HL Deb 31 October 1979 vol 402 cc374-8

2.51 p.m.

Baroness HORNSBY-SMITH

My 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 representations to the EEC to speed up the machinery for investigations into breaches of the multi-fibre agreement and other EEC textile arrangements by countries exceeding their agreed quotas, selling at politically manipulated prices or providing subsidies by way of supplying low cost fuel or selective tax reductions, in view of the estimated three years delay in cases of flagrant abuse already submitted.

Lord LYELL

My Lords, no quota under the Multi-fibre Arrangement has been exceeded. The Government are satisfied that where other suppliers exceed agreed or notified levels action is taken as quickly as possible. Allegations of dumping or subsidy are investigated by the EEC Commission under the relevant provisions of the GATT. I know of no case which has been subject to a delay of three years, but if the noble Baroness would care to send me details I will look into the matter.

Baroness HORNSBY-SMITH

My Lords, while thanking the noble Lord for that reply, I am frankly staggered by it, because there have been representations on excesses of quota, some of up to nearly 100 per cent., put by the industry to the EEC. Whatever it is called, whether it is exceeding the quota or whether it is breaking the understandings of the GATT and the multi-fibre agreement on unfair competition, there is ample evidence that goods are coming from Eastern Europe at prices less than they cost. Following the reply to a Question in the other place yesterday, the noble Lord must be aware that the American Government is aiding its industry by ill-concealed subsidies on fuel costs that have had a disastrous effect in the imports into this country of carpets and polyester fibres, which increased in the first eight months of this year by over ten times what they were in the whole of last year. Whether the noble Lord calls it dumping or not, it is not fair trading.

Lord LYELL

My Lords, my noble friend Lady Hornsby-Smith has covered a varied number of points in her supplementary question. However, she opened with a comment on quotas. It would be reasonable if I were to point out to my noble friend that, as regards particular textile quotas, under the Multi-fibre Arrangement the limit cannot be exceeded because we do not issue import licences beyond the quota levels. My noble friend mentioned other arrangements, but where restrictions are embodied in those other arrangements under voluntary restraint agreements, we in this country are not authorised to suspend the issue of licences; but, if it seems to the industry or to the Government that the agreed levels are about to be over-licensed, then the first action that the Government can and must take is to inform the Commission. My noble friend also raised a point about one specific aspect of imports from the United States. The Government are considering that point with urgency.

Lord RHODES

My Lords, is the Minister aware that the noble Baroness has a case and that what she says can be substantiated? Is the Minister also aware that there is grave reluctance on the part of EEC officials to invoke any of the safeguard clauses provided under the Treaty of Rome? One of the principal reasons for that is the shortage of staff. Whether the action is deliberate or not we do not know. However, we should be very glad if the Minister could find out.

Lord LYELL

My Lords, I am not entirely clear about where there is a staff shortage—whether it is at the EEC or in this country. If the shortage of staff is at the Commission I do not think that the Government can be held responsible. If the noble Lord is complaining of a shortage of staff in the Department of Trade, I would not necessarily agree with him on that score. Certainly the House may feel that my noble friend Lady Hornsby-Smith has a case. The Government are looking into it and are aware of most of the abuses. But, as I pointed out in my original Answer, if the noble Baroness knows of a particularly outrageous case of dumping I should be very glad to look into it and try to settle it.

Lord RHODES

My Lords, the noble Lord is confusing the issue. The noble Baroness is talking not about a case of dumping but about fixing the quotas. I should like to ask the noble Lord whether he will inquire in Europe. It is as regards the policing of the safeguards that labour is in short supply.

Lord LYELL

My Lords, so far as the Government are aware, the Commission is doing everything it can to invoke these safeguard arrangements, and I think the Government are satisfied that these arrangements are satisfactory. Nevertheless, I will look into the matter.

Lord DRUMALBYN

My Lords, is my noble friend able to say what happens to goods that are landed in excess of quota? Is it not the case that goods are sometimes landed in other countries—this even happens before they are actually landed—and then they are transferred to this country, and they get in?

Lord LYELL

My Lords, I think that question is verging away from the original Question. However, I shall certainly look into the matter and inform my noble friend in detail.

Lord HALE

My Lords, is not the noble Lord aware that the Commission itself has said time after time in evidence that it has not sufficient staff to monitor all aspects of this agreement? Some frontiers are not being pursued by officers of the Commission at all. Imports are coming in from all over the world. Is he further aware that another factory, which has been operating in Oldham for 125 years, has been closed down permanently within the last fortnight; that there has been an increase of 6,000 redundancies in the woollen section of the industry since this Government came into office; and that the Commission itself says that it is essential that the EEC should have a viable and successful operating textile industry? Is he also aware that the cessation of the multi-fibre agreement and the erection of factories in South-East Asia—usually with American capital—are rendering the situation beyond remedy unless there is immediate action by this Government?

Lord LYELL

My Lords, the Government are aware of the situation as regards products—under both the Multi-fibre Arrangement and other voluntary arrangements—entering the country from South-East Asia. However, I think that that question is a little wide of the Question that has been raised as regards the EEC Commission. The Government cannot be responsible for the shortage of staff in the EEC Commission, but the Government are doing their best to assist so far as possible in the monitoring. The Government are not responsible for the EEC.

Lord BARNBY

My Lords, is my noble friend fully aware of the degree to which the very efficient wool textile industry is now being oppressed by imports and that it is causing great unemployment and distress? In his second supplementary reply he put emphasis on the quotas. Does he understand that, apart from quotas, the main pressure comes from politically-priced products from Eastern countries? Also, is he aware that the result of the pricing of oil in the States enables yarns and other materials to come into this country? Will my noble friend alert himself to the extent to which unemployment has increased?—as has just been mentioned by a noble Lord opposite. In the last two years the way in which the high register of employment in the wool textile industry has fallen is distressing.

Lord LYELL

My Lords, the Government are indeed aware of the level of unemployment in the wool textile industry. Nevertheless, the Government believe in upholding agreements, such as are embodied in the multi-fibre agreement. I do not think that I can go much further on the question of United States oil pricing than I went in my original Answer to my noble friend Lady Hornsby-Smith. At present, that is as far as I can go.