NORTHERN IRELAND (FINANCIAL PROVISIONS) BILL

HC Deb 17 November 1972 vol 846 cc779-839

Order for Second Reading read.

11.8 a.m.

The Minister of State for Northern Ireland (Mr. David Howell)

I beg to move, That the Bill be now read a Second time.

The Northern Ireland (Financial Provisions) Bill, 1972, was introduced on 1st November and it now comes before the House for a Second Reading at the end of a week in which a good deal of attention has been given to the political future of Northern Ireland and to the hopes for the restoration of normal life there. My hon. Friend the Financial Secretary also came to the House earlier this week seeking approval for an order making available to Northern Ireland the final portion of loans up to the limit provided in the Finance Act, 1970. Clause 1 refers to that limit and seeks to provide for requirements a little further ahead.

The Bill has three clauses, not including the short title. The operation of Clauses 2 and 3 is linked with the currency of the Northern Ireland (Temporary Provisions) Act, 1972, which expires on 30th March, 1973, unless otherwise extended.

The House would be quite right to conclude from the shortness of the Bill and from the relative simplicity of its drafting that it is essentially a vital but interim measure. There is no fundamental revision of financial arrangements which were set up under the Government of Ireland Act, 1920, nor is there any alteration of the relationship between the Northern Ireland Exchequer and the Treasury which has subsequently evolved. That system continues as before, but with a new grant in aid flexibility and with arrangements for parliamentary accountability at Westminister for the duration of the present temporary situation. That is as intended.

The House will recall that the Northern Ireland (Temporary Provisions) Act pro- vided in Section 1(4) that the administration of Northern Ireland services should continue and their costs should be met as nearly as may be as if the Act had not been passed. The Bill continues in the spirit of that Act. Not only do Clauses 2 and 3 tie themselves to the operation of the temporary provisions Act but the Bill is concerned with only three limited financial proposals which are, we believe, necessary for the proper functioning of all the Northern Ireland Departments in the immediate and short-term period ahead.

Relations between the Northern Ireland Exchequer and the Treasury have, of course, developed throughout the last 50 years to take account of the various social and historical changes that have occurred. The general principle that parity should govern both expenditure and taxation as between Great Britain and Northern Ireland became established as the working rule in the years following the Government of Ireland Act and it was formally declared in the memorandum of 12th May, 1938. Over the years a number of arrangements covering specific items or social programmes were made between the two Governments. These were designed to supplement the tax revenue of the Northern Ireland Exchequer so that it could meet the increasing burden of public expenditure which rising standards and the principle of parity inevitably threw upon it.

The main subventions under these arrangements, some of which are reciprocal are described in the White Paper. "Northern Ireland—Financial Arrangements and Legislation", presented by my right hon. Friend and the Chief Secretary to the Treasury last June. They are the health services agreement; the social services payment: the national insurance and redundancy funds adjustments; regional employment premium; and agricultural subsidies. The White Paper estimated all these to total £133 million in 1972–73—that is, a net inflow of £133 million to Northern Ireland for these social, industrial, welfare and agricultural support purposes.

The very titles of these payments and agreements reflect the social history of the United Kingdom and the great advances that there have been in the last 50 years. That the original financial arrangements have had to be supplemented to meet new demands on public expenditure arising from entirely new social attitudes should surprise nobody. Many areas of Great Britain, particularly those that are designated for regional assistance, receive similar financial inflows, but because they have no separate exchequer the amount is less explicit. The Northern Irish effectively pay taxes at one and the same rate as the other regions of the United Kingdom.

Some time before the passing of the temporary provisions Act discussions were going on with the Northern Ireland Government about the inevitable need for some further supplement to Northern Ireland's resources. As the White Paper said in paragraph 3 The continued rise in development expenditure and reductions in tax rates have for some little time made it clear that some fresh and possibly more comprehensive means of supplementing Northern Ireland's tax revenues was likely to become necessary. Clause 2 provides for an interim grant-in-aid to the Northern Ireland Exchequer as a flexible means of supplementing Northern Ireland's tax revenues. In its flexibility the grant-in-aid is an innovation because it differs from the various agreements and special payments which are defined by formulae and are linked to specific purposes and programmes. But neither Clause 2 nor the Bill as a whole represents the Government's comprehensive and settled proposals for the future financing of Northern Ireland.

As hon. Members will readily appreciate, the longer-term financial arrangements are intimately bound up with the political and constitutional framework which my right hon. Friend hopes will emerge in the process of debate and consultation now going on.

Unfortunately it is still not possible to debate any aspect of Northern Ireland's life without considering the effect of the continuing acts of strife, destruction and violence. The civil disturbances have had cumulative effects on the economy particularly in certain sectors and in certain localities. The Government have recognised the difficulties that exist and have taken a series of measures right across the economy in support of the maintenance of activity, employment and prosperity. The grant-in-aid facility pro- vided under Clause 2 will help to ensure that these and all the other agreed expenditure programmes are funded from the Northern Ireland Exchequer.

