[column 413]

Clause 3.—(Disclosure of Information By Commissioners.)

Mr. Sheldon

I beg to move Amendment No.12, in page 4, line 32, after first ‘Commissioners’ to insert:

‘providing that the goods are not so limited in number that details of quantity and price may be deduced from this information in conjunction with that available from official returns’.

The Deputy Chairman (Mr. Sydney Irving)

With this Amendment we may discuss Amendment No. 13, in page 5, line 3, leave out paragraph (e).

Mr. Sheldon

The purpose of Clause 3 is to permit disclosures of goods imported to this country for the benefit of the D.E.A., amongst others, which can thereby find out that certain goods are imported and so come to certain decisions in that respect. The purpose of the Amendment is to achieve a consistency which is at present not in the Clause.

Subsection (3) states:

“The Secretary of State may by order add to the descriptions of information to which this section applies any further description of information contained in any document … other than the price of the goods …”

In fact, what can happen already is that this information can be deduced from the information given under the Clause in conjunction with that given in the Overseas Trade Accounts of the United [column 414]Kingdom or other sorts of official returns. This can be very important in a number of cases. The Amendment seeks to give the Commissioners the right to withhold this information which subsection (3) says should be withheld.

If one looks at the Overseas Trade Accounts in conjunction with Clause 3 we are able to deduce information about goods, including a detailed description, quantities, name of the maker, country of origin and—this I find difficult to understand and it is the reason for Amendment No. 13—the country from where the goods are consigned. This Clause together with official returns might disclose the price. From last January's Overseas Trade Accounts I give an example of how this might be done. Under division 71 machinery other than electrical, metal working machinery, we see that physico-chemical machines imported in January, 1967, were imported at a cost of £12,000 and the total number was six. It does not need much deduction to come to the view that the machines were £2,000 each. This information is at present available, but very few categories are quoted by number. Most are quoted by tonnage and this sort of information is not then available.

By passing Clause 3 unamended we shall be providing precisely that kind of information and anyone who has the returns will be able to deduce exactly the cost in those cases where the quantity is small; he can accurately judge the value of each machine imported. I am not against this disclosure. I think that [column 415]Governments and civil servants have been far too secretive and their atmosphere of secrecy has perhaps spread to the private sector, but the way to overcome the secrecy is not through permitting an oversight in legislation. To make the Clause consistent we put forward this Amendment.

The Joint Under-Secretary of State for Economic Affairs (Mr. Harold Lever)

I am sure that we welcome the constructive approach of my hon. Friend the Member for Ashton-under-Lyne (Mr. Sheldon) in moving this Amendment. He and I have often moved Amendments together from the position he now occupies and as everyone, particularly the Chancellor, is aware, we always did so in a most constructive spirit. Therefore without any surprise I note the moderate way in which he put the Amendment and argued in its favour.

I am glad that he welcomes the Government action, taken at the request of the E.D.C.'s for the machine tool and the mechanical and electrical engineering industries to give some information to our own manufacturers and some means of assessing the demand which they should try to meet which at present is met by imports. My hon. Friend is in favour of that, but he feels that we should not give information of such a detailed kind as to give the actual cost and price of imports in appropriate cases. The Government have no intention of breaching in any way the confidentiality of import documents on which they will rely, and upon which alone they will rely, for this information to be provided. 11.15 p.m.

Secondly, there will be not merely the protection incorporated in the Clause, which strips away anything which is confidential in the individual documents so that in the aggregate nothing confidential is disclosed. But in addition, the Government, who will not automatically operate the power to give this information, will vet every category of information before operating the power and ensure that there will be full and adequate consultation with all the relevant trade and industrial representative bodies before they authorise release of any category of information. That will be a check in addition to the careful stripping [column 416]of confidential matter from what is publishable under the Clause.

To be quite sure that even in such odd cases as that which my hon. Friend cited nothing unfair or unwise will result, we have made this not mandatory but subject to individual examination by the Government, and in every case there will be consultation with the relevant trade bodies. In the kind of case my hon. Friend mentioned of an import of six articles amounting to £12,000, there is no question that the Government would authorise the provision of this information in any event. What we are trying to do is to communicate to our own manufacturers where there is a very substantial and repetitive demand which they should be trying to meet. We are not interested in picking up bits like £12,000 and six articles. Whether my hon. Friend thinks the inference could be accurately drawn or not is open to argument.

