The Vice-Chamberlain of Her Majesty's Household-- reported her Majesty's Answer to the Address, as follows :
I have received your Addresses praying that the Double Taxation Relief (Taxes on Income) (Uganda), (Ukraine), (India), and (Ghana) Orders 1993 be made in the form of drafts laid before your House. I will comply with your request.
Lords amendments agreed to.
The Parliamentary Under-Secretary of State for Technology (Mr. Patrick McLoughlin) : The aim of local government reform is to improve the accountability, efficiency and effectiveness of all local government services.
Mr. Gerrard : Does the Minister accept that an increase in the number of local authorities with trading standards powers will mean their having to set up their own specialist teams to deal with specific sectors of trade? How does he intend to ensure that that does not exacerbate the current national shortage of qualified trading standards officers, and that the money will be available to provide the extra numbers required?
Mr. McLoughlin : The hon. Gentleman prejudges the Local Government Boundary Commission. That is a dangerous thing for him to do. I am aware of concern about small unitary authorities providing training standards services. However, the reform process involves extensive consultation and affords an ample opportunity for any potential difficulties to be anticipated and solutions developed. The hon. Gentleman's own borough council is a unitary authority, and perhaps he is concerned because it does not provide a good service. That would not be surprising, as it is Labour controlled.
Mr. Waller : Is my hon. Friend aware that the joint committee arrangement that enables the five districts in West Yorkshire to run a combined countywide trading standards service is regarded as successful? Does he agree that the range of expertise required to fulfil the wide responsibilities that trading standards officers have these days makes the economies of scale afforded by joint arrangements most valuable, and that that should be considered in the context of the Local Government Commission's recommendations?
Mr. McLoughlin : I am grateful to my hon. Friend. His example shows how joint arrangements can work successfully. The matter can be considered in the context of the proposals of the Local Government Commission, when the House eventually decides on them.
Mr. Nigel Griffiths : Does the Minister realise that when the Government abolished the metropolitan county councils there was a surge in consumer frauds, counterfeit goods and activities by loan sharks? Does he recall that Tory councils, such as Westminster today, have slashed their budgets for consumer protection? Will he answer the question that my hon. Friend the Member for Walthamstow (Mr. Gerrard) asked : what will he do to ensure that the 220 vacancies for professional trading standards officers are filled immediately?
Mr. McLoughlin : That is a damning indictment of Barking and Dagenham, Camden, Greenwich, Hackney, Hammersmith and Fulham, Haringey, Hounslow, Islington, Lewisham, Merton, Southwark and Waltham Forest, which are all Labour controlled. Is the hon. Gentleman saying that those authorities are incompetent in carrying out their duties?
Mr. Mandelson : Is the Minister aware of the high expectations among people in the north-east of the Government's new industry policy following the Chancellor's Mansion House speech last week? When the Chancellor was asked for details of that policy at Question Time last Thursday, he said that he could not pre-empt the work of the President of the Board of Trade. What would the Chancellor have been pre-empting?
Mr. Sainsbury : I hoped that the hon. Gentleman would recognise what was done for industry in the recent Budget of my right hon. Friend the Member for Kingston upon Thames (Mr. Lamont), which was much appreciated by industry. I am sure that the hon. Gentleman is also well aware of the initiatives that my Department has taken and is continuing to take in dialogue and partnership with industry to broaden and strengthen Britain's manufacturing base.
Mr. Bates : Will my right hon. Friend join me in congratulating the 50 north-east manufacturing firms that met in Middlesbrough on Monday of this week to launch the Teesside Manufacturing Challenge? Is he aware that
Column 285that excellent initiative is a self-help initiative designed to fund manufacturing apprenticeships at the excellent Teesside Training Enterprise, Ltd., which already provides similar apprenticeships for more than 600 young people in the region? Is not that further evidence, if it were needed, of the dynamism, vitality and foresight of manufacturing industry in the north-east?
Mr. Sainsbury : It is indeed, and I am happy to join my hon. Friend in congratulating the private sector on the initiative, which has the ambitious target of doubling manufacturing output and has rightly identified training as one sector which needs attention and improvement if the target is to be met.
