HC Deb 14 February 1968 vol 758 cc340-1W
33. Mr. Iremonger

asked the Secretary of State for Defence what sums will be required of Her Majesty's Government for cancellation charges as a result of recent reductions in defence programmes; and what estimate he has made of the value of orders lost through the lapse of offset arrangements.

Mr. Mason:

No estimate will be available until the precise implications of these reductions have been worked out. So far as the cancellation of the F.111K aircraft is concerned, the costs of cancellation and the future of the offset arrangements are at present under consideration with the U.S. authorities and the firms concerned.

Mr. Goodhew

asked the Secretary of State for Defence what is the total amount incurred since October, 1964 by way of cancellation charges on defence equipment.

Mr. Mason:

A total of about £200 million has been paid out on the main defence projects cancelled since October, 1964. This amount includes payments for equipment delivered or in course of manufacture, and materials and equipment obtained for the purposes of the contracts as well as compensation payments for unavoidable terminal costs by reason of the cancellations.

Rear-Admiral Morgan Giles

asked the Secretary of State for Defence what estimate he has made of the total cancellation charges resulting from the Defence cuts announced on 16th January, 1968.

Mr. Mason:

No estimate will be available until the precise implications of the decisions announced on 16th January, 1968, have been worked out.