§ 60. Mr. Barnettasked the Secretary of State for Foreign and Commonwealth Affairs (1) how much of the offset provisions under Article 5 of the Protocol of 20th July, 1965, with the West German Government remains to be completed; and when this is expected to be finalised;
(2) how much remains to be spent in the Arms Deposit Account for the years to 1966–67 under the offset agreement with the West German Government; and when this is expected to be completed.
§ Mr. M. StewartArticle 5 of the Anglo-German Protocol of 20th July, 1965, provided for the use of the funds in the Arms Deposit Account "together with German payments across the exchanges to finance in the United Kingdom additional transactions which qualify under the Agreement of 27th July, 1964 to twice the amount drawn" from that account; and that payments made in accordance with this Article should be accounted for in respect of the two-year period ending 31st March, 1966. The balance currently remaining in the 13W account as on 6th February, 1969, is estimated to be DM.59.3 million or about £6.2 million. We estimate the full accountable value of the business remaining to be completed in accordance with provisions of Article 5 of the Agreement to be DM. 168.6 million. This represents, in addition to the money actually remaining in the account, an equal amount of additional German payments (as provided for in Article 5) and a further payment of DM.50 million deriving from a project (the M45H engine for the VFW614 German airliner) to which a contribution has already been made from the Arms Deposit Account.
2. The balance of the Account has virtually been committed in full. It is estimated that with the exception of payments from one or two of the longer term projects, such as the M45H engine, the spending of the balance of the Arms Deposit Account will be completed by about the end of 1970.
§ Mr. Barnettasked the Secretary of State for Foreign and Commonwealth Affairs in each of the years since the commencement of the offset agreement with the West German Government, how much of the civil purchases have been by the West German Government, and how much by private companies.
§ Mr. M. StewartI regret that a detailed break-down for each of the financial years concerned is not readily available.
2. The following figures represent the division of off-setting payments between, on the one hand, German public authorities (which for this purpose include governmental authorities at all levels, companies in which those authorities have a minimum holding of 50 per cent. and public corporations), and, on the other hand, private companies including sales to private companies in third countries:
Public Private 1962–64 230 — 1964–67 772 342 1967–68 225 57 Note. The figures for 1964–67 and 1967–68 include the accountable value of deposit account transactions attributable to those years, e.g. according to the provisions of Article 5 of the Protocol of 20th July, 1965, irrespective of the actual dates of payment The figures for 1964–67 are estimated and will need to be adjusted as projects are completed.
14W
§ Mr. Barnettasked the Secretary of State for Foreign and Commonwealth Affairs to what extent the shortfall in 1967–68 on civil purchases of DM 78 million out of DM 350 million under the offset agreement with the West German Government will not be met and whether it is proposed that the balance should be added to the 1968–69 target.
§ Mr. M. StewartAs my right hon. Friend the Minister of State for Foreign and Commonwealth Affairs told my hon. Friend on 28th January, the Federal German Government undertook to use their best endeavours under Articles 3 and 4 of the 1967–68 agreement to promote accountable purchases "up to" the Deutschemark target figure quoted in those Articles, and performance would have been better but for the effects of devaluation. The Federal German Government were not under any obligation under the terms of that agreement to make up the difference in respect of the current agreement.—[Vol, 776, c.313–4.]
§ Mr. Barnettasked the Secretary of State for Foreign and Commonwealth Affairs what proportion of the civil purchases by the West German Government under offset arrangements have been purchased on behalf of private companies.
§ Mr. M. StewartOn the basis of the figures available to us from 1962 up to the termination of the 1967–68 agreement, the proportion of civil public purchases is about 75 per cent. of the total, as against 25 per cent. for civil private purchases.