PRIME MINISTER
Westland plc
Q1. Mr. Dalyell
asked the Prime Minister what has been the total Government contract expenditure committed to Westland since January 1986.
The Prime Minister (Mrs. Margaret Thatcher)
The work of Westland Helicopters Ltd. for the Ministry of Defence in support of the existing helicopter fleet is worth some £60 million per annum. Negotiations are nearing completion for eight new Sea Kings, worth over £25 million. My right hon. Friend George Youngerthe Secretary of State for Defence announced on 9 April that orders worth over £300 million are planned for an initial batch of 25 utility version EH101 and 16 Lynx helicopters.
Mr. Dalyell
On 27 January, at column 657, the right hon. Lady assured my hon. Friend the Member for Bolsover (Mr. Skinner) that she did not know about the role of the then Secretary of State for Trade and Industry over the disclosure until after the inquiry had reported. Will she confirm that Mr. Charles Powell did his duty as a civil servant and kept the Prime Minister fully informed about the disclosure?
The Prime Minister
The question that the hon. Gentleman has put on the Order Paper is about Government contract expenditure committed to Westland since January 1986. On the other matters, I have answered in detail and stand by what I have said.
Mr. Wilkinson
Is it not the case that the first flight of the prototype of the Anglo-Italian EH101 augurs well for that aeroplane, as was the case with the collaborative Puma, Lynx and Gazelle before it? For the future of Westland, is it not also important that we should take part in expanding European participation in space, as Westland Aerospace has an important contribution to make in that area, which is of great significance for British industry?
The Prime Minister
We hope that the development of the EH101 will proceed satisfactorily so that the orders can be fully and properly negotiated. With regard to work on space, I have nothing to add to what I said previously. As my hon. Friend is aware, we give a subscription of about £100 million to the European Space Agency. At present we simply could not do any more than that because the amount of taxpayers' money that goes to research and development is very considerable. At present, further money is coming from the private sector. [Interruption.]
Mr. Speaker
Order. Can we concentrate on these questions and not on those who are wearing fancy dress?
Engagements
Q1. Mr. Canavan
asked the Prime Minister if she will list her official engagements for Thursday 29 October.
The Prime Minister
This morning I presided at a meeting of the Cabinet and had meetings with ministerial colleagues and others. I attended the memorial service for [column 446]Lord Soames at Westminster abbey. In addition to my duties in the House, I shall be having further meetings later today.
Mr. Canavan
Does the Prime Minister recall that during her visit to Scotland last month she made the absurd claim that there was little if any popular demand for a devolved Scottish Parliament or Assembly. If the right hon. Lady is still stubbornly refusing to accept the fact that at the general election she was resoundingly rejected by 76 per cent. of Scottish voters who all voted for parties committed to some form of Scottish Assembly, will she now consider putting her claim to the test by, for example, having a referendum on the constitutional future of Scotland?
The Prime Minister
The hon. Gentleman will remember the occasion of a previous referendum on the constitutional future of Scotland. Many of us on both sides of the House believe that an Assembly such as the hon. Gentleman and others propose would be the first step towards separatism, which would not be popular in many quarters.
Mr. Ashby
Will my right hon. Friend confirm that she upholds the principle of free speech, and that that principle is not restricted to those with Marxist views, but applies also to those opposed to such views?
The Prime Minister
Yes, indeed. We see a great deal of free speech during Prime Minister's Question Time.
Mr. Kinnock
When the financial markets at home and abroad are unstable, and when Britain has one of the highest real interest rates of all the developed countries, why do the Government not use their power to secure significant cuts in interest rates, rather than an inconsequential 0.5 per cent.?
The Prime Minister
That is a matter for judgment, which has to be made at the time. I think that the right hon. Gentleman would be the first to understand that several factors are necessary in combination to deal with the present position. First, we need a decision on the United States budget deficit. That is perhaps the most important single factor, and I welcome the talks that President Reagan is holding with Congrees about cutting the deficit, because early and decisive action on that is vital. Measures beyond anything previously envisaged, in both scale and content, would do more than anything else to bring back confidence.
We are entirely prepared to play our part, in concert with other nations such as Germany and Japan, to consider further matters. My right hon. Friend Nigel Lawsonthe Chancellor of the Exchequer hopes to make his decision on the BP issue later today. Those three developments would be very effective if we could arrange for them to take place fairly close together.
Mr. Kinnock
It is those very three matters that argue so strongly for a substantial cut in interest rates, especially when such a cut would aid President Reagan 's efforts to stabilise his external deficit. They would also ease the downward pressure on markets, increase our international competitiveness and cut costs for British industry and British households. British real interest rates are now 53 per cent. higher than those in Japan, and 25 per cent. higher than those in Germany. As the Prime Minister says, this is a time for judgment, and that judgment should be a big cut in interest rates.
[column 447]The Prime Minister
My right hon. Friend Nigel Lawsonthe Chancellor has already made a reduction in interest rates of 0.5 per cent, as the right hon. Gentleman knows. I have said what I believe to be the most important factor for the return of confidence in the markets, but I feel that it will be more effective if we make our decisions in accordance with it and achieve as much co-operation internationally as possible.
