STRATEGIC GOODS (CONTROL) (Hansard, 25 November 1957)

§ Mr. John Edwards (Brighouse and Spenborough)
I beg to move, That an humble Address be presented to Her Majesty, praying that the Strategic Goods (Control) (Amendment No. 4) Order, 1957 (S.I., 1957, No. 1282), dated 23rd July, 1957, a copy of which was laid before this House on 25th July in the last Session of Parliament, be annulled. One of the duties that we have in the House is to examine the delegated legislation which reaches us in such vast quantity and which is not always easy to follow. In the scrutiny which some of us have made of recent Statutory Instruments, we have been somewhat intrigued by Statutory Instrument No. 1282. I appreciate that the point that arises on this Instrument is a relatively narrow one, but I should first of all like to know whether the Minister confirms that I have the matter aright.
As I understand it, in 1954 the Government revised the list of goods the export of which to the Soviet bloc, to China and certain other areas was prohibited. At the same time a new control was 940 introduced which dealt with merchanting operations. That control was promulgated in Statutory Instrument 1622 of 1954—the Strategic Goods (Control) Order—which was operative from early in January, 1955.
The effect of that Order was to forbid any United Kingdom resident from disposing of certain strategic goods from areas outside the United Kingdom to anybody within the Soviet bloc, in China, in North Korea, and in Tibet, or to anyone else if it was thought that the goods might directly or indirectly find their way into those areas.
There have been three previous Amending Orders which have altered the list of specified strategic goods and which have also brought North Vietnam into the list of forbidden territories. Tonight, therefore, we are considering the fourth Amending Order, the point of which is to bring two items into the list of the specified strategic goods—printed circuit equipment, and a particular kind of centrifugal testing apparatus.
The simple question that I want to put to the Minister is this: why these two things—and why now? Printed circuits now constitute a well-known process. I am told that they are fairly well documented. Some of us may possess radio sets in which they are used, and such circuits are in use, not only here in the United Kingdom but in many other countries as well—in the United States and in Europe—and there certainly must be a very highly-advanced technique in the printing of circuits in countries like the United States and Germany.
941 I should like the Minister to tell me whether these two items are now on the embargo list of exports. If they are, is it only recently that they have been included? Is it really thought that the Russians do not know how to print circuits? I find that hard to believe. In fact, I should not be surprised—although I do not, of course, know—if there were some printed circuits somewhere in the elaborate mechanism that makes up a Sputnik.
Why, if these circuits have not been on the embargo list before, should they now be brought into it? Why should anybody who has been free to trade in such equipment over the past years be prevented from 1st August from doing so? It may be that there is a good reason. In any case, the Minister will doubtless be happy to explain why the Board of Trade, on 22nd July last, thought it necessary to make this particular Control (Amendment) Order. Very much the same considerations apply to the other item, the certain kinds of testing apparatus indicated.
I am, therefore, asking the Minister to be good enough to say why, after so long, it is now necessary to make this change. What is the particular significance at this point of time which makes it necessary to prevent the merchanting of these things if, as I understand, it was all right to do so before? If I understand our broad strategy from the formulations of the Minister of Defence, it would seem all the more strange that at this time, as my right hon. Friend the Member for Huyton (Mr. H. Wilson) indicated in his speech on the Address, it should be right to include strategic controls in our strategy. Why bring in these items which have been left out for so long?
The point of our Prayer is to afford the Government an opportunity of giving an explanation of a matter which seems to us to be rather strange at this time. I have no doubt the Minister will be very glad to have an opportunity to explain the Order to the House.

§ Mr. Harold Davies (Leek)
I should like to ask the Minister why these two items were introduced on 22nd July and are now contained in this Statutory Instrument when everybody knows that these 942 products are scheduled in Western Germany, Eastern Germany, Switzerland and Sweden and that merchanting is being attempted in the Far East?
Is it considered that we are limiting the strategic powers of China or of Vietnam? I should have thought that any intelligent Western citizen, if he had travelled to Vietnam as I did last June, when I was in the North and the South, would have been pleased to try to help those people to further their standards of life. In passing, I would mention that on my way back by aircraft, I travelled with some Poles who were dealing in these products.
To believe that by imposing this embargo we are in any way serving any purpose in this twentieth century world is to fool ourselves and to waste the time of the House, when British engineers and British skill should be competing with the rest of Western Europe to get into the markets. I thought that the Government had promised the House to influence Cocom in its control of the movement of goods to the Far East. We were told the other day that Vietnam was taken off the list of scheduled goods.
The Minister owes it to the House and to the country to explain why British engineering skill should not have the opportunity of competing against the best products of Russia, Sweden and Switzerland which are offered on the markets in the Far East, and which I am sure will continue to be offered even if this Order is passed.

