HC Deb 03 August 1965 vol 717 cc1252-3
9. Mr. Wingfield Digby

asked the Chancellor of the Exchequer what discussions he had on his recent visit to Washington with the United States Government regarding its policy of placing orders for United States Navy ships in British yards; and what is the policy of Her Majesty's Government in this regard.

Mr. Callaghan

These confidential talks were covered by the joint communiqué issued in Washington on 30th June. As for the second part, I would refer the hon. Member to the reply given by my right hon. Friend the Secretary of State for Defence on 21st July.

Mr. Digby

Would not the right hon. Gentleman agree that these orders would be of the greatest importance to our shipbuilding industry and to the balance of payments? Can we be assured that this matter is being pursued? Could the right hon. Gentleman say, if these orders come along, how they will be placed? Will individual firms have to go to America, or will the orders be placed with the Shipbuilding Conference?

Mr. Callaghan

I cannot answer the last part of the supplementary question because there are some earlier questions of principle, mostly on the American side, which still have to be resolved and there are certain difficulties in the way. But, of course, these orders would be of very great help to our balance of payments.

Mr. Emrys Hughes

Will the Chancellor of the Exchequer keep in mind that one of the troubles in the shipyards on the Clyde is the shortage of skilled labour and that if deliveries cannot be made promptly orders will go to Japan? Will he keep a very careful eye on the position before trying to get orders which would add to the difficulties?

Mr. Callaghan

Yes. Nobody wants to see the industry too tightly stretched. That is why it is important that there should be a redeployment of labour into those industries where we can get most export orders.

Mr. Onslow

Is the right hon. Gentleman aware that a factor which might influence the placing of these orders would be an anticipation that sterling might be devalued and that payment, therefore, might be correspondingly cheaper? Even at the risk of losing these orders, would he give a categorical assurance that devaluation is not contemplated by the Government?

Mr. Callaghan

That does not arise out of the Question which I have been asked. I must say to the hon. Gentleman that I deplore that kind of propaganda which is getting much too widespread on the benches opposite.