HC Deb 29 March 1976 vol 908 cc379-80W
Mr. Sandelson

asked the Chancellor of the Exchequer whether arrangements have been made to replace or continue the interim arrangements for the profit formula for non-competitive Government contracts, which expired on 29th February 1976.

Mr. Joel Barnett

Yes. Agreement has been reached between the Government and the CBI to continue the arrangements which I announced on 20th March 1975 until 30th June 1977 or such later date as may be agreed between the Government and the CBI. I have exchanged letters with the President of the CBI as follows:

CHIEF SECRETARY TO THE TREASURY

Treasury Chambers,

Parliament Street, SW1P 3AG

23rd March 1976

Sir Ralph Bateman, KBE

President

Confederation of British Industry

21 Tothill Street

London SW1

Dear Sir Ralph,

Profit Formula Arrangements for Non-Competitive Government Contracts

By means of an exchange of letters on 12fh March 1975 we agreed new profit formula arrangements of an interim nature to apply until 29th February 1976 or such later date as may be agreed between the Government and the CBI.

Discussions have been held between Government officials and CBI representatives concerning the arrangements to apply after 29th February 1976. Following these discussions and after consultation with the Review Board for Government Contracts, I write to you to propose that in the present circumstances and as the next General Review is due to be reported on in June 1977, the interim arrangements which came into effect from 1st March 1975 should be continued until 30th June 1977 or such later date as may be agreed between the Government and the CBI.

If you are in agreement with this proposal I suggest that this letter and your reply in that sense should form an agreement between us.

Yours ever,

Joel Barnett.

CONFEDERATION OF BRITISH INDUSTRY

21 Tothill Street

London, SW1H 9LP

Telephone 01–930 6711

Telex 21332

Telegrams

Cobustry London SW1

From the President: Sir Ralph Bateman, KBE

24th March 1976

Dear Chief Secretary,

Profit Formula Arrangements for Non-Competitive Government Contracts

Thank you for your letter of 23rd March following the discussions held between government officials and CBI representatives concerning the arrangements to apply after 29th February 1976.

I would now like to confirm to you that the CBI is prepared to accept and to recommend to CBI member firms and trade associations your proposal that, in the present circumstances and as the next General Review is due to be reported on in June 1977, the interim arrangements which came into effect from 1st March 1975 should be continued until 30th June 1977 or such later date as may be agreed between the Government and the CBI.

I agree that your letter of 23rd March and my reply should form an agreement between us.

Yours sincerely,

Ralph Bateman.

The Rt. Hon. Joel Barnett, MP,

Chief Secretary to the Treasury,

Parliament Street,

London,

SW1P 3AG.