HC Deb 23 January 1978 vol 942 cc1109-41

Commission Documents: R/2461/75, R/1860/76, R/222/77 and R/1964/77.

10.36 p.m.

The Minister of State, Department of Industry (Mr. Gerald Kaufman)

I beg to move, That this House takes note of developments in the EEC Civil Aircraft sector as outlined in the Government's memorandum of 17th January 1978.

Mr. Nigel Spearing (Newham, South)

On a point of order, Mr. Speaker. I wonder whether you will assist the House. The Commission documents which are listed in italics on the Order Paper are to provide for and suggest the control of aircraft design and manufacture and a European defence procurement agency.

The Government have moved a motion to say that the House is taking note of these developments, and the Government's view is outlined in the Government memorandum of 17th January. I understand that that memorandum is not a public document, as the Commission documents are. I believe that it is the right of the House to take note of whatever documents it likes. I understand why the Government have done it in this way, because they are indicating their view to the House, but I shall be grateful, Mr. Speaker, if you will confirm that the House can take note in a motion of memoranda which are not available to the public. Perhaps the Minister will tell us in the course of his speech whether such memoranda will be made public, to make the motion understandable.

Mr. Speaker

I am obliged to the hon. Gentleman for giving me notice of the point of order. I am therefore able to say at once that the fact that a document which is available to Members is not available to the general public does not make this discussion out of order.

Mr. Kaufman

I assure my hon. Friend the Member for Newham, South (Mr. Spearing) that, while it is not for me to comment on the ruling given by Mr. Speaker, I hope that in what I have to say the intent of the memoranda which have been tabled will be made available to the general public. If it turns out that my hon. Friend requires any amplification, I can rely upon him above all to make sure that he obtains it.

The documents which are relevant to the motion that we are considering have, as my hon. Friend has pointed out, been the subject of explanatory memoranda, and I hope that the House will agree that it is unnecessary for me to discuss them in great detail.

It was in October 1975 that the European Commission submitted to the Council of Ministers what it called the "Action Programme for the European Aeronautical Sector." That was communication R /2461/75. The main proposals of the action programme were contained in what was called a proposal for a Council decision concerning the creation of a common policy in the civil air-raft and aviation sector", supplemented by a draft resolution on the establishment of an EEC military procurement agency. These proposals were the response of the Commission to the Council resolution of 4th March 1975 calling for consultation and concertation—I apologise for these terms—on future aircraft projects among the member States.

Communication R/1860/76 of July 1976 is a Commission document entitled "The European Aerospace Industry: Position and Figures", which supplemented and updated the statistical information contained in the action programme. Communication R/222/77 is a more recent development. It is concerned with aeronautical research and recommends initial programmes in the fields of helicopter technology and airframe structures. These, in brief, are the documents which form an important part of the background to the debate.

The action programme itself has not been considered in full by the Council of Ministers, but I think it is fair to say that there has been general agreement amongst the member States that the Commission's proposals as originally conceived were unacceptable. This view, with which the Government agree, has greatly influenced the course of action stemming from the action programme.

At the request of the Committee of Permanent Representatives, a study of the proposals for the establishment of a joint programme for civil transport aircraft was carried out. This study resulted in the identification of a number of objectives for the future development of consultation between member States, notably a strategy for the manufacture of new large civil aircraft; joint action by European manufacturers towards co-operation with American manufacturers; and joint research efforts. These objectives were approved by the Council in a statement in March 1977. It was also decided that member States examining potential civil aircraft projects in their countries should assist the Commission in the preparation of a report, for submission in due course to the Council, on the opportunities for co-operation offered by those projects. The Commission is at present preparing this report.

Mr. Neil Marten (Banbury)

The memorandum keeps on referring to "promoting European co-operation". Does that actually mean "European" or does it mean "Community"? The two things are quite different.

Mr. Kaufman

The hon. Gentleman is, of course, correct in the sense that "European" is wider than the Community. I take it that it means the Community in this case. That is what has been proposed. The hon. Gentleman must offer his own interpretation. I am merely describing what it says.

I am sure that hon. Members would rather I devoted more time to what is happening now than to a step-by-step account of what is largely history. It is, however, necessary to go back a little into past events in order to bring out that member States, including ourselves, have adopted a practical approach, based on actual projects, and that action has been aimed at those proposals which, by general agreement of the member States, offer the most scope for promoting genuine collaboration and concerted efforts in Europe. This is an objective, certainly in the manufacturing sector, which we can all share. It is the means by which we achieve this objective that is of paramount importance to the manufacturers, including our own British Aerospace.

It is accepted throughout the world's aerospace industries that major new civil aircraft projects have to be collaborative. This is so not only because it is hard for one country to find the very large sums of money involved, amounting to several hundred million pounds, but also because it is necessary to widen the market appeal of projects and to spread the risks among several partners. Even the major American companies, which have such a large share of the world market, are now forced to think in terms of collaboration.

As hon. Members will know, British Aerospace has since last summer been engaged in intensive discussions with the principal French, German and Dutch aircraft manufacturers about the possibility of collaboration on one or more projects. These discussions are concerned with two main types of aircraft: first, a short/medium haul aircraft with between 130 and 170 seats, and, secondly, a 200 to 220-seat derivative of the A300B airbus.

With regard to the 130- to 170-seater, the four manufacturers agreed in July last year to set up a number of study groups to consider such subjects as engineering, marketing, organisation, finance and work-sharing. These groups have made good progress, and in December the manufacturers agreed to go ahead to a further stage of studies. I must make it clear to the House that no agreement has yet been reached on a particular project, or, indeed, to launch any project at all. Launch will depend on there being satisfactory market and commercial prospects; and before these can be assessed it will be necessary to hold intensive discussions with the airlines.

At the moment, work is concentrated on what is called the JET aircraft, after the joint engineering team which studied it in detail. This would be a new twin-engined design, basically of about 160 seats but capable of being developed into both smaller and larger versions. The smaller version would have about 130 seats and the larger about 190. All three versions could be powered by variants of the CFM-56 engine, now under development jointly by the French firm SNECMA and the United States firm General Electric, though the larger version would require a substantial increase in the thrust of the engine over what would be likely to be available when it first entered service.

Work is also in hand in relation to the crucial areas of organisation, finance and work-sharing. This is a matter for the manufacturers to consider in the first instance. But I have no doubt that British Aerospace, as the largest aircraft manufacturer in Europe, will feel that it is entitled to a substantial part of the work on any aircraft may eventually be launched and to an important role in its design and development.

