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Aid and Trade Provision
Mrs. Clwyd : To ask the Secretary of State for Foreign and Commonwealth Affairs how many applications for aid and trade provision funds to support contracts between developing countries and General Electric Company, Plessey, Northern Engineering Industries, BICC and Trafalgar House have been refused since 1979.
Mrs. Chalker : Since aid and trade provision funds first became available in 1977, a total of 169 applications have been formally considered from the five companies named. These have led to 133 offers of aid ; six applications are still under consideration. Of the 30 remaining cases, our records do not distinguish between those which were refused, and those which fell away for other reasons.
Mrs. Clwyd : To ask the Secretary of State for Foreign and Commonwealth Affairs in how many aid and trade provision supported projects since 1979, the minimum test of developmental soundness was not carried out by the Overseas Development Administration.
Mrs. Chalker : Since 1979 all aid and trade provision supported projects have been assessed to provide a reasonable assurance of the soundness of the investment.
Mrs. Clwyd : To ask the Secretary of State for Foreign and Commonwealth Affairs (1) how many internal, confidential, Overseas Development Administration evaluations of aid and trade provision projects contain references to excess profit margins, above departmental profit margin guidelines ;
(2) how many published Overseas Development Administration evaluations of aid and trade provision projects contain references to excess profit margins, above departmental profit margin guidelines ; (3) in how many internal, confidential, Overseas Development Administration evaluations of aid and trade provision projects profit margins are considered ;
(4) in how many published Overseas Development Administration evaluations of aid and trade provision projects profit margins are considered.
Mrs. Chalker : For negotiated contracts, value-for-money checks, which are undertaken before the provision of ATP funds is agreed, include consideration of anticipated profit margins. Two of the ATP projects that have been evaluated involved contracts awarded in 1978 and 1982 prior to the introduction of value-for-money checks ; the evaluations considered anticipated profit margins in these cases and concluded that these were not excessive.
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Mrs. Clwyd : To ask the Secretary of State for Foreign and Commonwealth Affairs (1) how many internal, confidential Overseas Development Administrationevaluations of aid and trade provision projects include references to corrupt practices ;
(2) how many published Overseas Development Administration evaluations of aid and trade provision projects include references to corrupt practices.
Mrs. Chalker : In one evaluation report of an ATP-financed project there is a reference to allegations of undue influence in relation to the arrangements made for the consideration of competing bids by a tender committee. The contract was awarded to the firm making the lowest-priced bid.
Mrs. Clwyd : To ask the Secretary of State for Foreign and Commonwealth Affairs (1) if he will give details of Overseas Development Administration guidelines on profit margins used in evaluating applications for aid and trade provision funding ; (2) whether applicants for aid and trade provision grants must state the profit margins expected by British contractors when applying for funds ;
(3) whether consideration is given to the level of profit margins when a contract between a British company and a developing country Government is considered for a grant from the aid and trade provision.
Mrs. Chalker : There are no general guidelines on profit margins for assessing applications by companies for ATP assistance made available to developing country Governments to help them finance overseas projects. Companies are not required to state their expected profit margin when applying for ATP assistance. In general, value for money in all aid-funded projects is sought by means of competitive tendering for contracts. In the case of a negotiated contract, in the absence of competition, we undertake a detailed value-for-money check of the proposed contract price, including an assessment of the anticipated profit margin.
Mrs. Clwyd : To ask the Secretary of State for Foreign and Commonwealth Affairs whether allocations of aid and trade provision funds include contributions towards commission payments.
Mrs. Chalker : An ATP grant helps finance a proportion of the total contract price for the purpose of providing only the eligible goods and services specified in the contract. Payments are made in accordance with the terms of the ATP aid agreement between Her Majesty's Government and the recipient Government and of the contract.
Mrs. Clwyd : To ask the Secretary of State for Foreign and Commonwealth Affairs whether consideration is given to the amount of commission payments when a contract between a British company and a developing country is considered for a grant from the aid and trade provision.
Mrs. Chalker : In the case of a negotiated contract between a British firm and a developing-country Government, where competitive bidding has not taken place, the detailed value-for-money check scrutinises all components of the contract price, including any agents' fees.
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Mrs. Clwyd : To ask the Secretary of State for Foreign and Commonwealth Affairs whether, in the allocation of aid and trade provision funds to contracts between British companies and developing countries, consideration is given to contributions made by British companies to British political parties.Column 198
Mrs. Clwyd : To ask the Secretary of State for Foreign and Commonwealth Affairs on what date aid and trade provision funds were offered for the Pergau hydro-electric project in Malaysia ; what is the value of the grant offered ; what is the value of the total contract ; and when the first instalment of aid is likely to be released.
Mrs. Chalker : I refer the hon. Lady to the reply I gave her on 22 October, at column 25.
