Orders of the Day — Regional Aid

Part of the debate – in the House of Commons at 6:08 pm on 13 November 1979.

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Photo of Mr Richard Wainwright Mr Richard Wainwright , Colne Valley 6:08, 13 November 1979

I propose to deal with certain aspects of the wool textile industry, which is an important employer in my constituency. It is also an important employer in the constituency of my right hon. Friend the Member for Roxburgh, Selkirk and Peebles (Mr. Steel).

Successive Governments have gone out of their way to acknowledge the reliability of the wool textile industry in its reports to them. The self-reliant wool textile industry has not repeatedly moaned to the House of Commons or sounded false alarms. It has not asked for negative or self-destructive remedies during its various and recurring troubles.

In that spirit of reliable reporting it must be said that, in spite of the appalling handicap of a greatly over-valued pound, the industry has remained successful in much of its export effort. It is still exporting about 40 per cent. of its output. That is a remarkable percentage, and, on average, represents about £5,000 for each member of the work force. That is a proud record for an industry in such a competitive sector.

When we consider the danger of retaliation in valuable export markets against any attempt by Britian to establish import controls, we must remember that the whole of the southern hemissphere is closed to our wool textile exports by protectionist and rather stupid attitudes.

Hon. Members have justifiably criticised the appalling record of the United States. Firms in my constituency, and no doubt in other areas, still manage to export substantial amounts of high quality cloth to the United States, despite tthe 45 per cent. tariff. That tariff is to be reduced to 41 per cent. over six years under the Tokyo round. That is no tribute to the negotiators on the non-American side.

The 60 per cent. of the wool textile industry's trade that is done at home has slumped badly in recent months, and the trend of decay is accelerating. Because of that decay the all-party wool textile group requested the official Opposition to provide time for a debate. The saddest part is that some firms in the worsted sector which re-equipped as recently as four years ago have had to close because it is impossible for them to compete with low-cost imports.

The Minister used a rather devious form of words when speaking of the multi-fibre arrangement. I hope that those words will be strengthened by the Under-Secretary of State. The wool textile industry benefits relatively little from the multi-fibre arrangement. Wool textiles, whether tops, yarns or cloth, do not figure in what is known as the sensitive group under the MFA and are not subject to import quotas in the EEC.

Cotton and certain types of knitwear are included in the sensitive group. I do not grudge them that, but they benefit conspicuously from the quotas under the MFA. The wool textile industry's protection under the MFA depends almost entirely on the basket extractor mechanism—that is not my term. That mechanism is as cumbersome as its description suggests.

At the next meeting of the Council of Ministers I urge the Minister for Trade to remind the Council of the appalling delay in operating the basket extractor mechanism. The idea of the mechanism is not a bad concept. It is used when the imports of certain products—for example, wool cloth, tops or yarns—suddenly surge and become positively disruptive to the home industry. A quota is then established by means of the mechanism. The industry insists that the machinery is creaky, slow and subject to bureaucratic delay in Brussels. I am sure that that was not the intention of those who framed the MFA and who hailed it as a great advance.

We must have a declaration from the Government that they will do everything possible in the EEC to ensure that a new multi-fibre arrangement is negotiated before the current arrangement expires at the end of 1981. I do not doubt the Government's good intentions, but the EEC is flabby on the issue. It is not good enough for comfort to be taken from the words of Commissioner Davignon. Commissioners are here today and gone tomorrow. The Commission has not made any worthwhile pronouncement about the future of the MFA.