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ECOFIN

Mr. Forman : To ask the Chancellor of the Exchequer if he will make a statement on the outcome of the latest meeting of the European Community's Economic and Finance Council.

Mr. Ryder : The ECOFIN Council met in Brussels on 18 December. The Chancellor of the Exchequer represented the United Kingdom. The abolition of fiscal frontiers was discussed. The Presidency concluded that the Community should aim to reach a decision on VAT standard rates by the end of 1991 on the basis of a rate band or a minimum rate within a 14 to 20 per cent. band. The Chancellor of the Exchequer recorded the United Kingdom's view that Community decisions on tax rates are neither necessary nor desirable, but the Chancellor of the Exchequer stated that there is no present intention of diverging from the 14 to 20 per cent. bracket of the standard rate of VAT. The Chancellor of the Exchequer reiterated also the importance to the United Kingdom of retaining zero rates. We now expect work to move forward on the technical systems of collecting VAT and excise duties after 1992, on a basis that is fully acceptable to the United Kingdom.

Eleven member states, including the United Kingdom, were prepared to accept the Commission's proposals for improving mutual assistance between tax authorities to counter tax evasion, but Luxembourg is still unable to do so.

Company Cars

Mr. Malcolm Bruce : To ask the Chancellor of the Exchequer if he has any plans to abolish tax relief on company cars.

Mr. Lilley [holding answer 18 December 1989] : I cannot anticipate my right hon. Friend's Budget statement.

Tax Recovery

Mr. David Shaw : To ask the Chancellor of the Exchequer if he will list the results of those High Court cases in the last two years in which the Inland Revenue has sought to recover £1 million or more of tax revenue.

Mr. Lilley [holding answer 19 December 1989] : The information requested could be provided only at disproportionate cost.

Tax Avoidance and Evasion

Mr. David Shaw : To ask the Chancellor of the Exchequer if he will call for and publish a report by the Inland Revenue on the current extent of tax avoidance and evasion.

Mr. Lilley [holding answer 19 December 1989] : Because of their nature it is not possible to measure accurately the overall extent of tax avoidance and evasion.

Tax Havens

Mr. David Shaw : To ask the Chancellor of the Exchequer what estimates he has of tax revenue which is being lost through the creation of business transactions carried out solely or mainly for tax reasons between


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United Kingdom-based individuals and companies and trusts and companies located in (a) Jersey, (b) the Isle of Man, (c) Guernsey, (d) the Netherlands Antilles, (e) the Cayman Islands and (f) Liechtenstein.

Mr. Lilley [holding answer 19 December 1989] : I regret that the information requested is not available.

Mr. David Shaw : To ask the Chancellor of the Exchequer what is the latest estimate he has of assets owned by United Kingdom resident companies and individuals which have been disposed of or transferred to (a) the Isle of Man, (b) Guernsey, (c) Jersey, (d) the Cayman Islands and (e) the Netherlands Antilles corporate, trust or individual ownership in each of the last five years.

Mr. Lilley [holding answer 19 December 1989] : I regret that the information is not available on which to base such estimates.

Capital Gains Tax

Mr. David Shaw : To ask the Chancellor of the Exchequer what has been the effect on revenues of raising the top rate of capital gains tax to 40 per cent.

Mr. Lilley [holding answer 19 December 1989] : The 1988-89 FSBR estimated the yield from aligning capital gains tax and income tax at £70 million in 1988-89 and £65 million in 1989-90. However, tax on gains realised in 1988-89, the first year for which capital gains were charged at income tax rates, became payable from 1 December 1989. It will therefore be some time before sufficiently complete information about 1988- 89 liabilities is available.

Accounting Firms

Mr. David Shaw : To ask the Chancellor of the Exchequer which accounting firms are or have been involved in privatisation work ; and which of those accounting firms maintain affiliated offices in (a) Jersey, (b) the Isle of Man, (c) Guernsey, (d) the Netherlands Antilles, (e) the Cayman Islands and (f) Liechtenstein.

Mr. Lilley [holding answer 19 December 1989] : The following accountants have been, or are currently engaged by the Government in connection with the privatisation programme :

Arthur Andersen

Binder Hamlyn

Coopers and Lybrand

Deloittes, Haskins and Sells

Ernst and Whinney

Peat Marwick Mitchell

Price Waterhouse

Thomson McLintock

Touche Ross

Now merged.

Now merged with Arthur Young to become Ernst and Young. Now the merged firm of Peat Marwick McLintock

Details of their affiliated offices may be obtained from the firms in question.

Solicitors

Mr. David Shaw : To ask the Chancellor of the Exchequer which solicitors firms are or have been involved in privatisation work ; and which of those firms maintain affiliated offices in (a) Jersey, (b) the Netherlands Antilles or (c) the Cayman Islands.


