The Parliamentary Under-Secretary of State for Corporate Affairs (Mr. Jonathan Evans): The Government are currently reviewing their policy on media ownership and my right hon. Friend the Secretary of State for National Heritage will make the Government's views known once that process has been completed.
Mr. Hinchliffe: The Under-Secretary will be aware that, in a debate exactly a fortnight ago, hon. Members on both sides of the House expressed their concern about the serious implications of the Murdoch News Corporation's involvement in the proposed rugby super league. What steps have the Government taken to evaluate the implications of that development, especially for media coverage of British sport as a whole?
Mr. Evans: If a monopoly of televised rugby league emanates from any registrable agreement, that matter would be considered under the provisions of the Restrictive Trade Practices Act 1977, not under the monopolies legislation. In those circumstances, it would be for the Director General of Fair Trading to look into the new agreements. As I know that the hon. Gentleman has taken an exceptional interest in this matter, I am sure that he will draw his concerns to the attention of the director general.
Mr. Fabricant: Does my hon. Friend agree that there is a great deal of obsession in this place with News International, yet Longman Pearson, The Guardian group and Associated Newspapers all have a considerable degree of cross-media ownership covering newspapers, television and other media? Does he further agree that mechanisms exist--such as the Monopolies and Mergers Commission and the Office of Fair Trading--to ensure that there are no monopolies in the media?
Mr. Evans: I have already referred to the structure of our current competition law. However, within the context of the question asked by the hon. Member for Wakefield (Mr. Hinchliffe), the whole matter of cross-media ownership is complex. The issues outlined by my hon. Friend the Member for Mid-Staffordshire (Mr. Fabricant) make that clear. For that reason, the whole matter is currently the subject of a review and it would be wrong of me to pre-empt its outcome.
Mr. Wilson: Does the Under-Secretary agree that my hon. Friend the Member for Wakefield has raised a subject of considerable importance relating to monopoly and, in particular, the coverage of British sport? I understand that, in the case of rugby league, there is a monopoly issue because the contracts will exclude non-Murdoch players from international competition. Does the hon. Gentleman accept that the implications of that go far beyond rugby league? Is it not time to send out a strong signal that the Government are not prepared
Column 730to allow whole sports to be bought, with access to them then being conditioned by people whose interests are in the media rather than in the sport?
Mr. Evans: The question raises two distinct issues. The first relates to the review of cross-media ownership, and I have made it clear that my right hon. Friend the Secretary of State for National Heritage is deeply involved in that. The Government will announce their policy at the appropriate time.
Within the context of the issue raised by the hon. Member for Wakefield, I have outlined the current structure of competition law. If the hon. Gentleman feels that he has real concerns which he believes should be raised in relation to other sports, I have suggested to him that he draw those concerns to the attention of the Director General of Fair Trading.
Mr. Peter Bottomley: May I return my hon. Friend to the question of predatory pricing? If News International has 37 per cent. of the daily national newspaper market, and if the Director General of Fair Trading satisfies himself that a sustained price cut will increase the losses of The Times , why is it fair and reasonable to allow that media concentration to continue and to hit the other newspaper groups that are trying to compete in the broadsheet market?
Mr. Evans: I am aware of the concerns which my hon. Friend has outlined on previous occasions in relation to this issue. He will be aware that the Director General of Fair Trading is the appropriate person for considering allegations of predatory pricing. The director general looked at the issue when the pricing war between major national newspapers began, and it is a matter that will continue to excite his interest.
The Parliamentary Under-Secretary of State for Industry and Energy (Mr. Richard Page): Overall levels of consumer satisfaction are a matter for British Gas. Thirty-nine specific standards of service are regulated by the Office of Gas Supply.
Mr. Jones: Does the Under-Secretary think that British Gas's blind, elderly and disabled customers are happy with the service that they are getting, when the home advisory service which British Gas has provided up to now is being cut by 50 per cent.? Does he think that those customers will be satisfied with the fact that the British Gas chairman is giving himself a 75 per cent. pay rise?
