HC Deb 21 March 1983 vol 39 cc527-9
8. Mr. Aitken

asked the Minister for Trade what progress has been made in reducing the tariff levied by the Spanish Government on British car imports; and if he will make a statement.

19. Mr. Les Huckfield

asked the Minister for Trade whether he will make a statement on the current position on negotiations on Spanish car imports.

Mr. Peter Rees

I refer my hon. Friend the Member for Thanet, East (Mr. Aitken) to the written answer that I gave to my hon. Friend the Member for Beaconsfield (Mr. Smith) on 16 March.

I was glad to be able to announce in that answer the decision of the Spanish Government to open shortly a reduced duty quota of 15,000 cars from the Community. For cars between 1300 cc and 1600 cc the quota will be 5,000 and the duty will be almost halved to 19 per cent. For cars between 2000 cc and 2600 cc the quota will be 10,000 and the duty will be reduced by about one third to 25 per cent.

Mr. Aitken

Is my hon. and learned Friend aware that the new tariff quotas that he has announced will be seen as a long-overdue step towards removing the unfair discrimination by the EC relating to British cars going to Spain? Does he accept that there is still a long way to go before we achieve the principle of tariff equality? Will my hon. and learned Friend assure the House that in the interests of the British car manufacturing industry he will be vigilant in his efforts to press for that principle?

Mr. Rees

My hon. Friend is right. This Government have been anxious—as have various of my hon. Friends, in particular my hon. Friends the Members for Birmingham, Selly Oak (Mr. Beaumont-Dark) and for Bromsgrove and Redditch (Mr. Miller)—to reduce the tariff disparity between the European Community and Spain. We welcome the announcement by the Spanish Government. It provides British Leyland once more with the possibility of breaking into the Spanish market. In the long term, the disparity will be removed completely when Spain becomes a full member of the European Community.

Mr. Huckfield

Is the Minister aware that although his announcement is welcome, it deals with only one part of the problem? It does not deal with completely assembled Spanish units coming here. Does the hon. and learned Gentleman accept that since the Government took office, although there has been a certain amount of stability in Japanese, West German and French completely assembled units coming here, the number of Spanish completely assembled units coming here has almost doubled? When will he do something about too many Spanish cars, particularly the Vauxhalls, coming into Britain?

Mr. Rees

I can reassure the hon. Gentleman. Spanish car imports have dropped by 10,000 each year over the past three years, and we have a healthy surplus in sales of components to Spain.

Mr. Beaumont-Dark

Does my hon. and learned Friend realise that many of us recognise the tremendous amount of hard work that he has put into negotiations to get us this far, but does he accept that it is somewhat less than some of us hoped for, particularly in relation to small cars, such as the Metro? Will he bear in mind that, in the arrangements being made for Spain to join the Common Market, it would be unsatisfactory to have a long transitional period in which the Spanish were allowed to pillage our car market?

Mr. Rees

I am grateful to my hon. Friend for his kind words, particularly since he has been such a vigorous defender of the interests of the British motor car industry in the west midlands. He will be aware that the arrangement offers scope for British Leyland to sell the larger Metro and the Maestro on the Spanish market. I hope that when it has rebuilt its dealer network that will be done on a successful scale. I take note of what my hon. Friend said about the length of the transitional period.

Mr. Archer

Does the Minister recognise that the arrangement falls far short of what is required to achieve reciprocity between duties of 19 and 25 per cent., a converse duty of 4.4 per cent., and the fact that there is no concession on cars under 1275 cc? Has the hon. and learned Gentleman made clear to our EC partners and to the Spanish Government that it is no more than an offer on account of what is clearly required?

Mr. Rees

It may be an offer on account, but it is a very useful offer. We should not look gift horses in the mouth. When the transitional period is over we shall be in a position of complete equality. I hope that in the meantime British Leyland will be able, on the basis of the offer by the Spanish Government, to rebuild its dealer network. We can then judge the adequacy or otherwise of the present arrangements.

Sir Peter Emery

Is it not a fact that, prior to the start of negotiations for Spain to enter the Common Market, it was agreed that the status quo on tariff arrangements should remain until the negotiations were completed? Is not the arrangement a considerable achievement for the British motor car industry? Of course it does not go far enough, but should we not praise the Government for what they have obtained?

Mr. Rees

I thank my hon. Friend for his kind words. Since the unilateral offer by the Spaniards has been achieved independent of negotiations for entry, my hon. Friend's observations are well founded.

Mr. Roy Hughes

Will the Minister seek an early meeting with British motor car manufacturers and urge them to use more British steel in their products, since in quality, finish and delivery dates it can meet any challenge from the continent, as I am sure Mr. Ian MacGregor, chairman of the BSC, will readily testify?

Mr. Rees

I am sure that our British motor car manufacturers will take full note of the hon. Gentleman's warm commendation, which I fully endorse.