British Leyland

Oral Answers to Questions — Industry – in the House of Commons at 12:00 am on 23rd January 1978.

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Photo of Mr Gwilym Roberts Mr Gwilym Roberts , Cannock 12:00 am, 23rd January 1978

asked the Secretary of State for Industry if he will make a further statement on British Leyland.

Photo of Mr Hugh Dykes Mr Hugh Dykes , Harrow East

asked the Secretary of State for Industry when he expects to receive a copy of the Chairman's review report into the reorganisation of British Leyland.

Photo of Mr Hilary Miller Mr Hilary Miller , Bromsgrove and Redditch

asked the Secretary of State for Industry when he will next meet the Chairman of British Leyland.

Photo of Mr Michael Grylls Mr Michael Grylls , Surrey North West

asked the Secretary of State for Industry when he last met the Chairman of British Leyland.

Photo of Mr Eric Varley Mr Eric Varley , Chesterfield

The Chairman of British Leyland will shortly be submitting a revised corporate plan to the National Enterprise Board, whose report I expect to receive in March. I meet the Chairman of British Leyland from time to time as circumstances warrant.

Photo of Mr Gwilym Roberts Mr Gwilym Roberts , Cannock

Does not my right hon. Friend accept that one of the major problems of British Leyland is reflected in the fact that the price of a new Mini has trebled over the last five years, in a period when the retail price index and average wages have risen by only about twice? Does he accept that this means that a smaller and smaller proportion of new cars has been bought by individuals?

Does not the Minister agree, therefore, that one of the solutions may be for British Leyland not to go up-market but to concentrate on automating its production of a more standard vehicle, which will maintain the labour at British Leyland by increasing throughput and reducing the real cost, and also perhaps meet the real need for this type of car?

Photo of Mr George Thomas Mr George Thomas , Cardiff West

I hope that the rest of the supplementary questions will be briefer.

Photo of Mr Eric Varley Mr Eric Varley , Chesterfield

I hope very much that the British Leyland management will have a model strategy which will command the support of the whole work force and will produce products which the British people will want to buy.

Photo of Mr Hugh Dykes Mr Hugh Dykes , Harrow East

As we have the Secretary of State answering Questions and not the Minister of State, perhaps we shall have a more objective exchange of views. The "Easy Ryder Plan" has been totally overturned. Will the Secretary of State confirm that the report and recommendations arising from the new solution will have to be that much tougher now as a result of all that has happened, even if a no-strike agreement or a guarantee—putting it higher—with the unions is achieved in order to try to get back to a million vehicles per annum?

Photo of Mr Eric Varley Mr Eric Varley , Chesterfield

The National Enterprise Board and ' the Chairman of British Leyland have told me that they want to see the participation arrangements strengthened. The arrangements were set in train two and a half years ago, and they want to ensure that they have a successful company. It is true that two of the most important ingredients of the Ryder strategy have not been met, namely, the company has not held its share of the United Kingdom market and has not generated sufficient internal resources.

Photo of Mr Hilary Miller Mr Hilary Miller , Bromsgrove and Redditch

When he next meets the Chairman of British Leyland, will the Secretary of State point out to him the third criterion that the money advanced by the House was for capital expenditure and not for meeting recurrent costs? Will he inform us now whether any guarantee was given by himself or by the National Enterprise Board for the recent drawings by the company?

Photo of Mr Eric Varley Mr Eric Varley , Chesterfield

The recent drawings were discussed with my Department and I understand that they will be sufficient until about the end of March. Further financial requirements for British Leyland will depend on the revised corporate plan which is being discussed by the Leyland board and its work force for submission to the NEB.

Photo of Mr Michael Grylls Mr Michael Grylls , Surrey North West

When the Secretary of State says that he will give his unstinting support to the Edwardes Plan instead of the Ryder Plan, does that mean that he will give support when the going gets tough and there are proposals for redundancies, which may well be necessary, and, indeed, when plant closures may be found necessary, as the CPRS Report said in 1975? If he does, he is entitled to ask for the support of the Opposition.