Mr. Page: British Gas is not going to cut its services to the elderly and the blind, and it is in fact spending £170 million a year on those services. It also provides a gas care register. Ofgas has agreed some standards of service with British Gas, and British Gas has failed in three areas of service. For example, Ofgas wanted a level of 100 per cent. for the reading of meters for customers moving home, but British Gas has reached only 98.9 per cent.
Column 731A level of 100 per cent. was demanded for energy efficiency, but British Gas is getting only 99.8 per cent. British Gas is addressing those shortcomings.
Mr. Nigel Griffiths: In view of the soaring number of complaints, will the Under-Secretary join the Pensions Investments Research Consultants --an organisation that advises pension funds that hold £70, 000 million in their funds--in condemning the soaring boardroom pay-outs at British Gas, which are in breach of the Institute of Directors' guidelines on best practice? Will the hon. Gentleman advise shareholders at the British Gas annual general meeting on 31 May to support resolution 13 on controlling the pay-outs and perks in the boardroom, as I shall be doing at that meeting? If not, why not?
Mr. Page: The Government have made our position clear on the pay of the directors of British Gas. We will await the report of the Greenbury committee. I hope that the pensioners connected with the PIRC are happy with the 21 per cent. reduction in gas prices since privatisation.
Mr. Lidington: Does my hon. Friend agree that gas consumers have every right to be pleased not only with the reduction in gas prices since privatisation but with the healthy profits being made by British Gas, taxation on which goes to help finance the improvements in public services to which the Government are committed?
Mr. Jonathan Evans: Primary responsibility for finding a new occupant for the factory falls to the company and its agents. However, the local development organisations, together with Inward, the regional development organisation, and the Government office for the north-west are fully aware of the opportunities that the site has to offer. They continue to promote the site at every suitable opportunity.
Mr. Campbell-Savours: Will the Minister refer my comments to his departmental officials with gratitude for the work that they are doing in trying to market that very important site? Will he join me in reiterating that we have in Workington a 500,000 sq ft modern factory in an assisted area where European moneys are available? Anyone watching Parliament today who knows of a potential client should come forward as soon as possible.
Mr. Evans: I thank the hon. Gentleman for the generosity of his remarks about the work undertaken by Government officials. It may reassure him to know that I had a meeting with Inward last week at which that subject was at the top of the agenda. Inward is very much aware of the statements which have been made not just in this House but throughout the north-west by the hon. Gentleman, who has taken a leading role in seeking to promote the occupation of the site.
Mr. Canavan: Will the Minister demand an explanation from the chairman on why more than 16,000 disconnections were made last year because of fuel poverty and why the number of consumer complaints increased by 150 per cent. during the first quarter of this year compared with the first quarter of last year? Will the Minister instruct the chairman, the chief executive and all the other fat cats on the board of British Gas that it is high time that they put their house in order and started providing a better standard of service instead of lining their pockets with exorbitant salary increases and share options?
Mr. Eggar: The hon. Gentleman mentioned the current figure for disconnections but failed to mention that, some six years ago, just after privatisation, there were 61,000 disconnections a year, which shows that British Gas has improved its standard of service to those clients by a very high degree. Moreover, the standards with regard to the introduction of pre -payment meters have improved sharply. The 39 standards of service set out by the Office of Gas Supply have been met in full, with the exception of three specific services, two of which my hon. Friend the Under-Secretary of State referred to. British Gas has said publicly that it is committed to improving its standards further. If that is not enough for the hon. Gentleman, he should know that we shall introduce competition into the domestic gas market, which will almost inevitably lead to a reduction in prices for domestic consumers and an improvement in standards of service.
Mr. John Marshall: When my right hon. Friend meets the chairman of British Gas, will he congratulate him on the massive increase in investment since the industry was privatised, the massive increase in productivity and the substantial real terms reduction in prices? Does he agree that the snivelling comments of the hon. Member for Falkirk, West (Mr. Canavan) show that the new Labour party is just the old Labour party writ large, with the same prejudices it has always had?
