§ 2.45 p.m.
Lord CAMPBELL of CROYMy Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
§ To ask Her Majesty's Government whether they will make a further Statement about the arrangements agreed with Poland for the building and operating of ships.
§ Lord WINTERBOTTOMMy Lords, I am pleased to confirm that on 26th January British Shipbuilders and the Anglo-Polish Shipping Venture Ltd., Szczecin, signed contracts for the construction in United Kingdom shipyards of 22 ships and two crane barges which will be chartered to the Polish Steamship Company.
Lord CAMPBELL of CROYMy Lords, I thank the noble Lord for that Answer; extra work for British shipbuilding yards is welcome. However, is the noble Lord aware that much is still unknown and not announced about this deal; for example, the terms of the bare-boat charter between the British-Polish company and the Polish shipping line and even what flag the ships are to fly? There is understandable anxiety about unfair competition with British shipping, which still ranks third in the world league and makes an important contribution to our balance of payments.
§ Lord WINTERBOTTOMMy Lords, I had hoped to implement today something I said in November, but perhaps I can first say what I was going to say and then say that unfortunately I cannot answer the other two points. The Shipbuilding Intervention Fund provided a grant of up to £28 million; ECGD are guaranteeing credit of not more than 70 per cent. of the export price; and British Shipbuilders have raised from a consortium of banks and without Government guarantees a loan of 65 million dollars to finance the joint venture company. All this is within the framework of our international commitments and, as I said earlier, any British company wishing to buy the same ship on the same terms is able to do so.
§ Lord BOYD-CARPENTERMy Lords, may I ask the noble Lord at least to tell the House what measures Her Majesty's Government have taken in the course of this transaction to make sure that ships acquired with the aid of help from the British taxpayer are not used unfairly to compete with the British Merchant Navy?
§ Lord WINTERBOTTOMMy Lords, one cannot give a categorical undertaking on this matter.
§ Lord BOYD-CARPENTEROf course not.
§ Lord WINTERBOTTOMHowever, these ships are proposed to be used principally in the Baltic and that, I presume, is not an area where we have the same interest as we have elsewhere in the world.
Lord CAMPBELL of CROYMy Lords, British ships do and can ply in the Baltic. Furthermore, is the noble Lord aware that a categorical assurance was given about this when the Aircraft and Shipbuilding Industries Act was passing through this House, by the noble Lord, Lord Melchett, when he said that there would not be unfair trading with British shipping? Is the noble Lord further aware that an advantage of £1 million for a foreign competitor in the cost of a ship enables him to undercut British companies by £400 a day during the whole life of that ship?
§ Lord WINTERBOTTOMThese are interesting figures, my Lords, but the hard fact of life is that, if we had not built these ships, somebody else would.
Baroness WARD of NORTH TYNESIDEMy Lords, does the Minister remember that quite a long time ago, when I raised this matter of Polish shipbuilding, he gave me an undertaking so far as the Tyne is concerned? He said then that it was a very difficult question to answer and that he wanted some time to consider it. Since then we have not been given the answer. Can the noble Lord add to what he said to my noble friend and tell us what in fact was spent on the Tyne on Polish shipbuilding and whether the shipping interests on the Tyne are being adequately protected, as they are very important to my part of the world?
§ Lord WINTERBOTTOMMy Lords, as the noble Baroness will know, a substantial element of this contract was offered to the Tyne and the shipyard concerned was unable to give an undertaking that it would carry out the contract as agreed, and therefore the contract went elsewhere, mainly to Scotland.
§ Lord LEATHERLANDMy Lords, may I ask my noble friend a question dealing with another aspect of this matter? Is it not a fact that one of the leading British ship-owning firms has placed an order with Polish shipbuilders for the building of ships for its British fleet? If that is so—and I know it is—is it not a good thing that we in return should be building some ships for Poland?
§ Lord WINTERBOTTOMI am grateful to my noble friend for that observation, my Lords. Everybody seems to think that we are a completely contained economy, whereas in fact we are an international trading community, and for this reason we must trade in all directions.
Lord CAMPBELL of CROYMy Lords, does the noble Lord agree that, very recently, a Government spokesman congratulated the British shipping industry on having placed so many of its orders with the British shipbuilding industry in the last year or two?
§ Lord WINTERBOTTOMAnd I am certain that your Lordships' House would support the Government in this matter.
§ Lord SEGALMy Lords, as the balance of trade with Poland will be strongly in our favour after completion of this order, can my noble friend say whether it would be desirable, in order to promote good relations with Poland, if some reciprocal arrangement were made for increasing the amount of our own imports from that country?
§ Lord WINTERBOTTOMYes, my Lords; I think it is very important, because of the interesting political situation in Poland, that close economic relationships should be maintained with that country.
§ Lord ORR-EWINGMy Lords, does the noble Lord not agree that the anxieties from all parts of the House about the terms 8 of this agreement suggest that it would I have been wiser to have built naval ships or naval auxiliaries in our shipbuilding yards, which, if we were not able to use them ourselves, would be readily available to sell to our allies and others who admire British warships and who would be very glad to have them?
§ Lord WINTERBOTTOMMy Lords, perhaps I may say that I sympathise with the noble Lord's views, as I have said previously from this Box. However, he knows that there are more factors involved than just building warships "on spec".
Baroness WARD of NORTH TYNESIDEBut, my Lords, whatever the situation is now, is the noble Lord aware that he gave an undertaking to me, when I raised the same Question a long time ago, that he would give the details about the ships for Tyneside? Why does the noble Lord not answer that question, which he promised me he would answer?
§ Lord WINTERBOTTOMMy Lords, the final answer is "Nil". They have nothing because they would not agree to the terms that were offered to them.