As the White Paper makes clear, the impact of continuing high social and development expenditure in Northern Ireland was bound to lead to more drawing of loans for capital works and increased commitments from the Consolidated Fund. The major policy changes affecting expenditure in 1972–73 have been in the trade, industry and employment programmes. These follow the Cairncross Review of Economic and Social Development in Northern Ireland dated December, 1971, the package of measures announced on 27th July this year, and a number of other measures announced before and since.

The year has seen the setting up of the Finance Corporation to assist industry; a further acceleration of public capital works, including many in the amenity and health fields; special employment schemes involving environmental public works and agriculture; and a further expansion of industrial training. It has also seen increases in industrial incentives to preserve Northern Ireland's differential over the other assisted areas; special measures to help the liquidity of retail and service businesses; and a big contribution to the expansion scheme of the Belfast shipyard.

The House—and particularly hon. Members with Northern Ireland constituencies—will be aware that the province has had serious and stubborn economic problems for many years, particularly evident in high and localised rates of unemployment. The latest unemployment figures recorded a fall, but 38,000 people—that is, 7.3 per cent. of the labour force—are still out of work. Thanks to the good sense and determination of management, trade unions and work people, industrial production has been very little disrupted by the prevailing situation. Ulster industry is still very much in business, and asks no more than to be given an equal chance to compete for orders with suppliers elsewhere.

The record over the last few years and to date shows that performance and delivery will be maintained despite the political situation. We have current inquiries from important foreign investors who are attracted by what Northern Ireland has to offer in terms of financial inducements and a highly trained labour force. Currently we have one firm commitment to come to Northern Ireland. In this situation it would be doubly unfortunate if buyers in Great Britain should decide to switch their orders away from Northern Ireland simply on the grounds of general and unsubstantiated fears that the orders would not be fulfilled. I would urge anyone contemplating such action to give his Northern Ireland supplier an opportunity to discuss the situation, preferably by visiting Northern Ireland, where he could see and assess things at first hand rather than through the eyes of the television camera.

I now turn to the Bill. Clause 1 increases by £150 million the existing limit of £200 million on Northern Ireland's borrowing from the National Loans Fund. This is done by amendment of Section 35 of the Finance Act, 1970, which contains a provision for £200 million to be made available to Northern Ireland in £50 million tranches by order subject to affirmative resolution. Last Monday night the final £50 million portion was made available. It is therefore convenient and timely to provide in the Bill for further drawings in the years ahead. The effect of the clause is that the limit on loans is raised by £150 million on enactment.

Provision is also made in the clause for up to a further £100 million by order. The Northern Ireland Government pay interest on the loans they draw, and use them principally for on-lending to local authorities and public service bodies. The biggest single purpose for which the loans are employed is housing, through the agencies of the Housing Executive and the new town commissions. That accounts for almost 50 per cent. of what is currently being drawn. The remainder goes in roughly equal parts to the Finance Corporation, the Electricity Board and the local authorities for their general capital programmes. Loans from the National Loans Fund are not tied to any particular expenditures or programmes, but must be for purposes that the Treasury agrees to be capital expenditure.

Clause 2 gives my right hon. Friend the Secretary of State statutory approval to come before Parliament in the normal course of the appropriation and supply procedure for the voting of a grant-in-aid to the Northern Ireland Exchequer. Any grant or grants under the clause will therefore add to the existing sources of revenue of the Northern Ireland Exchequer. The grants will not be specific to particular decisions or programmes; they are concerned with funding and not with expenditure, so that both the grants under this clause and the loans under Clause 1 rank as transfers within the public sector, and do not themselves constitute public expenditure. Decisions affecting expenditure will continue to be taken as before, and the control of expenditure and the departmental accountability of the Northern Ireland Departments will continue.

There will, of course, be an overall relationship between the total agreed expenditure of the Northern Ireland Exchequer and the size of any grant-in-aid, and it is in this light that the approximate figure of £60 million estimated as likely to be required in 1972–73 should be regarded, rather than as an estimate of the cost of particular measures and expenditure decisions.

Clause 3 seeks to repair what hon. Members on both sides of the House have rightly described as a deficiency in the Northern Ireland (Temporary Provisions) Act, 1972. The prorogation of Stormont has left a hiatus in the parliamentary scrutiny of the accounts. These would normally have been subject to the examination of the Public Accounts Committee of the Parliament of Northern Ireland. The Government recognise the need to ensure proper and continuing accountability, and Clause 3 requires that the appropriation accounts of the Northern Ireland Departments and the other accounts defined in the relevant sections of the Exchequer and Audit Act (Northern Ireland), 1921, shall be presented to this House if they relate to 1971–72 or to any other financial year ending during the currency of the Temporary Provisions Act.