Mr. Anthony Nelson (Chichester)

To assist hon. Members who, like me, do not know, will the Minister indicate whether this design is a derivative of any existing aeroplane or a completely new design? My understanding is that the cost of a completely new design is very substantial, whereas the cost could be mitigated substantially if it were an improvement on or a derivative of an existing one.

Mr. Kaufman

If the hon. Gentleman will allow me to proceed with my speech, he will discover that these are matters on which I have some comments to make. He has made a fair and relevant point, and I shall be coming in a moment to derivatives as opposed to new aircraft.

A crucial question on organisation will be the relationship between any new programme and the existing Airbus Industrie organisation. Clearly, it would be right to market a new aircraft in a way that was properly concerted between the manufacturers and as part of a European family of aircraft including the airbus. It is, however, arguable that it would be a mistake to centralise operations within the existing Airbus Industrie organisation. An alternative might be to set up a parallel organisation but in close cooperation with Airbus Industrie.

Consideration of the JET aircraft has been given priority, but the X11—here we come to the matter raised by the hon. Member for Chichester (Mr. Nelson)—which is a derivative of the BAC111 of about 150 seats, is still a possibility for discussion should it prove that the JET aircraft is not either technically or commercially feasible.

The House will recall that possible collaboration on an aircraft for the 130-to 170-seat market was one of the topics discussed last month between the Prime Minister and President Giscard. In his statement to the House after that meeting, my right hon. Friend made it clear that both Governments regarded the project as essentially a commercial, not a political, matter. Both sides very much hope that the manufacturers will come forward with firm recommendations one way or the other as quickly as possible.

The other main programme under consideration between the European manufacturers is the B10.

Mr. Ron Thomas (Bristol, North-West)

Will my hon. Friend say a little more about the X11 as against the JET project? He seemed to indicate that the X11 had been pushed into the background and that the JET would be the decision maker, with the X11 being considered only if it was decided not to proceed with the JET.

Mr. Kaufman

That is exactly right. British Aerospace takes the view that the X11 is very much a possibility but that it is committed to collaborative discussions with our European partners. It has signed a memorandum of understanding, which is not a hard commitment but which nevertheless commits it to these discussions. The view is that it is best to get a collaborative arrangement, if possible, with our European partners, though there is an American possibility. to which I shall come in a moment.

The X11 has been set aside during the course of these discussions. If the discussions turn out not to be fruitful, the X11 will return to the front of the stage as a possibility for British Aerospace. But I hope my hon. Friend will accept that for us to launch an aircraft of our own, even a derivative, without partners would be very expensive. The view hat we have taken is that the only plane that we are likely to be able to launch on our own, should it be necessary and should it be approved, is the HS146, a much smaller plane, to which I shall come later in my remarks.

Mr. Geoffrey Pattie (Chertsey and Walton)

On the point regarding the X11 which his hon. Friend the Member for Bristol, North-West (Mr. Thomas) has rightly raised, will not the Minister agree, however, that the proposal which is being canvassed by British Aerospace calls for collaborative involvement, with French engines on the X11, and that to suggest, as I think he may have done, without intending to mislead the House, that we were talking about an entirely British project versus a collaborative one is not right? They are both collaborative projects.

Mr. Kaufman

I have never sought to do that, but at this stage I am talking about airframe, and the X11 would be an entirely British airframe unless we decided to go ahead as a prime promoter but sought collaborators on that. But, as the hon. Gentleman will hear when I come briefly to the possibilities of American collaboration, there are other possibilities as well.

I return now to what I was saying about the airbus project, the B10. As hon. Members will know, British Aerospace is not a member of the Airbus Industrie consortium. But it has a sub-contract to make the wings, it has an overall design consultancy, and British Aerospace staff are seconded to Airbus Industrie and have played an important rôle in marketing and other areas. The House will have noted that sales of the airbus have increased in recent months and that, in consequence, substantial new orders have been placed with British Aerospace.

Since the summer of last year, British Aerospace has been taking part with the members of the Airbus Industrie Consortium in discussions relating to the B10. The aim is to establish whether there is an adequate market for an aircraft of this type, and, if there is, whether the market would be met better by a major redesign, which would inevitably be costly, or whether it would be preferable to go for a less elaborate and, therefore, cheaper development.

Although views have been expressed by some airlines in favour of a major redesign, known as the B10X, those views are, no doubt, subject to revision. Obviously, it will be very relevant to the final decision of the airlines what prices have to be charged for the different designs in order to recover expenditure on development.

It will also have to be decided whether British Aerospace should join Airbus Industrie as a full member and, if so, on what terms. It is common knowledge that the French and German Governments have had to provide their industries with very large sums of money in assistance for the airbus programme. and we would not think it reasonable to contribute to those past costs. Moreover, it will be necessary for any changes in British Aerospace's relations with the Airbus Industrie consortium to take full account of the existing and very profitable sub-contract to make the wings, no less than of the future commercial prospects of an exteneded airbus programme.

The House will understand that these are complicated and interlinked matters. However, both the Government and British Aerospace are aware of the need for early decisions, and I hope that definite recommendations will be coming forward progressively in the next few months. I repeat, however, that what the Government will be looking for is firm evidence of commercial viability. We are not interested in political aircraft that do not sell, and we are quite clear that such aircraft will not provide a foundation for a healthy industry either in this country or in Europe as a whole.

Hon. Members will remember that Hawker Siddeley Aviation, as it then was, suspended work on the HS146 project in 1974 and that the Government subsequently asked the firm to continue development work under a Government contract and with Government funding in order to keep open the possibility of proceeding with the project. Since vesting day, the work has been funded as a normal part of the capital investment programme of British Aerospace.

The aircraft is now at an advanced stage of development, and extensive studies of its potential market have been carried out. It is a four-engined design, which would be available in two civil versions, one of about 70 seats and one of about 90 to 100 seats. These versions would be largely, though not exclusively, intended for use on short-haul and feeder routes.

Mr. Nelson

What about the marginal seat?

Mr. Kaufman

The hon. Member for Chichester must make up his mind whether he wants aircraft. Political slanging will not make the decision easier one way or the other. Indeed, earlier today the hon. Member for Chingford (Mr. Tebbit) was demanding an early decision.

Mr. Norman Tebbit (Chingford)

But the Minister, of course, has not said, and nor have I, what was the decision for which I asked.

Mr. Kaufman

That is an exceptionally sinister and incomprehensible intervention. No doubt at some stage the hon. Gentleman will elucidate it.

The versions that I have described would be largely, though not exclusively, intended for use on short-haul and feeder routes. The HS146 might also be made available in the freighter/military version. All versions would be very suitable for operation from difficult airfields; and they would also have a more general appeal because the HS146 would be an outstandingly quiet aircraft.