Mr. Jack Thompson : Is the Minister aware of the vast number of skilled personnel in the northern part of the northern region who are unemployed? The result is that skills related to the shipyards, mines and heavy engineering are now decaying as there are no longer the skilled personnel to pass on their skills. That is a major problem in that part of the region along the Tyne valley and Northumberland, which is not receiving the necessary response from the Government. I accept the comments of my hon. Friend the Member for Hartlepool (Mr. Mandelson), who represents a constituency in the southern part of the northern region. Instead of Ministers making a two-hour visit to the region--which the Minister and his colleagues have done--would it not be better if they visited the region, perhaps during the recess, for two or three days or even two or three weeks to discover the truth of the northern region?
Mr. Sainsbury : I know that the hon. Gentleman is concerned about such issues. He will be aware that there has been too high a level of unemployment in that region for a long time--since before the last world war. We have discussed the issue and my hon. Friend the Minister for Energy has been to look at the position on the ground, and will be visiting the district again soon. We shall continue with a range of initiatives, about which the hon. Gentleman is aware, to do all that we can to help to provide employment opportunities for those wanting jobs in his region and throughout the north-east.
Mr. Devlin : Is my right hon. Friend aware of the high concentration of manufacturing businesses in the north-east of England that have already achieved BS5750? Is that not part and parcel of the excellent initiative that the Government have pursued in bringing one third of all inward investment to the European Community into this country? The emphasis on quality, which is now moving through north-east manufacturing business at all levels, will enable them to compete much more strongly in future.
Mr. Sainsbury : My hon. Friend is right to identify the importance of quality as one way in which we can achieve success for our manufacturing industry. He is also right to recognise the contribution to jobs in the north-east made by inward investment. That contribution will continue to be made by inward investment, because the Government believe in promoting it.
Ms Morris : Does the Minister realise how unsatisfactory his reply is? Does he further realise that we have been waiting almost a year for the Government's plans on the future of Parcelforce and the structure of the Post Office? Does he accept that that unjustfiable delay is the worst possible environment for the Post Office to operate in? Will he take this opportunity to acknowledge that the Post Office is popular, successful and profitable, and that the best way in which he can help it is to leave it alone?
Mr. McLoughlin : It is rather typical of the Opposition to oppose any changes. They are following their usual practice of opposing the changes that we have introduced in the nationalised industries and nationalised structures over the past 14 years. It is rather a pity that the hon. Lady did not take time to praise the Post Office for the way in which it showed increased profits yesterday and announced a very good annual report.
Mr. Dover : Is not it true that the Post Office is currently constrained in its ability to invest because it has to compete with other nationalised bodies? Is not there a real risk of the sub-post office network closing because there are restrictions on what those post offices are allowed to do? Would it not be by far the best bet to opt for privatisation, when all those restrictions will be removed?
Mr. McLoughlin : I am grateful to my hon. Friend. As I have said, we are still considering several points. With regard to Post Office Counters Ltd., of the 20,000 post offices, 19,000 are in private ownership.
Mr. Malcolm Bruce : Will the Minister recognise that a new pressure group for the Post Office was launched last week called PPS--Protecting Postal Services? That pressure group has been founded because there is widespread concern about the Government's intentions in relation to the future of the Post Office. Would not it be helpful if the Minister relaxed the external financing limits so that the Post Office can invest? The Minister lifted restrictions to allow sub-post offices to develop their services. However, further delay on the ideological privatisation of the Post Office is not what is needed : what is needed is the continuation of the service that is so necessary for urban and rural communities throughout the United Kingdom.
Mr. Page : I congratulate the Post Office on its recent and most successful figures, but when my hon. Friend the Minister considers the future of the Post Office, will he set in place a structure that will attack the present estimated deficit of some £400 million to £500 million in losses through fraud and organised crime in respect of the distribution of benefits and pensions?
Mr. McLoughlin : I am grateful to my hon. Friend. His work on the Public Accounts Committee provides him with extra experience of these areas. The Government remain committed to the maintenance of a nationwide
Column 287network of post offices. It would not be appropriate at this time to prejudice contractual negotiations between Post Office Counters Ltd. and Government Departments. However, total Government business transacted by Post Office Counters Ltd has increased over the past three years and is expected to increase this year.
