35. Mr. Leeasked the Minister of Power what was the increased cost of the importation of sheet steel during the first quarter of 1960, compared with the first quarter of 1959; and what percentage increase of sheet steel was imported during the first quarter of 1960 over the comparable period of 1959.
§ Mr. GeorgeThe increased cost was £8 million on an increased quantity of 110,000 tons. This quantity is 355 per cent. above the corresponding period of 1959.
Mr. LeeIs not the nation passing into a most serious situation? I am aware of a sort of conspiracy of silence in the Press to keep this matter quiet, but would not the hon. Gentleman agree that we are now suffering from some inefficiency within the industry in its lack of effort to expand the production of sheet; and that we are now reaching a situation in which the balance of payments position is threatened by our inability to get sufficient sheet steel in Britain?
§ Mr. GeorgeNo, Sir. Between the first quarter of 1959 and the first quarter of 1960 net deliveries of sheet steel from United Kingdom sources have increased—not decreased, but increased—by 26 per cent., or 146,000 tons, the bulk going to home consumers. Home consumption increased by 176,000 tons or 32 per cent., and demand by even more as consumers built up stocks they had run down in the previous quarter. For the moment, imports are inevitable to sustain industrial output. The present level of production is rising at a rate of 250,000 tons annually.
Mr. LeeWould the hon. Gentleman agree that the increase to which he refers 992 is consequent upon a decrease because of the recession brought about by Government policy in the steel industry, and that in fact it is not a real increase in our ability in the steel industry at all? Therefore, will the hon. Gentleman consult his right hon. Friend in order that we can now have a positive increase in the production of sheet in Britain before it becomes a great drain upon our balance of payments position?
§ Mr. GeorgeIn my reply I referred to actual increased capacity. In 1958 it rose to 2¼million tons from 2 million tons. It rose again in 1959 to 2½million tons; in 1960 it is expected to reach 24¾million tons and next year 3 million tons. Thereafter the output of sheet is expected to be ample for any demands.
36. Mr. Leeasked the Minister of Power whether the programme for increased sheet steel production takes account of the recently announced expansion of the car industry.
§ Mr. GeorgeYes, Sir. When schemes already approved are completed there should be ample capacity to meet all foreseeable demands.
Mr. LeeIs this not a contradiction of what the hon. Gentleman said in his last answer? In other words, we are now importing sheet at a level £8 million higher than in the previous quarter of last year, which represents an increase in importation of over 350 per cent.? We now have a pretty vast expansion of the car industry, and the hon. Gentleman says that the Department has already taken care of this in its estimates for the future. How is it possible to reconcile these two points?
§ Mr. GeorgeThe position is that there will be imports this year and imports next year. Thereafter production is expected to meet demand, and in the years following substantially to exceed demand.