Mr. Salmond: Is it possible that the Minister is unaware that British Gas is now held in public odium and that, at the annual general meeting later this month, the British Gas board faces a revolt by small shareholders, not just on salaries but on a range of other issues? When will the Department of Trade and Industry stop waffling on about British Gas being a world-class company and recognise that it has created a privatised Frankenstein's monster that is now totally out of touch with its customers, shareholders and staff?
Column 733privatisation and the rest of it, will my right hon. Friend tell my constituents, who have a real interest in this subject, what has happened to gas prices in real terms since privatisation and how those compare with prices before privatisation? Behind everything else, that is the issue that really matters to them.
Mr. Eggar: My hon. Friend is absolutely right. Gas prices have fallen by more than 20 per cent. in real terms since privatisation and by 15 per cent. when account is taken of the imposition of value added tax. Furthermore, standards of service have improved and the number of disconnections has fallen, which is concrete evidence of the success of our privatisation policy.
Mr. O'Neill: When the Minister sees the chairman, will he take account of the fact that the assurances which he gave in Committee on schedule 5 to the Gas Bill, that the changes were no different from those that would take place in any other privatisation legislation, will result in the prospect of a world-class company like British Gas abrogating its contracts on gas supply with a number of companies, both British and international? Does he realise that he is putting Government support behind the possibility of a major British company betraying undertakings that it has entered into faithfully with other companies, both British and worldwide, to take their supplies of gas at prices that were agreed some time ago?
Mr. Eggar: The point that was made in Committee with regard to schedule 5 was that there was a clear precedent for the allocation of existing contracts in such a position. The most recent precedent was the Gas Act 1986 and the previous one was in 1981, in the sale to Enterprise Oil.
As the hon. Gentleman said in Committee, and as I reiterated in that debate, it is appropriate that there should be commercial discussions between the producers and consumers of gas--in that case, between British Gas and several suppliers. That is what I believe that the hon. Gentleman said in Committee he wanted, and that is what I continue to want. I hope that there will be successful commercial discussions in the coming weeks.
The President of the Board of Trade and Secretary of State for Trade and Industry (Mr. Michael Heseltine): Officials in my Department are in close contact with the White Paper team and have been working with them to ensure that the interests of businesses in rural areas are fully represented.
Mr. Colvin: Does my right hon. Friend acknowledge that, although 23 per cent. of our population live in the countryside, only a small proportion work there, and that the more that can be done to encourage jobs alternative to agriculture, the better that is for our transport system and our rural economy as a whole? Will he support the proposal for the rural business unit, which would enable farmers and landowners to lump together for tax purposes
Column 734not only their farming enterprises but alternative enterprises, which would do a great deal to encourage the alternative industrial use of redundant farm buildings?
Mr. Heseltine: My hon. Friend raises a very important point. I am aware of the proposal that has been made by the Country Landowners Association. I can assure him that, in the context of that proposal and of a wide range of other representations to enhance the wealth-creating potential of the countryside, my right hon. Friends the Secretary of State for the Environment and the Minister of Agriculture, Fisheries and Food are giving the most urgent consideration to those matters.
Mr. Rendel: Will the President of the Board of Trade ensure that the White Paper demonstrates support for tele-cottages in rural areas, especially ones like that recently set up by the Lambourn Valley trade and tourism association in my constituency, with support from the Liberal Democrat-run county and district councils, and will he tell us how many other authorities are supporting tele-cottages at present?
Mr. Heseltine: I think the hon. Gentleman will recognise that the changing technological capabilities of people to work in outlying areas or at home are well understood by the Government and will play a significant part in the findings of the White Paper.
Mr. MacShane: The President may not be aware that in Rotherham 65 per cent. of the land area is rural and there is a very important small rural economy there, but how can any rural economy function without an efficient network of public transport? Bus deregulation and privatisation have ripped out the heart of bus transport and, if we continue with rail privatisation, there will be no rail transport to keep the rural economies alive.
