§ Mr. Gryllsasked the Secretary of State for Industry whether he will report on the progress of the action taken so far on each recommendation from the sector working party on the pumps and valves 628W industry, further to his reply to the hon. Member for Surrey, North-West, on 18th November 1976.
Mr. Alan WilliamsRecommendation: The Government should consider attaching priority, under the Industry Act Foundry Scheme, to investment for the production of short-run high alloy and complex castings.
Action: Under the Ferrous Foundry Scheme a substantial amount of assistance was granted to improve the production of specialist castings and castings generally. The Government's new Non-Ferrous Foundry Scheme has already attracted an encouraging response from industry. Projects for assistance with the production of specialist castings will be sympathetically considered.
Recommendation: The Employment Services Agency should consider how its employment transfer scheme and placement services could assist the movement of skilled workers to areas with most vacancies.
Action: The Employment Services Agency has reviewed its transfer and placement services and has reported its findings to the Manpower Services Commission, where they are under consideration at present.
Recommendation: The Training Services Agency and the Engineering Industry Training Board should review current training and retraining programmes with reference to potential shortages of skilled engineering manpower.
Action: Links between the Department of Employment, the Employment Services Agency, the Training Services Agency and the National Economic Development Office have been strengthened to ensure that reported skill shortages should be investigated quickly and efficiently. The Employment Services Agency has undertaken to examine each individual case fully. The Training Services Agency has undertaken to give priority to special training needs identified by the Sector Working Parties: it is maintaining close contact with the Engineering Industry Training Board. The Sector Working Party is liasing closely with all these bodies in its consideration of the future manpower requirements of the pumps and valves industries.
629WRecommendation: The Government should consider allowing a higher proportion than the present 20 per cent. of new investment to be recovered through higher prices.
Action: The revised Price Code which came into operation on 1st August 1976 provided that the proportion of budgeted capital expenditure which companies may apply as a cash amount to increase their permitted prices and profit margins should be raised from 20 per cent. to 50 per cent.
Recommendation: The Government should consider easing the pressure on corporate borrowing limits by removing the possibility of future clawback of stock appreciation relief.
Action: In his last Budget speech the Chancellor of the Exchequer reiterated that he had no intention of bringing the present stock relief scheme to an end without a replacement scheme and that for the normally continuing business there is little or no risk that any substantial part of the deferred liability would in fact arise. He promised to continue the scheme for 1977–78 and 1978–79 at least, to be followed by a permanent scheme when a satisfactory one could be devised which would take into account developments in current cost accounting.
Recommendation: The Government should consider recasting the ECGD arrangements for bank guarantees and performance bonds such that no contingent liability remains with the contractor.
Action: There is nothing to add to the information given on 18th November 1976.
Recommendation: The Government should consider reducing the cover qualifying limit under cost escalation insurance from £20 million to £250,000 and for units within a contract from £500,000 to £25,000, and increasing the flexibility of the definition of a unit to cover identifiable sections of a contract.
Action: There is nothing to add to the information given on 18th November 1976.
Recommendation: The Government were asked to support discussions with the nationalised industries about rationalising standards and quality assurance procedures.
630WAction: Sir Frederick Warner presented his report on standards and specifications in the engineering industries to the National Economic Development Council in March. The Chancellor of the Exchequer and the Secretary of State for Industry wrote to ministerial colleagues whose Departments are major public purchasers asking that they give a high priority to ensuring that their requirements are related to standards and to overseas requirements. In addition, Ministers who have sponsoring responsibility for public bodies have been asked to draw to their attention the recommendations of the Warner Report.