§ Q2. Sir David Priceasked the Prime Minister what is the minimum size and mix of the merchant marine fleet that is necessary to be maintained under the British flag for reasons of national security.
§ The Prime MinisterAt present the United Kingdom registered merchant fleet numbers some 820 ships. The Government keep under continuous and detailed review the requirements of Her Majesty's Forces for support by merchant ships when carrying out their roles in the NATO Alliance and elsewhere, and the availability of merchant ships with specifications capable of meeting those requirements. For reasons of security, details of the ships that could be needed cannot be given.
§ Sir David PriceDoes my right hon. Friend recall that at the height of the Falklands conflict there were more ships flying the Red Ensign than the White Ensign in the south Atlantic? Is she further aware that if the decline in the size and the mix of the British Merchant Navy continues she will be unable to call on the same merchant marine ever again in support of the Royal Navy?
§ The Prime MinisterI understand exactly my hon. Friend's concern. The decline of the merchant fleet has been due to increased competition and continuing difficulties in the world shipping market. I think that the shipping industry is perhaps best at identifying the most 819 profitable opportunities to keep its numbers as high as possible. I readily accept that the Merchant Navy is very important for our defence. It is also important to keep a merchant building capacity in this country, for strategic reasons.
§ Mr. KinnockCompetition and other challenges are regular and continual factors. How does the right hon. Lady explain the fact that the British merchant fleet has been reduced by half since she became Prime Minister?
§ The Prime MinisterI gave the reasons in my reply to my hon. Friend the Member for Eastleigh (Sir D. Price). The decline in the merchant fleet is due to increased competition and continuing difficulties in world shipping markets. Against that background our shipping industry has done very well to create such large invisible earnings.
§ Mr. KinnockAre not the changes made in this year's Budget in allowances, taxation and investment in danger of accelerating that decline still further? Will the right hon. Lady halt those policies if she does not want to take the risk of sinking the British merchant fleet along with much of the British shipbuilding industry, and of losing £1,000 million in balance of payments earnings?
§ The Prime MinisterThe right hon. Gentleman will readily accept that any changes in this year's Finance Bill cannot have had any effect on previous losses in merchant shipping—[Interruption.] As the right hon. Gentleman will also know, some final amendments were made during the passage of of the Finance Bill which were welcomed by the shipping industry.
§ Sir John Biggs-DavisonSince Mr. Scargill——
§ Mr. SpeakerOrder. That has nothing to do with the question.
§ Mr. DouglasWill the right hon. Lady acknowledge that coastal shipping is an important ingredient of the British fleet? Why does the right hon. Lady not adopt the same policy towards our coastal shipping as the French and other members of the EC adopt to theirs and make it the exclusive province of the British flag fleet with British-built vessels?
§ The Prime MinisterThe answer is that we are trying the world over to reduce the amount of protectionism that is practised, particularly in countries such as the United States and India. It would be far more beneficial to have free coastal shipping there than to protect our own very much smallers shores. Our fleet will do better when we can reduce the amount of protectionism. The step suggested by the hon. Gentleman would not give us very much, if any, advantage.