HC Deb 07 March 1977 vol 927 cc893-5
1. Mr. Tim Renton

asked the Secretary of State for Industry what representations he has received from British Leyland or the National Enterprise Board in connection with the investment of further public funds in British Leyland.

3. Mr. Kenneth Clarke

asked the Secretary of State for Industry when he next intends to visit officially any British Leyland factory.

The Secretary of Statefor Industry (Mr. Eric G. Varley)

I have no further plans at present to visit any British Leyland factory. I have nothing further to add to the statement I made on 2nd March.

Mr. Renton

In the light of the comments made this morning by Mr. Roy Fraser that the attitude of the toolmakers has hardened, does the Secretary of State feel that the situation has worsened since he last spoke to the House? Is he, in conjunction with the National Enterprise Board, laying any contingency plans to keep the specialist car division, Jaguar and Rover, afloat even if the volume car production has to be irrevocably closed?

Mr. Varley

The NEB is considering the matter and is looking at the situation continually. I have not heard Mr. Fraser's statement, but I can only hope that he and his colleagues will quickly return to work in accordance with the advice given to them over the weekend by Mr. Hugh Scanlon on behalf of the Confederation of Shipbuilding and Engineering Unions.

Mr. Clarke

Has the Secretary of State any estimate of how much longer British Leyland can survive the present dispute before it begins to trade while insolvent? Is he satisfied that the AUEW appreciates the urgency of the situation given that it has taken an extremely long time even to meet its members on strike? Does he think that he can offer any encouragement to the toolmakers to return to work by announcing that no future stage of Government pay policy will be based on the principle of giving precisely the same rise to everyone regardless of skills and responsibilities?

Mr. Varley:

There is no question of British Leyland trading illegally. It is clear that the financial position of British Leyland is deteriorating as a result of the dispute, and I repeat that I hope it ends as soon as possible. It is not for me to pronounce about future incomes policy. My right hon. Friend the Prime Minister, from this Dispatch Box last week, said that it was the Government's intention that phase 3—if it could be negotiated—would be more flexible. I think that that has been made plain to the toolmakers at British Leyland, and it has been fully acknowledged by the AUEW that we are doing everything in our power to get the chaps back to work.

Mr. Rooker

Will my right hon. Friend place in the Library the letter he received last week from the NEB? Quite clearly, after the debate last week the comments of Mr. Urwin cast great doubts on the accuracy of the information given to the House by my right hon. Friend.

Mr. Varley

The letter I received from the NEB is confidential concerning certain commercial information. It is not in the best interests of British Leyland to lay it before the House. I can tell my hon. Friend that the objective set out in my speech on 2nd March was agreed with the NEB. My understanding was that the main parts of my speech had been agreed unanimously by the NEB, including Mr. Urwin.

Mr. Eyre

Is the Secretary of State aware that suppliers of British Leyland are beginning to lay men off and that unless urgent action is taken unemployment will snowball in the Midlands?

Mr. Varley

The position at British Leyland is clearly tragic. For the past 18 months or more I have been prepared to back British Leyland and to persuade this House, as best as I was able, to support its long-term future. The £246 million to acquire 95 per cent. of British Leyland for the State, the first tranche of £100 million last August and the Mini replacement programme which I persuaded my colleagues in the Government should go ahead are all being placed in jeopardy.

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