The first great protection is that the release is not automatic. The second is that the trade bodies will be consulted in every category of information before any is released. The third is that the Government are instituting very careful machinery for vetting each of these categories before any information is released. That machinery will be very thorough and my hon. Friend can rest assured that in no circumstances will information be given which would amount to the kind of damaging, trivial breach of confidence implied in the kind of figures he cited.

Finally, I emphasise that the Government has a vested interest in maintaining the trust that industry has in the confidentiality of all matters communicated to the Government. This would be seriously damaged if the Government were to authorise any information to be given that was a breach of the confidence entrusted to it.

In all these circumstances, I think that my hon. Friend's fears are hypothetical, and he need not be so anxious as to be disabled from withdrawing the Amendment.

Mrs. Margaret Thatcher (Finchley)

I wish to say a few brief words on the Amendment, but to reserve one or two comments for the debate on the Question, “That the Clause stand part of the Bill” . [column 417]

May I also say how delighted I am to see the hon. Member for Manchester, Cheetham (Mr. Harold Lever) on the Government Front Bench? I imagine that the rest of the Front Bench is very relieved that he is there and not on the back benches. I hope that he is urging the same sort of advice behind the scenes as he would be urging if he were still on the back benches.

Harold LeverThe Minister has sought to say that the Clause offers great protection, particularly with reference to the Amendment. In fact, the Clause does not offer great protection. It is drafted very widely and I believe that that is the reason for the Amendment. I have no doubt that the Minister would operate it strictly in accordance with the assurances he has given. But that is no guarantee that anyone else would operate it in that way.

I have particularly in mind the case of a company importing goods to test the market before setting up in manufacturing itself. It might import goods to test the market and make considerable inroads into that market. But a company would probably be readily identifiable and the information as to its importing, the catalogue number and the deduction that it was going to set off into manufacturing would be useful to any competitor.

It is not enough in such a case to say that the Government would consult the industry. Some of this information would be unfair to any particular firm. Many companies in an industry would like to have more information about other firms in that industry. I think that the hon. Member for Ashton-under-Lyne (Mr. Sheldon) would be well advised to press the Amendment, if not now then on Report, on the Government, so that the Clause may offer greater protection than it does.

Mr. Barnett

It is nice to see my hon. Friend the Member for Manchester, Cheetham (Mr. Harold Lever) on the Front Bench, although it was pleasant to have him back here with us. I hoped that he would accept the Amendments in the same constructive spirit that he suggested that we withdraw them because, if the assurances he gave are valid, they would surely be equally valid and appropriate for him to accept the Amendments. He has not really presented any arguments for not accepting [column 418]them. All he has said—although, of course, we accept it—is that they will be dealt with.

Mr. Sheldon

Although I think that this matter can be examined further possibly on the Report stage, as a token of my friendship for my hon. Friend the Joint Under-Secretary of State for Economic Affairs, my former colleague on these benches, I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn

Question proposed, That the Clause stand part of the Bill.

Mr. Biffen

I would not like it to be thought that there was universal acclamation for Clause 3. I have grave doubts about the virtue of this kind of Clause because I suspect that it results from the activities of the economic development committees. That does not of itself render the Clause necessarily unacceptable but it puts into my mind some suspicions.

These arise from a belief that we are obsessed with the supposed problem of import substitution. In fact, we should be much more concerned with the competitive environment in which British industry should operate, and far from encouraging people like the Machine Tool Trades Association to try and get the Government to hand things to them on a plate about the kind of competition they are meeting, we should be hoping that the Machine Tool manufacturers should themselves be aware of the kind of competition they are facing.

There is no doubt that the Clause arises in part as a result of representations by a number of economic development committees. The Economic Development Committee of the machine tool industry was foremost amongst those pressing for this kind of legislation. I have here the progress report for the first two years, 1964–66, published by the Committee. It says:

“The study of imports generally is considerably hampered by the lack of detail in the published import statistics, which at present show only the broadest categories. The E.D.C. has confirmed that details required can be obtained from existing information in the Government's hands, and has made strong representations to the Government for it to be made available to the machine tool manufacturers so that an effective attack on imports may be mounted.”