Mr. Ian Bruce: Does my right hon. Friend agree that the Rural Development Commission and the Department of Trade and Industry are doing extremely good work in developing new businesses in the countryside? However, I wonder whether he could do more to ensure that other colleagues in other Departments make sure that we obtain the right planning permission and that we restore the right enterprise culture to the countryside, because that will ensure that we have a growing rural economy rather than a dying one.
Column 735hon. Gentleman to agree with me that there was nothing crooked in the arrangements that brought those companies into existence.
Mr. Skinner: There is one easy way to find out, is there not? The President of the Board of Trade has one story. "Panorama" and some other people, including myself and other Opposition Members, believe another story. He must do the decent thing and clean the matter up. Why does he not set up a fully independent public inquiry to find out the truth about the sequence of events that led to one of his friends, Richard Budge, getting the coal pits and then having £100 million knocked off the bid? Only an independent inquiry will be able to find out the truth.
Mr. Heseltine: I am glad that the hon. Member has not repeated the disgraceful allegations he made yesterday. What he does not understand is that all the papers relevant to this matter will be at the disposal of the National Audit Office and that it will be for it to determine whether any matters should be drawn to the attention of the Public Accounts Committee.
What I find utterly intolerable in the hon. Member's allegations is that he thinks that a Minister in my position has the power so to order civil servants in my Department that they would carry out the sort of activities of which he is accusing them and the Government. To suggest that the permanent secretary in my Department and all the civil servants involved would behave in the way suggested by the hon. Member is an intolerable abuse of the privileges of the House.
Mr. David Evans: Does my right hon. Friend agree that, since privatisation, jobs have been created in the mining industry every single day and coal is being produced more competitively? Does he not think it a bit rich that, when the lot opposite were in power from 1964 to 1970 and from 1974 to 1979, 313 pits were closed, with the loss of 230,000 miners' jobs? Is that what is meant by the new, caring, sharing Labour party of the lot opposite?
Mr. Heseltine: My hon. Friend, as so often, has hit the nail firmly on the head. The real determination of the Labour party is to try to obscure by smear the remarkable success of the privatised coal industry. That coal industry is seeing increases in productivity; sales of British coal overseas and increased profitability. It has kept open far more pits in the private sector than the nationalised industry considered possible in the public sector. Once again, privatisation has proved immensely successful, despite everything that the Labour party has said.
Mr. Jonathan Evans: The Government are committed to pursuing a vigorous competition policy under existing competition law, and to introducing legislation to reform the law on restrictive trade practices and abuse of market as soon as parliamentary time permits.
Column 736who is widely respected, is stepping down after only two years in office? The Government have not even been able to find a successor. Why does the Minister not adopt the Labour party's policy of merging the Office of Fair Trading and the Monopolies and Mergers Commission to create a dynamic new regulatory body that could stamp out anti-competitive practice?
Mr. Evans: One of the sights of new Labour with which it is somewhat difficult to come to terms is the image of the hon. Gentleman as a spokesman for competition in the marketplace. That unreconstructed Tribunite socialist is now portraying himself as a friend of competition.
I think that the hon. Gentleman referred to the speech made by the hon. Member for Dunfermline, East (Mr. Brown), who suggested that he supported the remarks of the Director General of Fair Trading when he recently gave evidence to the Select Committee on Trade and Industry on the issue of a unitary competition policy. It is clear that the hon. Gentleman did not understand that evidence, because Sir Bryan Carsberg actually suggested that there should be a lesser role for Ministers and for the House. The hon. Member for Dunfermline, East, however, made it clear in his speech that he wants to substitute his personal judgment for the independent analysis of the MMC.
Mr. Anthony Coombs: Last year, industrial output in this country was at its best ever level and manufacturing exports rose by 14 per cent., also to their best ever level. Does my hon. Friend not think that it is a bit rich that the hon. Member for Neath (Mr. Hain) should talk about anti- competitive measures when the measures that the business men of this country fear most are the imposition of a social chapter and the minimum wage--precisely the policies adumbrated by the Labour party?
