Synthetic Fibres (Hansard, 17 January 1983)

§ 3. Mr. Kilroy-Silk
asked the Secretary of State for Industry whether he will consult the trade unions in the United Kingdom synthetic fibres industry before finalising his response to the proposed agreement among the major European producers of synthetic fibres to cut capacity within the European Economic Community by half a million tonnes.

§ 5. Mr. Hoyle
asked the Secretary of State for Industry if he will estimate the effect on the British textile industry of the proposed agreement among the major European producers of synthetic fibres to cut their capacity within the European Economic Community by half a million tonnes.

§ The Minister for Industry and Information Technology (Mr. Kenneth Baker)
The agreement between the major European synthetic fibre producers to reduce production capacity was in fact signed last October. It is not an inter-Government agreement and it would therefore be inappropriate for me to consult the trade unions about it.
I do not anticipate that the agreement will have any effect on the British textile industry, which will still be able to obtain the yarns and fibres that it requires.

§ Mr. Kilroy-Silk
If there are to be reductions in jobs and capacity in the synthetic fibres industry, what assurance can the Minister give that those reductions will be shared equally by all companies and countries, and that countries such as Spain and Portugal, which are privy to the discussions but not signatories to the agreement, will not build up capacity before they enter the EC?

§ Mr. Baker
The purpose of the agreement was that the European producers should join together voluntarily to try to reduce the substantial over-capacity in the industry. We do not expect any further reductions in capacity in the United Kingdom. We shall be looking for reductions in Spain and Italy.

§ Mr. Hoyle
Will the Minister take heed of what happened in the Common Market over the agreement to rationalise steel production? We carried out rationalisation, but our EC partners did not. Will the Minister ensure that he does not fall into that trap? If he does, it will not just decimate the synthetic fibres—

§ Mr. Speaker
Order. We are already beginning to have arguments instead of questions. We must have questions.

§ Mr. Hoyle
It is a very important question, Mr. Speaker.

§ Mr. Speaker
Order. I have no doubt about the importance of the question. I am worried about the interrogatory part.

§ Mr. Hoyle
If that is carried out, it could decimate not just—

§ Mr. Speaker
Order. We had better have the answer now.

§ Mr. Baker
I shall try to answer the assertions. The point that I should like to stress again is that this agreement is an attempt by the companies in Europe to rationalise and to reduce their capacity. The Governments are not involved in this matter. I understand that the companies would expect to see reductions particularly in Italy and Spain rather than in this country.

§ Mr. McNally
Is not the problem that neither this Government nor the Community have any idea of the size or shape of the textile industry that they want? Would it not be better to decide that and then give the incentives and the long-term perspective, which would allow the industry to plan ahead?

§ Mr. Baker
If the hon. Gentleman reflected upon what he was asking, he would appreciate that it is unrealistic for any Government to try to set an ideal size for any particular industry. Whether an industry is too small or too big must depend on factors outside those that Governments can influence.

§ Mr. Dickens
Does my hon. Friend accept that many European countries are subsidising the yarn spinning end 4 of their industries? Would it not be to the advantage of British yarn spinners if European Governments agreed not to subsidise over-capacity? Does my hon. Friend believe that the agreement that has been achieved is sensible?

§ Mr. Baker
I certainly agree with the last comment of my hon. Friend. The agreement that has been reached is eminently sensible. We have made the strongest protest to the Italian Government over the way in which they have been subsidising and maintaining capacity in an industry which, on a European basis, has substantial over-capacity.

§ Mr. Stoddart
Is the Minister aware that in any industry such as the British textile industry, where 210,000 jobs have been lost since 1979, there is bound to be considerable worry among the trade unions and the work force? Bearing in mind that in negotiations with the EC we always get the neck of the chicken, will the Minister give us a real assurance that the Government will protect the British synthetic fibre industry?

§ Mr. Baker
I congratulate the hon. Gentleman on joining the industry team on the Labour Benches.
I assure the hon. Gentleman that I discuss these matters with the trade unions in the textile industry. In fact, about six weeks ago I had a meeting with the British Textile Confederation, and I take its views on board. I assure the hon. Gentleman that the interests of the British textile industry are strongly protected in all the negotiations in Brussels.