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Pergau Hydro-electric Project
Mrs. Clwyd : To ask the Secretary of State for Foreign and Commonwealth Affairs (1) which companies, other than Balfour Beatty, General Electric Company and Trafalgar House have sought contracts for the Pergau hydro-electric project in Malaysia ;
(2) whether the Government have sought bids from companies other than Balfour Beatty, General Electric Company and Trafalgar House for the Pergau hydro-electric project in Malaysia ;
(3) whether Balfour Beatty, General Electric Company and Trafalgar House tendered for the contract for the Pergau hydro-electric project in Malaysia.
Mrs. Chalker : The client for the Pergau hydro-electric project is Tengah Nasional Berhad--TNB--the Malaysian power utility ; it is for TNB to decide from whom it should invite proposals. It would not therefore be appropriate for Her Majesty's Government to provide such information.
TRADE AND INDUSTRY
Spirits (Australia)
Mr. Sims : To ask the Secretary of State for Trade and Industry what steps are being taken by Her Majesty's Government to persuade the Australian Government to amend their import duty/excise structure so as to put imported and locally produced spirits on an even footing.
Mr. Sainsbury : Following representations by United Kingdom industry, the Government have, through the European Community, alerted the Australian Government to their concern at certain practices that discriminate against imported spirits, and have sought to secure their elimination. We are addressing this issue in the Uruguay round of multilateral trade negotiations.
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Accountancy Bodies
Mr. Austin Mitchell : To ask the Secretary of State for Trade and Industry what matters he intends to discuss with the presidents of the accountancy bodies during his next meeting.
Mr. Redwood : I expect that, as usual when I meet leading representatives of the accountancy profession, we shall discuss matters of current mutual interest.
Mr. Austin Mitchell : To ask the Secretary of State for Trade and Industry whether the current president of any of the bodies listed in section 389 of the Companies Act 1985 is or has been a partner in a firm criticised by his Department's inspectors.
Mr. Redwood : Thornton Baker, now part of Grant Thornton, Chartered Accountants, was criticised in the inspectors' report on Gilgate Holdings Ltd. and others, which was published in 1981. Mr. M. Lickiss FCA, currently president of the Institute of Chartered Accountants in England and Wales, and Professor J. Percy CA, currently president of the Institute of Chartered Accountants of Scotland, are partners in Grant Thornton.
Mr. Austin Mitchell : To ask the Secretary of State for Trade and Industry whether he will be meeting the president of the Institute of Chartered Accountants in England and Wales in the near future.
Mr. Redwood : I met him on 8 October and have no plans for a further meeting in the near future.
Mr. Austin Mitchell : To ask the Secretary of State for Trade and Industry whether any accountancy firms criticised by his Department's inspectors act as auditors to public bodies sponsored by his Department.
Mr. Redwood : Six reports, issued since June 1979 by inspectors appointed under the Companies Act have contained criticisms of accountants who act as auditors to public bodies sponsored by my Department. They are as follows :
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Name of company |Date of publica- |Firm of accountants
|tion of report
-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Gilgate Holdings Ltd. and others |8 September 1981 |Thornton Baker and Co. (now Grant Thornton)
Norwest Holst Ltd. |23 June 1982 |Price Waterhouse
Ramor Investments Ltd. |23 March 1983 |Price Waterhouse
Milbury plc |27 October 1988 |Arthur Young (now Ernst and Young)
Minet Holdings plc and WMD Underwriting Agencies |29 August 1989 |Arthur Young (now Ernst and Young)
Alexander Howden Holdings Ltd. |29 August 1989 |Arthur Young (now Ernst and Young) and Peat
|Marwick and Mitchell of Bermuda (now Peat
|Marwick McLintock)
Mr. Austin Mitchell : To ask the Secretary of State for Trade and Industry whether any accountancy firms criticised by the joint disciplinary scheme act as auditors to public bodies sponsored by his Department.
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Mr. Redwood : Three reports issued since 1980 by the committee of inquiry appointed under the joint disciplinary scheme, have contained criticisms of firms of accountants who act as auditors to public bodies sponsored by my Department. They are as follows :
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Name of company |Date of report |Firm of accountants
--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Gilgate Holdings Ltd. and others |22 December 1982 |Thornton Baker (now Grant Thornton)
Orbit Holdings Ltd. |28 March 1983 |Peat Marwick Mitchell & Co (Peat Marwick Mclintlock)
Ramor Investments Ltd. |27 January 1986 |Price Waterhouse
Mr. Austin Mitchell : To ask the Secretary of State for Trade and Industry whether he intends to take any criminal or civil action against auditors criticised by the inspectors in the Minet Holdings report.
Mr. Redwood : No. A copy of the Minet report has been passed to the Institute of Chartered Accountants in England and Wales.
Mr. Austin Mitchell : To ask the Secretary of State for Trade and Industry if he will invite the Office of Fair Trading to investigate the accountancy bodies' control of the accountancy press.
