HC Deb 30 June 1980 vol 987 cc1068-71
Mr. Roy Hughes

asked the Secretary of State for Wales if he has had any recent discussions with representatives of the British Steel Corporation to discuss the scale of redundancies in works in Gwent.

Mr. Nicholas Edwards

I last met the chairman and the chairman designate on 26 May. I discussed with them various matters relating to British Steel Corporation works in Wales.

Mr. Hughes

When will the Secretary of State inform his Cabinet colleagues that the Government's policies are creating chaos in Wales, particularly in our vital steel industry? If he cannot reconcile himself to speaking up for Wales, why does he not pack up?

Mr. Edwards

The latest Government policy has been to announce that we will guarantee the debts of the Brtish Steel Corporation, which would otherwise be bankrupt, and provide additional financial assistance if that is necessary when the new chairman of the BSC, who takes over tomorrow, has produced his assessment of the needs. We also made it clear that the new chairman must continue the essential task of making the BSC competitive, because it has to trade in a competitive world.

Sir Anthony Meyer

Will my right hon. Friend confirm that the money that the Government will have to produce to ensure the continued trading viability of the BSC has to come from somewhere, and that the Government must calculate whether the resources being pumped into the BSC are not taking away more jobs in other industries than they are likely to save?

Mr. Edwards

There can be no doubt that the loss in the previous financial year of £450 million and the news that the external financing limit of £450 million for the current year is likely to be exceeded by about £400 million must be directly destructive of jobs in other industries.

Mr. Abse

On Thursday the Secretary of State shocked the House by informing us that either another £400 million had to be found or the BSC would be liquidated. He said that on the basis of what he was told in a letter that he received on 6 June. The Secretary of State did the Select Committee the courtesy of appearing before it on 10 June.

Will the right hon. Gentleman tell the House the answer to this question: did he or did he not know, was he or was he not told, of that serious situation when he appeared before the Select Committee? If not—if he is being treated as a whipping boy or as a subordinate who is told nothing in the Cabinet—will he give an undertaking to the House that if Llanwern is closed he will maintain the dignity of his office by resigning from the Cabinet, as Wales would expect him to do?

Mr. Edwards

Presumably when the hon. Gentleman referred to a statement by the Secretary of State last week he was referring to the statement by my right hon. Friend the Secretary of State for Industry, because I did not make a statement. It was clear—from the evidence given to the Select Committee—that the current position of the British Steel Corporation was extremely serious. All that my right hon. Friend did on Thursday was to come to the House, which is the right place to report these matters, tell the House the facts and announce that he would guarantee the debts of an organisation that would otherwise have had to be in liquidation.

Mr. Rowlands

Did the right hon. Gentleman know?

Mr. Best

Will my right hon. Friend have regular meetings with the new chairman of the British Steel Corporation so as constantly to monitor the situation to make sure that we are not expecting the corporation to run down its works too far, and to ensure that the prognosis for future demand is kept under constant review, so that that is a correct forecast, bearing in mind the difficulties of trying to look beyond any 12-month period?

Mr. Edwards

Every forecast made by the corporation over the past five years has proved to be grossly optimistic. I am sure that my right hon. Friend and my hon. Friend the Minister responsible, the Minister of State, Department of Industry, who is on the Bench with me will keep the closest eye on the forecast, but it must be said that the market is deteriorating very sharply.

Mr. Alan Williams

Does the Secretary of State realise that it must be a matter of the greatest concern to the House, and particularly to the Opposition, that four days after Sir Charles Villiers made his statement to the Secretary of State for Industry that a £400 million extra cash requirement was likely this year, he, the Secretary of State for Wales, apparently concealed that information from the Select Committee on Welsh Affairs, which he himself set up, or was unaware of the information at that time? Will he assure us that he intends not just to intervene, as in the past, but to fight for the Welsh plant, because there is no way in which we in Wales will accept the closure of Llanwern or Margam? If he fails to save those plants, the whole of Wales will expect his resignation.

Mr. Edwards

I concealed nothing from the Select Committee. I answered every question freely and fully. I do not concede for one moment that it is only right hon. and hon. Members on the Opposition Benches who have a concern for these matters. If they had a concern for them, they would have done well not to encourage the strike that has done so much damage to BSC.