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Oral Answers to Questions
TRADE AND INDUSTRY
Assisted Areas
1. Sir Roger Moate: To ask the President of the Board of Trade what is the timetable for the next re-examination of the assisted area status map. [38649]
The President of the Board of Trade and Secretary of State for Trade and Industry (Mr. Ian Lang): When the present map of the assisted areas was introduced in July 1993, the Government made clear that it would remain in place for at least three years. Areas need time to take full advantage of assisted area status, and frequent changes to the map could create uncertainties for potential investors. The Government have no plans to review the map during this Parliament.
Sir Roger Moate: I thank my right hon. Friend for that reassuring reply. In my constituency, in the travel-to-work area of Sittingbourne and Sheerness, assisted area status is much appreciated and has already produced several hundred jobs. However, the unemployment level is still 10.8 per cent, and it must be clear that areas such as mine and many others take longer than three years to gain the full benefit of such status.
Can my right hon. Friend give some assurance that the general tendency would be to favour renewal of the three-year periods where unemployment remains high, and furthermore that there will be no automatic cut-off at the end of the three years, and that cut-offs, if they are to occur at all, will do so only when the House has reviewed the orders and passed new ones?
Mr. Lang: I am happy to assure my hon. Friend that there is no question of a cut-off. The map will remain in place until it is changed. The previous map remained in place for nine years. I am glad that assisted area status is helping my hon. Friend's constituency. I understand that 34 offers of assistance have been made in the Sittingbourne and Sheerness travel-to-work area, worth £2.4 million, and associated with more than 650 jobs.
Mr. Campbell-Savours: Why can there not be an urgent review of the assisted areas map, especially in the light of the decision of Campbell's Soups of America to close its Homepride plant in my constituency? That was a profitable operation that made £3.9 million last year, and it has one of the most modern canning plants in western Europe. Is it not an outrage that a foreign predator can move into a small town such as Maryport, destroy jobs and create such anguish and concern in that small community?
Mr. Lang: I recognise the hon. Gentleman's protectionist instincts, but the assisted area map can operate effectively only on a long-term basis. If changed periodically at a whim, in the light of temporary economic circumstances, it would not have the intended impact of enabling mobile investment projects to be decided upon in the context of a secure and stable economic background.
Mr. Nicholls: While assisted area status may be helping the constituency of my hon. Friend the Member for Faversham (Sir R. Moate), it is not helping my
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constituency of Teignbridge. Will my right hon. Friend ensure that there are proper safeguards to ensure that, when a business locates in an assisted area, the jobs created there are real and have not been pinched from elsewhere?Mr. Lang: I am happy to reassure my hon. Friend that the effect of the assisted area status map and regional selective assistance is primarily to create new jobs. The attraction of inward investment to the United Kingdom is a result of a number of factors, but the assisted area map certainly helps in that direction.
Mr. Wigley: Will the President of the Board of Trade give urgent attention to west Gwynedd, north Meirionnydd, Dwyfor and Arfon and give them full development status? When the assisted area map was last drawn up, the Transfynydd nuclear power station was open, but it has subsequently closed and employment in the area has fallen. The Government's plans to provide an enterprise zone in the area have now been abandoned. In the light of that, unemployment is now at an unacceptably high level, and the area desperately needs help to attract new industry.
Mr. Lang: The hon. Gentleman knows that the Government are keen to help attract investment to areas of high unemployment, and that and there is a range of ways in which that can be done. Regional selective assistance, through the assisted area map, is only one method but, as I said, the map does not benefit from frequent changes. It benefits only from stability, which allows decisions to be taken on a proper long-term basis. I cannot give the hon. Gentleman any encouragement that a review will take place in the near future.
Mr. Michael Brown: Will my right hon. Friend reassure my hon. Friend the Member for Faversham (Sir R. Moate) on the basis of what happened in my constituency after the Government
decided--correctly--that we no longer needed assisted area status? Will he assure my hon. Friend that there is more inward investment and that more jobs are being created now, without assisted area status, than before?