Photo of Mr Eric Varley Mr Eric Varley , Chesterfield

I want to see British Leyland a successful company. I want to support all those in British Leyland, including the Chairman, who want to achieve objectives as a substantial British company, not only arresting the decline but improving its market share where it can. Unfortunately, that has not taken place over the last two years. I think that the matter is being tackled now and being discussed with the work force.

Photo of Mr Ian Mikardo Mr Ian Mikardo , Tower Hamlets Bethnal Green and Bow

Will it not be difficult for a chairman, whatever his qualities and qualifications, who is on relatively short secondment from another company and therefore quite secure, irrespective of what happens to British Leyland, to obtain full co-operation from managers and workers whose jobs he is putting at risk? Does not this critically difficult task demand a man of longer and deeper commitment?

Photo of Mr Eric Varley Mr Eric Varley , Chesterfield

I have said publicly that I support Mr. Edwardes's appointment. Not only do I support it, but the whole of the National Enterprise Board does, including the four senior trade union leaders who are members of that board. The best way of securing jobs in British Leyland is to ensure that there is comparability of performance and continuity of production. That is what Michael Edwardes wants to achieve, as does the vast majority of those who work in British Leyland.

Photo of Sir Keith Joseph Sir Keith Joseph , Leeds North East

In view of the obvious difficulty for the Government of managing nationalised industries—we are coming to the subject of steel later in Question Time—what does the Secretary of State think of the proposal of the National Executive Committee of his party for a huge expansion of nationalisation, both of industries and firms, in Labour's "Programme for Britain 1976"?

Photo of Mr Eric Varley Mr Eric Varley , Chesterfield

I am always in favour of the fully worked out policies of the Labour Party, especially those expressed in the manifestos of 1974.

Photo of Mr Frank Hooley Mr Frank Hooley , Sheffield, Heeley

What will be the repercussions on the reorganisation of British Leyland so far as its overseas investments and commitments are concerned, especially in South Africa?

Photo of Mr Eric Varley Mr Eric Varley , Chesterfield

I know that my hon. Friend has some Questions on this matter on the Order Paper for answer later this week, but I understand the Board of British Leyland is reviewing all its operations, both at home and abroad.

Photo of Mr Peter Hordern Mr Peter Hordern , Horsham and Crawley

Will the Secretary of State now answer the second question of my hon. Friend the Member for Bromsgrove and Redditch (Mr. Miller)? Did he personally, on behalf of the Government, give a guarantee for any of the recent loans to British Leyland from the banks, totalling £50 million?

Photo of Mr Eric Varley Mr Eric Varley , Chesterfield

It is not my responsibility. That responsibility rests with the National Enterprise Board, and these arrangements, I understand, are satisfactory to those from whom the loans have been received.

Photo of Mr Nigel Fisher Mr Nigel Fisher , Kingston upon Thames Surbiton

asked the Secretary of State for Industry what production output, in terms of vehicles per employee, has been achieved by British Leyland in the past year.

Photo of Mr Leslie Huckfield Mr Leslie Huckfield , Nuneaton

I refer the hon. Member to the National Enterprise Board's report on the performance of British Leyland which my right hon. Friend provided to the House on 25th July 1977.

Photo of Mr Nigel Fisher Mr Nigel Fisher , Kingston upon Thames Surbiton

Can the hon. Gentleman confirm whether it is correct, as has been reported, that the equivalent Japanese output is 43 vehicles per man per year, which is an enormously higher figure than ours? Is not this difference in output really the key to the future of British Leyland?

Photo of Mr Leslie Huckfield Mr Leslie Huckfield , Nuneaton

While it is true that some of the productivity levels of some of our main competitors are higher than at British Leyland, I should warn the hon. Gentleman that direct comparison is not exactly of like with like because we are not necessarily talking about the same vehicle types.