We are actively discussing the HS146 with British Aerospace in the context of other potential civil aircraft projects, and I hope that decisions will be taken as soon as possible. In the meantime, British Aerospace is continuing to fund work on the project.

If it were decided to go ahead with the HS146, British Aerospace would welcome collaboration with other European partners. Discussions are taking place with possible associates in Europe but no definite conclusions have yet been reached.

Mr. Michael McNair-Wilson (Newbury)

Before the Minister—

Mr. Kaufman

I hope that the hon. Gentleman will allow me to proceed. I have been fairly liberal about giving way. A large number of hon. Members wish to contribute to the debate. I do not wish to cut them out. If the hon. Gentleman catches your eye, Mr. Deputy Speaker, perhaps I may be permitted to reply in the closing moments of the debate to what he has to say.

British Aerospace has communicated to the other European manufacturers, as part of the JET discussions, the results of its discussions with Boeing on possible collaborative projects, such as the use of the fuselage of the 737 as the basis of a new European design. And, in general, British Aerospace naturally keeps closely in touch with Boeing and the other United States manufacturers, since there are so many areas of common interest, including collaborative military projects such as the Harrier. The House will understand that the work immediately in hand is for British Aerospace to carry forward discussions with its European colleagues as quickly as possible and to assess the situation in the light of those discussions.

As far as aeronautical research and the underlying technology are concerned, the Government accept the importance of setting up significant collaborative programmes within Europe. However, our view is that, while the topics for collaborative research proposed in Document R/ 1964/77 are acceptable in principle, such further work might best be done through the already established machinery such as the Group for Aeronautical Research and Technology in Europe or under the auspices of NATO.

Within the United Kingdom, we already probably have the most fully developed ways of bringing together the needs of industry, on the one hand, and of the defence and civil limbs of Government, on the other. The procurement executive of the Ministry of Defence is at the hub of this, though my Department is also involved. In addition, the aviation interests in the Department of Trade, the Civil Aviation Authority and, most important, the aircraft manufacturing and operating industries themselves are very deeply involved.

My defence colleagues collaborate with our allies in this field, largely through NATO. But in many areas where the underlying technology is common to both military and civil interests some aspects of civil collaboration are also covered. The same, of course, is true for our allies. A recent activity is a good example, Those of us who have had to deal with the aircraft industry are aware of the importance of adequate test facilities, such as wind tunnels. It is only by the use of such equipment that we can build up our technological capability; they serve to reduce to an acceptable level the risks inherent in real aircraft projects. But they can be very expensive to build and operate, as, indeed, we have seen in other areas of technology. So we, in conjunction with the Ministry of Defence, have agreed to join with colleagues in France, West Germany and Holland in a study of a possible future wind tunnel. We would all like to have a facility like the one we are studying. None of us can afford it alone. And this is a good basis for collaborating with others.

We have also come together again with military colleagues with similar authorities in these same nations in the Group for Aeronautical Research and Technology in Europe, more commonly known by the elastic acronym of GARTEUR. This was set up in 1973. It is intended to work together on matters which approach the limits of military and commercial security; just as far as we think is wise in an environment fully open to our competitors in the world market. Industry is involved to some extent, and we are presently looking at taking this further. Again, this is the stuff which makes collaboration necessary and which makes it work.

The European Commission has sought to add to this with a view to increasing the collaboration between the industries directly involved within the Community. My officials, together with colleagues in the Ministry of Defence, have been working with the Commission staff in looking at the responses from industry. Of the many areas which could be worked on, two have been selected, as hon. Members will have seen from the papers before the House. One concerns some aspects of fixed-wing aircraft design, the other is concerned with helicopters. These proposals are still working their way through the Brussels machinery and are expected to come before the Committee of Permanent Representatives next Thursday.

It is not for me to prejudge the attitudes taken by other nations in Europe. As far as we are concerned, the House will have understood from what I have already said that the Government are in favour of building up collaboration, but it must be the sort which will enhance the commercial success for future aircraft and their components, both civil and military. As to the specific proposals now being looked at in Brussels, I strongly suspect that, if they do not proceed on a Community basis, they may well be picked up in some other way, like GARTEUR.

It seems unlikely that the particular Community documents referred to in the motion will lay down the lines of progress or will lead in the near future to formal actions by the European Communities. We are taking the more practical approach of encouraging the manufacturers to try to reach agreement on the basis of actual projects. This does not, of course, mean that either the Government or the industry regard the decisions which will have to be taken on aircraft before the 1980s as other than urgent and important.

11.2 p.m.

Mr. Norman Tebbit (Chingford)

It seems hard to believe that the first of these documents has been lying around for two and a half years—since October 1975. That is so long ago that I cannot remember whether it was then Government policy even to remain in the EEC. I doubt whether the Minister can even remember whether he was in favour of direct elections at that time, though no doubt he knows now.

The Minister has added nothing to what he has already told the Press. The only extraordinary thing is that he has been so late in coming here to tell us what he has told the Press. In an interview just before Christmas with M. Jean-Marie Riche, the distinguished editor of the French magazine Air et Cosmos, the Minister masqueraded as the Secretary of State for Industry. In a footnote on the following page, there is a reference to "Mr. Eric Varley, the Minister of Industry."

The hon. Gentleman does not change very much does he? In that interview, he suggested that these were entirely domestic matters. He said: "Il va sans dire que dans cet esprit nous rejetons fermenent le rapport Spinelli." My less than adequate French got stuck on the word "fermenent". I was not sure whether it derived from "ferme" and meant that he rejected Spinelli in a workmanlike way or from "ferment" and that he rejected Spinelli with excitement and unrest.

However, the Minister can relax. The Spinelli style of approach has not found favour on this side of the House either. But if we are not to follow that route, along which road do the Government intend to lead Lord Beswick or Lord Beswick the Government? We are not much wiser or even better informed than we were before the Minister started his speech.

The Minister said that the X11 had been shelved. The hon. Gentleman keeps saying that. It is nonsense. The Minister has killed the X11. There is no prospect of an aircraft being taken off the shelf, especially after having been sold so hard to the American market. It is not possible for the promoting company to go to the Americans and say "Sorry, that was not a very good aeroplane. We are not interested in proceeding with it. We have thought of a better idea", only to turn round and say "No, we do not like the better idea. We are going back to the X11." The Minister and his colleagues know that the X11 will not be proceeded with now. There is no prospect of that happening. The reason is that he has cut its commercial throat.

We must even be a little gloomy about the prospect of selling 100-seat aeroplanes, especially after Air France has given British Airways an example by buying 13 737s. So much for the brave words of M. Cavaille. No doubt the Minister will remind him of his words when he next sees him.