[column 419]

The hon. Member for Manchester, Cheetham (Mr. Harold Lever) has just been talking about consultations with the relevant trade bodies. What is the relevant trade body if we are dealing with machine tool imports? Is it the British machine tool manufacturers, or the machine tool importers? In many instances, the companies are one and the same. However, I took the precaution of discussing this Clause with a machine tool importer this morning and he was very eloquent on the disadvantages which he thought would flow from the Clause. I share his scepticism about the extent to which this provision will encourage a protectionist attitude among industrialists in this country.

We have some signs of the extent to which the incipient protectionism which exists in this country, an attitude which is encouraged by bodies such as the economic development committees, is causing concern among our trading partners in that in February a good deal of concern was expressed by the Swiss machine tool manufacturers' association.

The Times of 15th February said that the Swiss machine tool manufacturers' association had issued a statement saying that official policy in Britain was against the letter and the spirit of the E.F.T.A. treaty. The burden of their argument was that the Government had urged British users of machine tools to buy British. The statement referred to the 1965 “Little Neddy” programme which, it contended, could be interpreted as an invitation to British manufacturers to copy foreign machines and thus reduce imports.

It is particularly undesirable that this country, the Government and British industry should be exposed to charges of that sort, but I have a sneaking sympathy with that kind of charge against the average British machine tool maker who on the whole knows all his customers or potential customers and who is not dealing with a vast market which he cannot conceivably encompass with his own sales organisation—if he has a sales organisation worthy of the name.

At one stage I worked for a body called the Economist Intelligence Unit and I remember talking to the managing director of a very large machine tool company in this country who laughed at the thought [column 420]of someone like the E.I.U. doing a market survey for him. He said, “We know the market” , and I am sure that he was right. It was a company with an extremely good reputation in the machine tool industry, not a company to be held up to ridicule. It happened to be Alfred Herbert.

My concern is that once we start having this kind of disclosure we encourage the worst element in British management, which is to ask, “If we are subject to competition from imports, what will the Government do to help us?” It is not as though this information is not within the scope and ability of any competitive manufacturer to find out for himself and if we believe that we increase the competitive efficiency of British manufacturers by trying to pass this kind of information to them via the Customs and Excise, we underestimate the kind of environment in which we are operating.

Mr. J. T. Price (Westhoughton)

Perhaps it is better that I should intervene on my feet than interrupt the hon. Member for Oswestry (Mr. Biffen), who has just spoken about the machine tool industry. His argument may be valid in a general sort of way with a smaller circumference industry like the machine tool industry where individual units are identifiable within the trade, but it does not apply generally to every industry in this country. I have never appeared as any sort of crude protectionist, but I hope that it will be recognised that the machine tool industry is a very different kettle of fish from the textile industry, of which I have some local knowledge as a Lancashire Member of Parliament.

I have noticed recently that leading members of the Conservative Party, impressed by the cases that we have occasionally put up on behalf of the industry, are beginning to make very friendly noises towards the Lancashire textile industry, which has never asked for any kind of protection, but which has asked, and this is the proper occasion to raise the matter, not for less disclosure, but for more. 11.30 p.m.

This is an industry which has been more than two-thirds destroyed within the last decade by the unrequited imports coming into the country, willy-nilly, under our present system of import controls. I am entitled to remind the Committee [column 421]that the textile industry has, through its official bodies, asked for more disclosure because of the very grave practices which are going on, and which do not represent fair international trade, as some of us understand it.

While I disown any charge of being a protectionist in the narrow sense, I also disown any charge of being a crude laissez-faire man, who wants to let the free play of the market settle everything, because that leads to all kinds of happenings that Members on both sides of the Committee know perfectly well every civilised state in the world, except ours, takes very stern measures to deal with.

I would advise my hon. Friend the Joint Under-Secretary of State for Economic Affairs, who has appeared in this new rôle for the first time—the poacher turned gamekeeper—and who is sitting there looking very pleased with himself, to bear in mind, as a Lancashire Member, that there is a case for Lancashire that does not equate with the sort of consideration that has been put to us in support of this Amendment.