Mr. Cousins : Does the Minister accept that it is a disgrace that, after a year, no conclusions have been reached and there have been no statements to Parliament? How does he propose to celebrate the first anniversary of the Post Office review--with the price hikes, loss of investment and export business and the loss of tens of thousands of jobs which the chairman of the Post Office predicted yesterday? Is not the Government's policy on the matter now a combination of fumble, fright and fat fees for consultants while the British people, the British Post Office and British business suffer?
Mr. McLoughlin : I am grateful to my hon. Friend. As I said earlier, we are considering a number of options in the review. Some of the points that my hon. Friend has made will be very much borne in mind.
4. Mr. Clelland : To ask the President of the Board of Trade what plans his Department now has to ask the European Commission for access to the intervention funds for British warship yards ; and if he will make a statement.
Mr. Clelland : It is regrettable that the President of the Board of Trade cannot be here to deal with this matter and we sympathise with him about his illness-- [Hon. Members :-- "Oh!"] My hon. Friends must be patient. There are thousands of people in this country whose health has also suffered as a result of 14 years of Tory Government, but they are not being looked after quite as well as the President of the Board of Trade.
Is the Minister aware that what the people of Tyneside now want from him is direct action? He should get across to Brussels, speak to the Commission and obtain the preventive medicine which is needed to relieve the stress on the workers of Swan Hunter. As the Minister's right hon. Friend the President of the Board of Trade will no doubt now confirm, it is far better to prevent collapse in the first place than to have to live with the hope of recovery afterwards.
Mr. Sainsbury : I am grateful for what the hon. Gentleman said about my right hon. Friend--I am only sorry that he ruined it by what he said subsequently. As for Swan Hunter's eligibility for the shipbuilding intervention fund, I wrote to the Commissioner. I have not yet had a reply to my letter. I hope that it will be a reply in the affirmative. If it is not, I shall certainly be ready to go to Brussels to discuss the matter with him, because I share the
Column 288hon. Gentleman's belief that eligibility for the shipbuilding intervention fund would help the receiver in his task of finding a buyer for the Swan Hunter yard.
Mr. Wilkinson : Has not Swan Hunter had a unique capability among British yards over the years in being dual-capable, inasmuch as, in addition to building some of the very best warships that the Royal Navy has ever received, it has built geographic survey vessels for the Antarctic, cable-laying ships and auxiliaries? In those circumstances, how can the Commission of the European Community rightfully deny intervention funding to that yard? Is it not about time that Her Majesty's Government did what is in the interests of the British shipbuilding industry and the British nation, rather than always acting at the behest of Brussels?
Mr. Sainsbury : I am sure that my hon. Friend would like the Commission to exercise restraint in giving state aid in other countries of the Community. Quite rightly, the shipbuilding intervention fund is regarded as a state aid and is, therefore, controlled under the seventh directive. If we were to go against the arrangements, we should be doing what we sometimes rightly complain about other countries doing.
My hon. Friend will also be aware that the arrangements under which warship building yards are not eligible for the shipbuilding intervention fund were approved by the Commission in 1985 because we had considerable state aid to the shipbuilding industry at the time, which we agreed with the Commission on the understanding that warship building yards would not be eligible for the shipbuilding intervention fund. I have approached the Commissioner now because I believe that the circumstances have changed sufficiently to justify reconsideration of that ruling.
Mr. Bell : The House will welcome the Minister's reply to my hon. Friend the Member for Tyne Bridge (Mr. Clelland). The Minister will know that there are those who wish to buy Swan Hunter's yard. Will he confirm that Swan Hunter has a role to play in the building of warships and merchant vessels? If he could see Commissioner Karel van Miert very early on, he would give the country and the people of the north-east the impression that his Department is serious, anxious and positive about the matter.
Mr. Sainsbury : As the hon. Gentleman knows, the receiver has received a number of strong expressions of interest from reputable parties for the Swan Hunter yard. We are keeping in the closest possible touch with the receiver and we will certainly do all that we can to help him in his task of finding a buyer. I recognise that the Swan Hunter yard has had great achievements in the past and has great skills in the present which could be used in warship and merchant shipbuilding.