The Minister talks about a 130–160 seater. That was the X11. The hon. Gentleman referred to the A200 project. What are the results of all the Minister's talks?

Let us turn to the JET project or the A200, whatever the hon. Gentleman likes to call it. Presumably before we shelved the X11 and thereby killed it, and with it our last change of unilateral programme in that area, we must have had certain understandings with our prospective partners. Have we any understanding that we shall have the design leadership on that aircraft? Have we any understanding that the final assembly and testing of the aircraft will be in the United Kingdom? Is there any understanding on the number of assembly lines? If we did not get those understandings clear before we threw away our own project, we threw away far more than the Minister has admitted tonight.

As for the A300 programme, the Minister does not seem to have clear ideas on which parts of it we are going into. The hon. Gentleman does not seem to have any clear idea whether we should be in it or whether there is any proposition of a formal return to a partnership in the programme, or an entry into part nership. That is because we have not been full partners since the Labour Government walked out of the programme and left it to the private enterprise of Hawker Siddeley to maintain a foothold in the only large European civil aircraft still in production.

The Minister had something to say about the HS146. Again, he earlier told not the House but the French journalist that British Aerospace was to deposit its report on the project before the finish of the year. Did British Aerospace give him a report on the project before the finish of last year? Does he have the report on the HS146?

Mr Kaufman

I have had an interim report from British Aerospace. In that respect it kept its undertaking to me. British Aerospace is not yet in a position to decide whether it wishes to make a recommendation for the plane to go ahead. It wants to examine the market prospects and the collaborative prospects. It also wants to examine the freighter-military possibilities before making a final recommendation. The hon. Gentleman is constantly pressing for a commercial approach, and that is what British Aerospace is taking.

Mr. Tebbit

So the Minister has not yet had any recommendation from British Aerospace to go ahead with the aeroplane. It seems that British Aerospace is still unable to make up its mind whether it is a commercial aeroplane on which it has been spending public money for a considerable time. I am grateful to the hon. Gentleman for that admission.

Mr. Kaufman

British Aerospace is keeping the matter open. Hawker Siddeley definitely and specifically decided that it was not a commercial proposition and said that it would go ahead only if the Labour Government paid 100 per cent. of the cost.

Mr. Tebbit

The company prudently and sensibly said that as it could not envisage a viable market it would not risk its money upon it but that if Her Majesty's Government required the project to go ahead it would naturally, like any other company, carry out as subcontractors to Her Majesty's Government any task that it was asked to undertake provided that the price was sensible.

The Minister said that there had been talks on the HS146 with other European firms. But he omitted to say that there had also been talks on the HS146 with at least one major American firm. Will he tell us about those talks with the American company? Are they going well? Has there been a positive response from that American company? Why did he not mention that matter? I suggest that lie seems reluctant to come clean on that project.

The Prime Minister and the Minister have constantly stressed commercial viability. What interests us is what has changed since the February 1977 market survey report. Who will be the launch customers for the aeroplane to be launched? How large a market is envisaged? The F28, which is already well established, is selling at about 15 a year. That does not suggest that there is a huge market for that aeroplane.

Mrs. Helene Hayman (Welwyn and Hatfield)

It is a different aeroplane.

Mr. Tebbit

I am aware that it is a different aeroplane, but it is essentially selling in the same market. We shall want to know what break-even forecasts have been made. We shall want to know whether there is a partner in a risk sharing, not just a sub-contract, sense.

There has been talk of the proposed engines being changed. The Minister did not mention whether the Avco Lycoming engine was still proposed for the aeroplane. Would he care to add anything to that matter? Are different engines under consideration?

Some time early last year, after the February 1977 market survey forecast was in the hands of the company, I discussed the HS146 with some of the senior executives. I asked them what they thought about it. They were not overwhelmingly optimistic at that stage. Perhaps there has been a great change since. At the end of the conversation I asked "What are you going to do?" The answer was "We shall put it up to the Government". I asked "Would you have put it up to Sir Arnold Hall?" Answer "Oh, no". That was their opinion of the commercial viability of that aeroplane. It was not very encouraging.

Mr. Michael McNair-Wilson

Does my hon. Friend recall the visit paid by representatives of the Fokker Company to the Conservative Back-Bench aviation committee? They pointed out how the HS146 could damage the F28 market and reminded us that Short Brothers and Harland, which is a nationalised company, made a number of sub-assemblies for the F28.

Mr. Tebbit

I remember it particularly well, because Rolls-Royce makes the engines, and a large amount of the systems for the F28 are manufactured in Britain.

It is a question of the balance of advantage. Anybody can be wrong, even in the industry, let alone politicians looking at the matter from the outside. [An hon. Member: "Even you".] Indeed. Originally I thought that the HS146 looked a promising aeroplane on the basis of the information given by Hawker Siddeley at the time that it wanted to launch it. So did the company. Sometimes second thoughts may be better than first. One cannot rule out that third thoughts would be even better. We would like some clear thinking on that subject. It seems that the HS146 will have an early launch only if the hon. Member for Welwyn and Hatfield (Mrs. Hayman) resigns as a Member of this House and causes a by-election. I should imagine that the aeroplane would then be launched fairly rapidly in the normal manner of the Labour Government running by-elections.

The Minister said very little about the engines. Is Rolls-Royce in the running for the contract to supply engines for any of the likely major aircraft projects in Europe which are under discussion today? Does he fear that the CF56 will be the only engine of the right size for any of those projects? Has Rolls-Royce, having given up the programme with Pratt and Whitney for a similar size of engine, now not got an engine in the right class for the European projects?

Does the Minister not agree that it is time that decisions were taken on the cropped fan 535 variant of the RB211 if that engine is to have a chance of being installed on any of the projected Boeing aircraft—perhaps the 757, as I understand that rather stretchable and squeezeable aircraft to be called? Many hon. Members and many people outside the House will want to know what the Minister feels about Rolls-Royce's engine strategy in relation to the strategy for airframes to which he has referred but not described.

I do not wish to raise too many points for the Minister to answer because I do not want to hog too much time in this brief debate. I do not want to let the Minister off the hook by asking so many questions that he can avoid them all.

I want to mention the question of the agreed certificate of airworthiness standards. Progress towards common standards and mutual acceptance of certificates of airworthiness is to be encouraged, and we hope that that baby has not gone out with the Spinelli bath water. We also feel that Document R1964/77, the action programme of aeronautical research, had considerably more merit than the Spinelli grand vision document. I welcome the Minister's reactions to the proposal for the large trans-sonic wind tunnel. That is a sensible way to approach these matters, to see where we can establish joint facilities when otherwise we would have inferior facilities for each country. It is no good being second best in any of these matters in this industry.

