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Rev. Martin Smyth (Belfast, South): Other Governments of divers compositions have helped particular companies to the detriment of other companies in the same industry. The Minister must listen to the hon. Lady's warning.

Mrs. Browning: That is quite right. If the Government are to intervene through regional or sectoral aid, it is vital that they do not set one domestic company against another simply because of geographical position.

The Government can assist companies such as John Heathcoat in another way. I mentioned a level playing field and we all know of the difficulties that companies in all industries encounter when tendering for contracts. As someone who worked in the Ministry of Agriculture, Fisheries and Food for three years, I am well aware that within the European Union there is always concern about how hidden subsidies are used to give an unfair advantage when companies from different states are tendering for the same contract.

At my meeting with John Heathcoat, I was concerned to hear about one problem that the company brought to my attention, which involved a contract with the Ministry of Defence for supplying the RAF coverall. I have written to the Minister's colleague, the Minister for Defence Procurement, about that issue and I will outline the company's experience--it is well established in the niche market of supplying that product--and the difficulties that it encountered when tendering for that contract. I shall read a letter from the company, as it includes various

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registered trademark names, which I hope that hon. Members will follow if I put them into context. The company writes:


    "We have been supplying approximately 10,000 metres/year of this fabric"--

it is supplying Ballyclare Special Products, which produces the RAF coverall--


    "woven from Nomex (DuPont) Aramid fibre.


    In September we responded to a new tender from Ballyclare for 30,000 metres/year over the next three years.


    Last month"--

that is, in December, just before Christmas--


    "Ballyclare were informed by the MOD that they had not been successful. The contract had been awarded to a German company called Freutcher, who will apparently commission garments to be made, part in Sarajevo and part in Tunisia. The garment tender price was claimed to be 5 per cent. lower than Ballyclare's quotation.


    However, Freutcher's tender is based on Conex (Teijin fibre) which is priced lower than Nomex, and is a fibre which we are informed that the MOD has not yet fully evaluated.


    Ballyclare contacted the MOD before submitting their tender to enquire whether they should offer an alternative to Nomex. The response was negative, they should only submit based on Nomex."

Ballyclare is extremely annoyed with that scenario simply because it has discovered that the German company's tender was based on an alternative fabric. The letter says that the company is


    "very aggrieved . . . as with Conex being cheaper yarn it is likely that we could at least have matched the competitive tender. We have now lost valuable business at a difficult time for the textile manufacturing industry, putting jobs at risk in our weaving unit."

As I wrote only 10 days ago I do not expect a reply yet, but I draw that matter to the Minister's attention because there is room for Government intervention if one set of rules are applied to one company and another set to others--in that case a company supplying the main supplier--and if that results in United Kingdom jobs being put at risk because the contract goes to a German company. I do not expect the Minister to give me an answer today, unless he has one, but I hope that he will encourage his right hon. Friend the Minister for Defence Procurement to look into the matter and take a personal interest in how such important contracts are lost, as that clearly proves that we do not have a level playing field. That is a genuine case for Government intervention.

The Government could also be making representations on behalf of the industry in another area, which has been flagged up in the newspapers in the past few days. Owing to the banana war, which hon. Members will have read about, the situation with the United States is now serious. I will not go into too much detail, but as a former Agriculture Minister I am only too familiar with the banana trading arrangements of the Caribbean countries and competing south American countries, which all want to export their bananas to the European Union. There is a banana war between the EU and the United States over World Trade Organisation regulations, and the US is threatening 100 per cent. tariffs on EU exports as a reprisal because it cannot get its own way. The tariffs will target cashmere knitwear and printed cotton.

A statement from the industry reads:


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    Yorkshire and cashmere spinners and weavers in the Borders of Scotland are already having orders cancelled and job losses are imminent".

That is the result of the stalemate, and those of us who take an interest in the matter have been following the WTO talks daily. Perhaps the Minister can give us an update. As I understand it, yesterday's talks were deferred, yet again. The Government have a role here. They can intervene at the highest level. I would like to think that the Prime Minister will speak to President Clinton about the matter.

Mr. Archy Kirkwood (Roxburgh and Berwickshire): The hon. Lady will understand that people in the borders are as concerned as she is. It is to be hoped that my hon. Friend the Member for Tweeddale, Ettrick and Lauderdale (Mr. Moore) will catch your eye, Mr. Deputy Speaker, and will be able to develop the arguments from the point of view of south-east Scotland. People in the borders rightly believe that the United Kingdom Government have given the United States international support, which was justified at the time, but their reward for such support is a tariff that is damaging our industry today, here and now. Factories in Hawick are closing because the delivery dates for their garments will be caught by the 100 per cent. tariff. It will bankrupt those businesses if they knit the garments and then have to pay the penalty.

Mrs. Browning: The hon. Gentleman speaks as a representative of people working in that industry and knows far better than I do the impact on his constituents. I endorse his comments. He is right. The Government can legitimately intervene in such issues and I should like to think that the Minister will assure the House from the Dispatch Box that pressure will be brought to bear on the United States at the highest level--at prime ministerial level. If we in this House believe in anything, it is in free trade--well, we Conservatives certainly do. We do not like tariffs and barriers. If Labour's new-found devotion to free market philosophy is genuine, the Prime Minister will not hesitate to pick up that phone, speak to the President and ensure that the barriers are brought down--and not merely in a few months' time when it suits everyone to sit around a table for yet more talks, because we need action in a hurry.

John Heathcoat in my constituency is not a sunset company. I hope that I have clearly demonstrated that it has not rested on its laurels. However, the company is worried and I hope that the Minister will understand that it is not asking me to make representations to the Government with a begging bowl in my hand asking for largesse. I have highlighted several issues in which the Government can rightly intervene and assist the industry.

The managing director of Heathcoat wrote to me saying:


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    dispel the view that exists in the country (and regrettably in some areas within the industry) that all is lost, that textiles is a sunset industry and all we can do is wait while it dies a lingering death.


    This cannot be the case, the country cannot afford to lose the jobs that the Textile industry provides, and we feel that we should get at the very least moral support from the Government for those companies that have not joined the race to low cost countries and have decided to keep their manufacturing facilities, and the jobs that go with it, within the UK.


    We do run a research unit which is continually looking at new uses for textiles and at new processing methods, but we find that the amount of paperwork involved in obtaining a grant and the work necessary in preparing it is burdensome to say the least. We should not have to employ consultants to show us how to best prepare cases for Brussels, we should get Government encouragement and help to do this ourselves."

I have already given the House an example of the difficulties that the company encountered in tendering for one EU contract. Although I am discouraged by the Minister's intervention and his brickbat approach, I hope that he will give us a substantive reply to the debate that will address the practical aspects of legitimate Government intervention so that John Heathcoat can continue for hundreds of years as one of the leading textile companies in Britain within a vibrant sector that can hold its head up high.


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