TUC
Q1. Mr. Wrigglesworth
asked the Prime Minister when he last met the TUC.
The Prime Minister (Mr. James Callaghan)
I refer my hon. Friend to the reply that I gave to my hon. Friend the Member for Hemel Hempstead (Mr. Corbett) on 3rd February.
Mr. Wrigglesworth
When my right hon. Friend again discusses economic policy with the TUC, will he ensure that it is not taken in by the posturing of the Opposition on matters such as increased food prices, where their policies would lead to even higher prices than those we have at present, on gas prices, where their entreaties for public expenditure cuts ignore the policies that the Chancellor has been putting forward, and on Shotton, where the works would have been closed had it not been for the reversal of policy by the Secretary of State for Industry?
The Prime Minister
My hon. Friend is quite right—and we all know that any introduction of the kind of policies favoured by the Opposition would lead to a higher cost of living throughout this country.
Mrs. Thatcher
Doubtless James Callaghanthe Prime Minister has discussed public expenditure proposals with the TUC. Will he admit that he is the first Prime Minister in the post-war period who has been too afraid to put his proposals for public expenditure cuts into a White Paper and lay them directly before the House on a direct motion for a direct vote?
[column 615]The Prime Minister
I do not see what the right hon. Lady is complaining about. She has been pressing us for months to cut public expenditure, and we have now cut it. As regards a vote on a motion, I would expect to find every member of the Tory Party on my side in the Lobby.
Mrs. Thatcher
But is it not truth that if the Prime Minister put down a motion to approve the White Paper he would lose it and the whole of his economic policy as well, despite Government whipping?
The Prime Minister
If the right hon. Lady really means that, she is being very hypocritical in calling on me to reduce public expenditure. The reduction of public expenditure is what the White Paper is about, so perhaps she would reflect on the question why, when she has asked us to cut public expenditure and we have cut it, she would vote against the cuts.
Mr. Steel
Will the Prime Minister explain to the TUC how he expects to increase the authority of the Prices Commission in keeping down prices in the private sector if the Government override the Commission's decisions in the public sector, as was the case with gas prices? As he said outside that he was bringing this matter to the House, and as it would be doubtful that the House would approve it, what does he intend to do about it?
The Prime Minister
If I remember rightly, I was having an erudite discussion with my hon. Friends about higher institutions of learning in Birmingham when I was rudely interrupted with a question on gas prices. At that time I was under the impression that the matter would have to come before the House, but I find now that it does not.
I humbly apologise to the right hon. Gentleman and to everyone else for that grave and grievous error, which I trust I shall not repeat again. With regard to the general question, it is a matter that I hope we shall not have to repeat. As the right hon. Gentleman knows, the increase in gas prices was part of the undertakings that we gave to the IMF in relation to our borrowing requirements. There is no need for Opposition Members to say “Ah” ;this was explained on 15th December and they knew it perfectly well. [column 616]It is contained in the document that is being discussed today. It would not be proper to go back on the cuts that were made then or on the increases made then. If we did we should have to find £100 million of cuts somewhere else. We shall not depart from the basic arithmetic of that agreement.
Mr. Atkinson
Will my right hon. Friend confirm that he is knowledgeable about the anxieties and incomprehension that have been expressed by some members of the General Council about the fact that the Government and the NEB are now saying that they cannot fill the vacancies among the directorships for which they have nominating rights because, it is suggested, there is no available managerial executive talent? Will the Prime Minister now say that he will try to encourage Ministers to resist the story that is put about that they have no knowledge of such talent, or no talent-spotting methods, by which they can fulfil these obligations? Will my right hon. Friend also look at the whole question of Government appointments?
The Prime Minister
I shall be glad to discuss this matter with my hon. Friend in more detail, but it is certainly the case that on occasions it is difficult to find people of the requisite talent to fill particular posts which are necessary to be filled. [An Hon. Member: “Look behind you.” ] I do not have to look behind me. I just have to look across the Floor of the House. This is a real problem in British industry and it is one to which we must devote a great deal of attention. I am bound to say that when I am looking for recruits I shall not look at the bunch of faded daffodils on the Opposition Benches.
MERSEYSIDE SHIPYARDS
Q2. Mr. Loyden
asked the Prime Minister if, as part of his visits to industry, he will visit the Merseyside shipyards.
The Prime Minister
I went to Cammell Laird's shipyard at Birkenhead on 3rd September last year, during my visit to Merseyside. I have no plans at present for a further visit.
Mr. Loyden
Does my right hon. Friend agree that the long history of [column 617]uncertainty facing the ship repair industry has been worsened by its exclusion from the Aircraft and Shipbuilding Industries Bill? Is he aware that Western Shiprepairers, which 12 months ago employed 1,000 people, is now employing 700, and that further redundancies are pending in the next week? The disappointment of the Merseyside workers is turning to anger as a result of the high unemployment level obtaining there.
