to the House if the Chair is told when Members are unable to be present for the very reasons mentioned by the hon. Gentleman. Of course, the fact that some hon. Members are not here today has meant that we have been able to reach question No. 20, which was a bit of good luck for the hon. Member for Uxbridge (Mr. Shersby).

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Mr. Campbell-Savours : On a point of order, Mr. Speaker. You will have heard today the utterly outrageous statement by the Secretary of State for Trade and Industry that 12-year-olds should be able to use credit cards. I wonder whether-- [Interruption.]

Mr. Speaker : Order. That is a clear continuation of Question Time and not a matter of order for me. An Opposition day prayer has been set down and if it were possible for me to limit speeches I would do so today because such a large number of hon. Members wish to participate. Points of order which are not points of order are a disservice to the House.

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