Mr. McLoughlin : In the past 12 months, export volumes of goods have risen by 6.6 per cent., while imports have risen by only 5 per cent. This sustains the marked improvements in our export performance in recent years,
Column 289and I know that United Kingdom exporters will build on those gains as they reap the benefits of our improved competitiveness.
Mr. Dickens : Does my hon. Friend believe that those encouraging figures are based on the advantage that the United Kingdom has from the floating pound, or is it possible that some British companies are selling abroad at a favourable price because of the shallow domestic market--in other words, dumping? If that is the case, I would be a very happy man. We would be giving many nations a taste of their own medicine, which the textile companies in my constituencies have received for many years.
Mr. McLoughlin : I am not sure whether I would go along with my hon. Friend in respect of United Kingdom companies dumping. United Kingdom companies are winning export markets in very competitive areas, and I am sure that we all welcome that.
Mr. Purchase : Despite the Minister's assurances on exports, is not it true that, although there has been a welcome start of a recovery in manufacturing, imports are set to grow at twice the rate for exports that was given by the Minister? Is not that due entirely to the Conservative party's antipathy to manufacturing and the wipe-out of capacity that has taken place during the past 13 years of their rule?
Mr. McLoughlin : It will come as no surprise to the hon. Gentleman that I neither follow nor recognise his figures. The hon. Gentleman talks about a reduction in manufacturing. He represents a Wolverhampton constituency, and will remember well that British Steel Bilston closed down under the last Labour Government.
Mr. Batiste : Is not one of the most important factors in our improving export performance the fact that, over the past decade, we have had the lion's share of inward investment into the EC? Is not it time that we acknowledged that the best companies in the world believe that Britain is the best place in Europe in which to manufacture?
Mr. McLoughlin : I agree entirely with my hon. Friend. My constituency benefited from a huge inward investment of £770 million from Toyota. That investment could have gone anywhere in Europe, but Toyota chose the United Kingdom because it recognised this country as the best place to invest.
Ms Short : Will the Minister admit that we have a disastrous problem in the British economy, as we are losing £1 billion on our balance of payments every week? After 14 years of Tory rule, the British economy is in deep crisis because our manufacturing-- [Interruption.] Conservative Members should not be so ignorant. These are the facts. The British economy is in deep crisis and the strategy of the Government towards manufacturing has been a disaster. The economy will not prosper unless the Government adopt an industrial strategy that will encourage long-term investment in manufacturing. Will the Minister admit that that is the truth and say whether the Government have any strategy to deal with the crisis?
Column 290competitive advantage. Between 1974 and 1979, our competitiveness fell dramatically, and the Government have gone a long way towards improving the position.
The hon. Member for Wolverhampton, North-East (Mr. Purchase) referred to exports. Compared with the first quarter of 1993, exports of medical and pharmaaceutical equipment are up by 28 per cent ; of power generation equipment by 42 per cent ; of office machinery by 45 per cent ; of machine tools by 47 per cent ; of radar equipment by 60 per cent ; and of computer hardware by 70 per cent. I should have thought that even the hon. Lady would regard that as good news.
Mr. Butcher : Does my hon. Friend agree that, of all the countries in the European Community, Britain more than any other shares with the United States a common attitude and a common policy to free trade? Does he therefore agree that Britain is uniquely placed to lead a discussion with the United States Government on the creation of a North Atlantic free trade area encompassing north America and the EEC, which would have the advantage for us of stimulating the western coasts of western Europe and for the Americans of stimulating the north-eastern seaboard of America, which is currently a depressed area?
6. Mr. McKelvey : To ask the President of the Board of Trade if he will give the date on which he received the last representations on consumer guarantees ; and when he expects to announce the results of his consultation.
Mr. McLoughlin : The last response was received in April of this year. However, the Director General of Fair Trading has embarked on a further study of consumer guarantees, and the EC Commission is also preparing a discussion paper. We have thought it best to await the outcome of these initiatives before making any announcement ourselves.
Mr. McKelvey : For heaven's sake, the DTI has been sitting on these responses since October--it has had nine months in which to consider these matters. Does not the Minister feel that British firms would gain an advantage if we had proper and effective consumer guarantees? We should then be more than able to compete with the import of foreign goods and thus do something to help our balance of trade deficit.
