HC Deb 01 February 1973 vol 849 cc1611-7
Mr. Benn

(by Private Notice) asked the Secretary of State for Trade and Industry if he will make a statement on the cancellation of the options on Concorde by Pan Am and TWA.

The Minister for Aerospace and Shipping (Mr. Michael Heseltine)

I very much regret that Pan American and TWA have felt unable to purchase Concorde at present. Both have, however, indicated that they will maintain an interest in the future of the programme and be open to further discussions with the manufacturers. I very much hope that both airlines will decide at a later date to order Concorde.

The manufacturers are now engaged in an active sales campaign and are in detailed negotiations with a number of other airlines. The British and French Governments will continue to give the manufacturers every support in these negotiations.

Mr. Benn

I am grateful to the Minister for answering my question and for the active support given by the Government to the sales campaign up till now.

While I share the hon. Gentleman's disappointment at the failure of Sir George Edward's mission, we understand that this must be taken in perspective in view of Pan Am's financial difficulties and so on. But it is a serious setback, and must be seen as such.

Is the Prime Minister raising with the President in Washington the much more important question of the landing rights for Concorde flying under BOAC and Air France colours into the United States, which is an essential interest for this country, to see that this matter is not set back by environmental pressures wrongly directed in America by the pressure of the American aircraft industry, itself motivated by the loss of its Boeing, or as a by-product of the campaign against the restoration of the Boeing in the United States?

I ask the hon. Gentleman to recognise and to make clear what is, I think, not as fully understood as it might be, that if by any chance the Concorde project were to fail it would de-gut the British aircraft industry. It would certainly stunt the growth of the city of which I share representation in the House. It would have a much greater significance for the British economy and reputation than is perhaps understood by those who are critics of the aircraft.

As the Government, with the French Government and the industry, are to look again at the sales strategy, may I ask the Minister to discuss with his colleagues whether the time has come for more information to be made available to the public about the Concorde project? That point was put by the Opposition in the debate before Christmas. Will the hon. Gentleman accept from us that the secrecy surrounding the Concorde project, far from helping, is actually damaging its prospects? In the United States and France there is a far wider public discussion about these issues than has ever been allowed in this country.

Mr. Heseltine

The House will be aware that the question of landing rights was discussed first by myself and then by my right hon. Friend the Secretary of State for Trade and Industry with officials of the American administration over the past fortnight. It is our view that the American administration wish to see that Concorde is able to land at American airports, and that there are no regulations which would prevent it from so doing.

The right hon. Gentleman's second question, the general concern that he rightly has as a constituency Member for employment in the Bristol area, is very well known to the present Government, as it was to the previous Government. But the preoccupation of all of us associated with the Concorde is to concern ourselves with the sales programme and not to deal with the rather more gloomy circumstances which at present are not relevant to our considerations.

Thirdly, the right hon. Gentleman asked whether there should be more publicity, whether more facts and figures should be made available. I remind the House that for 11, hours last week I provided a great range of information to the Standing Committee examining the Concorde Aircraft Bill. If hon. Members read the OFFICIAL REPORT of that debate, they will realise that a vast amount of information is available and that we had a detailed opportunity there to consider the Concorde programme. The House will have a similar opportunity when the Bill comes back on Report.

Sir F. Corfield

At this juncture, perhaps above all others, it is essential that my hon. Friend should be free to carry on the further negotiations without being pressed to disclose his hand to Parliament and thence to the public. In view of the clear interest of American carriers to postpone supersonic transport for as long as they can, does my hon. Friend agree that it would be very unwise to interpret what has happened as something more than a move in very tough negotiations which require determination?

Mr. Heseltine

My right hon. and learned Friend's intervention is particularly helpful, because no man knows more than he of the difficulties of combining the job of Minister responsible to the House with that of sponsorship of a commercial project of the kind we are discussing. I totally agree with the points he put to me. Obviously I have real responsibilities to the House, but so I have to the taxpayers, who have invested large sums of money, and to the tens of thousands of people employed on the project. In those circumstances, I believe it is right that I should concentrate on the top priority, which is to ensure that I give every support possible to those who have to conduct the commercial negotiations for the Concorde programme.

Mr. Palmer

What the Minister has just said is rather worrying. Will he reassure those thousands of workers in Bristol who are dependent on the project for their livelihood that the Government's support for Concorde remains undiminished?

Mr. Heseltine

Let me remind the hon. Gentleman of the closing sentence of my initial answer. I said: The British and French Governments will continue to give the manufacturers every support in these negotiations.

Mr. Bruce-Gardyne

Does my hon. Friend agree, nevertheless, that the withdrawal of two major potential customers creates a rather new situation? Is there not a case for setting up a Select Committee of this House to obtain information from all concerned and from all sides so that we know whether the Government are right to pursue this programme in the new circumstances?

Mr. Heseltine

I fully understand the general argument about the need for parliamentary inquiry and the use of a Select Committee for the purposes. But in view of the stage which the sales campaign has reached the appointment of a Select Committee could not be considered helpful to the salesmen who have the job of negotiating whatever decisions have to be made.

