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TRADE AND INDUSTRY

Audit Standards

Mr. Cousins: To ask the Secretary of State for Trade and Industry what steps she is taking to ensure UK compliance with the EU recommendation on standards for external quality assurance systems in statutory audit. [37287]

Ms Hewitt: It may help if I set the context by first explaining our plans to ensure that there is a careful review of the UK's current regulatory practices for statutory audit and financial reporting, following the collapse of Enron in the US.

The requirements in the UK are significantly different from the US in relation both to the relevant accounting standards and to the oversight and regulation of the audit profession. But it would be most unwise to conclude that problems of this sort could not arise in the UK; and it is right therefore to review arrangements carefully

I am therefore setting up a group jointly with the Treasury, and including the Financial Services Authority and other regulators such as the Accountancy Foundation, to oversee and co-ordinate the response in the UK to these issues raised by the collapse of Enron. These include:

whether the ethical standards of the professional audit bodies provide an adequate assurance on the independence of auditors, including the restrictions on the supply of non auditors, including the restrictions on the supply of non audit services


whether there should be a requirement for the mandatory rotation of audit firms; or for the mandatory re-tendering for company audit


whether current disclosures of audit and non audit fees in company accounts are adequate


the role of Audit Committees in relation to the audit engagement


the implications for accounting standards in the UK


the implications for auditing standards in the UK.

The Group will report on progress and emerging conclusions by the summer.

At the same time I am also setting up an independent review of the role and effectiveness of non-executive directors in the UK. The review will report jointly to me and the Chancellor of the Exchequer. I will provide further details of who is to lead the review and the terms of reference in due course.

Together these reviews are aimed at:

Ensuring that companies can fulfil their potential and improve productivity;


Strengthening the UK's framework for how companies operate; and


Encouraging greater transparency.

The quality assurance systems for the statutory audit, both within and outside the audit firms, are an important part of the regulatory arrangements which give confidence in the audit process.

The European Commission's Recommendation C(2000) 3304 of 15 November 2000 on "quality assurance for the statutory audit in the EU: minimum requirements" recommends that all persons carrying out statutory audits should be subject to a quality assurance system. The Recommendation sets out acceptable methodologies and covers topics such as review cycles, the scope of the review and the quality of the reviewer.

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The United Kingdom has an established system of monitoring of statutory company auditors, which was in place well before the Recommendation was adopted. The bodies recognised under the Companies Act 1989 to supervise registered auditors are required regularly to monitor the performance of audit firms or individual auditors registered with them. My Department asked the recognised supervisory bodies to review existing requirements against the detail of the Recommendation and to report the results. The arrangements were found to be broadly in line with the Recommendation. All audit firms and individual auditors are subject to regular review, including monitoring visits by independent reviewers, and those with public interest clients, such as listed companies, are subject to a higher frequency of coverage.

Post Offices

Mr. Andrew Turner: To ask the Secretary of State for Trade and Industry what proportion of the population of (a) England, (b) Scotland, (c) Wales, (d) Northern Ireland and (e) the United Kingdom live more than (i) five miles, (ii) 10 miles and (iii) 20 miles from a Crown post office. [38040]

Mr. Alexander: I am informed by Post Office Ltd. that in the United Kingdom with regard to proximity to a main Post Office branch, 79 per cent. of the population live within five miles, 93 per cent. of the population live within ten miles and 99 per cent. of the population live within 25 miles. Figures are not available on an individual country basis.

Mr. Andrew Turner: To ask the Secretary of State for Trade and Industry what proportion of the population of (a) England, (b) Scotland, (c) Wales, (d) Northern Ireland and (e) the United Kingdom live more than (i) two miles, (ii) five miles and (iii) 10 miles from a sub post office. [38039]

Mr. Alexander: I am informed by Post Office Ltd. that in the United Kingdom with regard to proximity to a sub post office, 99 per cent. of the population live within two miles and 100 per cent. of the population live within five miles and, therefore, within 10 miles. Figures are not available on an individual country basis.

Energy Technologies

Mr. Sayeed: To ask the Secretary of State for Trade and Industry what action has been taken as a result of her Department's Memorandum of Understanding with the United States Department of Energy in relation to new and renewable energy technologies. [37704]

Mr. Wilson: I have nothing further to add to the answer given to the hon. Member on 14 February 2002, Official Report, column 525W.