Mr. McLoughlin : Since April, when representations were last made, a number of matters have moved on, and we have thought it best to await the outcome of the initiatives that I described to the hon. Gentleman.
The Parliamentary Under-Secretary of State for Corporate Affairs (Mr. Neil Hamilton) : Departments are conducting comprehensive reviews of regulations for which they are responsible and will shortly provide me
Column 291with their candidates for repeal and simplification. Seven private sector business task forces are producing their own hit lists, which I hope will be radical and extensive.
Among many other initiatives, we are determined to force EC institutions to recognise the job-destroying effect of
over-regulation from Brussels and roll back the tide of Euro-regulation.
Mrs. Winterton : Is my hon. Friend aware that regulation is stifling business? Does he agree with the Institute of Chartered Accountants, which seeks to abolish burdensome auditing requirements on small firms? Is he aware that, when businesses register for value added tax, they are sent a 180-page book, a 20-page leaflet, a 17-page leaflet, a 14-page leaflet, a 12-page leaflet and two six-page leaflets, all of which warn of dire consequences if the contents are not fully understood? When do the Government intend to put their money where their mouth is and reduce burdensome regulations on business?
Mr. Hamilton : I congratulate my hon. Friend on her enthusiasm for the cause which I have embraced. I am most grateful to her for coming to the House today with that catalogue to demonstrate to hon. Members on both sides of the House the difficulties that small companies must endure before they can even get on with the business of trading at all. As my hon. Friend will know, there is a consultation exercise under way at present, which we hope will lead to the removal of an important but unnecessary regulation-- the requirement for a compulsory audit for small companies. I am most grateful to my hon. Friend for the strong support that she gives to this worthwhile cause.
Mr. McAllion : Is the Minister aware that, if the Government persist with their policy of promoting inward investment on the back of reducing what they call the burdens of labour and social costs, they will find themselves in competition with the likes of Thailand, where the social costs are so low that health and safety regulations are generally ignored and where recently more than 200 workers lost their lives in a factory fire? Does the Minister understand that although that policy may make Britain a place in which it is easy to do business, it will also make it a place in which workers' lives are held to be cheap and of no account? Labour Members want no part of that strategy.
Mr. Hamilton : The Government are concerned with inward investment. What the hon. Gentleman and his party would produce is not only outward investment but the export of jobs. As the Member for Dundee, East, the hon. Gentleman has significant experience in these matters because, as a result of his neanderthal attitude and that of the Transport and General Workers Union, a large number of jobs that would otherwise have gone to Dundee did not go there.
Mr. Winterton : Although I warmly welcome my right hon. Friend's response to my question, is he aware that the United Kingdom continues to export its manufacturing base, whether in traditional industries or even in high-tech ones? If he wants chapter and verse, I will give it to him. Does my right hon. Friend accept that the way in which the Government can improve the position of United Kingdom manufacturing industries, which are the only real source of genuine economic growth in this country, is to achieve a further modest reduction in interest rates, introduce 100 per cent. capital allowances and give my right hon. and learned Friend the Chancellor of the Exchequer every encouragement in his Mansion House speech to have a Budget in November for economic growth?
Mr. Sainsbury : I know that my hon. Friend has great enthusiasm for manufacturing industry, but I hope that he will not entirely neglect the contr and learned Friend the Chancellor. My hon. Friend referred to exporting our manufacturing base. I am not sure to what he is referring, but I hope that he will join me in congratulating British manufacturing exporters on their achievement in increasing exports by 6.5 per cent. last year in extremely difficult world trade conditions.
Mr. Robert Ainsworth : Will the Minister accept that the Under- Secretary of State for Technology has a selective recognition of trade figures, because the deficit grew in April and May, with imports growing by 0.6 per cent. and exports falling? The basic cause of that is the size of our manufacturing base. When will the Government have some underlying strategy to improve the situation?
Mr. Sainsbury : May we be clear about exports? Total exports, excluding oil and erratics--which is the most sensible way of looking at them--were at a record level in the first quarter of this year and 6.5 per cent. higher than a year earlier. Having said that, of course we all share the objective of broadening our manufacturing base and enabling British manufacturing industry not only to increase exports but to gain a larger share of the home market.