We are glad that the Minister has got to first base in understanding that the military order book is the backbone of the industry. He has referred to that not so much this evening as in this illuminating interview with the magazine Air et Cosmos. As he now realises, it is sales of weapons, of fighting aeroplanes, of bombers and of vehicles to deliver napalm and guns and all those terrible things that the Left are always going on about, to the Saudi Arabians, the Iranians and the South Americans which keeps well over 60 per cent. of the work force in this industry in jobs. I know that my hon. Friend the Member for Chertsey and Walton (Mr. Pattie) will say more about the defence aspects of the Spinelli proposals and what we generally think of them.

We are glad that the Minister has embraced commercial viability, at least until the next election.

Mr. Hugh Dykes (Harrow, East)

My hon. Friend rightly said that the original outline of this document and the philosophy behind it has been overtaken by events. But in the context of my hon. Friend's remarks, could not the Community be involved in some planned and concerted action of some kind, although this is primarily a NATO function, in regard, for example, to the need for the new Canadian tighter by 1984–85? This is one area where the Community countries could appeal to the Canadian authorities to consider a European plane such as the Tornado, particularly within the context of the Canadian contractual agreement.

Mr. Tebbit

My hon. Friend is much more of an idealist than I if he can see the French appealing to the Canadians to buy MRCA as a European aeroplane when it has no French content. That is a difficulty. There seems to be a considerable lack of agreement, springing principally from the fact that the various European partners in the EEC have different timings for the introduction of new aircraft. They seem reluctant to co-ordinate their timings in order to achieve these things. I would welcome any collaboration which would enable workers in British factories to sell more military equipment to the Americans so that we could travel along the two-way street—

Mr. Deputy Speaker (Mr. Oscar Murton)

Perhaps I may interrupt the hon. Gentleman. Admittedly, he is answering a question, but the main theme of the debate is the civil aircraft sector. Therefore, references to military aircraft should be merely incidental. Only one paragraph of the memorandum, paragraph 11, refers to the question of military aircraft. The Minister made only incidental reference to the military aspect, and the rest of the House should follow that example.

Mr. Robin Maxwell-Hyslop (Tiverton)

Is it not true, Mr. Deputy Speaker, that no major aircraft producer in the world can live off its civil aircraft, and we are in our present position because the American civil aircraft manufacturers have had immense military programmes on which to carry the overheads?

Mr. Deputy Speaker

The hon. Gentleman may know the point I am trying to make. I do not dispute his statement, but I am trying to put to the House that only incidental reference may be made to the military aspect of what we are discussing, which is principally the civil aircraft sector.

Mr. Tebbit

If you refer to the basic document, R/2461/75, and turn to the annexes, Mr. Deputy Speaker, you will find large sections, page after page, dealing specifically with the military industry. They propose the formation of a European military aircraft procurement group. Therefore, you will perhaps conclude, Mr. Deputy Speaker, that it is perfectly proper that we should deal with these matters, which are in the document under discussion.

Mr. Deputy Speaker

This is a civil aviation debate. That is the heading on the Order Paper.

Mr. Tebbit

The heading may be whatever it likes, Mr. Deputy Speaker, but the European Community documents which are the subject of the debate refer to the formation of a military procurement group for European armaments and refer extensively to the European industry.

Mr. Deputy Speaker

Those documents may relate to the relevance of the matter, but this is a civil aviation debate, and military reference should be purely incidental.

Mr. Pattie

Is it not possible that the description on the Order Paper is at fault, Mr. Deputy Speaker, as it says that the debate is about civil aviation, when even a cursory glance at the Community documents makes clear that we cannot make a distinction between the two parts?

Mr. Deputy Speaker

I refer the hon. Gentleman to the terms of the motion, which is to take note of developments in the EEC Civil Aircraft sector. That is what is on the Order Paper, and that is what we are debating.

Mr. John Cope (Gloucestershire, South)

On a point of order. Perhaps the Minister could help by assuring us that there will be another opportunity to discuss EEC developments in the military aircraft sector, to which large parts of the documents will also be relevant.

Mr. Deputy Speaker

That is not a point of order nor a matter for the Chair.

Mr. Tebbit

I shall continue with my glancing reference to the major items in the documents.

I was saying that my hon. Friend the Member for Harrow, East (Mr. Dykes) was a little idealistic if he thought that our European colleagues would give up so many of their rights to produce the aircraft that they think proper for their own purposes—whether civil or military is another matter.

Mr. Dykes

I should like to return to the question of the Canadian fighter and why it is so important for the future of European collaboration. Like my hon. Friend, I should prefer the Canadians to go for a British plane. We must think, reluctantly, that that is unlikely, to say the least. Therefore, is not the essence of the matter to try to get practical European collaboration going, so that that order—an enormous order for a single aircraft vehicle—goes to a joint European project, not for an American plane?

Mr. Tebbit

My hon. Friend is right, but, as the Minister said, the great thing is the market. The aeroplane must suit the market, whatever it is. I have no doubt that if that market is to be filled from Europe it is more likely that it can be filled by a British project than by any other, although we would welcome people coming in to collaborate with us.

I am glad that the Minister has agreed with us that the factories of this industry are there not primarily to supply jobs but to supply aeroplanes to people who can choose to buy them anywhere in the world. For that reason they must be aeroplanes which people want to buy and not just those which the industry thinks that it might like to produce. But we only wish that the Minister's somewhat slothful and somewhat devious actions matched the policies which he has begun to annunciate in this area—the policies of the market and not of the producer.

11.26 p.m.

Mr. Ron Thomas (Bristol, North-West)

I wish to make one or two remarks, but briefly, since I know that my hon. Friend the Member for Welwyn and Hatfield (Mrs. Hayman) wishes to take part in the debate. I was disappointed that the Minister did not spend more time on the 1975 programme, which indicates the thinking of the bureaucrats in Brussels.

We have heard statements that the Council will make major policy decisions on programmes. We have heard the bureaucrats talk rather humorously about creating European air space, as if there were not already air space over Europe. We continually hear references to European air space which would stretch from Southern Ireland to the Urals and from Iceland to North Africa.

In the document dated 17th January 1978, the only real reference to the 1975 action programme reads, It was recognised that member States were reluctant to begin discussion of the wider issues of civil aviation policy … I had hoped that the Minister would say more positively that, having brought British Aerospace into public ownership, the Government had no intention of handing it over to the bureaucrats in Brussels now or in the future. The programme indicates clearly what some of the people who are running the Common Market would like to see happen—that British Aerospace, Rolls-Royce and the rest should be handed on a plate to the Commission to run as it thinks fit.