Mr. Redwood : I have no plans to do so. The hon. Member is of course free to put his concerns on this subject to the Director General of Fair Trading, who will look into any competition issues which arise.
Mr. Austin Mitchell : To ask the Secretary of State for Trade and Industry whether he will seek to legislate to ban the call-off stocks accounting method used by companies.
Mr. Redwood : It would be helpful if the hon. Member would explain the nature of the problem he has in mind, as "call-off stocks" is an imprecise phrase.
Audit Policy
Mr. Austin Mitchell : To ask the Secretary of State for Trade and Industry whether he will publish the recommendations which his Department has made on the review of the Auditing Practices Committee's review of operations.
Mr. Redwood : The Government attach great importance to the role of the Auditing Practices Committee in setting auditing standards and in developing auditing guidance. I, therefore, welcome the decision of the Consultative Committee of Accountancy Bodies to review the constitution, procedures and resources of the Auditing Practices Committee and look forward to the outcome.
Mr. Austin Mitchell : To ask the Secretary of State for Trade and Industry whether the law firm criticised in the House of Fraser report acts as an adviser to any audit policy-making organisation.
Mr. Redwood : If the hon. Member is referring to the firm of solicitors which acted for the Fayed brothers, I understand that a partner in that firm is a non-voting member of the Auditing Practices Committee.
Mr. Austin Mitchell : To ask the Secretary of State for Trade and Industry on how many occasions he has taken any civil or criminal action against any auditing firm criticised in the Department of Trade and Industry inspectors' reports.
Mr. Redwood : None. Copies of critical reports are passed to the auditors' professional body for consideration.
Inspectors (Business Connections)
Mr. Austin Mitchell : To ask the Secretary of State for Trade and Industry whether he will provide a list showing the business connections of inspectors appointed by his Department since 1985.
Mr. Redwood : The information requested by the hon. Member is as follows :
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1985J. R. Sendall of the Department of Trade and Industry
H. B. H. Carlisle QC
M. G. Lickiss of Grant Thornton, Chartered Accountants N. Bohm, solicitor, of Norton Rose
A. Ridler of Pannell Kerr Forster, Chartered Accountants 1986
Sir Michael Kerry QC
K. S. Carmichael of Longcrofts, Chartered Accountants D. T. Donaldson QC
I. G. Watt of KPMG Peat Marwick McLintock, Chartered Accountants R. G. A. Youard, solicitor, of Slaughter and May
D. Anton of Coopers & Lybrand Deloitte, Chartered Accountants 1987
M. McIver, solicitor, of Bird Semple Fyfe Ireland WS
D. J. McLeod of Ernst & Young, Chartered Accountants
H. Brooke QC
H. G. C. Aldous of Robson Rhodes, Chartered Accountants J. F. Eden, solicitor, of Bevan Ashford
C. H. C. Chudley of Bromhead & Co., Chartered Accountants 1988
L. D. Ziman of Nabarro Nathanson, Solicitors
W. M. Hoffman of Baker Tilly, Chartered Accountants
D. A. Evans QC
B. L. Worth of Clark Whitehill, Chartered Accountants
Miss M. H. Arden QC
G. N. Lane of Chantrey Vallacott, Chartered Accountants G. W. Staple of Clifford Chance, Solicitors
T. G. J. Tress of Hays Allen, Chartered Accountants
P. L. Heslop QC
R. P. G. Lewis of Kidsons Impey, Chartered Accountants M. Crystal QC
D. L. Spence of Grant Thornton, Chartered Accountants
1989
E. J. Lawson QC
D. Anton of Coopers & Lybrand Deloitte, Chartered Accountants D. A. Evans QC
B. L. Worth of Clark Whitehill, Chartered Accountants
Miss H. Heilbron QC
M. D. Boohan of Grant Thornton, Chartered Accountants G. S. Moss QC
J. R. Venning of Robson Rhodes, Chartered Accountants R. M. Owen QC
P. D. Powell of Moore Stephens, Chartered Accountants
1990
C. J. Brougham QC
R. T. Turner of Neville Russell, Chartered Accountants
E. W. Hamilton QC
J. A. Scott of BDO Binder Hamlyn, Chartered Accountants C. P. F. Rimer QC
J. White of KPMG Peat Marwick McLintock, Chartered Accountants
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Company Legislation
Mr. Austin Mitchell : To ask the Secretary of State for Trade and Industry whether he will seek to introduce legislation to require companies to show market value of their stocks.
Mr. Redwood : No. There is already a similar legislative requirement. Paragraph 27 of schedule 4 to the Companies Act 1985 requires companies to disclose in their annual accounts the amount of any material difference between the amount at which stock is stated in the balance sheet and its replacement cost, or its most recent actual purchase price if more appropriate.
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