Mr. Stonehouse

Having got to this stage, does the hon. Gentleman agree that it would be rash and foolish to give any hint about cancellation? Will the hon. Gentleman keep in mind the importance of this project not only to Bristol but also to the thousands of subcontractors up and down the country? On the hon. Gentleman's point about protecting the taxpayers' money, will he be in a position soon to tell us about the new pricing arrangements, with BAC especially, to avoid the cost-plus situation which seems to be a technique of guaranteeing a return to the company concerned rather than of ensuring top efficiency?

Mr. Heseltine

I accept the right hon. Gentleman's suggestion that there should be no hint of weakness, vacillation or doubt in the Government's mind. Nothing that I have said could give rise to any such suggestions.

The right hon. Gentleman's second point was about the cost-plus situation, which was referred to recently in the national Press. As the programme has developed it has become increasingly possible to fix the design of an increasingly large part of the programme. We have been in discussion with the engine and airframe manufacturers with a view to moving to a fixed-price element in the programme. The discussions have been going on for some months and the House will appreciate that it is a necessary step to take to try to get the maximum possible control on the cost situation in a high technology exploratory situation.

I understand the right hon. Gentleman's third point that not only in Bristol but throughout the United Kingdom the Concorde programme is of immense importance. I have myself pointed out to the House that one hon. Member in four has people in his constituency working on the programme. What is more, it is equally important to the employment situation in France.

Mr. Biffen

Is my hon. Friend aware that in all quarters of the House there will be approbation for the full-hearted way in which he has sought to promote the sales of Concorde? Nevertheless, is my hon. Friend aware that only those bemused by the superstitions of high technology will assume that we can continue as though it were business as usual? Is my hon. Friend aware, further, that there are some hon. Members who are not so naive as to suppose that they can talk about the undesirable aggregate levels of public expenditure without drawing attention to certain components of public expenditure which have highly questionable economic and social implications?

Mr. Heseltine

I do not think that my hon. Friend will dissent from the view that the responsibilities that I have are those for giving every support possible to the Concorde programme. Obviously in any dialogue about public expenditure it is a matter for hon. Members to raise such matters as they wish.

Mr. Elystan Morgan

Will the Minister consult his right hon. and learned Friend the Attorney-General with a view to publishing a White Paper setting out in detail the circumstances, if any, in which we should be able to withdraw from or to renegotiate this project if we wanted to? In such a White Paper will the hon. Gentleman set out a quantification of the damages which the Government will have to pay?

Mr. Heseltine

No, Sir.

Mr. McLaren

Is my hon. Friend aware that we realise that no one has worked harder than he has to secure the American contracts and that he has the support of nearly the whole House and the country behind him in his efforts to ensure the continuing success of the project? Cannot we be sure that in the long run supersonic transport is bound to come?

Mr. Heseltine

I thank my hon. Friend for his kind words. The advent of supersonic transport is not entirely within the control of the British and French partners. The Soviet Union has a supersonic transport which it intends to introduce into service at about the same time as our national flag carriers.

Mr. Hugh Jenkins

Is the hon. Gentleman aware that those who said that the American airlines would not purchase Concorde derive no satisfaction from having been proved right? Is he aware, further, that the commercial considerations which motivated the American airlines are likely to motivate anyone else who examines the project? In the circumstances, surely the hon. Gentleman should not exclude from consideration the possibility that a grave error has been made and that in the interests of all concerned it would be better if we guided the efforts of the British aircraft industry in another direction?

Mr. Heseltine

I am sure that the hon. Gentleman is as aware as I am that the decision of Iran Air and of China to purchase Concorde flies in the face of his suggestion that following the decision of one or two American carriers everyone has to reach the same conclusion. There are few hon. Members who would argue that because the Americans make one decision we should all make the same decision.

Mr. Hastings

Is not it probable that this decision reflects the economic performance and position of Pan American rather more accurately than that of Concorde? Secondly, is not it possible that we have exaggerated the importance of the transatlantic route in any event and that the greatest advantage lies in the Far Eastern routes? Ought not the manufacturers and the Government to concentrate in this direction? Thirdly, is not it fair to say that nothing now can stop supersonic flight and that if the Americans by the end of the 1970s opt out and leave the field to Europe and to Russia they will place themselves in a very dangerous position?

Mr. Heseltine

The House will understand that it will not help if I make comments about Pan American's financial position. As for the importance of the transatlantic route, I draw attention to this morning's statement by BOAC, which obviously attaches great importance to it. The fact that BOAC and Air France will introduce Concorde on to that service in 1975 must be a tribute to their judgment that it is an important route. It carries the highest proportion of first-class passengers of any major route.

The possibility of supersonic transportation being extended by the introduction of an American SST is for all hon. Members to reach a conclusion upon themselves. But expenditure on supersonic transportation is continuing in the United States. At no time in history when human beings have been given the choice to go faster have they ever failed to take that choice.

Mr. Benn

Without prejudice to the argument about whether more information should be made available on Concorde's performance and so on, will the hon. Gentleman consider making available in either a Written Answer or a full Press statement the degree of commitment in the project that there is in this country in terms of investment and employment throughout the country, so that those who are still pursuing the theoretical but now historical argument about 1962 can realise the extent to which we are involved in building the aircraft and therefore can measure their comments about it against the background of our real interests instead of pursuing the matter in rather different terms?

Mr. Heseltine

The right hon. Gentleman frequently made this information available when he was responsible. Like my predecessors in this Government, I have continued to do so. I shall see to it that the information is republished, although it is already available for hon. Members to seek.