HC Deb 29 November 1988 vol 142 cc564-5
7. Miss Lestor

To ask the Secretary of State for Defence what discussions he has had with British Aerospace on collaborative production agreements with non-North Atlantic Treaty Organisation countries in relation to explosives and propellants.

The Parliamentary Under-Secretary of State for Defence Procurement (Mr. Tim Sainsbury)

None. The company has announced that it has signed joint-venture agreements with companies in the United States and Brazil, with a view to selling explosives and technology and thereby expanding its business in overseas markets.

Miss Lestor

I want to reconsider the hon. Gentleman's previous answer. If it is true that there is a five-year agreement with Royal Ordnance factories, presumably the equipment that it would no longer produce if its factories were closed would be bought from somewhere? As I understand it, the Minister has hinted that that equipment will come from Latin America and other countries. Bearing in mind that they are non-NATO countries, will he inform the House what guarantees he has that standards of manufacture, which have been an essential part of Royal Ordnance factory production, will be maintained? Presumably the jobs at those factories will be re-exported to non-NATO countries.

Mr. Sainsbury

I think that the hon. Lady is referring to the reply that my right hon. Friend, rather than myself, just gave, referring to the five-year agreement. Under that agreement Royal Ordnance has the responsibility to meet 80 per cent. of our requirement for certain specified explosives, propellants and related end products. It is, of course, for the company to organise its production facilities to meet that requirement as efficiently as possible. My right hon. Friend has already said that that is in the interests not only of MOD, but of the company.

I assure the hon. Lady that we have standard conditions of contract in those arrangements that will require the company to notify us of any intention to purchase more than £100,000 worth of goods from overseas. If any such request were received, we would look at it in the light of our strategic requirements, among other factors.