CHP

Mr. Sayeed: To ask the Secretary of State for Trade and Industry what steps her Department will take to ensure CHP is excluded from the obligation base for the Government's renewable energy obligation. [37698]

Mr. Wilson: I have nothing further to add to the answer given to the hon. Member on 12 February 2002, Official Report, column 292W.

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Hairdressers

Mr. Austin Mitchell: To ask the Secretary of State for Trade and Industry what assessment she has made of the regulations governing hairdressers in other EU countries. [35870]

Miss Melanie Johnson: None.

Car Block Exemption

Miss McIntosh: To ask the Secretary of State for Trade and Industry (1) when she will lay the European Draft Regulation on the Car Block Exemption before Parliament; [37100]

(2) when she expects the draft Regulation on the Car Block Exemption to be adopted and published by the European Commission; what the length is of the consultation period to be held; who will be consulted; and what form the consultation will take. [37101]

Miss Melanie Johnson: The European Commission adopted a draft regulation on 5 February, and communicated it in confidence to member states. Following an initial discussion with member states on 7 March, the Commission will publish the draft on its website and in the "Official Journal of the European Communities". The consultation period will be not less than one month. As well as member states, the Commission will also formally consult the European Parliament and the Economic and Social Committee, and will invite any other interested parties to submit their views.

Bogus Billing

Mr. Lazarowicz: To ask the Secretary of State for Trade and Industry what plans she has to take action to deal with bogus billing for entries in business directories. [36387]

Miss Melanie Johnson: Companies are already afforded protection under the Unsolicited Goods and Services Act 1971 and the Control of Misleading Advertisements Regulations 1988.

Trading Standards and the Office of Fair Trading take enforcement action against bogus billing (in conjunction with their counterparts overseas, where necessary).

For example, the Office of Fair Trading (OFT) has investigated complaints about the European City Guide and this has led to the cancellation of some 400 contested invoices. The OFT is also pursuing complaints about the tour and travel guide with the relevant authorities in Liechtenstein.

Domestic Subsidies

Lynne Jones: To ask the Secretary of State for Trade and Industry what the timetable is for implementation of the commitment reached at the Doha ministerial meeting on trade of November 2001 to cut export and trade-distorting domestic subsidies. [37858]

Ms Hewitt: The reference to export and trade- distorting subsidies can be found in the section of the fourth Ministerial declaration relating to agriculture. The negotiations on agriculture form part of the single undertaking in which virtually all the linked negotiations

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are to end by 1 January 2005. The mandate given by the Doha declaration also includes a series of interim deadlines.

The negotiations on agriculture began in early 2000. Further key dates are 31 March 2003, when formulas and other "modalities" for countries' commitments are to be submitted, and the fifth ministerial conference in 2003, by which date countries are to have submitted comprehensive draft commitments.

Unsolicited Mail

Mr. David: To ask the Secretary of State for Trade and Industry what recent discussions she has had with her European counterparts on measures to curb the posting of offensive and unsolicited mail to the UK from other EU countries. [36571]

Miss Melanie Johnson [holding answer 25 February 2002]: The Department's officials work closely with enforcement bodies, such as the Advertising Standards Authority (ASA) and the Office of Fair Trading (OFT), who work with their European counterparts on unsolicited mail.

The ASA supervises the British Codes of Advertising and Sales Promotion and works with national and international regulators. The ASA liaises with the European Advertising Standards Alliance for action with the regulatory body.

Since 1 June 2001, Stop Now Orders have provided a stronger mechanism for enforcing consumer protection legislation emanating from the European Directive. This includes laws on advertising. These Orders enable OFT and other specified UK qualified entities to act against businesses elsewhere in the EU, where their activities are harming the 'collective interests of consumers'. The OFT is working closely with counterparts in other Member States to establish the most effective means of acting against cross-border infringements within Europe.

Unsolicited mail which is indecent or obscene under the terms of the Protection of Children Act 1978 or the Obscene Publications Act 1955 is a matter for my right hon. Friend the Secretary of State for the Home Department.

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