I was disappointed to hear what the Minister said about the X11. I understand from Press reports that it is ready for launching whereas the A200 is unlikely to be ready before the American competitors come into the field. We are thinking forward to the need for 1,200 civil aircraft by 1990. Although I accept that we must think in terms of collaboration, workers in the industry feel that there is not enough positive and ruthless thinking about such British projects as the X11.

I have a constituency interest in the engine of the HS146. What is the situation concerning the Rolls-Royce M45 engine as opposed to the Canadian engine? I understand that Rolls-Royce says that it can deal with the problems that are said to be associated with it in terms of its competition with the Canadian engine.

I turn to the question of future research. I hope that we shall have another opportunity to look at the document because I am disturbed about parts of it. It deals with harmonisation of design and non-destructive testing procedures, the structure of aircraft and so on. There are two or three paragraphs on what will happen to know-how and inventions and how these, presumably, will be shared in some way between the contractors, even though they are qualified in certain ways. It seems that there are a number of dangers in this for our own publicly-owned aerospace industry. On the other hand, we are all agreed that if Britain is to retain any semblance of a manufacturing nation, industries such as aerospace have to be the industries on which we should concentrate.

The aerospace industry has the highest conversion ratio in the sense that it takes a small quantity of imported materials and injects into them the skills of the workers in the industry and produces products of high quality and value. All of the time it is pushing forward the frontiers of technological advance. I hope that the Minister will make it clear, as he has made it clear on so many other occasions, that, having brought this industry into public ownership, we have no intention of allowing it to become a sub-contractor for the Americans or any European country. We want collaboration in terms of equality, but all the time pushing forward the interests of the British industry. It is on that basis that I hope that the Minister will make it clear that the main principles and thinking behind the 1975 programme from the bureaucrats in Brussels are completely unacceptable to the Government. They are certainly unacceptable to those who work in the industry.

11.32 p.m.

Mr. David Walder (Clitheroe)

One could be forgiven for thinking that in his opening speech the Minister was not talking about the Commission's proposals at all. He mentioned a large number of trees and the need to cut one down but he never seemed to make any reference to the wood. He juggled, as we all do in a debate of this sort, with acronyms. I think that followed most of them.

I agree with the Minister that it is impossible for one, two or perhaps three European nations to support an aircraft industry. The United States does so and it is possibly the only nation in the Western world that could do so. Co-operation must be the order of the day in future.

We have seen for many years attempts at co-operation in the area of the manufacture of military aircraft. Some results have been obtained. The Tornado and Jaguar are obvious examples. Standardisation and inter-operability are equally applicable to the civil sector. All those military atempts at co-operation, and previous attempts in the civil area, have had the disadvantage that each nation probably had a different timescale for its programme. Naturally enough there have been nationalistic rivalries. Over and above that there has been a tendency in Europe for the larger nations—France, Germany, Italy—to squeeze out the other members of the Community. That process affects other industries, those directly concerned with aeronautical matters and the technological industries backing them up.

We know that these proposals have a long history, dating from 1975. They may be over-ambitious to some. They may suggest an orderliness throughout Europe to which those who do not like the Community would object. The pursuit of common standards, common air transport policies and common commercial projects can make nothing but sense for the future.

Perhaps I am doing the Minister an injustice, but I do not think that it is a very constructive policy, for the EEC or for our aeronautical industry, to say of what the hon. Gentleman calls commercial aircraft as distinct from political ones "We shall proceed with these, but perhaps not with others".

In considering, as I hope it did, the reams of documents with which we are concerned in this debate, and certainly the last three attempts, if I may call them that, before the final result was achieved, the European Parliament, I noted, was more enthusiastic even than the Commission. We have had one example tonight of Parliament overruling the Government. My enthusiasm sides with the Parliament rather than with the Commission. Certainly I have more enthusiasm for cooperation than the Minister has expressed.

11.36 p.m.

Mrs. Helene Hayman (Welwyn and Hatfield)

It has been pointed out that this debate provides more of an opportunity for a general discussion on civil aviation and aircraft policy than perhaps a detailed study of the Commission documents. I welcome that. The House would be disturbed if it were considering the detail of these documents as the plan under which British Aerospace had to work.

Some of us have been anxious that decisions should be taken on various projects and at times we have despaired over the difficulty of getting decisions from one national industry and one national Government. The thought of trying to get decisions made among the nine members of the EEC is horrifying.

No one with any knowledge of the aircraft industry in this country would deny the necessity for collaboration or the benefits which it can bring and has brought to our industry. Because of the cost of funding any new major civil project and because of the competition in terms of the market share which is always offered by the Americans, it is plain that we shall need partners in major projects. However, I firmly believe that collaboration between strong and successful national industries is different from the central control and funding outlined in the documents and that the former is the more healthy path for our industry to take.

The HS146 project has been referred to by my hon. Friend the Minister and, in slightly more Delphic terms, by the hon. Member for Chingford (Mr. Tebbit). The hon. Gentleman takes a universally depressing view of the world, but tonight his argument was even more difficult to follow than usual. On the one hand, he seemed to be berating the Government in the most scathing terms for their inability to make a decision on the HS146. On the other hand, he posed a further series of questions without the answers to which he seemed to think it would be totally irresponsible for any decision to emanate from British Aerospace or from the Government. He became even more Delphic about the decision that he would like to be made about that in an intervention in my hon. Friend's speech.

I have no doubt that his is a non-question when it comes to the HS146 and that his febrile imagination is so anxious to ensure that it does not come about that he had to go off on the red herring of my resignation. I hope that the hon. Gentleman will not canvass the suggestion too enthusiastically throughout Welwyn and Hatfield. It might be considered by some of my constituents the ultimate sacrifice that a Member should make for his or her job. But I think that a positive decision on the HS146 can be and should be and will be made without recourse to quite such a melodramatic excursion on my part.

The HS146, as my hon. Friend pointed out, is the one project that is near to getting into production. The thing that the British industry needs desperately at the moment is production work. When we look at the possibilities of JET and the further possibilities, if JET is rejected, of going back to the X11, we are talking of a very long time scale. The same is true of the B10.

What we need desperately in this industry, not simply from the industrial welfare aspect or whatever it is termed by the Opposition at the moment, but also in terms of actually taking up the market which exists in Europe for a new generation of European aeroplanes, is to get on with the decision-making, to the business of production of that new generation of aeroplanes now.

