HC Deb 23 May 1975 vol 892 cc1803-21
The Prime Minister (Mr. Harold Wilson)

With permission, Mr. Deputy Speaker, I would like to make a statement, as I intimated yesterday, on the present situation in the textile, clothing and footwear industries. In view of the concern which has been expressed in all parts of the House, and outside it, I think it right to make a statement before the House adjourns.

The Government have been examining the situation which has developed in these industries in the context of the worst world recession since the 1930s which has hit with particular severity the textile industries of the developed and developing world alike. Indeed, other developed countries are even worse off than we are. The level of textile unemployment in the United States, in Germany, in Belgium, Ireland and Denmark is substantially higher than ours.

The United Kingdom is a party to the Multi-Fibre Arrangement under the aegis of GATT. Within the MFA, agreements are being progressively made with low-cost textile suppliers, mainly in developing countries. An arrangement with India has been initialled: negotiations with Hong Kong are well advanced; they have begun with Korea; and arrangements are being finalised for the imposition of restraints on Taiwan. These multilateral negotiations, while having regard to the interests of the less developed countries, will give the United Kingdom industry a more effective degree of protection than it has ever had before, and certainly more than can be achieved by unilateral protective action.

Wherever evidence can be produced of dumping, subsidised exports or other forms of unfair trading, Her Majesty's Government are ready and willing to take vigorous protective action on behalf of these industries; and other industries outside these.

After very careful examination of all the evidence, the Government have taken the view that the British Textile Confederation's proposals for unilateral action to provide an across-the-board cut of 20 per cent. would be inappropriate, ineffective and would lead to certain retaliation against the products of these and other industries.

The present problems facing these industries go deeper than the problems of import penetration. In fact, in nearly all the major textile sectors, the volume of imports in the first quarter of this year has not increased compared with the average over the first half of last year. It has fallen. The percentage of our home market represented by import penetration again has fallen.

We could not therefore justify, under our GATT obligations, a general cut in imports, apart, as I have said, from any cases of unfair competition we can identify in this or any other industries. We should be breaking the Multi-Fibre Arrangements which is of benefit to our industries and which the TUC Textiles, Clothing and Footwear Industries' Committee has described as the keystone of a long-term policy for achieving a stable pattern of trade and greater confidence in the industries.

It would also be totally contrary to the policy we advocated at the recent Commonwealth Heads of Government meeting and would be detrimental to our trade within the Commonwealth. Certainly it would be bound to lead to other countries applying similar measures against our trade, from which the industries we are trying to help would be among the first to suffer.

The Government have therefore decided upon direct action to help the industries, on which we shall now consult with all those concerned in the industries sector by sector. We have suffered enough in recent years through lack of industrial capacity lost during the recession period and through lack of investment and modernisation. We are determined to ensure that the world-wide recession in these industries, as in others, does not cause damage which would mean the loss of viable capacity which will be needed when the expected upturn comes in world markets.

Under the Industry Act we have powers appropriate to this objective. A scheme is already in operation under these powers to help the wool textile industry. The House will be aware that in the Budget speech on 15th April my right hon. Friend the Chancellor of the Exchequer said that he was setting aside £100 million particularly to assist industry to modernise. We shall not hesitate to draw on this provision or to use the other powers available to the Government to help these industries to maintain their ability to produce and provide the maximum possible level of employment.

I am making this statement today before the House adjourns in view of the anxiety in these industries. The urgent work and consultations necessary to achieve the Government's objective, which have already started, will continue while the House is in recess. Should it be possible to make a further announcement before the House returns, I am sure hon. Members would agree that it should be made in the recess. The House will, of course, be fully informed on progress in all these matters when Parliament resumes.

Mr. Heseltine

I know that the Prime Minister will understand when I ask him whether it would have been possible for the Opposition to have rather longer than 10 minutes' notice of this statement, which gives very little time to read it and to reach a judgment on it before having to comment on it. I think that on first reading the conclusion of the House will be that there is a degree of vagueness and lack of precision about these proposals which will be of concern to the workers and management in the industry.

Mrs. Elaine Kellett-Bowman

It is outrageous.

