§ Mr. Sainsbury
I beg to move amendment No. 18, in page 4, line 43, at beginning insert'The Secretary of State shall prepare an annual report on the discharge of his functions under sections Ito 5 of this Act. (1A)'.
§ Mr. Sainsbury
During consideration of amendments Nos. 93 and 111 on 19 February in the Standing Committee, the view was expressed that there should be a statutory requirement on the Government to lay the ECGD's annual report and trading accounts before Parliament. During our discussions I drew attention to the high level of reporting to Parliament to which the ECGD, as a Government trading organisation, is committed. Already, annual trading accounts which are statutorily required under exchequer and audit legislation are laid before Parliament, as are annual estimates and appropriation accounts. Of course, the report of the Department of Trade and Industry itself, which, from this year, replaces the public expenditure White Paper, also refers to the work of the ECGD. Then there are the reports to Parliament, under clause 7, on ECGD commitments against statutory ceilings.
However, I recognise the merits of supplementing the existing reporting requirements with a statutory obligation on the Secretary of State to submit an annaul report. In Committee, I undertook to consider the feasibility of finding the right words for such a provision. The purpose of the amendment is to put into effect the wishes expressed by members on both sides of the Committee. It requires the Secretary of State to submit to Parliament an annual report on the discharge of his functions under clauses 1 to 5.
Amendment No. 19 is consequential. It places on the Secretary of State a statutory duty to produce a report. Although final decisions on the precise form and content of the new statutory report have not yet been taken, my basic intention is that the existing annual report—there is no statutory responsibility to table the existing report, but it has been placed in the Library—should represent the starting point for the new statutory report. Changes will be necessary to reflect the ECGD's changed role after the privatisation of the Insurance Services Group, and, indeed, with the new powers conferred by the Bill, particularly those provided for in clause 3.
The annual report—the one which we do not have statutory responsibility to table but which is placed in the Library—covers various topics. These include a review of the year's activities of the various groups and divisions, detailed reports and accounts of trading operations, a brief report of the non-trading operations—the public expenditure programmes operated by the ECGD, such as the fixed rate export finance scheme, to which I referred earlier—and developments within international forums, such as the OECD and the European Community's policy co-ordination group.
As new activities permitted by the Bill come on stream, provisions will need to be added to cover financial management activities authorised under clause 3—bond issues, cross-currency and interest-rate swaps, which were referred to during the Committee stage—and services that 78 might be provided by the ECGD for a fee, as authorised by clause 5. In addition, it may be possible for the annual report to contain an expanded section on the non-trading operations of the new ECGD, possibly building in elements currently contained in the public expenditure report of the Department of Trade and Industry. The report might contain also a summary of returns made under clause 7 of commitments logged against the statutory ceiling. It is my intention also that the separate annual report required in relation to investment insurance activities should be subsumed into the new report.
I hope that the House will accept these amendments, which reflect the wishes expressed in Committee. They will further improve the already quite extensive reporting arrangements for the ECGD.
§ Ms. Quin
These amendments are not controversial. They go a little way towards meeting some of the concerns that we expressed in Committee. Parliamentary accountability is a theme that we raised several times during the course of the debate. Since the legislation as a whole is controversial, we are concerned to ensure that the ECGD, in its new form, will be properly scrutinised by Parliament, just as we are concerned that Parliament should have some involvement in how the privatised company—the new ISG —operates. We welcome the extra commitment that these amendments represent.
The Minister did not say anything about the timing of the presentation of the report and the returns. Of course, the Bill provides that they should be made as soon as practicable after 31 March each year. I should like the Minister to confirm that that is the situation. In Committee he said that in the first year it would be difficult to meet the deadline of 31 March but that the Government's aim in subsequent years would be to present the report and the returns very shortly after that date. I hope that the Minister will be able to give us a clear commitment on the matter.
We take very seriously the issue of parliamentary accountability. We shall certainly want the maximum information on the operation of the continuing ECGD. It is well known—we have highlighted the issue already this evening—that exporters are very concerned about how the continuing ECGD and the privatised company will operate. Especially in the early days, we shall want to scrutinise very closely the practical implications of these changes for exporters. For that reason, the information given to Parliament will be very important. We shall need to be in a position to debate the information, having had access to it in good time.
§ Mr. Cousins
I do not want to detain the House unduly, but it would be churlish not to welcome the Minister's remarks and his commitment to use the annual report as an important source of information to the business community and to members of the public who are interested. This is something that many of us on the Standing Committee suggested. We welcome the proposal to deploy the annual report to some degree as a means of engaging in the continuing debate about the direction of the remaining activities of the Export Credits Guarantee Department. To that end, following the Minister's suggestions as to what the annual report might contain, can he tell us whether it will contain an area-by-area analysis? By that I mean areas of the world. The annual report for 1986–87 contains an interesting breakdown of 79 area-by-area exposure in different country groups. I hope that that helpful feature will continue to appear in annual reports.
The Minister mentioned some changes that he proposed to make in the work of ECGD in regard to the assurances he gave in our previous debate. Can he assure us that the annual report will rehearse and repeat the way in which those undertakings are borne out in practice, and that any intention to review the continuation of political reinsurance on a national interest basis, as the Minister said might happen, will be flagged up clearly in the annual report so that there will be plenty of time to consider its implications?
§ Mr. Sainsbury
On the timing of the report, as the hon. Member for Gateshead, East (Ms. Quin) said, it will be as soon as practicable after 31 March. As I said in Committee, those words mean exactly what they say. After the first report, which obviously carries certain difficulties, it is our intention to meet that deadline or improve on it. If we did not do so, and if there were any unreasonable delay, because those words will be on the statute book, a Secretary of State could be got at for failing to discharge his statutory responsibilities. That is the value of including those words in the statute.
Issues such as area-by-area coverage, which was mentioned by the hon. Member for Newcastle upon Tyne, Central (Mr. Cousins), could certainly be included in the annual report and could even be expanded. He referred to national interest reinsurance. There are commercial and diplomatic reasons which I explained earlier for not listing the countries for which reinsurance is required, particularly as that could be damaging to the interests of exporters to those countries. We take it as a primary purpose of the report that nothing in it should do anything other than help, and certainly should not in any way hinder, British exporters. With that proviso, we shall seek to make the report as full as is reasonably possible.
§ Amendment agreed to.
§ Amendment made: No. 19, in page 5, line 3, leave out 'A return' and insert 'Reports and returns prepared".—[Mr. Sainsbury.]