It is Government policy to keep the competition policy mechanism under review. For that reason, changes were introduced last year in the Deregulation and Contracting Out Act 1994 in order to refine the system. The Government have also announced that they will legislate further when parliamentary time permits. As my hon. Friend made clear, the greatest threat to competition within our economy comes from the policies advocated by the Labour party.
Dr. John Cunningham: Does the Under-Secretary of State agree that the Government's commitment to effective reform of competition policy can be gauged by the fact that the proposals to which he referred--which apparently have not been acted upon because of lack of parliamentary time-- were first announced in 1988, seven years ago? Is it not clear that the Government's commitment is not to the competitive markets but to the privatisation of as many large-scale monopolies as possible in order to raise revenue to bail out their mismanagement of the economy? Is that not obvious from the Government's ill-considered, hastily arranged statement yesterday about the privatisation of the nuclear
Column 737industry? That is another cynical measure--a pre-election tax bribe--which will end up costing the taxpayers much more in the long term.
Mr. Evans: That effort was no better than that of the hon. Member for Neath. The right hon. Member for Copeland (Dr. Cunningham) is correct in that we wished to legislate earlier in relation to the restrictive trade practices matter. However, I should correct his assertion that the announcement was made in 1988; it was 1989. It is only one part of a range of measures that the Government have announced. The abuse of market power consultation was undertaken in 1993 and a large number of the responses that we received supported the eventual outcome as proposed by the Government. The right hon. Gentleman has not referred to the fact that the Deregulation and Contracting Out Act 1994 confers new powers on the Director General of Fair Trading to accept undertakings. I know that the right hon. Gentleman welcomed those provisions previously.
8. Mr. Tony Banks: To ask the President of the Board of Trade if he will list the top six countries exporting machine tools by value to the United Kingdom in the most recent complete year and in 1979. 
Mr. Page: The top six countries exporting machine tools by value to the United Kingdom in 1997 were, in descending order, the Federal Republic of Germany, the United States of America, Switzerland, Italy, Japan and France. In 1994, the top six on the same basis were the USA, Japan, Germany, Switzerland, Italy and Belgium/Luxembourg.
Is it not a fact that for many years we had a machine tools and transport machinery trade surplus, yet from 1983 we have had a deficit in all years except 1991? In 1994 there was a trade deficit of about £5 billion on machinery and transport. We do not export to many of the countries from which we import. Why do we have a balance of trade deficit with Japan? Why can we not export machine tools to Japan, which is our largest source of imports?
Mr. Page: I thank the hon. Gentleman for correcting my transposition of 1997 for 1979. I also congratulate him on giving me the opportunity to set the record straight. In 1979 there was a machine tools trade deficit of £50 million and, by contrast, in 1994 the industry ran a balance of trade surplus of £28 million. In 1993 and 1994 we saw the first balance of trade surpluses for two years. I thank the hon. Gentleman for giving me the opportunity to draw that success to the attention of the House.
Sir Donald Thompson: Is my hon. Friend aware that, in the real world of the west riding of Yorkshire, the machine tool industry is doing even better than it did last year, and will he join me in congratulating Denford Machine Tools in my constituency, which this very day is celebrating publicly the expansion of its business?
Mr. Page: My hon. Friend is absolutely right. The machine tool industry is showing significant improvement. In fact, on Sunday, subject to the business of the House, I hope to be allowed to fly to Milan to attend the EMO
Column 738machine tool exhibition, which is one of the largest in the world and at which some 33 United Kingdom-based machine tool companies are exhibiting. I hope to do my bit to secure them some orders and bring more work and jobs to the United Kingdom.
Mr. Hardy: Would not that industry do even better if Britain had the same opportunity to export machine and hand tools to some of the countries on that list, and to two or three other significant exporters to Britain, that they have to export to us?
Mr. Page: The hon. Gentleman makes a valid point, but our machine tool industry has undergone a considerable revolution. We are starting to make computer-controlled machine tools that are suitable for export. Back in 1979, machine tools were manually operated and few were run by computer. That is the world in which we are operating.