Mr. Knapman : Will my right hon. Friend confirm that our manufacturing base will be helped by the initiative introduced by my right hon. Friend the President of the Board of Trade to cut red tape and bureaucracy? Is my right hon. Friend the Minister aware that, according to the Library, 265 new rules, regulations and directives will come from Brussels in the near future? Can we help my right hon. Friend best by supporting or by opposing those directives?
Mr. Sainsbury : My hon. Friend is right to identify excessive regulation and over-zealous application of bureaucratic rules as damaging to all industry, but particularly to small industry. My hon. Friend the Under-Secretary of State for Corporate Affairs is doing a magnificent job. We all wish him the greatest success in wielding the axe against regulations that are unnecessary, excessive or over-bureaucratic, from whatever direction they come--Whitehall or Brussels.
Mr. Bennett : Does the Minister agree that one of the most successful parts of manufacturing industry in Britain is our mining engineering equipment industry? Does he realise that it faces devastation of the home market as a result of so many rapid closures of pits? What does he intend to do to help it to win export orders, especially in eastern Europe where there is clearly a major need for mining engineering equipment?
Mr. Sainsbury : I recognise that our mining engineering industry has considerable skills. My hon. Friend the Minister for Energy has met representatives of the industry and is working closely with the industry to help it at a time when obviously there has been a reduction in demand for deep-mining equipment in Britain and internationally.
Mr. Clappison : Will my right hon. Friend join me in acknowledging the warm welcome that has been given by exporters of manufactured goods to the improvements in the Export Credits Guarantee Department scheme announced in the autumn statement and the Budget? Does he agree that those exporters who benefit from the scheme have a vital role to play in developing and sustaining our improving export trend?
Mr. Sainsbury : I am happy to agree with my hon. Friend. As he knows, the announcement in the Budget of additional ECGD support followed earlier announcements at the end of last year and a reduction in rates by the Department earlier last year. There have been successive moves to improve the service provided by ECGD to our exporters. I am glad to say that our exporters have responded magnificently to that encouragement.
9. Mr. Wareing : To ask the President of the Board of Trade what representations he has received alleging abuses of monopoly power within the brewery industry ; what his response has been ; and if he will make a statement.
Mr. Neil Hamilton : My right hon. Friend the President of the Board of Trade and I have received several representations about the brewing industry, but these have mainly been about the treatment of tenants. If the hon. Gentleman has any evidence of abuse of monopoly power or other anti- competitive practices, it is open to him to raise these with the Director General of Fair Trading.
Mr. Wareing : Is the Minister aware of the so-called white knight policy administered by Inntrepreneur estates on behalf of Grand Metropolitan breweries, which seeks not only to circumvent the Government's Beer Orders but to extinguish the rights of its tenants in the brewery trade? Indeed, every year, 9 per cent. of those pubs go into bankruptcy. An examination of the document will show that the company's practice is sheer exploitation of the tenants and a dereliction of its duty under the Beer Orders. Will the Minister carry out a full public investigation into the activities of that brewery and that scheme?
Mr. Hamilton : The Department was sent anonymously a copy of the document to which the hon. Gentleman referred. It has been examined by my officials. Following a minute examination of what it contained, they discovered no apparent breaches of the Beer Orders.
As the hon. Gentleman will know, as a result of the intervention of Ministers, which secured sympathetic
Column 294treatment of the tenants of many companies-- not only the one to which he referred--we have managed to secure a significant improvement in the lot of many people who were otherwise worried about the circumstances in which they found themselves. It must be in the interests of brewers to develop a constructive relationship with their tenants. I hope that Grand Metropolitan will continue in the course of action that Ministers have urged on it.
Mr. John Greenway : Does my hon. Friend agree that, if there is one monopoly in the brewing industry that people should welcome, it is the small brewers of real ale? Does he agree that small brewers, such as Malton brewery in my constituency, provide an excellent beer for visitors to Ryedale during the summer months? If there is a problem in the brewing industry, we should address the Treasury about it to ensure that our brewers have fair and equal treatment under the tax regime affecting beer