§ Mr. Cyril Osborne (Louth)
Could my right hon. Friend say whether there has been much trade in these two items in the past? Has there been any increase? If we could be told, it would help us to understand why this embargo is imposed.

§ Mr. E. Fernyhough (Jarrow)
I believe that it is nonsense to impose any strategic embargo on any country in the world. Looking back, we are bound to recognise that all the objects for which these restrictions were set up have failed completely. Look at any part of the world, and although one might think that we were denying other countries offensive weapons, nevertheless, despite our refusal to supply them, they have been able to build up every kind of armament and weapon that they have desired. I put it to the 943 Minister that Britain today is in such a position that she wants trade wherever it can be found. No country will go without strategic material of any kind merely because Britain refuses to supply it.
If we are to maintain full employment and have a prosperous economy, it is time we dropped this utter nonsense and began to realise the kind of world we live in. We should supply any market that is available to us. If we do not, we shall lose the race and we shall certainly have unemployment returning to this country because of stupid controls which may have had some relevance twenty years ago but which have no relevance at all in the present world situation.

§ The Minister of State, Board of Trade (Mr. J. K. Vaughan-Morgan)
The right hon. Gentleman the Member for Brighouse and Spenborough (Mr. J. Edwards) did most of my work for me. He gave a very lucid explanation of the circumstances which have led up to the Order, and I will try not to duplicate anything that he has said.
Very briefly, this Order amends the Strategic Goods (Control) Order, 1954. The purpose of that Order was to prohibit merchanting transactions with the Iron Curtain countries in certain specified strategic goods. The main control for such strategic purposes is still the export control of goods manufactured in this country, which operates under the Import, Export and Customs Powers (Defence) Act, 1939, and the answer to the right hon. Gentleman as to whether these goods were strategically controlled is, "Yes, under that Act, since the same date, when this Order was originally laid". The two things were parallel.
In so far as goods produced in this country were not allowed to be exported, this Order extends the prohibition to merchanting. It is only, however, merchanting transactions in the two specified items of equipment which fall to be discussed tonight, and I am quite certain that I should be very much out of order if I went into the wider issues of whether these controls are still necessary.
The purpose of the original Order was to prevent unscrupulous dealers in this country from selling behind the Iron Curtain goods of strategic importance 944 which had been obtained in a third country and which, not being manufactured in or transhipped in this country, were not caught by other export controls. The provisions with regard to merchanting were only a fair and reasonable quid pro quo to the United Kingdom manufacturers who loyally operate the strategic controls; it was only fair that this should be done, quite apart from the obvious wisdom of the original step.
As technology and weapons develop, it is necessary to consider whether new products should or should not be added to the list. I apologise if my technical knowledge is not quite adequate for this occasion. The control on the printed circuit equipment is on that equipment which prints components or automatically inserts components into printed wiring, not that equipment which prints wiring.
That, perhaps, may account for the slight differences in respect of goods which I understand the hon. Member for Leek (Mr. Harold Davies) to say he has seen in Vietnam, a thing which I find rather surprising. The centrifugal apparatus and the printed circuit apparatus with which we are dealing tonight have been added because both are used in the production, testing or development of the very newest types of weapon now coming into production.
I understand that the centrifuge is unique. There is one installed at the Institution of Aviation Medicine, at Farnborough. It is used in the testing of very high speed flight and high rates of acceleration both on the human body and on airborne equipment and components. This centrifugal apparatus is, therefore, used for testing guided missiles, and the printed circuit equipment is used for the production in quantity of reliable miniaturised electrical circuits of a kind used in guided missiles. I am advised that Soviet Russia has shown a wish to buy both types of equipment here. It may be, as has been suggested, that the Russians may eventually find a way of making them themselves, or prove ultimately, perhaps, even to have invented them, but in the meantime I think that this strategic control is an absolute necessity.

§ Mr. Fernyhough
Surely, the Russians do not require it. They have already launched their guided missile. They have all the "know-how" and there is nothing 945 we can give them to help them with something they have already done.

§ Mr. Vaughan-Morgan
If so, I wonder why they were anxious to buy the equipment.
This obligation is binding on all the members of the Paris Consultative Group and it is in pursuance of that binding obligation that we table this Order. I hope that in the circumstances, and in view of the fact, which I must stress, of the strategic necessity of this control, the right hon. Gentleman will withdraw his Motion.

§ Mr. J. Edwards
If there is a strategic need now, does the Minister not agree that there must have been a strategic need years ago? We have not just started using this sort of thing in our defence programme. It is not new. We were using it for certain defence purposes. I would say, at a modest estimate, ten years ago. Why this sudden change? Have the Government suddenly realised the significance of this, or what is the reason? It is not good enough to say that we are now to use it for these purposes when it is common knowledge that it has been used for defence purposes for a long time.

§ Mr. Vaughan-Morgan
In this country, but not elsewhere. This is in the light of the inquiries we have received.