Mr. Amess: Would my right hon. Friend join me-- [Hon. Members:-- "Labour gain."] Is that old Labour or new Labour? Would my right hon. Friend join me in welcoming the news that the Princess Royal will visit Basildon on Tuesday to open the new headquarters of MK Electric, the company that produces the finest plugs in Europe, and PMS, the company that produces the finest gifts and novelties in the world? Does he agree that such expansion and investment are further evidence of this country's economic recovery?
I am delighted that Her Royal Highness will visit Basildon on Tuesday, not least because MK Electric, as my hon. Friend knows, has recently received an "Investors in People" award as well as transferring its headquarters to Basildon, and PMS is creating 170 new jobs. As my hon. Friend is aware, the number of people unemployed in Basildon has fallen by no fewer than 700 over the past 12 months, and that is recognition of the economic success in Basildon.
Mr. Page: To avoid placing undue burdens on small firms we use administrative sources to monitor survival rates of new businesses. Recent estimates of the survival rates of new, mostly micro, businesses have been produced by Barclays bank. For the period 1989-1993, it estimates that on average 77 per cent. of start-ups were still trading after their first year of operation.
Column 739350 people to set up their own businesses, has disappeared in a cloud of smoke into the single regeneration budget. There is no DTI funding for business links to give help and financial support to start up businesses. What advice, apart from do-it-yourself, can he give my constituents who will lose the benefit of the enterprise allowance scheme, and what proposals has he to help small businesses and people who prefer self-employment to benefit?
Mr. Page: As the hon. Lady said, the single regeneration budget provides some start-up support to help unemployed people into self- employment. She made the valid point that the first moments after any birth are the most fragile. There is a fond belief that running a small business is easier than running a large business, but that is not so. The important point is that survival rates for smaller businesses would be much better if those wishing to start them went along to business links and took strong advice on the viability of their financial package before going ahead. What is even more important for small businesses is a stable economic environment in which they can plan with certainty.
Mr. Sykes: One of the greatest challenges facing small businesses in 1995 is the over-burdensome and over-zealous enforcement of regulations by petty bureaucrats across the country. A year ago the House passed the Deregulation and Contracting Out Act 1994, at which time the Government promised to introduce a system of appeals to help small business people. What has happened to that procedure?
The Minister for Trade (Mr. Richard Needham): My right hon. and learned Friend the Chancellor of the Exchequer will publish new forecasts for the balance of payments in June. Manufacturing exports were at record levels in 1994 and the prospects for this year are excellent.
Mr. Grocott: I do not blame the Minister for not answering the question, but will he confirm what the Under-Secretary failed to in his answer to my hon. Friend the Member for Newham, North-West (Mr. Banks)-- that Central Statistical Office figures show that in 1979 in the key manufacturing sector of transport, equipment and machinery there was a surplus of £2 billion and that in 1984 there was a deficit of £5 billion? In the face of those incontrovertible facts, I suggest to him in a friendly and helpful way that the Government should abandon their policy of getting the message across, because in that key area their message has been one of 16 years of failure.
Mr. Needham: Every month the hon. Gentleman comes back for more; he often asks these questions. Let me give him the figures for cars. In 1979, exports of cars from the United Kingdom were worth £838 million and imports of cars into the United Kingdom were worth £2.6 billion-- exports were a third of imports. In 1994, we exported £5 billion-worth and imported £9 billion-worth. We have more than halved the gap in one of the most important areas of
Column 740manufacturing about which the hon. Gentleman asked. Between 1974 and 1978, the United Kingdom had 4.9 per cent. of world trade and between 1989 and 1993 we had 5.2 per cent. Will the hon. Gentleman please congratulate the Government on their magnificent achievements?
Mr. Waller: Imports of capital equipment have increased during the past year, which has reflected a welcome revival in the confidence of British manufacturing industry. Is it not especially pleasing that exports of the British capital equipment industry have done very well and that we are now in surplus with the rest of the world? Does not that demonstrate a favourable currency position and the fact that our exports are capable of competing effectively in terms of quality anywhere in the world?