Mr. Heseltine

What progress is being made with our EEC partners towards acceptance of the Multi-Fibre Arrangement under GATT? May I ask the right hon. Gentleman whether the Government are carrying out investigations into dumping and particularly whether they have been able to reach conclusions on the widespread charges of dumping of footwear, for example, from the COMECON countries?

Finally, which Department will be responsible for conducting the negotiations with the industry? If it is to be the Department of Industry—and we are sorry that the Secretary of State for Industry was not here to make the statement for his Department—will the condition, often referred to by the Secretary of State for Industry, apply that where aid flows from public funds, ownership of industry must be a necessary condition attaching, to that aid?

The Prime Minister

I regret the short notice of the statement. It was necessary to keep on amending it almost to the last minute as further facts became available on, for example, the arrangements being made under the Multi-Fibre Arrangement. As the hon. Gentleman knows, this sort of thing happens under successive Governments. As Leader of the Opposition, I sometimes suffered from the late arrival of statements.

The hon. Gentleman wanted to know exactly what we had in mind. He seemed to think that there was some vagueness and lack of precision about the proposals. The Industry Act gives us power to help with re-equipping and modernisation on the lines of the scheme already in hand in wool textiles. The Clothing EDC has put to the Department of Industry comprehensive proposals for aid under Section 8 of the Industry Act.

Because it is important in maintaining production at the highest possible level, we want to give encouragement for a scheme of stock holding and stock building. This is one of the matters which we are examining. It can make a big difference to the liquidity of the industry and the maintenance of employment. Since this recession, as with so many other textile recessions, is very much concerned with violent fluctuations, not to mention speculation in raw material prices, it is of great advantage to be holding stock when raw material prices change again and demand revives. We are reviewing urgently the possibility of Government purchasing policy in this field, but we shall want to discuss all these possibilities in our consultations with each sector of the industry.

Nothing I have proposed this morning and nothing we have in mind transgresses the EEC Multi-Fibre Arrangement or will cause difficulties with the EEC countries, most of which are involved in the Multi-Fibre Arrangement.

With regard to imports into this country and unfair practices, we examine all evidence and, quite apart from this sector, we are making a deep investigation here and in the home country in relation to the import of cars and colour television tubes from Japan.

The hon. Gentleman mentioned the question of footwear from Eastern Europe. There will be a statement today, I think—it will be made very soon, anyway; there is a Question down on this matter—which will inform the House that, following discussions with Czechoslovakia, Poland and Romania, their exports of men's leather footwear to Britain this year are to be cut very considerably. The details will be given in the Written Answer.

With regard to the responsibility of Departments, I have made the statement because its subject matter cuts across a considerable number of Departments—Trade, Industry and others. My right hon. Friend the Chancellor of the Duchy of Lancaster has been taking charge of the co-ordination of Departments and the investigation of this matter, and what I have announced is the result of his report to me. My right hon. Friend will also be exercising very close supervision of this matter as between the Departments and in the consultations with the industries.

Finally, I have said that the aid which is proposed—the action to be taken—will take a number of forms, but we do not envisage a long-term involvement with these industries. They are facing a serious problem. They need assistance of the kinds I have described, possibly other kinds, too, but we do not regard this as providing permanent capital for the industry. In those circumstances, the question does not arise.

Mr. James Lamond

I regret to say that almost the only thing about the announcement that I can welcome is that it is an indication that the Government are showing some concern about this matter. My right hon. Friend has completely misunderstood the representations of the British Textile Confederation which suggested across-the-board import restrictions, on the basis of a short-term policy, which were needed immediately because of the very grave depression in the industry. To dismiss the suggestion as my right hon. Friend has done is wrong. I think that he should have accepted it in the way that Canada, New Zealand, Australia and the United States have imposed tariff restrictions to give immediate assistance to their industries.

If my right hon. Friend is saying that he is embarking on what must be a fairly lengthy and complicated process of negotiating with the industry with a view to stocking to assist the industry, I do not think that this will have any immediate effect. I believe that in the long term it will be damaging—

Mr. Deputy Speaker

Order. I am sorry to interrupt the hon. Gentleman, but many Members wish to ask questions and Adjournment debates are to follow.

Mr. Lamond

I apologise, Mr. Deputy Speaker.