Mr. Lang: My hon. Friend makes a good point. It is also the case that the financial assistance offered under the arrangement is substantially less than that offered in many other countries. We are able to win inward investment because of the other qualities that Britain has to offer. Among the major inward investment projects which have come to this country without assistance are Nissan, Toyota and Samsung Heavy Industries.
Mr. Bell: The President will know that those inward investment projects were assisted by Labour-controlled local authorities throughout the country.
The hon. Member for Faversham (Sir R. Moate) reminded the House that the assisted area scheme has been extended to areas that have known prosperity and then known mass unemployment. Even the Deputy Prime Minister admitted at lunchtime that the UK is 21st in the international league table of investment per capita, and 18th in the league table of national income. In a moment of honesty, the right hon. Gentleman might also admit that Britain has halved its level of investment since 1979.
The House will welcome the assurance from the President of the Board of Trade that the assisted areas map will not be rewritten in the short term. That will
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obviate the suspicion that existed last time --when the map was redrawn by the right hon. Member for Hove (Sir T. Sainsbury)--that it was written in blue pencil to help the Tory party, and not the country.Mr. Lang: I must point out to the hon. Gentleman that the figures used in the Labour party's advertisement in The Times today were taken from the Organisation for Economic Co-operation and Development, which recently described Britain's performance as "impressive", and added:
"The United Kingdom's sweeping structural reforms are yielding dividends in a more flexible, competitive and less inflation-prone economy".
The OECD endorsed our approach to deregulation and a flexible labour market and adopted all of the policies that we are supporting in the face of fierce opposition from Labour.
Midlands Electricity
2. Mr. Robert Ainsworth: To ask the President of the Board of Trade what representations he has received in respect of consumers regarding the PowerGen bid for Midlands Electricity from the Midlands Electricity consumers committee. [38650]
The Parliamentary Under-Secretary of State for Trade and Industry (Mr. Jonathan Evans): None
Mr. Ainsworth: Is the Minister aware of the Midlands Electricity consumers committee chairman's concern that the proposal will not be in the interests of consumers? Is he aware that the centre for the study of regulated industries has shown that, while the cost of generating electricity since privatisation has fallen by 6.8 per cent., bills have fallen by only 1. 6 per cent.? The interests of consumers have certainly not been protected to date. Is it not about time the Minister started doing so? Will he refer the proposal to the Monopolies and Mergers Commission?
Mr. Evans: The interests of consumers have been served by the privatisation of the electricity industry in terms of the price to domestic and industrial consumers. I remind the hon. Gentleman of the structure that relates to these matters. It is a matter for the Director General of Fair Trading first to produce a report, which will then be passed to my right hon. Friend the President of the Board of Trade. At this point, any representations should be directed to the Office of Fair Trading and the director general so that they may be incorporated in the advice that he will tender in due course to my right hon. Friend. My advice to the hon. Gentleman is that he should ensure, if he has not already done so, that his
representations are passed to that quarter.
Mr. Harvey: Without anticipating the Budget, can the Minister tell the House whether the Government are still opposed in principle to a windfall tax on the electricity companies?
Mr. Harry Greenway: Does my hon. Friend recall that electricity prices rose by 2 per cent. every six weeks in the midlands and the rest of the country under the Labour Government? Labour has no right to lecture this or any other Government about electricity price rises.
Mr. Evans: My hon. Friend is absolutely right. The Opposition were then determined to ensure that the
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electricity industry remained a 100 per cent. state-owned monopoly. In those circumstances, the great benefits that are now pouring on consumers would not have been possible.Shipbuilding
3. Dr. Godman: To ask the President of the Board of Trade how many merchant vessels of 500 gross registered tonnes or more were constructed in United Kingdom shipyards in each of the past four years. [38651]
The Parliamentary Under-Secretary of State for Trade and Industry (Mr. Ian Taylor): The number of merchant ships of 500 gross registered tonnes or more completed by United Kingdom yards between 1990 and 1994 was 18, 17, 14, nine and 11 respectively. The total tonnage of the completed ships almost doubled over the period.
