Orders of the Day — Jaguar Aircraft

Part of the debate – in the House of Commons at 12:00 am on 23rd January 1975.

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Photo of Mr William Rodgers Mr William Rodgers , Teesside Stockton 12:00 am, 23rd January 1975

I have listened with interest to the remarks of the hon. Member for Chertsey and Walton (Mr. Pattie) and I understand his concern about the export future of what, as he has said, is a very great and successful aircraft with a potential use throughout the world.

My concern this morning is whether I shall be able to add a great deal more to what I said in answer to the hon. Gentleman's parliamentary question in November. The considerations that he has raised will be very much in my mind, and I hope that he will believe that, even if the emphasis is slightly different, they are not matters which the Ministry of Defence and its sales organisation or my right hon. Friend the Secretary of State have overlooked.

If the hon. Gentleman had that fear, I am sure that he will feel that his own speech was totally justified in asking us about our responsibilities in this area. So if I do not add significantly to what he and the House already know, I can at least undertake to examine carefully what he has said and do all that I can to ensure that in the proper circumstances this aircraft has a very substantial overseas sale.

We are very anxious to sell equipment, within the proper restraints and given the proper safeguards, to friendly countries. There is no doubt that the RAF is very pleased with the aircraft, and we hope that it has a very substantial future ahead of it in service.

Basically, however, it is not whether we want to sell, but whether a country wants to buy. The hon. Gentleman referred at the end of his speech to "positive salesmanship". But I do not think that he suggested that it was in our interest or compatible with our relationships with other countries to try to sell an aircraft which they may not want or to persuade them to look at it in a rôle which does not apply. So, although positive salesmanship in terms of showing concern at selling and suggesting that there are alternatives in terms of a replacement for the four countries in NATO is right, there comes a point when it would be foolish to seek to persuade an unwilling buyer to change his specification, knowing that it did not make a great deal of sense.

We want, therefore, to sell aircraft at a price and in circumstances which make good economic sense to both the parties to the sale. Inevitably, this raises the question which the hon. Gentleman raised in relation to the Indian order and the credit terms. This itself is a major policy question with all export sales. "The seller wants a realistic period for repayment at a realistic rate of interest. The purchaser often wants very soft terms, a long period of repayment and a low rate of interest. The need is to find a reconciliation between the two which makes good economic sense to both parties.

The hon. Gentleman was right to say that there had been times in the past when our sales organisation had not been as fiercely competitive as it might have been. But I do not mean now. Nor do I mean in recent years. There has been a fundamental change in the attitude to salesmanship, and that is equally true of the Diplomatic Service. I know from my experience that distinguished ambassadors coming to this country spend a remarkably large part of their time going round factories and getting to know techniques lying behind the exports which it is their job to promote. The old-fashioned generation would not have regarded this as proper, but the new generation of diplomats is often more concerned with commercial sales than with the strict orders of diplomacy as we understand them.

If the hon. Gentleman were to see the telegrams which come in, he would realise that a substantial proportion of them deal not with the great issues of our time but with something that we want to sell abroad. Though there may still be room for improvement, the hon. Gentleman can feel confident that our diplomatic staff feel themselves at least as much salesmen in matters of this kind and are fully aware of the importance of the sale of the Jaguar as often as possible. We cannot give it away. But, short of that, we want to sell it to friendly countries wherever they may be.

Jaguar has been in squadron service for some months now in a ground attack role. The RAF is extremely pleased with its performance. Pilots have found it very easy to fly and have been particularly pleased with its low-level performance. It has proved reliable and easy to maintain, which has meant that the flying rate has been considerably higher than was at first forecast. For this reason it is an aircraft with at least some of the qualities of robustness—very difficult to combine with modern technology—which give it good export prospects.

We believe that there will be substantial sales, and BAC has already concluded deals with two countries. It would not be consistent with the policy of successive Governments for me to give further details of these deals. In this area, except for the broad areas of policy, it is for the Government purchasing an aircraft or any piece of defence equipment to make an announcement about it if they wish.

We are very aware of Indian interest in the Jaguar. Whether at the moment it is strong or less strong is not a matter for us. It is for the Indian Government to decide what aircraft they need. We have made, and will continue to make, a real effort to ensure that the aircraft is available at the right price. Certainly, credit terms are central here, and the Indian Government have very good internal economic reasons, because in the aftermath of the oil crisis they face a quadrupling of oil prices, for wanting to get the aircraft as cheaply as possible.

Therefore, one of the major factors to be taken into account is the ability of the Indian Government, faced with this problem, to find the money for the purchase, given other interests that they may have, on anything approaching normal credit terms. It is finally a decision for the Indian Government but they are aware of our present position and know that we are happy to try to meet them if the commercial aspect of the deal makes good sense. It is a question not of bending rules or breaking them, nor of having rules which do not change in any circumstances, but of having arrangements which are practical and represent a good bargain to both parties to the sale.