I ask my right hon. Friend to take into account the need for immediate action which his statement today does not promise.

The Prime Minister

When my hon. Friend has thought further about the matter, I am sure that he will not support the 20 per cent. across-the-board cut, including less-developed countries. I believe that that would be a wrong decision totally against the philosophy of all parties, and against the spirit of the communiqué on the Commonwealth Prime Ministers' Conference in Jamaica, and would lead to very severe retaliation by a large number of countries against our own textile, clothing and footwear industries and other industries and exports.

Secondly, I must inform my hon. Friend—and if he wants to pursue this matter in correspondence or in some other way I shall be happy to give him the evidence—that what he suggests would break international agreements. It would be contrary to GATT and to the Multi-Fibre Arrangement, from which we derive great benefit, and we should lose other advantages. I referred to the various restraint agreements with some countries, even developing countries, organised under the aegis of the Multi-Fibre Arrangement.

The international rules 'governing the imposition of import restrictions—there is no problem where we can prove dumping or unfair trade—specifically prohibit any member country from introducing import restrictions in a year when imports have not risen compared with the previous year. In many of the sectors to which I have referred imports in 1974 rose compared with 1973. The import penetration percentage rose compared with 1973. In the first quarter of this year, for most of those sectors, imports have fallen in absolute terms and also in the degree of import penetration.

Therefore, under my hon. Friend's suggestion we should be breaking our international obligations, and these industries would be among the first to suffer from any consequences of that breach.

Mr. Molyneaux

Is the Prime Minister aware that in Northern Ireland there will be a welcome for his assurance that action will be taken where there is clear evidence of dumping? Will the right hon. Gentleman bear in mind the problems created by the fall in the value of the pound as they affect the cost of raw materials for the man-made fibres industry, which forms a very large part of the textile industry in Northern Ireland?

The Prime Minister

Yes, Sir. I confirm that, as the hon. Gentleman has deduced, Northern Ireland will be fully included in the scheme. As for the cost of raw materials, affected as they must be by changes in foreign exchange value, what has happened is that over the past year the price of textile fibres generally has fallen by about one-third. This means that, as always happens in every textile recession, anyone holding stocks at various stages of the distributive chain gets right out of stocks and throws the whole burden back on to the producing unit—on to the mill or factory and, therefore, on to employment. That is the problem which we are trying to tackle by various means, especially by helping at the factory itself.

Mr. Cryer

Would my right hon. Friend accept that this statement is extremely disappointing to those of us who have been pressing for some sort of control? Would he accept that import controls would have been possible under the Multi-Fibre Arrangement, because Article 19 of GATT overrides that agreement?

Will my right hon. Friend explain to the House what evidence there is of possible retaliatory measures to import controls? Does he not accept that 40 per cent. of our imports are from EEC countries, anyhow? He said that, if evidence is given of dumping, vigorous protective action will be taken. Can he say what has happened to the application for antidumping measures by the West Riding Federation of Worsted Spinners which was made in November and which disappeared to the EEC? Does he agree that the EEC Commissioners have been considering anti-dumping measures for the past two years? Cannot the Government take independent action and impose import controls in the near future?

The Prime Minister

The last matter is being investigated. It takes quite a time to reach agreement. I know from my experience in these matters that to find evidence it is necessary to look not only at the prices charged here but also at what is being done in the supplying countries. The EEC is considering antidumping measures, and we are considering them separately ourselves. If we wish to take action, there is nothing to stop us from taking action about any kind of unfair trading.

On the other issues which have been mentioned, there are two relevant provisions of GATT. Both of them must be taken together. We are satisfied that we should be in breach of our international obligations and that retaliation would set in. My hon. Friend has asked where it would set in and what evidence there is of it. One has to commit the breach before one gets the retaliation. Already it is clear to us that Turkey is one country which would take retaliatory action against us if we were to take the action which is called for.

Mr. Fletcher-Cooke

The only positive part of the Prime Minister's statement was devoted to steps to modernise the textile industry.

Mrs. Kellett-Bowman

It is already modern.