Mr. Harold Lever

It is apparent from what my hon. Friend the Member for Westhoughton (Mr. J. T. Price) says, that anxiety often disguises itself in the most remarkable ways. He implies that I have the appearance of being exceedingly pleased with myself. I welcome the very kind comments which have been made upon the responsibility which has been cast upon me. I think that the hon. Lady the Member for Finchley (Mrs. Thatcher) was a little mistaken in thinking that my colleagues on the Front Bench are relieved by my presence. Their full attendance is, I think, to be attributed to anxiety rather than relief.

The hon. Member for Oswestry (Mr. Biffen) carries his normally attractive support for the principle of self-help beyond the bounds of what is reasonable on this occasion. When he says that the average machine tool manufacturer ought not to be helped in this way, ought not to be handed this information on a plate, he is really caricaturing his own position as an ardent admirer of virile businessmen.

I do not really think that he would, on reflection, believe that machine tool manufacturers should institute a national survey in order to find out what kind of [column 422]machines are selling well, so that they might get a full appreciation of the market that is being supplied by imports, and compete accordingly. There is nothing shameful, either in seeking to find what are the best selling items that are sucking in imports to the country, which could well be met by existing capital equipment and existing U.K. manufacturers. It is an entirely competitive, non-protectionist situation which we are seeking to encourage. We are not giving them a price advantage, or a tariff advantage.

What we are doing is to assist them, with reasonable information, stripped of all its confidential aspects, of the kinds of machinery and goods which are coming into the country. We are saying to them: “This is what is coming in; can you match it competitively by your energy?” The hon. Member said that they know their own customers. Of course they do. What we are trying to do is to tell them what people who are not their customers are buying from abroad and what they might well supply from their own capital equipment, “know-how,” intelligence and work force.

I welcome the comments of my hon. Friend the Member for Westhoughton (Mr. J. T. Price), although some of them were not directly related to the powers which we are seeking. I assure the Committee that the undertakings which have been given against breaches of confidentiality will be effectively honoured. The Clause has been drafted with the intention that all the figures which would be given, even if there were no supervision from the Government's point of view, would not in any event result in a breach of confidentiality, because they would be aggregates and not individual figures, and the aggregates would be stripped of the name of the importer and the prices of individual items of goods. Consequently, even if the Government exercised no further supervision they would involve nothing which was confidential.

To give a simple example, if it were desired to know how many Renault 1.5 litre cars were being imported into this country in a quarter, this could be announced and the figures given. There is nothing confidential in that information, which is given in every country in the world about manufactured imports. It is [column 423]right that we should have that information, but to make sure that in no instance will anything which is confidential be disclosed, the Government will not automatically disclose the information and will maintain consultations with the relevant trade representative bodies.

I was asked which bodies they would be in respect of machine tools. Clearly, they would be the machine tool importers, not solely those who have an interest in finding out this information. Before we would authorise this information we would consult the kind of people who might be affected if there were any breach of confidentiality. The Committee's fears ought to be laid at rest, therefore, and I hope that the Committee will accept the Clause.

Mrs. Thatcher

I should like a little more information about the Clause, which is rather wide. I am, in part, asking for information and in part making comment, and I hope that Harold Leverthe Minister will correct me if I say anything which is incorrect.

The normal position is that the information in these documents is given for one purpose only—to ensure that the right amount of tax, imposed by Statute, is collected on that class of goods. Information given for that purpose is normally absolutely confidential and is not disclosed for any other purpose. Between that information and the ordinary statistical information in the trade return there is a wide gap. The hon. Member is seeking to bridge that gap in this Clause, which I think is a far-reaching Clause, and I want him to define more closely than he has defined so far what are the objectives which he hopes to achieve, as they are not at all clear.

If we are to breach confidentiality, there must be a good reason for doing so and we should know what we are hoping to achieve. I understand that “Neddy” [NEDC] thinks that if every manufacturer in this country knew what was being imported he could create, or would be more likely to create, a competitive substitute for that import. Going through the trade and navigation returns, I earnestly hope that every country in the world will not go in for import substitution because that would have a very damaging effect on much of our export trade. [column 424]

I know the chemical industry very well, and I know that we could go through the list and cut out export after export if other countries adopted the policy which I think is inherent in the Clause. If that is not the purpose of the Clause, then I do not know what is its purpose.