Dr. Godman: The Minister knows that, on the Clyde, we have witnessed a decline from 32 shipyards to three. Even though Kvaerner Govan won a tidy little order recently, those three shipyards are in a perilous condition. Will the Minister seek a reappraisal of the decision to end the seventh directive of the shipbuilding intervention fund? Should he refuse to do so, will he urge upon the European Commission the need for fair competition in the Italian and Spanish yards, against which our yards bid for European contracts?
Mr. Taylor: The hon. Gentleman slightly underplays the small order to which he referred, because Kvaerner Govan has won a £60 million contract to launch communication satellites from a platform in the Pacific. I am sure that he welcomed that order in his constituency, so I hope that he will also welcome it in the House.
The agreement within the European Union on the OECD shipbuilding agreement effectively means the end of the shipbuilding intervention fund. The hon. Gentleman must know that. That will, however, benefit his yards and others, in the sense that there will be a fairer basis of international competition. At the moment, we compete against highly subsidised yards elsewhere. It is in Britain's interest that that agreement should come into effect as soon as possible, and that we should continue to improve the competitiveness of ships carrying the red ensign.
Mr. James Hill: May I congratulate my hon. Friend on his roving commission along the south coast? We were pleased to see him in Southampton. As he roves along the south coast, he will find many small shipbuilding yards that would appreciate orders. Some years ago, there was a scrap and build scheme operated by the European Union, but I am afraid that we did not take it up. When my hon. Friend is in Brussels, he may have reason to raise that scheme. Any more support for our small shipyards would be welcome.
Mr. Taylor: I understand my hon. Friend's concern for the yards along the south coast. I am delighted to be the sponsor Minister for those south coast towns. I have recently visited Southampton, Portsmouth and Hastings, and I am aware of the local difficulties. I shall look at my hon. Friend's proposal, but there is no substitute for our competing with the rest of the world for contracts. I therefore welcome the fact that other countries are having to abandon their subsidies.
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Exports By Heavy Goods Vehicle
4. Mr. Rendel: To ask the President of the Board of Trade what was the approximate value of the goods exported from Britain in heavy goods vehicles in the last financial year. [38652]
The Parliamentary Under-Secretary of State for Trade and Industry (Mr. Phillip Oppenheim): The latest figures for the value of exportbroken down by mode of transport are for 1992. Since then, the abolition of relevant customs documents for intra-EC trade has resulted in no figures being available.
In 1992, the value of seaborne exports carried by vehicles was £40.4 billion.
Mr. Rendel: Does the Minister agree that the extremely valuable trade carried by heavy goods vehicles can cause considerable environmental damage, especially where it is forced, on its way to the ports, on to roads that go through old market towns? Can he assure the House that he will do his utmost to ensure that the Government go ahead with the Newbury bypass as soon as possible?
Mr. Oppenheim: I appreciate the hon. Gentleman's constituency concerns, but he would do better to address his remarks to my right hon. Friend the Secretary of State for Transport.
Mr. Atkins: Is my hon. Friend aware that an increasing proportion of the heavy goods vehicles that are used to improve our export trade are made in my constituency by Leyland Trucks? Does he recognise the achievement of the reformed Leyland Trucks in terms of its share of the heavy goods vehicle market, which is a direct result of the Government policies with which my hon. Friend and I have been associated for many years?
Mr. Oppenheim: My hon. Friend is absolutely right. UK commercial vehicle manufacturers took nearly 60 per cent. of the UK market last year. They export nearly 40 per cent. of their output. He is right that the policy of the Opposition was to intervene and pour in Government money, which would have created another disaster along the lines of the one that they created with British Leyland in the 1960s and 1970s. Our policy has allowed the company to recover not only in the domestic market but so that it is exporting at record levels.
