HC Deb 06 July 1972 vol 840 cc746-7
Q4. Mr. Ashton

asked the Prime Minister whether he is satisfied with the co-ordination between the Departments of Employment and Trade and Industry in dealing with the economic effects of multi-national companies; and if he will make a statement.

The Prime Minister

Yes, Sir.

Mr. Ashton

Are not multi-national companies now bigger and stronger than the British Government? Are they not in a position to move jobs, work and currency around and in general to create havoc with the Government's policies?

The Prime Minister

I do not accept those statements. There is a great deal of interest in multi-national companies, and they are being widely studied not only in academic institutions but also in business and by the trade unions. If the hon. Gentleman will give me an example of a multi-national company operating in this country which has been damaging the national interest, I will study his thesis. Multi-national companies are subject to the laws of this country just like any home-based company. I do not, therefore, accept the hon. Gentleman's allegations. Any company which is trading outside this country has a certain scope for currency movement in the speed with which it moves its receipts and makes the payments which it has to make abroad. That is not limited to multi-national companies; it applies to any company which is trading overseas.

Mr. Fletcher-Cooke

Nevertheless, do not multi-national companies have a great opportunity of arranging their profits so that they occur in the country where the currency is strongest? Although I do not blame them for doing that—it is the natural thing to do—does it not have an accelerating effect upon the movement of currency across the exchanges which produces difficulties which were unknown in the past but which have confronted this and other countries recently?

The Prime Minister

That is a possibility. In the analysis which has been made so far—and it is a difficult one to make—there has been a complete absence of proof that the great movements of funds which caused the Deutschemark to float upwards last year and which affected sterling a fortnight ago were due mainly to the working of international companies. There is no evidence to justify that, as far as I know. If my hon. and learned Friend has some evidence I will gladly consider it.