§ 7. Mr. Hurdasked the Chancellor of the Exchequer what assumptions are made of likely trends in the United Kingdom's balance of payments with other members of the EEC in the general balance of payments forecasts published in his latest Red Book.
§ Mr. Joel BarnettThe forecasts attempt to allow for developments in the balance of trade in goods and services with all other countries. But it is not the practice to publish further details beyond those provided in Table 1 of the Financial Statement and Budget Report.
Mr. HardSince there appears to be some confusion on this issue below the Gangway will the Chief Secretary confirm that if importers switch to buying such things as cereal products from European suppliers because they are now cheaper the result will probably be an increase in our deficit with the EEC, but that that will be of benefit to the balance of payments as a whole?
§ Mr. BarnettWhat the hon. Gentleman said simply emphasises the difficulties of trying to make assumptions on a particular figure or figures.
§ Mr. Ronald AtkinsWill my hon. Friend put pressure on the Secretary of State for Defence to arrange an offset agreement with Germany to reduce the £200 million-£300 million deficit which we have in the balance of payments with that country because of running the British Army of the Rhine?
§ Mr. BarnettThere is, of course, already an offset agreement, but I shall naturally bear in mind what my hon. Friend said and bring it to the attention of my right hon. Friend the Chancellor.
§ Mr. MartenIs the Chief Secretary aware that the latest figure shows that 96 per cent. of our non-oil trade deficit is with the EEC? What are the Government going to do about that?
§ Mr. BarnettAs I pointed out, there is great difficulty in extracting figures in that way. Our balance of trade with the EEC has been deteriorating substantially since well before our entry—as, regrettably, it has been doing with many other areas of the world. I must therefore ask the hon. Gentleman not to make this kind of assumption.