Scotch Whisky Exports
5. Mrs. Ewing: To ask the President of the Board of Trade what recent representations he has received from the Scotch Whisky Association on improving the promotion of Scotch whisky within international markets; and if he will make a statement. [38653]
Mr. Oppenheim: We fully recognise the importance of the spirit drinks industry and its contribution to UK export performance and to our performance in general. We have wide-ranging contact at all levels with the Scotch Whisky Association and we give it extensive assistance towards its export effort.
Mrs. Ewing: Does the Minister recognise that the best international promotion that could be given to this vital industry would be to recognise at home the value to
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domestic industry of the Scotch whisky industry? As more than 45, 000 jobs in Scotland are directly and indirectly dependent on the Scotch whisky industry, is it not time for the excise duty levied on Scotch whisky to be put on an equal footing with the rest of the spirit industry throughout the European Union and the rest of the international community? Can the Minister give us an assurance that the DTI will make such representations to the Chancellor of the Exchequer?Mr. Oppenheim: I appreciate the hon. Lady's concern. In fact, excise duty on spirits has fallen by 15 per cent. in real terms during the past 10 years. If we were to halve excise duty on spirits, and that reduction were fully passed on, the result would be a fall in price for consumers of only about 20 per cent. It is worth remembering that. I expect that my right hon. and learned Friend the Chancellor of the Exchequer, who has been known to enjoy the odd glass of whisky himself occasionally, will take the hon. Lady's comments into account at the end of the month.
Mr. Quentin Davies: Does my hon. Friend agree that the present excise system for taxing alcoholic drinks is not just discriminatory and distortionary as between alcoholic drinks and other drinks or products, but distortionary within the alcoholic drinks business? It would be logical and desirable to move to taxing alcohol content, irrespective of whether it occurs in Scotch whisky, beer, wine or any other alcoholic product. I know that it cannot be done overnight--any reasonable person would accept that-- but should we not try to move towards it as a strategic objective?
Mr. Oppenheim: There is much validity in what my hon. Friend says, but he would not expect me to pre-empt my right hon. and learned Friend the Chancellor of the Exchequer's statement at the end of the month.
Mr. Graham: The Minister will not be aware that Chivas Regal is building a massive plant in my constituency which will create a wide distribution network. I therefore have a strong interest in Scotch whisky, as well as enjoying it. Scotch whisky is one of the most popular drinks in the world. Why do the Government not take steps to tackle measures such as those taken by the Japanese Government, who have put massive charges on to Scotch whisky and thereby created further unemployment in our country? We welcome Japanese products, but our products should be welcomed in Japan without being subject to punitive taxation. The Government should do their best to ensure a level playing field.
Mr. Oppenheim: I fully recognise the hon. Gentleman's enjoyment and extensive knowledge of the finer things in life. I assure him that we have referred the Japanese taxation system to the World Trade Organisation disputes settlement procedure, and we hope for a favourable decision before too long.
Export Promotion
6. Mr. Mark Robinson: To ask the President of the Board of Trade what steps his Department is taking to promote British exports overseas. [38654]
Mr. Lang: British exports have been breaking new records. This may be due in part to the recent White Paper which announced more support for companies attending
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trade fairs and missions abroad, more commercial staff at embassies and high commissions around the world, and improved local help through business links.Mr. Robinson: Given the excellent performance of British companies overseas, does my right hon. Friend agree that they have every incentive to go out and win even more orders in the coming year?
Mr. Lang: I do indeed. My hon. Friend will be pleased to note that the volume of our exports has risen by no less than 91 per cent. since 1979. We are breaking records in a wide range of new markets around the world.
Mr. MacShane: While we welcome any increase in British exports, is not the real problem the fact that our trade balance continues to widen in favour of imports? What are the Government doing to address that problem, particularly in light of today's very disturbing news that we have slumped to 18th in terms of gross domestic product per capita? Britain is going downhill: we are importing more and not exporting enough.
Mr. Lang: The hon. Gentleman seems to have overlooked the fact that our recent trade figures show that the trade gap is relatively narrow, taking no account of invisibles. Our trade gap last year was the narrowest since 1986. The export component of that figure, excluding oils and erratics, was a record. Why does the hon. Gentleman not welcome that fact?