In practice this means that the appropriation accounts, and the trading and other accounts, and the reports of the Northern Ireland Comptroller and Auditor General will be presented at Westminster. The appropriation accounts, and the Comptroller and Auditor General's reports on them represent the major volume; but an important feature of the trading and other accounts, presented under Section 22 of the Act, is that they also contain the Comptroller and Auditor General's comments on any other accounts which he has audited and on which he has seen fit to make a substantive report.

Mr. Stanley Orme (Salford, West)

The Minister states that the accounts will be presented to this House. Does that mean that they will be presented to the Public Accounts Committee or the Public Expenditure Committee for examination by hon. Members?

Mr. Howell

It means presentation to the Public Accounts Committee for examination by hon. Members.

Captain L. P. S. Orr (Down, South)

Does that mean that accounts which would normally have been presented at Stormont, available to the Public Accounts Committee there and for scrutiny there, will now be presented here?

Mr. Howell

It means that those accounts arising from expenditure and activity in 1971–72, the financial year which ended during the currency of the Temporary Provisions Act, will be presented here. Similarly, if that Act should extend over a period during which the current financial year ends, those accounts arising from activities now going on will also be presented here. I think that that covers the gap that would otherwise arise.

The volume also lists all the accounts which are audited or examined by the Northern Ireland Comptroller and Auditor General, so I think that covers quite effectively the gap which hon. Members have rightly pointed out.

Therefore, within on the one hand the limitations imposed by the Temporary Provisions Act and, on the other, the wide-ranging powers of the Public Accounts Committee under Standing Orders, it is intended by Clause 3 to provide for appropriate and continuing public accountability while the present arrangements are in force. The clause deals with the specific matter that has caused some comment and criticism.

The Bill is an interim measure. It does not reflect the longer-term plans which are related to constitutional and political development in Northern Ireland. It is as an interim measure that I commend it to the House.

11.25 a.m.

Mr. Merlyn Rees (Leeds, South)

The Minister has given us a great deal of valuable information about the economic situation in Northern Ireland, which it will be most important for us all to read, particularly in the context of the appropriation accounts that we shall be considering in the near future. It follows that the Minister is the person to give that information.

I should like to concentrate on the Bill, and if my hon. Friend the Member for Salford, West (Mr. Orme) catches the eye of the Chair he will pick up many of the Minister's points and perhaps develop them.

The Minister explained that earlier this week in an order we provided a further £50 million from the National Loans Fund under Section 35 of the Finance Act, 1970, to the Northern Ireland Exchequer. It was the last bite of that cherry. The Bill increases the total to £350 million.

It is well to put in perspective the whole question of finance for Northern Ireland. It is also as well, as we approach the point of decision by the Government of this country, that we should obtain the facts of finance as well as of many other matters. It is part of the realism that we all talk about, quite correctly, the realism that we shall eventually all have to face up to.

Paragraph 67 of the Green Paper, "The Future of Northern Ireland", the paragraph which talks about the finance of Northern Ireland, tells us that loan advances to the Northern Ireland Government amounted to £65 million. We note that the estimates for 1972–73 are £100 million, a great increase in the course of a year.

Other information about the loans is given in paragraph 32 of Cmnd. 4998, "Northern Ireland: Financial Arrangements and Legislation". I deduce from the information in that paragraph that we are concerned here only with the on-lending. I should like information from the Minister about that, because I note from that paragraph that some capital expenditure is provided for by the revenue of the Government of Northern Ireland themselves. What is the distinction between the capital expenditure that comes from revenue and the capital expenditure that comes from the National Loans Fund money provided for the Northern Ireland Government? It may be that there is no distinction between the two, that it has arisen in an ad hoc way, but it is important for us to know for what purpose the Westminster Parliament provides the money from the fund.

The sum of £350 million is the new limit of the amounts provided from the fund. What control does the Treasury have of the sums to be made available after allocation? Is it done simply through the Public Expenditure Survey Committee in the first instance or is there any control afterwards of the expenditure by Government Departments? In this country the Treasury keeps a close eye on the expenditure of money after it has been allocated by PESC. Is there any such control of the allocation for money provided in this way to Northern Ireland?

I notice from the accounts that have been provided that interest is paid. What interest is paid by the Northern Ireland Government? As the Minister of State has explained, the bodies to receive moneys as on-lending are the local authorities. The Minister of State told us that a large amount of the money goes to the Housing Executive and to the new electricity board arrangement. It is some months since we approved by order the setting-up of a new electricity organisation for Northern Ireland, which took over what I think amounted to four organisations, the major function being co-ordination. As I recall, the Belfast and Londonderry organisations had been separate. There is also, although the Minister of State did not mention it, perhaps because he was only paraphrasing the list, the Northern Ireland Transport Holding Company.