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Mr. Lilley [holding answer 19 December 1989] : The following solicitors have been, or are currently, engaged by the Government in connection with the privatisation programme ;

Allen and Overy

Ashurst Morris and Crisp

Coward Chance

Clifford Turner

Freshfields

Field Fisher Waterhouse

Herbert Smith

Linklater and Paines

Lovell White and Durrent

McGrigor Donald

McKenna

Norton Rose

W. and J. Burness

Coward Chance and Clifford Turner have merged to become Clifford Chance.

Details of their affiliated offices may be obtained from the firm in question.

Environmental Damage

Mr. Malcolm Bruce : To ask the Chancellor of the Exchequer if he has any plans to revise economic indicators to take into account the environmental impact of industrial processes.

Mr. Lilley [holding answer 18 December 1989] : My right hon. Friend the Chancellor of the Exchequer has no plans at the present time.

Friendly Societies

Mr. Forman : To ask the Chancellor of the Exchequer whether the Chief Registrar of Friendly Societies has yet considered the representations made to him for an increase in the financial limits set in the Credit Unions Act 1979 ; and if he will make a statement.

Mr. Ryder : The Chief Registrar of Friendly Societies has held discussions on the representations with the representative bodies. He told them last year that he accepted in principle the case for increases, but that he needed further confirmation that the work which the bodies had done to ensure that their member societies were properly run was bearing fruit. He is now satisfied on the basis of improvements since then that the increase in limits can be made without running risks to members' funds.

The Chief Registrar accordingly sought Treasury consent to an order under the Credit Unions Act 1979 increasing the limit on the size of loans to £5,000, with similar increases in other limits. I gave that consent. The order has been laid today, and will take effect on 1 February 1990.

I hope that these increases will help the credit union movement at this relatively early stage in its development, immediately by enabling unions to give an enhanced service to their members, and thereafter by encouraging more groups to form such unions.

DEFENCE

Poland

Mr. Cox : To ask the Secretary of State for Defence what plans he has to visit Poland.

Mr. Archie Hamilton : My right hon. Friend the Secretary of State has no current plans to visit Poland.


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I was there at the beginning of September for the commemoration of the outbreak of world war 2.

Trident

Mr. John Evans : To ask the Secretary of State for Defence if he will make a statement on the progress of the Trident missile programme.

Mr. Alan Clark : The Trident programme continues to progress to time and budget towards its in-service date of the mid-1990s.

Defence Policy

Mr. Allen : To ask the Secretary of State for Defence what practical changes in policy have arisen from the new situation in eastern Europe.

Mr. Adley : To ask the Secretary of State for Defence what reassessment he has made of defence policy in the light of political changes in the Warsaw pact countries ; and if he will make a statement.

Mr. Archie Hamilton : I refer the hon. Member and my hon. Friend to the answer I gave to my hon. Friend the Member for Richmond and Barnes (Mr. Hanley) on 28 November 1989 at column 573.

RAF St. Mawgan

Mr. Rogers : To ask the Secretary of State for Defence (1) how many hardened aircraft shelters are being constructed at RAF St. Mawgan ; (2) what is the purpose of the hardened aircraft shelters being constructed at RAF St. Mawgan ;

(3) who is funding the hardened aircraft shelters being constructed at RAF St. Mawgan.

Mr. Archie Hamilton : Nine hardened aircraft shelters are being constructed at RAF St. Mawgan to provide protection for Buccaneer aircraft. The airfield is designated as a forward operating base for these aircraft. Costs are being met from NATO common infrastructure funds.

Explosives and Propellants

Mr. Rogers : To ask the Secretary of State for Defence what has been the expenditure on explosives and propellants in each of the years since 1979.

Mr. Alan Clark : Expenditure related to explosives and propellants is not available as we purchase the great majority of these components as an integral part of ammunition, mines and bombs. Our approximate expenditure (VAT inclusive, in year cost) on those weapons, but excluding guided weapons and rocket motors, was :


Year      |£ million          

------------------------------

1985-86   |380                

1986-87   |395                

1987-88   |400                

1988-89   |350                

Data for earlier years are currently in our archives. I will write to the hon. Member once the information has been retrieved.


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Mr. Rogers : To ask the Secretary of State for Defence how many explosive and propellant contracts were placed in the periods (a) January to July 1987, (b) July to December 1987, (c) January to July 1988, (d) July to December 1988 and (e) January to July 1989 ; and what are the values of those contracts.

Mr. Alan Clark : The value of the explosives and propellants purchased by the Ministry is not recorded separately. The approximate number and values of orders for ammunition and stores containing explosives and propellants, but excluding those for guided weapons and rocket motors and orders placed under international collaborative arrangements were :


-----------------------------------------

1 January 1987-20 June 1987  |35 |29     

1 July 1987-31 December 1987 |50 |99     

1 January 1988-30 June 1988  |60 |37     

1 July 1988-31 December 1988 |45 |145    

1 January 1989-30 June 1989  |60 |128    

Rover Group

Mr. Allan Rogers : To ask the Secretary of State for Defence whether any moneys were given to the Rover Group to help correct deficiencies in the DROPS contract.