Mr. Nicholas Winterton: Does my right hon. Friend accept that the best way to assist and promote United Kingdom exports is by providing incentives to investment, improved training, low interest rates, continuing low inflation and the continuation of a Conservative Government?
Mr. Lang: I am happy to say that, as is almost always the case, I agree with my hon. Friend. The economic policies pursued by the Government have led to that very satisfactory outcome. It is only by continuing to pursue those policies, rather than espousing those of the Labour party, that we will be able to sustain it.
Mrs. Beckett: Surely the Secretary of State is aware that the Confederation of British Industry reports increased anxiety among exporters. Today's figures not only reveal a deficit--and a growing deficit --in our balance of trade, but include the forecast that that deficit is set to grow wider still. That shows our lack of competitiveness after 16 years of Conservative government. Does the Minister deny that the trade figures reveal our lack of competitiveness and the fact that Britain has slumped from 13th to 18th in the prosperity league behind France, Germany and Italy, when we had the oil?
Mr. Lang: I welcome the hon. Lady to her new responsibility for trade and industry matters. I regret that I disagree with almost everything she has said, including the accuracy of her
figures--particularly in relation to France. The hon. Lady asked primarily about exports. I must point out, lest she has not noticed, that our exports are breaking records. We are exporting more now than at any other time in our history. She should recognise that achievement. If she takes account of invisibles, she will realise that the export:import balance and the balance of
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trade is very much more favourable than she allows. It is certainly vastly more favourable than it was under Labour Governments.Mr. Batiste: Does my right hon. Friend agree that one way to assist British exporters is by bringing to an early and final end the Arab boycott of Israel? If he agrees, what action is he contemplating to bring that about?
Mr. Lang: Of course I agree with my hon. Friend that it is desirable to achieve peace and harmony in that area on a long-term basis. That would certainly lead to increased trade, and probably more exports for the United Kingdom. However, my hon. Friend will recognise that that is primarily a matter for my right hon. and learned Friend the Foreign Secretary.
Nuclear Safety
7. Mr. Hanson: To ask the President of the Board of Trade what assessment he has made of the projected standards of safety to be applied in the nuclear industry following privatisation. [38655]
The Minister for Industry and Energy (Mr. Tim Eggar): The Health and Safety Commission made it clear in its evidence to the nuclear review that the current regulatory regime is a rigorous system which ensures that a high level of safety is achieved. The same high standard of safety will apply after privatisation.
Mr. Hanson: Is the Minister aware of the recent statements by Scottish Nuclear safety expert Dr Richard Killick, which say that privatisation will lead to a massive reduction in safety and will have long -term implications for the safety of the industry at large? Will he now abandon privatisation or, at the very least, reconsider safety--or will he allow dogma to influence his decision at the expense of the public's health?
Mr. Eggar: I read about Mr. Killick's allegations in the newspapers and I asked for a full report because I take safety extremely seriously.
I can tell the House and the hon. Gentleman that at no time while Mr. Killick was employed by Scottish Nuclear did he ever mention those anxieties to the company, or to the chief inspector of nuclear installations, or to the relevant nuclear installations inspectorate staff, or to my Department. Those anxieties have surfaced only since he left the company.
Given Mr. Killick's background, he is well aware that, if he has genuine anxieties about safety, the first place to go to express them is to the independent regulator, the NII. Apparently, instead of doing so, he has spoken to the hon. Member for Cunninghame, North (Mr. Wilson) and to the press. That is irresponsible behaviour and, if I may say so, it is irresponsible of the hon. Member for Delyn (Mr. Hanson) to mention those anxieties as he has.
Mr. Neil Hamilton: Did my right hon. Friend read the evidence that Greenpeace gave to the Trade and Industry Committee on precisely that subject? Specifically, it said that there was no reason to believe that
"the management of a"
privatised
"nuclear company should . . . be"
any
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"less sensitive to safety concerns. For operating power stations . . . ownership is less important than strength of regulation." It is obvious that that should be so, because a shut-down nuclear station will earn no revenue, which would be to the commercial disadvantage of a privatised company.Mr. Eggar: I noted what Greenpeace said. Post-privatisation, safety concerns will of course be at least as important as, if not more important than, they are at present, and they will be guaranteed by the independent nuclear inspectorate.