The HS146 offers the British industry the chance of getting in on a project for which there is a definite market which has been shown over a number of years. The hon. Member for Chingford seemed to think it a bad omen for the aircraft that the F28 had been selling only at 15 a year. I take the opposite view. I think that it is a god omen, since there is obviously still a market which is not being filled by the F28 for many reasons, including its lower performance of fuel consumption, noise and other problems. It means that, despite these desperately depressing delays, the HS146 has still not lost out on the market. We could still make the right decision; we could still go into a commercially viable project which would also give our industry a position of strength from which to collaborate in Europe. It can do that only if a decision is taken within the very near future.

Mr. Tebbit

The hon. Lady said that what the industry needs is production. What it actually needs is orders for aeroplanes to produce. Does she happen to know who it is, by name of airline, that will buy the HS146? If it is as near launching as that, those names ought to be known by now.

Mrs. Hayman

The hon. Friend reads Flight and other magazines as assiduously as I do, and he will have looked, as I have, at the airlines of the world that are looking for replacements for their Viscounts, for aeroplanes of the type of the HS146, in order to fill a gap. He knows that until one has an aircraft it is difficult to get orders for it. One has the chicken and egg situation. I am not the Chairman of British Aerospace and have not been out selling to the airlines of the world, but all the indications are that that slot in the market has to be filled and that it can be filled by the HS146.

My hon. Friend answered a Question of mine earlier today and used the phrase "as soon as possible". He used it again tonight. That phrase is becoming awfully familiar in the context of the HS146. I recognise that there are many questions to be answered, and the hon. Member for Chingford added a few more in his speech. Could my hon. Friend give a little more detail than the phrase "as soon as possible"?

We are getting to the point within the industry, if we are to decide rationally what its future is to be, when we have to know what the decisions are. Good or bad, it is necessary to have them in order to plan a future for the industry. I would be grateful for anything further that my hon. Friend has to say.

11.44 p.m.

Mr. Geoffrey Pattie (Chertsey and Walton)

The hon. Lady the Member for Welwyn and Hatfield (Mrs. Hayman) was, as always, eloquent in her advocacy of the HS146, and, of course, she had a point when she talked of the problem of the chicken and egg situation. But she should know that there has been some pretty heavy toting of this project around the world. To my knowledge, there is no single airline—sadly from the hon. Lady's point of view—which is as yet prepared even to say that it will be interested in purchasing, which is what is meant by the market potential for the aircraft. But we are here tonight to talk about the Commission documents and must keep to the matters under review.

The Commission's proposals, in my opinion, are not very intelligent and are not very well based, even allowing for the fact that considerable time has elapsed since they were first drawn to the attention of the House.

There are two major failings in the documents. First, they fail to draw any distinction at all between what I would call the administrative and organisational dimension and the commercial dimension. By the administrative and organisational dimension I mean airworthiness, safety, air traffic control, and so on, where collaboration and co-operation are eminently sensible. It ought to be even more advanced than it is now.

On the commercial dimension—which means obviously marketing, selling, construction and so on—we find in the Explanatory Memorandum on Document R/2461/75 the proposal that European aircraft policy is to be worked out and managed by the Commission, who would evolve a coherent programme for the manufacture of a large civil air transport with the industries, airlines and Governments. I do not think that the House ought to dwell for more than a moment on a suggestion as bizarre as that. Questions such as who is to decide what are the market opportunities, what the airlines need, what type of aircraft should be built for them, and so on, must remain entirely with the people whose job it is to build aircraft. If the day comes when civil servants, be they British or Eurocrats, are organising the commercial side of the business, it will be close to going into complete decay and becoming moribund.

Similar comments apply to a common European commercial policy for aerospace, and to Community financing to replace national financing of aircraft policy.

There is a suggestion about joint basic research. This may seem to be quite a good idea. My hon. Friend the Member for Chingford (Mr. Tebbit) talked about wind tunnels. That is very important, because it is rather foolish to build lots of these and to duplicate the resources. But even here there is quite a serious snag. The aerospace corporations of different countries are concerned at the moment that if they get European funds, these same funds, or an equivalent amount, are likely to be debited by their own domestic Governments. This will not be incremental money. They will involve themselves in some difficult budgeting arguments. Even the apparently straightforward suggestion of common research projects is not quite as straightforward as it seems.

The suggestion is made in Document R/2461/75 that there should be the establishment of an European defence procurement agency. Since the first document was tabled in October 1975, there has been established in January 1976, as is clearly stated in Document R/222/77 and R/1964/77, the European military procurement agency, known as the independent European programme group. The document says that this has been established as a forum for increasing collaboration on defence equipment and research; therefore it is a matter, obviously, that we have to consider to-night. The aims of this particular—

Mr. Deputy Speaker

I must warn the hon. Gentleman about what is being considered tonight. Incidental reference is in order but not a detailed discussion on the question of military aircraft.

Mr. Pattie

I shall endeavour to make only incidental references. Of course, if we are considering the inter-relationship between the civil parts of the industry in any of the European countries, we have to bear in mind that a group of the sort that we are talking about has to permit the effective use of funds for research and development, which is one of its main aims, and must ensure the maintenance of a healthy European technological base. What groups of this sort have been able to achieve over the last 12 years is to analyse the future requirements for the next 15 years because there has been a great muddle for many years past as to what the future needs of both civil and military requirements will be. Groups have been set up to analyse specific areas and these analyses and detailed reports have been extremely valuable on both the civil and military sides.

Because the Commission documents tail to make this distinction between what I call the administrative and the commercial, and by a similar token have failed to distinguish adequately between civil and military—whereas on the military side we have talk of two-way streets, standardisation and interoperability, none of which could ever apply on the civil side, yet they are all lumped together—the logic behind the documents is that we can apply the same arguments to the civil as to the military. Taken as a whole the documents are no more than proposals and a recipe for collaborative drift.

11.51 p.m

Mr. Anthony Nelson (Chichester)

I wish to interevene briefly. I follow my hon. Friend the Member for Chertsey and Walton (Mr. Pattie) whose detailed knowledge of this subject I certainly cannot surpass.

I wish to make one simple point with regard to research and development. Looking through the documents cursorily it seems to me that given that one of the major reasons for most of the international airlines renewing their fleets over the next decade is the examination of stricter noise and fuel consumption requirements, this is one of the prime areas of research study which should be undertaken.

It may well be that this is undertaken by other establishments not mentioned in the documents. I note that some reference was made in the Commission documents to airframe vibration, propellor vibration and noise emanating from helicopters. This seems to be a very important area for both applied and primary research both in projects on a collaborative or on a unilateral basis over the next decade.

My second point takes up the short reference in the Minister's introduction to the option of collaboration with American companies. I should like to make a personal observation and plea that this option should be kept firmly open. It seems to me that some sort of collaboration with an American manufacturer, either by British Aerospace or jointly with other European companies, will be vital if we can break into that market.