The Prime Minister
Yes, I am aware of that situation, and I am glad to say that at the moment the temporary employment subsidy is assisting about 300 of the workers in that repair yard. As to the future of the yard, I understand that some of the ship repair companies have already approached British Shipbuilders about the possibility of being taken over. If the shareholders of Western Shiprepairers wish the company to be acquired they should approach British Shipbuilders, which would be free and willing to negotiate its acquisition.
Mr. Graham Page
Is the Prime Minister aware that if he does visit Merseyside he will find that the failure of the Government is measured not only by the failure in the shipyards but by the 11 per cent. unemployment there—and about three times that in the construction industry—and also by the 3,000 workers who in the last three weeks have been told that they will be sacked from Plesseys, Lucas and English Electric? When all this can happen it shows the pretty rotten state of the Government's policy.
The Prime Minister
That is not a fair description of the situation. The right hon. Gentleman knows the cause of some of the redundancies both in shipbuilding and, to a lesser extent, in Plesseys. Part of the cause in shipbuilding is due to gross overcapacity throughout the world. We have set aside £65 million for the support of those yards. That is additional public expenditure. I hope that the Opposition do not wish to vote against that tonight when they are so anxious to vote. We have taken other steps to ensure that, so far as possible, British shipping is built in British yards. With regard to Plesseys, this is a serious situation, which has been caused by a change in policy. This is now being examined by Professor Posner. I hope [column 618]that within 90 days we shall get a report and that we shall be able to see what steps can be taken.
I believe that the country understands, even if the House does not, that the changes in technology that are taking place in our industrial situation mean that we shall have a very difficult period of adjustment ahead. The whole future of this country depends upon our industrial performance. Every Opposition Member really knows that.
Mr. Kilroy -Silk
Does my right hon. Friend accept that the people of Merseyside deeply appreciate the measures that the Government have taken to alleviate unemployment there even through it is still intolerably high? In that context, will my right hon. Friend indicate when he expects to receive the report from the NEB on the investment needs of the area? Will he publish that report and, even more important, will he immediately and urgently put into effect its recommendations for the regeneration of investment and jobs on Merseyside?
The Prime Minister
The report will be made to my right hon. Friend the Secretary of State for Industry. I shall convey to my right hon. Friend what my hon. Friend has said. It will be for my right hon. Friend to decide about publication, but there is no reason why we should seek to hide anything from the House on this matter. Merseyside is in a most serious and difficult situation. The solution depends not only on our own efforts in overcoming inflation but on a higher rate of world trade, and a regeneration of world trade. That is why the London conference will be important, as well as other efforts to get industrial confidence related without giving way to inflation.
USSR (CREDIT AGREEMENT)
Q3. Mr. Churchill
asked the Prime Minister if he is satisfied with the co-ordination between the Department of Trade and the Foreign and Commonwealth Office in relation to the Government's £1,000 million loan to the Government of the USSR; and if he will make a statement.
The Prime Minister
There is no such loan. If, as I assume, the hon. Member [column 619]is referring to the credit agreement between this country and the Soviet Union, the answer is “Yes” .
Mr. Churchill
Can the Prime Minister deny that Labour's wonderful credit agreement with the Soviet Government is so marvellous from the Soviet point of view that not only will not one penny of profit accrue to Britain but the British taxpayer will be called upon to finance approximately 50 per cent. of the total production costs of anything that the Soviets choose to purchase under that agreement?
The Prime Minister
I should like to look at the arithmetic, because I am not able to give an answer offhand. It is certainly the case that £188 million has been taken up by the Soviet Union, and this has created jobs in this country, perhaps including some of the hon. Gentleman's constituents at Trafford Park. There is every reason why we should continue to make advantageous bargains of this sort in the same way that our industrial competitors do. The hon. Gentleman should know—if he does not, allow me to inform him and the House—that France, Japan and Italy, to name but three other countries, have made agreements similar to those that we have made with the Soviet Union. It would be foolish to cut ourselves off from that trade.
Mr. James Lamond
Will my right hon. Friend explain why Conservative Members are so anxious to discourage trade with the Soviet Union, in marked contrast to their friends in private industry and business who, in their scramble to buy diamonds, furs, timber, and especially oil, from the Soviet Union, have caused a balance of trade with the Soviet Union that is in the Soviet Union's favour to the tune of £400 million a year?
The Prime Minister
It is noteworthy that while we do buy a lot of the products to which my hon. Friend has referred, France, the Federal Republic of Germany and the United States not only buy much more but sell much more. It would be valuable if at some time the Opposition would tell us whether or not they want to go on trading with the Soviet Union.
Mr. Hugh Fraser
Will the Prime Minister assure us, after investigation, that these British credits to the Soviet Union [column 620]are not used for the purchase of Rhodesian tobacco by some of the satellite countries?
The Prime Minister
As far as I know, they are not. These are arrangements that are made, for example, with firms like Rolls-Royce for the export of industrial goods from this country. That is why they are not only bringing employment but are helping us with our balance of payments with the Soviet Union.