Mr. Battle: Can the Minister confirm that the Treasury expects to receive less than £3 billion from the proceeds of the nuclear privatisation deal, and that it cost the Government more than £3 billion to build Sizewell B power station alone? Does that mean that the Conservative Government are prepared to give away seven power stations for nothing? On those terms, will not that prove to be a shabby, short-changing deal for taxpayers and consumers alike? [Interruption.]
Mr. Eggar rose --
Madam Speaker: Order. There should be only one debate in the House at a time. There is some cross-questioning going on below the Gangway and there should be only one lot of questioning--to Ministers at the Dispatch Box.
Mr. Eggar: I welcome the hon. Member for Leeds, West (Mr. Battle) to his new role. To the last of his questions I answer, "No."
Small Business
8. Mr. Bellingham: To ask the President of the Board of Trade when he next expects to meet representatives of small firms to discuss Government measures to encourage start-ups. [38656]
Mr. Ian Taylor: Ministers, my Department's officials and business links regularly hold meetings with small firms organisations. Support for business start-ups is regularly discussed. With a net increase of about 60,000 businesses in 1994 and a projected increase of about 100,000 businesses in 1995, Government policy is effective.
Mr. Bellingham: Is my hon. Friend aware that one of the biggest problems that confronts small firms in my constituency is excessive regulation? Does he agree that the Government's small businesses litmus test scheme will help firms because they will be consulted first? Is not that yet another example of the Government helping small firms? It is all very well the Opposition sneering, but does my hon. Friend agree that, as long as they support the minimum wage and the social chapter, they cannot claim to support small businesses?
Mr. Cummings: Henry, try to live on less than a minimum wage.
Madam Speaker: Order. [Interruption.] Order. I am inclined to name Members and ask them to leave the Chamber if they are not able to contain themselves while we are at Question Time. Hon. Members below the
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Gangway on both sides of the House must stop blaming each other and behave like the adults they are supposed to be in this Chamber.Mr. Taylor: My answers usually give rise to excitement after I have given them, not before. The key point about the small business litmus test is that all regulation will be considered in the light of its impact on small businesses. That is a welcome step forward. As for the minimum wage, it is important to ensure that when Opposition spokesmen talk to small businesses, small businesses understand what they are being told. The Association of British Chambers of Commerce had to correct a recent Labour press statement. It is clear that the Labour party has not understood the devastating effect that the minimum wage and social over-regulation would have on small businesses.
Mr. Sheerman: Is the Minister not aware of the devastating effect of the cancellation of the business start-up grant on business start-ups? Training and enterprise councils, business links and economic development units across the country are already reporting a 25 per cent. drop in small business start-ups. If the Government are serious about small business, is it not about time they reintroduced that useful grant, and soon?
Mr. Taylor: The grant is now part of the single regeneration budget, which is important in that local people come forward with partnership schemes which have, as part of their scope, the generation of small business start-ups. The announcement yesterday about the national network of business links will provide enormous help to those wishing to start up small businesses. The Department for Education and Employment's training for work scheme is also a great asset. I believe that the Government have in place a range of possibilities to which small businesses can look when they need help.
Sir John Cope: Does my hon. Friend recognise that it is not only start-ups that are important but that it is important to allow existing small businesses to flourish and expand? In that connection, it is extremely good to see on the Order Paper the flow of deregulation orders following the Deregulation and Contracting Out Act 1994. Will my hon. Friend and his colleagues do all they can to speed up the flow of those orders?
Mr. Taylor: My right hon. Friend speaks from experience, having been a Minister with responsibility for small businesses. I know that the creation of a small businesses Minister in every Department will accelerate the interests of small businesses in relation to any proposals for regulation that come to the Floor of the House and will speed up ideas about what we can do to deregulate.
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