The implication is that if a manufacturer knows what is being exported and where it is being exported from he is more likely to produce a competitive substitute. That is not necessarily the case. Hon. Members will see that if they go through the list of basic chemicals. Sodium chlorate is one example and potassium carbonate is another. Everyone knows that they are produced in this country, but they are, nevertheless, also purchased from other countries for very good reasons. They are sometimes purchased and converted into other chemicals which are exported.

Cut glass is another example. Many women buy Czechoslovakian cut glass. It is well known that we produce excellent cut glass in this country, but the knowledge that it is produced both in Czechoslovakia and here does not cut down the amount of imports. Indeed, the increase in world trade has come from an increase in trade between importers of manufactures, and I think the N.E.D.C. Report was operating on an outmoded view of trade. I think we should go for an increase of manufactured imports and exports between countries.

Now I ask the hon. Gentleman, therefore, what is the purpose of this Clause? Is he saying that he is giving more knowledge to manufacturers on the basis that if they have that knowledge they will produce similar goods? If he is not, why does he so particularly want this Clause? I do not accept his assumption at all, and I do not think it is borne out by the facts.

We may wish to return on Report to subsection (3), because I think it is most important that the hon. Gentleman and the Secretary of State should not have powers of the kind taken in sub-section (3) which, again, are extremely wide. The subsection enables more information to be given to anyone; not just N.E.D.C.; give it to N.E.D.C. and it can be given to anyone. For example, I know a good many manufacturers in the chemical industry who [column 425]would be delighted to have more information about the quantities and countries of origin; then they would trot along to the Board of Trade with a flimsy application for anti-dumping duty. I shall be very interested to see if the number of applications for anti-dumping duty goes up.

I am very suspicious of this Clause. I hope the hon. Gentleman will give us more information about its purpose. Also, will he give us a strict account now of the precise powers which exist to give information and what is the source of those powers? If not, we shall wish to return to this on Report.

Mr. Biffen

I am encouraged to make a few more brief comments by the answer from the Government and particularly by the remarks by my hon. Friend the Member for Finchley (Mrs. Thatcher), remarks which I fully endorse. If we are asked to pass a Clause which will give greater disclosure to the Government we must know the purpose to which this policy is directed. One does not need to be congenitally suspicious to have some considerable reservations about extending the area of Government intervention and Government knowledge. We are here as protectors of our constituents against this kind of activity, and the philosophy which prompts us is specially prompted by this kind of Clause and the coalition between departments like the Department of Economic Affairs and trade associations, an unhappy coalition if ever there was one.

Let us suppose that the purpose of the Clause is to encourage import substitution, to encourage British machine tool manufacturers, British chemical plant manufacturers, or even British textile manufacturers, to make the kind of products which are now being imported. Will the vital information of price also be revealed to those companies who wish to compete against the interests of their fellow citizens who act as importers? Because if this vital factor of price is not also to be included, will they not be back in the same difficulties in which they now find themselves, where they do not know about this factor?

It is still, in my opinion, the legitimate function of the machine tool manufacturer to get out and know his market, and not have this kind of information passed to him. [column 426]

If this information is passed to him and still excludes the vital factor of price, of how much more value is it? 11.45 p.m.

If, however, the vital factor of price is also to be included, I suspect that we may find that in the Clause we are stumbling across far greater degrees of disclosure than we ever imagined. All the pressures from now onwards, particularly from the trade associations which proliferate around the new Government Departments—which have given many of them cause for existing, whereas often in the past they found it damned difficult to justify the subscriptions for which they called from their members—will be to know more and more, including descriptions and designations, and to try to fill out our statistical knowledge, so that we will no longer be conducting the economy with the crude and imperfect weapons of the past.

I feel deeply suspicious about this development. Nothing which has been said so far disarms those suspicions other than the charm and urbanity of the Joint Under-Secretary of State for Economic Affairs, but even that cannot cover up what, I suspect, is a thoroughly bad case.

Mr. Sheldon

I would not wish to intervene at this late hour, but I am concerned about one aspect of this disclosure. As I have said, I am in favour of much greater disclosure, but I am doubtful why this disclosure is being required. There are far better methods for manufacturers to get the information which they require rather than the statistical returns which come a few months later when they should have the information. What should matter to a machine tool or any other manufacturer is information of what is going on now and what customers will do in the future and not about what happened a few months ago.

