HC Deb 14 June 1939 vol 348 cc1300-2
52 and 54. Mr. Ellis Smith

asked the Chancellor of the Duchy of Lancaster (1) whether he can now give a report on the consultations that took place between the last Minister for the Co-ordination of De-fence and the representatives of the Machine Tool Trades Manufacturers Association;

(2) whether he can now make a full report on his negotiations with the Machine Tool Trades Association?

Mr. W. S. Morrison

Negotiations in regard to the costing of machine tools supplied by makers in this country for the purposes of the Defence programme have been in progress for a considerable time. In the result, the Machine Tool Trades Association agreed on behalf of their members that a discount of 5 per cent. should be given on all standard machine tools delivered for the purposes of the programme after 5th December, 1938, and that, in the case of non-standard machine tools, prices shall, if the Government so desire, be fixed after costs have been investigated by Government accountants. The prices ruling on 5th December, 1938, are to hold good for one year, and provision has been made for revision where necessary due to upward or downward movements in basic costs, such as that of pig iron. It has also been agreed that individual members of the association may approach the Government with a view to modification of the agreement in cases where they consider hardship would result from its application. It has, of course, been made clear to the association that the arrangement has been accepted without prejudice to any legislative powers which may be conferred on the Government in future. Throughout the negotiations close touch has been maintained with the Departments concerned, and the assistance and advice of the Prime Minister's Advisory Panel of Industrialists has also been readily given.

Mr. Alexander

What was the date of that arrangement in regard to 5 per cent. and the date from which it will operate?

Mr. Morrison

I have not the exact date, but it was quite recent.

Mr. Kirk wood

In the reply, the right hon. Gentleman stated that they were guided by the advice of the Prime Minister's committee of industrialists. May I point out that those industrialists are there to look after the interests of those other industrialists; and, when it comes to the question of the engineers in relation to their demand for another 10s. per week, will the Prime Minister consult a representative of the working engineers?

53. Mr. E. Smith

asked the Chancellor of the Duchy of Lancaster the average rate of profit that the Machine Tool Trades Association desired on contracts; what was the amount proposed by the Government; and what arrangement has been in existence since the matter was reported to the Public Accounts Committee?

Mr. Morrison

Machine tools have hitherto been generally obtained by the Service Departments on the ordinary basis of competitive tendering. The question of a rate of profit does not arise in such cases. I have explained in my previous answer the result of the negotiations with the Machine Tool Trades Association.

Mr. Smith

Would the right hon. Gentleman consult the Minister of Supply with a view to taking notice of the evidence that was given before the Royal Commission upon the Private Manufacture of Armaments?

Mr. Morrison

I will certainly consult my right hon. Friend.

Mr. Alexander

Does the method of giving orders on a basis of competitive tender mean ordering both English-produced machine tools and the foreign machine tools which enter into competition; and can the right hon. Gentleman say whether any orders have been given on a cost basis and not a tender basis?

Mr. Morrison

In regard to the machine tools, no orders have been given on a cost basis. The Department asks for tenders from several firms at the same time and compares prices of each tender with the comparable article imported.