Mr. Fletcher-Cooke

As my hon. Friend says, that is not the problem. Surely the Prime Minister recognises that the textile industry is thoroughly modernised already. What it requires is a free and fair opportunity to sell its products. It is not getting such an opportunity either domestically or abroad at present. Is the Prime Minister aware that nothing in his statement gives the industry any hope that it will have that opportunity either in the near or the more distant future?

The Prime Minister

I do not accept what the hon. and learned Gentleman has said, though I accept his opening premise. Compared with 20 or even 10 years ago, the industry has advanced to a very high degree of modernisation. What causes concern to all of us is the fact that the more modernised an industry is, the greater the loss through working at a relatively low level of capacity with the higher overheads and the high capital costs in a capital-intensive industry. The more modernised an industry is, obviously the higher the level of capacity it has.

I have made it clear that this is not only help with modernisation. All parts of the industry are not fully modernised. Some of them can be assisted, and want to be assisted, with help in particular technologies, and so on. This is immediately relevant to the problem identified by the hon. and learned Gentleman, that of wanting to be able to continue production at a higher level in relation to capacity. That is why our proposals for helping with the financing of stocks are so important.

Mr. Noble

Will my right hon. Friend accept that we welcome the fact that he himself has become involved in seeking to solve the problems of the textile industry but that we find it disappointing that his statement this morning does not measure up to the opening paragraph of a document he produced entitled "A Plan for Cotton", in which he said that there had been enough investigation of the textile industry and that the time had come to bring about a secure future for Lancashire cotton in the modern world?

Will my right hon. Friend give a clear and categorical statement this morning that the Government accept entirely the need for a fully viable cotton textile industry and, should the situation arise, will be prepared to introduce import controls in the near future? Will he also clarify that part of his statement dealing with stock holding in terms of the number of jobs he thinks it will protect in circumstances where 55,000 people are on or have had short time this year?

Given the fact that the footwear industry is in a very similar position, would my right hon. Friend consider extending aid to that industry to help with stock holding?

The Prime Minister

On the last point, yes. I hope that my statement was clear. If it was not, I take this opportunity of clarifying it. I was referring to the textile, clothing and footwear industries in my statement, and what I have said about help of various kinds will undoubtedly include the footwear industry.

My hon. Friend referred to a document entitled "A Plan for Cotton" that I produced for the United Kingdom Textile Factory Workers Association. That was in 1957. What was said in that document was relevant in that situation. Indeed, much of it is relevant to today's situation. Since that time we have seen the very high degree of modernisation which has been referred to by hon. Members. The proposals in that document, when I set out the conditions under which there should be import restrictions, were the proposals for modernisation. The then Government in 1959—by coincidence, on the very eve of the announcement of the 1959 election—came forward with a very big plan for cotton, thus responding to what we were pressing for, with a £30 million spending programme to modernise the cotton industry.

We have come forward with these proposals. There is no figure that I can propose as yet, because we have to work out with the industries what their needs are, particularly in regard to stock holding and the building up of stocks as well as existing stocks.

My hon. Friend said, as others have said, that we should introduce import controls. I am disappointed to hear this emphasis on action which we could not justify in the situation, particularly as regards developing countries. If we were to discriminate in favour of developing countries—we have considered applying such action to developed countries and not to developing countries—the developing countries would take advantage of it and fill the gap, and the problem for Lancashire would be just the same.

Mrs. Kellett-Bowman

Does the Prime Minister accept that this statement will be received in my constituency with incredulity and dismay? We had hoped when we heard his words yesterday in response to a question that I put to him, that we would hear something positive today. People in my constituency will find it almost unbelievable that the Prime Minister can say that the Government will now consult sector by sector and work out what the needs of the industry are. We have been telling him what the needs of the industry are for the past six months and more.

The Prime Minister appears at least to accept the need for liquidity for the industry. If that is the case, may I beg him yet again to supply some liquidity to my area and the other intermediate areas of Lancaster by giving it the regional employment premium? For one of my firms alone this would mean help to the extent of £6,000 a week. This would be a life line which is desperately needed. As I said yesterday, our male unemployment is double that for the same month last year—

Mr. Deputy Speaker


Mrs. Kellett-Bowman

As is our female unemployment.

Mr. Deputy Speaker


Mrs. Kellett-Bowman

And unemployment is double the national average.

