HC Deb 26 July 1960 vol 627 cc1263-4
1. Mr. C. Osborne

asked the President of the Board of Trade if, in view of the high profits now being made in the Lancashire cotton trade, he will review the necessity for continuing the policy of giving grants of public money for scrapping and modernisation; how much has been paid out already; how much has been claimed; what the total cost is expected to be; and if he will make a statement.

The President of the Board of Trade (Mr. Reginald Maudling)

The estimated costs to the Exchequer of payments for eliminating excess capacity under the reorganisation schemes is about £13 million of which nearly £5 million has been paid. Applications so far received for re-equipment grants would, if fully accepted, cost some £2½ million. The best provisional estimate I can give of the total cost of the arrangements under the Cotton Industry Act remains about £30 million. The fact that the textile trade is now prospering does not seem to me to justify interfering with a scheme that is working well.

Mr. Osborne

Could my right hon. Friend tell me what earthly justification there can be for pumping public money into an industry which is already over-prosperous? How can it be justified? Since the industry is now undoubtedly acknowledged to be prosperous, why is not the scheme ended so that the public purse can be saved this money?

Mr. Maudling

The reasons for doing this were very fully argued when Parliament passed the Cotton Industry Act. The fact that the industry is now prospering seems not to militate against the scheme but rather to encourage one to think that it is right.

Mr. John Hall

Is my right hon. Friend aware that, since the scheme was brought into operation, the price of cotton goods has increased and delivery for many piece goods has gone up to twelve months?

Mr. Maudling

Of course, the introduction of the scheme has coincided with a considerable boom in the demand for textile goods throughout the world.

Mr. Jay

Did not the present Minister of Education when President of the Board of Trade promise Lancashire, in the course of the election campaign, that £50 million of public money would be spent? Can the present President of the Board of Trade endorse that estimate?

Mr. Maudling

I think that the estimate already given was £30 million, to which we stick. We have no desire to spend more than that.

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