Mr. Kinnock
No one will quarrel with the argument for international co-operation, but does what the Prime Minister has just said mean that we must wait for what she calls a return of confidence before we get the cut in interest rates that the economy truly needs?
The Prime Minister
It means that I expect the right hon. Gentleman to know that decisions on interest rates cannot be announced to the House of Commons during Prime Minister's questions.
Mr. Jessel
Will my right hon. Friend remind the House what fee the underwriters of the BP issue agreed to accept in payment for the risk that they agreed to take?
The Prime Minister
My hon. Friend has made his own point. As he knows, I cannot say anything further about the BP issue. The procedures that my right hon. Friend Nigel Lawsonthe Chancellor set before the House on Tuesday are well under way, but they are not yet completed. My right hon. Friend hopes to be in a position to announce his decision today.
Mr. Maclennan
With regard to the response of the international finance markets to the United States deficit problems—[Interruption.]
Mr. Speaker
Order.
Mr. Maclennan
—is the Prime Minister prepared to encourage the German and Japanese Finance Ministers urgently to relax their fiscal policies to assist the United States in the process of reducing its budget deficit?
The Prime Minister
I have said already that I think that co-operation is important. My right hon. Friend Nigel Lawsonthe Chancellor of the Exchequer is in regular touch with his opposite numbers in both the United States and Germany, and in Europe in general.
Mr. Budgen
Amid all this talk of international co-operation, will my right hon. Friend remind all Governments of her renowned scepticism of the European monetary system and of her view that attempts by Governments to control exchange rates are extremely expensive and in the end impossible?
The Prime Minister
My hon. Friend reminds the House very effectively of the view that we have taken about the European monetary system. That view has not changed. I believe, however, that the Louvre accord has been of very considerable value, especially in recent weeks.
Q3. Mr. Duffy
asked the Prime Minister if she will list her official engagements for Thursday 29 October.
The Prime Minister
I refer the hon. Gentleman to the reply that I gave some moments ago.
Mr. Duffy
Following the Prime Minister's exchanges with my right hon. Friend, is she aware that we have been waiting for at least three years for Washington to correct its budgetary deficit? Does she not think that the best earnest on behalf of international confidence would be for [column 448]someone to promote initiatives, and preferably leadership, on behalf of international financial stability and an easing of credit? Is the Prime Minister prepared to take such a step, or is she content to see Thatcherism eventually equated with Reaganomics?
The Prime Minister
May I remind the hon. Gentleman—[Hon. Members: “Oh” ] Yes, we have free speech in this House, too. May I remind the hon. Gentleman that Opposition Members have been urging us to follow the deficit policy of the United States and to increase it? They have urged us to do that, both in this House and in speeches outside. Only now are they beginning to realise that the policy of sound money that we have followed is the one that has kept sterling strong throughout this crisis.
Mr. Rowe
My right hon. Friend the Prime Minister is well aware that the parks and farms of Kent are now covered in very heavy fallen trees. Will she consider using her prestige to call together the many organisations that use the countryside to consider the possibility of creating a properly organised voluntary programme to help to clear up the beleaguered south-east of England?
The Prime Minister
I am aware that the part of the country that my hon. Friend represents was particularly badly hit by the storm and that many trees were damaged and lost. I know of his interest in voluntary work. I understand that the British Trust for Conservation Volunteers is already looking at what volunteers can do, with local authorities, to help. It is in close touch with the Countryside Commission's Task Force Trees. I am sure that we shall be able to get some very useful work done, both in clearing and in replanting trees.
Q4. Mr. Winnick
asked the Prime Minister if she will list her official engagements for Thursday 29 October.
The Prime Minister
I refer the hon. Gentleman to the reply that I gave some moments ago.
Mr. Winnick
In view of the Government's obsession with internal trade union matters, why is there not to be a postal ballot of all Conservative members in the country to decide who should be party chairman? In view of the difficulty of finding someone to do the job, is the right hon. Lady aware that her old mate, the right hon. Member for Henley (Mr. Heseltine), is very keen and very anxious to carry out that job? Is he on the short-list?
The Prime Minister
I do not know whether I am answerable from the Dispatch Box for Conservative party matters. I assure the hon. Gentleman that the chairman of a voluntary party is elected, but I shall not follow the example of the Labour party by taking on the office of chairman of Conservative Central Office myself.
Mr. John David Taylor
Is the Prime Minister aware that an isolated rural school in South Armagh—Cladymore primary school—has been closed by the Minister responsible for education in Northern Ireland, not only against the wishes of the parents, but against the unanimous decision of the regional education authority? Is she aware that that regional education authority is controlled, not by elected persons, but by the nominees of her Minister? Does she understand that such decisions alienate the people of Northern Ireland from the present dictatorial system of Government by the Northern Ireland Office, and will she at least consider the introduction of [column 449]some democratic control and answerability in matters of local government such as education, health and social services?
The Prime Minister
The strict answer to the right hon. Gentleman's question is, no, I was not aware, but, of [column 450]course, I will inquire. He cast doubt on direct rule, but I do not think that the overwhelming majority of people in Northern Ireland would agree. They welcome it as the best possible thing in the circumstances. A major Education Bill will be brought before the House, and the right hon. Gentleman may wish to table some amendments to it.