Mr. Deputy Speaker

Order. I think that is enough.

Mrs. Kellett-Bowman

On a point ot order, Mr. Deputy Speaker. I have now sat down permanently.

The Prime Minister

I accept from the hon. Lady—indeed, it is my own knowledge—that in her area, which is not a development area, there has been a very serious increase in unemployment, both male and female, in this and other industries. I do not accept, however, having regard to her opening words, that my statement will be received in the manner she suggested. I do not know why she expected that I would announce import restrictions today—

Mrs. Kellett-Bowman

Not today, now

The Prime Minister

I made clear yesterday that it would not involve import restrictions. I hope the hon. Lady is not pressing that point.

We shall look into the question of liquidity, but it is not a matter of the regional employment premium. Certainly her area will be fully covered by the scheme, and my right hon. Friend will look into the best means, in the hon. Lady's area and in others, of providing the immediate help which is required.

Mr. Edward Lyons

Since my right hon. Friend's statement seems to indicate a rejection of import controls in favour of a stock holding scheme, could my right hon. Friend say, first, whether the stocks to be bought will be existing stocks or stocks to be manufactured in the future? Secondly, will be say how much money the Government are thinking of putting into the scheme of stock holding and who will decide which stocks should be held by the use of Government money? Thirdly, when does he think the scheme will be implemented? The scheme is one to inject money into the textile industry, and it is important that any such scheme should come into existence as soon as possible.

The Prime Minister

I accept the urgency to which my hon. Friend has referred. As to how much money is involved, that depends on the need. As the need is identified we shall do what is necessary.

With regard to liquidity, there are different ways of financing the holding of stocks—advancing money against them, and I have referred to the possibility of Government purchasing. We want to do that which is quickest and that which provides the most immediate help. My right hon. Friends have already started on the problem, and I hope that they will be able to identify the means which will most readily and speedily give the help which is needed for maintaining production. What we are concerned with is the maintenance of production and employment, keeping vital productive capacity intact and meeting what we are all certain will be the need before very long.

I have pointed out that despite the very serious position of our own textile industry resulting from the world recession, other industries, particularly in Western Europe, have far higher textile unemployment. We are dealing with it by this method of direct assistance.

In answer to my hon. Friend the Member for Rossendale (Mr. Noble), whom I did not answer fully, we accept the objective of a fully viable continuing prosperous textile industry in all the sectors that I have mentioned, and action will be taken to that end.

Mr. Freud

Twelve months ago the Department of Industry was advised of an increase in imports from Eastern Europe. I should like to say, on behalf of my party and particularly on behalf of my hon. and voluminous Friend the Member for Rochdale (Mr. Smith), that he would dearly like to have had more than 10 minutes' notice so that he could have been here to hear the Prime Minister's statement. In my hon. Friend's absence, I should like to know to what extent the falling value of sterling has exacerbated this crisis. Secondly, while the Prime Minister has the support of the Liberal Party in the continuation of quota controls, may I ask him what is now his prognosis of the employment prospects in the Lancashire textile industry?

The Prime Minister

I am obliged to the hon. Gentleman. I think there has been some misunderstanding about the 10 minutes. The 10 minutes was the period which hon. Gentlemen opposite had in which to read the somewhat lengthy statement, and I have expressed my regret for that. I cannot imagine that if the statement had been issued 20 minutes earlier it would have enabled the Liberal Party Chief Whip to read it, as he is obviously not here. The House had notice yesterday afternoon that I would be making this statement this morning. Probably the Liberal Party Chief Whip's new duties have confused him a bit.

I am grateful to the hon. Member for Isle of Ely (Mr. Freud) for what he said about import controls. He was right to say that. He asked about the changes in the day-to-day parity in sterling. In fact, while this always has some effect on our purchasing prices and our selling prices, it is difficult to quantify that effect, particularly in the short term. In fact, the recent change in the sterling parity on the market over the last fortnight has had no real effect at all on this situation. It was last year, when sterling was at a somewhat different rate in relation to the dollar and other currencies, that the maximum impact was felt. Last year imports were coming in on a major scale, while this year imports have been coming in at a lower rate and with a lower degree of import penetration.

