asked the Secretary of State for Defence what arrangements he has made with the Government of Spain for the building under licence of British-designed frigates, equipped with British weapon systems, the Chieftain tank and the TSR2 aircraft.

asked the Secretary of State for Defence what agreements have been made with the Government of Spain for the production and building under licence of British-designed frigates and weapons.

asked the Secretary of State for Defence if he will make a statement about the construction under British supervision of Leander class frigates for Spain.

asked the Secretary of State for Defence whether he will make a statement on the recent negotiations with Spain for the export of naval vessels from this country.

As I informed the hon. Member for Wednesbury (Mr. Stone-house) yesterday, we have for some time been discussing with the Spanish Government the building of warships of British design in Spain. Until recently it seemed that the negotiations would reach a successful conclusion, but I understand that the Spanish Government do not now intend to proceed with them. It is estimated that the agreement would in all have been worth some £11 million to the British economy, £2–3 million for design fees and similar payments and £8–9 million for equipment manufactured in this country for the Spanish Government.

May I ask the right hon. Gentleman whether it is the practice of the Government to have discussions and negotiations of this character with Communist countries; and, if it is not, is it the deliberate policy of the Government that such negotiations shall take place with Fascist Governments?

The difference is quite clear. With regard to the Communist countries, we and our allies have fairly detailed arrangements that none of us will sell goods of certain categories to them, but in the case of Spain weapons of this category can freely be sold to her, and in fact will be sold by many of our allies.

Is the right hon. Gentleman aware that the official policy of Spain is still to drive the British out of Gibraltar? This policy was confirmed only a month ago by Franco's deputy, General Grandes. It was also written into a motion that was discussed at the United Nations. Does not the Minister consider that it is treachery to the citizens of Gibraltar to arm Spain while this is still her policy?

Whatever the policy of the Spanish Government may or may not be, it will not be affected by them buying French or American equipment rather than British.

Would not my right hon. Friend agree that there is a grave danger that, as a result of this, confidence may be lost in other British contracts, in the fastest growing market in Europe? Is not this a serious blow to our balance of payments position resulting from the crass political prejudice of the right hon. Gentleman the Leader of the Opposition?

This may be so, but I think that enough damage has been done to our trade already, without further comment.

Would the right hon. Gentleman be good enough to tell the House whether the statement made by his spokesman that he could confirm that this order had been concluded was made under his authority? Would he also tell the House whether he has had an inquiry made into what the Foreign Secretary described as the premature disclosure of information? Has he considered the possibility that in fact the order had already been lost, and that some hon. Gentlemen, perhaps not so far away from him now, had the bright idea of being able to put up a smoke-screen, as has been done frequently in the past, to cover the Government's own ineptitude and at the same time to embarrass my right hon. Friend?

On a point of order. Is it not highly reprehensible to refer to the Leader of the Opposition as a smokescreen?

That is a poor point of order.

As the hon. Member has another Question on the Order Paper dealing with this matter we had better wait.

While Gibraltar is British and must remain so, cannot only an ideologically fevered imagination conceive that these ships and aircraft would be used by the Spanish Government against us? Is not this antiquarian vendetta at the expense of British exports and British workers one more indication of the incompetence of the Socialists to govern modern Britain?

Can the Minister confirm that no agreement had been reached with the Spanish Government on such an order, and that the Spanish Government had simultaneously negotiated with a number of other foreign Governments for a similar order? Can he also say whether it is true that Her Majesty's Government had undertaken, if returned at the election—which heaven forbid—to support Spain's entry into N.A.T.O.?

The latter part of that supplementary question is a quite separate one. In respect of the sale of these frigates we were undoubtedly in intense competition—as we are in all trade matters all over the world—with many competitors. Unfortunately, the Intervention of the Leader of the Opposition undoubtedly frustrated this sale.