Mr. Alan Clark : No.

Berlin

Mr. Harry Greenway : To ask the Secretary of State for Defence if he has any plans to review the role of British defence forces in Berlin ; and if he will make a statement.

Mr. Archie Hamilton : British forces will continue to fulfil our responsibilities for the protection of Berlin in conjunction with those of other Allies.

Submarines

Ms. Short : To ask the Secretary of State for Defence pursuant to his reply to the hon. Member for Caernarfon (Mr. Wigley) of 28 November, Official Report, column 568, if he will give brief details of all of the incidents which have taken place in water far too shallow for submarines.

Mr. Archie Hamilton : Examples of which I am aware include the losses of FV Tijl Eulenspiegel on 5 March 1989 and FV Salve Regina on 6 December 1987 and allegations that the FV Crystal Sea was towed backwards on 17 October 1987.

The Ministry of Defence does not however maintain records of accidents to civilian shipping where there is no military involvement.

Fishermen's Associations

Ms. Short : To ask the Secretary of State for Defence, pursuant to his reply to the hon. Member for Carrick, Cumnock and Doon Valley (Mr. Foulkes) of 28 November, Official Report, column 245, if he will list the dates and meetings which have taken place and which are planned to take place between the Royal Navy and fishermen's associations.


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Mr. Archie Hamilton : The following meetings have been held between fishermen's organisations and the Royal Navy during the past year :

20 June 1989--Maritime Liaison Meeting.

4 August 1989--Meeting between Senior Naval Officers and the West Coast Committee of the National Federation of Fisherman's Organisations.

1 December 1989--Clyde Annual Fishing Liaison Meeting.

14 December 1989--Fishermen's representatives spent a day at sea in HMS SCEPTRE in the Firth of Clyde.

Further meetings are planned. The dates and details of these are still to be agreed.

Sea-based Weapons

Ms. Short : To ask the Secretary of State for Defence, pursuant to his reply to the hon. Member for Eastwood (Mr. Stewart) of 28 November, Official Report, column 571, whether sea-based weapons systems will be included in the consideration of significant reductions on the NATO side.

Mr. Archie Hamilton : By agreement of all participants, maritime forces are specifically excluded from the mandate for the CFE negotiations.

Warsaw Pact War Materials

Ms. Short : To ask the Secretary of State for Defence, pursuant to his reply to the hon. Member for Faversham (Mr. Moate), of 28 November, Official Report, column 570-71, if he will list the types and numbers of the war materials being newly produced by the Soviet Union and the Warsaw pact.

Mr. Archie Hamilton : I refer the hon. Lady to the answer I gave my hon. Friend the Member for Bolton, North-East (Mr. Thurnham) on 30 November at column 360.

Frigates

Mr. Devlin : To ask the Secretary of State for Defence if he will make a statement on the outcome of the recent competition for Duke class type 23 frigates.

Mr. Trotter : To ask the Secretary of State for Defence what steps he is taking to implement the Royal Navy's requirement for vessels to modernise its escort force.

Mr. Neubert : I refer my hon. Friends to the answer I gave yesterday to the hon. Member for Clackmannan (Mr O'Neill) at column 197.

Conventional Arms Planning

Mr. Menzies Campbell : To ask the Secretary of State for Defence what considerations prompted United Kingdom participation in the NATO conventional arms planning system agreement ; and if he will make a statement.

Mr. Alan Clark : The United Kingdom, in common with other NATO nations, participated in the trial of a conventional armaments planning system to determine whether a system could be devised to meet the following objectives : to provide guidance to the conference of national armaments directors (CNAD) and orientation to


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the nations on how the military needs of the Alliance can best be met by national armaments programmes, individually and collectively, and to help to elaborate armaments co-operation opportunities and priorities for CNAD.

The trial was completed in October, and NATO Ministers, meeting in the reinforced council in November, adopted the recommendation put to them by CNAD, that two full cycles of the conventional armaments planning system should now take place over the next four years, based on procedures derived from the lessons learnt during the trial.

Developing Defence Industry Countries

Mr. Menzies Campbell : To ask the Secretary of State for Defence what is his policy towards the developing defence industry countries, in the light of the NATO report entitled "Shared Roles, Risks and Responsibilities in the Alliance."

Mr. Archie Hamilton : NATO has long accepted the need for assistance to be given to developing defence industry countries to help them meet their defence requiremens. We provide assistance in a variety of forms, including training and credit support for sales of defence equipment.

Procurement Executive

Mr. Menzies Campbell : To ask the Secretary of State for Defence what is the job description of the director of contracts and organisation in the Procurement Executive of his Department.

Mr. Neubert : To develop the procedural and organisational framework for handling the contractual aspects of certain new initiatives, notably at present those concerned with contracting for reliability, implementation of the Next Steps policy and the establishment of the new management strategy.


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