I am also worried about the whole question of import saving. This may well turn into a discussion to see what competitors are doing and trying to copy them. That is not the rôle of a country like ours. It is a rôle of underdeveloped countries or countries which want to imitate. That imitative rôle is suitable for a country which is starting to industrialise, for a country like Japan in [column 427]the 1920s, and it is what is happening in certain African countries today. It is hardly a rôle for us. Our rôle is that of innovation. I am disturbed at this concentration on what other people are doing and why they are buying rather than on what we ourselves should be doing.

Mr. Harold Lever

First, let me say with unmistakable clarity that the purpose of the Clause is to allow the Government to provide information to our manufacturers of the size and nature of certain manufactured imports, with the intent that those manufacturers, being apprised of the larger-scale imports of manufactures, shall be alerted with precision to the nature of demand which exists at home which they might well satisfy in many cases by their own efforts and their own production.

It is not, of course, the Government's intention to pursue this in detailed minute quantities, but where there is a major scale of imported goods which manufacturers believe that they can replace by home production, or where they can make a contribution to replacing by home production, it is well that they should have at their disposal the kind of information concerning the nature of imports that is available in most other countries and which alerts and apprises domestic manufacturers of the areas where the market for their own products might be extended.

There is nothing shameful or backward in this. There is nothing here in terms of talking of copying and imitating backward nations. Many hon. Members would be well advised not to adopt patronising expressions about the industrial production and habits of countries like Japan. There is much that we might learn from other countries.

Mr. Sheldon

I referred to Japan in the 1920s.

Mrs. Thatcher

As the Joint Under-Secretary of State has referred to Japan, may I remind him that in the last five years, although our imports of manufactures have increased by 50 per cent., Japan's have increased by 100 per cent.?

Mr. Lever

This is not a matter of reducing the total imports of this country. [column 428]It is matter of alerting our own manufacturers to possible markets which are being satisfied, in some cases unnecessarily, by imports of foreign manufactures which we would seek to replace, so far as reasonably and competitively can be achieved, by our own manufactures.

There is no mollycoddling of British manufacturers. There is no question of giving them an improper preference. They will have to fight for their markets. We are arming them in the fight with information which is available in almost every other country in the world. It is information which will enable the British manufacturer to conduct his battle for the domestic market with the best possible knowledge of what is being imported into the country. That is not improper, undesirable or protectionist, and I cannot see why the hon. Members for Oswestry (Mr. Biffen) and Finchley (Mrs. Thatcher) are so anxious that British manufacturers should be deprived of the information.

Information will be given to them, and nothing else. It is quite ill-advised to suggest that the response of British manufacturing industry to full statistical information of this kind will be to run bleating and moaning to the Board of Trade for further protection. That is an unfair inference, and I am sad to find the Opposition Front Bench so ready to imply that there will be such an unsatisfactory reaction from British industry if we provide them with more information of this kind.

At any rate, British manufacturers can be satisfied that, whatever lack of confidence some hon. Members opposite have about their reaction to getting fuller information on what is selling in the way of imports, this Government are confident that the provision of this information will add to the efforts and zeal of British manufacturing industry to play a full part in competing for its own domestic market. I do not know why the British should think that there is something shameful or hangdog in encouraging their manufacturers to supply their own domestic market with manufactured goods in competitive conditions.

We have heard a number of conflicting criticisms. The hon. Member for Oswestry thinks that we go too far, and then implies that the information which [column 429]we produce will be of no use because we do not intend to breach confidentiality by giving prices of goods or names of importers to British manufacturers. The point is that they must find these facts out for themselves in the ordinary course of commerce, but there is no reason why this perfectly proper information should not be available to them for the purpose of encouraging them to make their maximum effort to supply the domestic market in manufactured goods from their own manufacturing capacity.

It is a perfectly legitimate objective. It is not in conflict with our international obligations or with our pride. It is very much in the interests of the economy of the country that our manufacturers should be successful, and that we give them all proper and reasonable aid, purely by way of information, to support those efforts.

Question put and agreed to.

Clause ordered to stand part of the Bill.