Mr. Fairgrieve

Does the right hon. Gentleman appreciate that while the textile industry in Scotland will accept his statement so far as it goes, more back up is needed to give it flesh and blood? For example, the Scottish woollen textile industry exports more than 50 per cent. of its products, and of those exports more than 50 per cent. go to members of the European Economic Community. An industry which stands on its own feet is not prone to exaggerate. The Chairman of the Scottish Woollen Manufacturers Association has said that if Britain comes out of Europe, it will put nails in our coffin. Does the Prime Minister appreciate the vital need of the Scottish woollen textile industry that this country—Britain and Scotland—should remain in Europe?

The Prime Minister

Without going into a matter which is being much argued in the country at the moment, it is a fact that the leader of the woollen textile industry south of the Border made a statement not quite in the same words but conveying the same general message. My right hon. Friend the Secretary of State for Scotland and I have the problem very much in mind, concerning not only wool but other textile industries, and particularly knitwear, light clothing and so on. Not only has my right hon. Friend the Secretary of State for Scotland been urging these problems on his colleagues but when we—three or four of us—were in Scotland to meet the Scottish TUC, that body urged on us the urgency of the situation in the light clothing industry in the border areas—

The Secretary of State for Scotland (Mr. William Ross)

And Glasgow.

The Prime Minister

—and Glasgow as well.

Mr. Skinner

Does my right hon. Friend accept that to some of us who listened to him yesterday speaking about the various consultations which were taking place, his statement represents a severe disappointment? Is he aware that the refusal to introduce some sort of selective import controls or quotas is part of the Common Market Commission's refusal to have nothing at all to do with it? The referendum prospect, therefore, has something to do with it as well.

Will the Prime Minister clarify a matter which affects the House itself and say why the Chancellor of the Duchy of Lancaster is to be the overall man in charge of this operation, and whether we shall have a repeat performance of a similar situation which arose when the Chancellor of the Duchy of Lancaster was put in charge of oil Questions and thereby prevented hon. Members in all quarters of the House from putting down Questions and receiving replies? Will that happen in respect of textile Questions?

The Prime Minister

My hon. Friend's questions are getting a little wide of the subject. Nevertheless I will try to answer them. I recall the questions about my right hon. Friend the Chancellor of the Duchy not answering Questions and the point made by my hon Friend—and, of course, his point was accepted.

Mr. Skinner

It was not.

The Prime Minister

In this case the position is quite clear. Questions will be put down to the departmental Ministers concerned respectively—Industry or Trade—relating to the different problems. The fact that my hon. Friend is quite wrong in trying to find a Common Market attribution of causality here will not prevent—

Mr. Skinner

Of course.

The Prime Minister

My hon. Friend is less likely to be wrong if he will listen sometimes—

Mr. Skinner

I have got my eyes open.

The Prime Minister

—with his ears open, his eyes open, and his mouth possibly closed. Of course, the fact that my hon. Friend is wrong on this will not stop him from making such statements outside. I know that.

My hon. Friend expressed disappointment about import quotas. Perhaps he will allow me, with equal courtesy, to express my disappointment that he and some of those closely associated with him seem so anxious to go down the line on restrictions on imports from developing countries, which I would have thought was a complete reversal of what he and so many of us have said in the past about the developing countries.

If my hon. Friend and those others would like to go back to the foundation document "One Way Only", of a certain group with which he is connected, they will find there a very different philosophy. It was set out by three former Ministers of the Attlee Government, of whom I was one. I am sorry indeed if my hon. Friend is changing his view on the fundamental issue of policy and world philosophy contained in that document.

Several hon. Members rose

Mr. Deputy Speaker (Mr. George Thomas)

Order. There are just three hon. Members with constituency interests waiting to be called. I hope that they will make their questions very brief so that we can begin the Adjournment debates by a quarter to twelve.

Mr. Robert Boscawen

Will the Prime Minister accept that the severity of the recession in the footwear industry, which affects the South-West of England very severely at present, is in no way due to any shortcomings of the industry itself, either in investment, labour relations or efficiency? Will he also accept that it is due, to some large extent, to the import of cheap shoes at below the cost of the raw materials in them from Comecon countries, despite the agreements with them, which has been going on since the first quarter of last year? Nothing has yet been done about it. Will he make a further statement as soon as possible?

