HL Deb 22 June 1992 vol 538 cc334-6

2.40 p.m.

Lord Bruce of Donington asked Her Majesty's Government:

How they propose to provide Parliament and the public with accurate monthly statistics, after 1st January 1993, on the United Kingdom's visible trade with each member state of the Community, and what other arrangements will be made to ensure that consistent and comparable data continue to be provided in Economic Trends and other regular publications.

The Parliamentary Under-Secretary of State, Department of Social Security (Lord Henley)

My Lords, a new system called Intrastat is being introduced throughout the Community with effect from 1st January 1993. Under this system, which is linked to VAT, large traders will be required to supply monthly details of their trade with other member states. That will enable the Government to continue to produce and publish accurate, consistent and comparable data.

Lord Bruce of Donington

My Lords, I thank the Minister for that reply. Is he aware that the current system of compiling statistics on the balance of trade with our European partners rests upon extremely accurate figures supplied by HM Customs and Excise which show that for the five months to the end of May there was a visible trade deficit with the Community of £1.8 billion; that is, about as much as the whole of last year? Is the noble Lord also aware that the system to which he refers depends upon data submitted by those larger firms supplying 80 per cent. of the trade either way, and the 20 per cent. balance is an estimate only? Further does he accept that this time next year we shall be unaware of exactly what our trading position is with the other 11 members of the European Community?

Lord Henley

My Lords, the noble Lord asked a number of questions. I shall attempt to answer some of them. Obviously we can no longer use Customs data. The inevitable result of the single market will be the abolition of most fiscal frontier controls. That is the system to which we shall move.

We have not yet decided on the threshold to apply; that is, the size of firm that will be providing the detailed data in the form of monthly statistics. Our aim is that it should be of the order of the top 20 per cent. of traders, which we estimate will account for 96 per cent. and not 84 per cent. of all trade, as the noble Lord indicated. We accept that there will be some temporary dislocation in the first half of next year in providing the statistics, but as the system beds down we expect to provide accurate statistics only two to three weeks later than the current system.

Lord Desai

My Lords, can the Minister assure the House that the data provided in the future will be provided on a comparable basis? That will enable us to compare before and after figures, unlike the unemployment data, which have been increasingly non-comparable.

Lord Henley

My Lords, I do not accept the premise underlying the second part of the noble Lord's question. We will try to make new data as comparable as possible. Obviously these data will not be identical to those which presently exist.

Lord Stoddart of Swindon

My Lords, does the noble Lord agree that it is essential that we have correct data to enable us to compare the statistics before and after the advent of the single market to see whether there has been any benefit? Does he agree also that since we joined the EC in 1973 this country has had a totally adverse trading balance in manufactures with the Community of £90,000 million? It is therefore essential that we have the correct data after the advent of the single market.

Lord Henley

My Lords, the second part of the noble Lord's question has nothing to do with the Question on the Order Paper. I have accepted that there will be some delay when we change over to the new system, but as the new system beds down we should produce good, reliable, honest statistics within two to three weeks of the current system.

Lord Peston

My Lords, when we move to a single currency, statistics between individual member countries will be of complete irrelevance and of as much interest as trade between Yorkshire and Lancashire. I was not clear on what the Minister said with regard to the new method. Is he saying that the aim is to use the new method for this year so that both methods are in being for the same year, thus enabling us to see how closely they match? Alternatively, is he suggesting that the new method will simply come in next year? If so, there will not be an overlap showing whether the new method compares with the existing method.

Lord Henley

My Lords, what happens in the event of there ever being a single currency is another matter. I am sure the noble Lord will understand that I cannot answer questions regarding trade between Yorkshire and Lancashire, however desirable that may be.

I do not believe that it is desirable to use the future system this year as well as the current system. It will be from 1st January 1993 that traders will have to provide details on their VAT returns. We do not envisage the system requiring much more work for traders and it will be only the larger traders who will have to provide detailed monthly statistics.

Lord Peston

My Lords, I am sorry to press the Minister, but the point does not concern the amount of work. We need to know whether or not the new system measures the same figures as the existing system. The only way that that can be done is to apply both systems to the same set of circumstances and compare them. If the new system starts next year and the old system ceases we shall never know how accurate the new system is; we will simply know that it produces data.

Lord Henley

My Lords, I am saying that we have no plans to bring in the new system before 1st January next year. The noble Lord makes an interesting point about proving the reliability of what will be our new set of figures. I shall pass on that comment to my right honourable friend. However, we have faith in the new system providing reliable and consistent figures.

Lord Bruce of Donington

My Lords, will the Minister give the House an unequivocal assurance that the figures produced by the new system will be in all respects comparable with those previously produced? Will he confirm that it will he unnecessary to make any amendments, for comparative purposes, in the variety of data at present rendered, which often goes back for 10 years or even longer? Will the noble Lord take note of the fact that if the Maastricht Treaty were ever ratified the Commission would take on the responsibility for the production of figures? Does he regard that with unalloyed pleasure and trust?

Lord Henley

My Lords, as I stated earlier, the figures will not be strictly comparable with existing figures. However, we believe that they will be good, reliable figures giving an accurate measure of trade with our European partners.