I understand the estimates are that over the next 12 years or so about 1,200 air craft will be renewed. Given the fact that approximately half the world market for commercial aircraft is the American commercial airlines, and given the historical and actual preference towards American manufacturers—and to some extent our failure in this market in the past—I feel it essential, if we are to apply the strict commercial criteria to which the Minister referred, that we should keep a very open option towards some sort of collaborative programme with them.

In this context there are a number of specific advantages. I take the point about the danger of becoming a subcontractor of American industry. While that is a possibility, equally it has been a possibility with regard to the joint collaborative programme with some European manufacturers of aircraft. I believe that we have the expertise to contribute equally to a joint European programme or, indeed, to one with American manufacturers. I have the underlying belief that aircraft manufacture is an industry which this country ought to be in. It is a simple gut reaction from a politician, and I try strictly to restrict my remarks to those made in a general sense, without getting into the many commercial and factual questions which, in my view, should be more matters for British Aerospace, if it is run as an autonomous body.

But these general matters of principle and policy and the options for the future are very important, given the skilled workforce in this industry, and given the historical and prospective financial commitment for which the British taxpayer will be liable.

It is very important that we keep open these options. Other European countries are doing it. I understand that the French company. Dassault, has options open with McDonnell-Douglas for the joint production of an aircraft in this competitive range of 150 to 200 seats. I hope that the Minister will take this opportunity to reaffirm that this option is still open and perhaps give us a little more insight into how it might become a reality rather than a possibility.

11.56 p.m.

Mr. Kaufman

It was inevitable that, starting with the speech of the hon. Member for Chingford (Mr. Tebbit), the contributions from the Opposition became more and more positive, and I congratulate the hon. Member for Chichester (Mr. Nelson) on a very positive and constructive contribution. There was very little that he said with which I disagreed.

The hon. Member for Clitheroe (Mr. Walder), I am sure unwittingly, misrepresented me wthen he implied that I was negative on the subject of collaboration. Any hon. Member who has troubled to follow what I have said during the period in which I have had my present responsibilities will know that I have stressed constantly the necessity for collaboration in aircraft projects, sometimes to the dismay of the shop stewards in the aircraft factories who mistakenly believe that it is possible for us to go it alone. I have always made it clear that, except perhaps for the HS146, it is not possible for us to go it alone any more and that we have to consider either European partners, which is the principal subject of debate tonight, or, as the hon. Member for Chichester pointed out, American partners, or possibly both. In many ways, if we could get a European-American venture, that might be the best outcome of all. But we have a commitment first to pursue our discussions with out European partners, and we must see where we go from there.

My hon. Friend the Member for Bristol, North-West (Mr. Thomas), understandably, would have preferred me to speak in rather more detail about the largest of the documents before us, and perhaps speak about it in opprobious terms. I did not feel it necessary to do so, because the document is now very much past history. Not only is it a very old document, but the Commissioner who was responsible for it has departed. The Italian General Election took him away, and he has now been replaced by Commissioner Davignon, who has a very different approach to these matters. It is a far more pragmatic approach. When Commissioner Davignon came to see me not long ago, we discussed these matters, and he made it clear that he regarded the Commissioner's role not as being a grand ringmaster of the European aircraft industry but simply as being a kind of post box for it. I thought that was a modest and self-effacing but realistic role, and I very much appreciated the way in which Commissioner Davignon was approaching his responsibilities in this regard. He is being extremely helpful in that way.

When it comes to specific projects, it is inevitable that those of my hon. Friends who have taken part in the debate should concentrate on the HS146 because, as my hon. Friend the Member for Welwyn and Hatfield (Mrs. Hayman) pointed out, it is the only project which could be launched very quickly and could get work into our factories. Understandably, my hon. Friend, as Member of Parliament for a constituency in which the factory most to benefit is sited if that plane went ahead, is especially interested.

My hon. Friend's exchange with the hon. Member for Chingford was not really a chicken and egg exchange. In fact, the HS146 is not like the larger planes in that it needs a large launch order. It is not that kind of plane at all. With his knowledge of these matters, the hon. Member for Chingford ought not to have implied that it is. I am sure that he realises that it is the type of aircraft which, if constructed, will sell in small numbers to each of a wide variety of airlines. It is not the sort of aircraft for which one looks for two or three large initial orders, as one would in the case of a 150- or 200-seat aircraft. That is why the approach to it has been very different from the approach to those aircraft on which we should require collaboration because of their expense.

The hon. Member for Chichester pointed out that there is a very different kind of expense between launching a completely new aircraft and a new design such as the JET would be and launching a derivative. One of the reasons why the advocates of the X11 have been so ardent in proposing it is that it combines the merit of being a British aircraft, which would provide a lot of work for our factories, with being a derivative, which means that the cost of launching it would be considerably less than it would be for a new aircraft, though still a considerable sum of money, as I know the hon. Gentleman recognises.

The hon. Member for Chingford asked about engines. I did not go into great detail about that for the simple reason that it is not possible to do so. What I can say is that there could be a role for Rolls-Royce in an HS146, if it were launched. Rolls-Royce is still in the running as a potential engine supplier for that aircraft. There could be a role also for Rolls-Royce in a JET project, and there could be a role for Rolls-Royce in the tri-jet version of the 757. These are all potentialities for it. I would not go further than that.

Mr. Tebbit

May I confirm what the Minister is saying? In the case of the HS146, it is not yet decided which engines the aircraft will have, and in relation to the other matters, I take it that he is referring to the cropped fan 535 version of the RB211 as the possibility for these aircraft.

Mr. Kaufman

The 535 could be the possibility for the others. That is certainly so. Clearly, if I say that Rolls-Royce is still in the running for the HS-146, it means that a final decision has not been made. Otherwise, I could not honestly have informed the House on that.

I hope that the House will forgive me if I do not go into further detail on these documents. This has been a useful debate, and it is interesting that it is the first debate which we have had on aircraft since the passage of the Aircraft and Shipbuilding Industries Act. Hon. Members have asked about the possibility of a further debate. I am not the one to give a commitment about that. It is the responsibility of my right hon. Friend the Lord President.

But this is a fast-moving situation in the sense that the potential projects are constantly changing. If we had been debating these matters six months ago, save for the HS146 we should have been talking of other possibilities entirely, and, knowing the ingenuity of my hon. Friends and hon. Members opposite, I am sure that they will find many further opportunities for debating the subject.

Question put and agreed to.

Resolved, That this House takes note of developments in the EEC Civil Aircraft sector as outlined in the Government's memorandum of 17th January 1978.