The Prime Minister

I fully accept what the hon. Gentleman has said about the industry and its record and the fact that it is not responsible for the problems it is facing in common with footwear industries in other parts of the world. This is a world recession and the hon. Gentleman will have heard what I said about restrictions on Comecon imports.

The problem is that the footwear industry, like the textile and clothing industries, has been hit in its export sales, as well as in the greater virulence of imports, by the world recession. I note what the hon. Gentleman said about dumping. I have often tried to make inquiries about dumping over the years. It is very difficult to prove. We should like evidence of the extent to which some countries charge a lot more for their raw materials than for their manufactures—and I do not mean the Comecon countries in the main. Such a situation makes it difficult for our industry to be competitive. Anything we can do to help in that situation if proof is forthcoming, we shall do. In effect, the problem is not dumping but the reverse of dumping.

Mr. Madden

Is my right hon. Friend aware that there will be considerable doubt in the textile industry whether his statement will redress the crisis which exists? When will the statement be reviewed? Can he confirm that the discussions he has announced will include representatives of both employers and employees? Is he prepared to make special arrangements for the textile industry to overcome redundancies and the short-time working which exist in it today?

The Prime Minister

We shall have discussions with both sides of the industry and with distributors and anyone else who may be affected. I have told the House that if there is anything to announce, I trust that the House would not object if a statement were made during the recess. That would be followed, of course, by a statement on the Floor of the House after the recess. I also envisage that, as action begins, it will be announced progressively and that we shall not wait until the whole plan is in operation. There may be an announcement before the House comes back after the recess.

Mr. Nicholas Winterton

Whilst the whole House welcomes the timing of the announcement because of the deep concern in the industry, the Prime Minister's proposals are very disappointing. Hon. Members on both sides of the House feel that his rejection of the BTC's proposals is unjustified. It would seem that the Government have not perhaps given sufficient consideration to them.

Is the Prime Minister aware of the extent of the import penetration of the British textile market, which is far higher than in other countries? Is he prepared to urge a speeding up of the renegotiations under the GATT? Will he give further details of the stock-holding assistance he has announced?

The Prime Minister

I cannot accept the hon. Gentleman's statement that import penetration is much higher in Great Britain than in other countries. In three comparable countries, for example—Germany, Belgium and the Netherlands—the penetration is considerably higher. But these figures must always be taken with reserve, as the situation is changing. The import penetration has fallen.

We considered the BTC's proposals very carefully, which was one of the reasons why we took so long in reaching our conclusions. We knew of the strong demand for dealing with imports. But we concluded, because of the reasons I have mentioned and the problems of retaliation, that we would be wrong to impose import restrictions. It was perhaps for that reason mainly that we took longer to make our proposals than we would have done otherwise.

The hon. Gentleman is mis-stating the position if he does not accept that this world-wide recession affects our exports as well as bringing additional imports. The problem arises from world depression, and we do not want to add to it by starting a round of import restrictions. The matter is not to do with the general argument about the management of the economy or about protectionism. We believe that the best way is to give direct help to the industry to enable it to be ready when the upturn comes and in the meantime to maintain its capacity and employment.

Mr. Cryer

On a point of order, Mr. Deputy Speaker. Following the announcement by the Prime Minister, will it now be required that Questions relating to textiles should be addressed to my right hon. Friend the Chancellor of the Duchy of Lancaster rather than to the Departments of Trade and Industry?

Mr. Deputy Speaker

Order. The hon. Gentleman is taking up the time of other hon. Members. His question has already been dealt with by the Prime Minister.

The Prime Minister

Further to that point of order—if it is indeed a matter for you, Mr. Deputy Speaker. I have already told the House that further Questions on the textile industry should be put to my right hon. Friends the Secretaries of State for Trade and Industry, depending on the particular nature of the Question. They will be answering Questions. My right hon. Friend the Chancellor of the Duchy of Lancaster, who has great knowledge of the textile industry, in which a very large number of his constituents work, will be helping to co-ordinate the work, but Ministerial responsibility is clearly in the Departments of Trade and Industry and Questions should be put accordingly.