HC Deb 11 March 1968 vol 760 cc970-1
49. Mr. Moonman

asked the Minister of Technology in view of the references in the Wilson Committee of Inquiry that Bristol Siddeley Engines Limited required substantial profits from repetition work such as overhauls on projects to lay the foundation for other research and development, what guidance he now intends to offer companies with regard to similar contracts.

Mr. Fowler

The Department has reminded those firms with whom contract prices are negotiated that the standard price fixing condition imposes an obligation on both parties to agree prices which are fair and reasonable in relation to the particular contract in which the condition appears, and also that the condition cannot be interpreted to imply that the fairness and reasonableness of prices can be judged in the light of factors extraneous to the particular contract in question.

Mr. Moonman

I am grateful for that statement. In view of the increasing disquiet arising from the Wilson Report and the absence of any statement on company practice from the C.B.I., can my hon. Friend go a little further and make it clear that, in these operations, high profit margins will not be encouraged simply to justify a high scale of R. & D.?

Mr. Fowler

This has always been made clear. There is no defect in the standard condition of contract, although it has on occasion been argued that the standard condition might bear an interpretation which it should not, in fact, bear.

Mrs. Renée Short

Is my hon. Friend aware that it was in the period between 1956 and 1963, when the party opposite was responsible, that £2,335 million worth of aviation contracts were handed out? Does he not think that it is now time for his Department to carry out a thoroughgoing investigation of all these contracts in order to see how many " Bristol Siddeleys" there are?

Category of Employee Source Period Percentage Increase
Manual Average weekly earnings October, 1966–October, 1967 5.8
Salaried Average earnings (weekly basis) October, 1966–October, 1967 4.6
All Monthly index December, 1966–December 1967 5.8 (provisional)
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