§ The President of the Board of Trade (Mr. Douglas Jay)
With permission, I should like to make a statement.
From today, the Export Credits Guarantee Department's premium charges for the insurance of suppliers' credits and financial guarantees for British exports are being cut by 10 per cent. This reduction has been made on the recommendation of the Advisory Council. It will not apply to policies covering external merchanting trade in non-British goods. It is made possible by the healthy state of the Department's finances, and is expected to result in further development of the Department's business.
I am sure that the House will welcome this improvement in the Department's facilities achieved over and above those I announced on 27th January and in the Budget debate on 8th April. The bank guarantees for financing exports were then extended to a wider field, both in terms of size of contract and of length of credit, and the charge for them was halved. The industries affected have welcomed these improvements as a substantial aid: and the shipbuilding industry, in particular, has benefited greatly with a large increase in orders from overseas.
1521 The reduction in premium charges announced today, taken together with the increase in the percentage of normal cover from 85 per cent. to 90 per cent., represents a substantial reduction in E.C.G.D.'s premium charges and therefore, a cheapening of its services to exports.
We are continuing to explore further ways in which the services of the Department can be improved.
I also take this opportunity of announcing the publication of the booklet I previously promised which has been prepared with the help of the British National Export Council and others, giving the names of 400 firms willing to assist smaller firms in export markets. This is being widely circulated through Board of Trade regional export officers and in other ways.
§ Mr. Barber
The House will welcome the right hon. Gentleman's announcement of the improved terms which are, as he will agree, a continuation of the cuts in premium charges which were made in 1961 and 1963, and, of course, as the right hon. Gentleman said in his statement, this has been made possible by the healthy state of the Department's finances, which is the result of the encouragement and backing which the E.C.G.D. has had over many years.
Is it not the case that these new terms will be of little avail unless the Government succeed in restoring business confidence and in providing conditions at home which will encourage and not penalise industrial prosperity and efficiency?
§ Mr. Hector Hughes
The President of the Board of Trade mentioned the need to give the shipbuilding industry some encouragement. Will he say whether the measures he has just announced with regard to the shipbuilding industry will help to cope with the very urgent and serious problem of Japanese and Russian competition?
§ Mr. McMaster
Will the right hon. Gentleman consider using part of the profit which the E.C.G.D. is making to extend similar credit to British ship-owners because of the international type of business which they do so that we do not have the anomalous situation of four large Shell tanker orders worth £20 million going to Japan and Germany while a Norwegian order comes to Britain?
§ Mr. Bessell
Is the right hon. Gentleman aware that his statement will be widely welcomed by exporters throughout the country and that it will be of material assistance to our export drive? Secondly, what will be the true rate of charge as a result of the 10 per cent. cut, and how does this compare with the facilities offered by other banks and institutions?