Those are the major groups which I noticed. It was with surprise, therefore, which illustrates our lack of knowledge of this matter in the House, that I heard that some of the on-lending went to the Northern Ireland Finance Corporation. A few months ago, when the Northern Ireland Finance Corporation was set up following the Cairncross Report, I recall that a sum of money was supplied for it to operate with. Does that mean that the British Exchequer was providing on-lending money to the corporation as a starter, and that it is possible now to provide more money as a result of the action which we are taking today? Or are we talking about the same money? I am seeking to find out the method of providing money to the Northern Ireland Finance Corporation. This is a valuable corporation and an example of what we might do in Britain again. I remind the House that the Industrial Reorganisation Corporation, which was set up by the Labour Government, was shut down by the present Government, who have now had to re-introduce means of providing money to industry via the Industry Act, which was part of the change of heart of the Government during the course of this year.

The provision of money by central Government to industry is part of the development that one finds throughout the Western world. It happens everywhere and it is a dangerous political party which says that it will never do it. It happens everywhere; all parties find themselves doing it. The Government are doing it in Northern Ireland.

I am concerned about the control which the Government have. Under direct rule the Government have a fundamental responsibility for the money provided to private firms through the Northern Ireland Finance Corporation. I am anxious only to know what control Westminster has, as Westminster has fundamental responsibility, over the money which the Minister of State has told us goes to the corporation. In that respect, my hon. Friend the Member for Salford, West (Mr. Orme), who is sitting with me on the Opposition Front Bench, will be asking questions and dealing with the situation on the ground in Northern Ireland.

I was interested in the International Engineering Company in Belfast, and when I went to see it I found that it was ICL. It had been set up in the days of the Stormont Government. I understand that the Northern Ireland Government are a major shareholder and provide money for the International Engineering Company in Belfast. Will it get its money through the Northern Ireland Finance Corporation or from it, or will it get it in some other way via the on-lending which we are making to the Northern Ireland Government?

It is important, if Governments are to become involved—and I think there is no option but for them to do so—in the running of individual firms, that there is not just accountability at the end of the day but, whether we agree with it or disagree with it, provision for us to know what we are doing and how we are doing it. The International Engineering Company, which was formed out of ICL, provides some valuable jobs in Northern Ireland of the right sort. I understand that some discussions are to take place between that company and Harland and Wolff about the provision of a computer, which would be of value to the shipbuilding industry but which would be at ICL.

I know that hon. Members from Belfast will be very interested in that matter. But what is the machinery for this to be done? The Government are shareholders in both Harland and Wolff and ICL. If it is to the advantage of people in Northern Ireland, and Belfast in particular, that there should be a computer, then the matter is in the hands of the bosses, who are the Government, of the International Engineering firm and the firm which would make the computer. It should not be too difficult for the same bosses, maybe in a different guise, to get together.

The Treasury has laid down criteria over the years for public corporations. It is now 25 years since these public corporations, which we now choose to call nationalised, were set up and given some sort of criteria. Then there came the work of the Select Committee on Nationalised Industries. There are not many hon. Members present to hear me say it, but in my view it is one of the best Select Committees to develop over the last 20 years. What it has to say is of value to the people running the industries. Out of its work there came the 1961 White Paper on the financial and economic obligations of the nationalised industries—I will not go into the precise rubric which was laid down in that White Paper. From the Labour Government came the White Paper of 1967—"Nationalised Industries—a Review of Economic and Financial Objectives."

Throughout this period, the social obligations of public corporations have been discussed. People cannot justly say, "Is not it terrible that the nationalised industries do not make a profit?" if the Government tell them to carry out operations on which nobody could make a profit. Arising from that kind of situation, the corporations receive grants towards their provision of social services, and this enables their accounts proper to be judged on their merits, through discounted cash flows and the rest, which the hon. Member for Belfast, South (Mr. Pounder) understands in practice, unlike others of us who use them in a different sense.

Each of the boards of the nationalised industries is given an objective. For example, the objective of the North of Scotland Hydro-Electric Board is to make 6 per cent. net per annum. That is laid down over the next few years. I will not list the objectives that are laid down for the other nationalised corporations. What I am driving at—I have eventually got to the point—is, do we do this for the public corporations in Northern Ireland, for which we are now supplying another £300 million through the National Loans Fund, which is then on-lent by the Government of Northern Ireland to the individual boards?

May I ask one question in this connection? As a result of pressure from both sides of the House the Minister has been good enough to tell us about public accountability. I shall say a word about that in a moment. If we are objective about it, it is one of those matters that had to be left for deeper consideration in the Government's haste to impose direct rule. However, I have searched diligently this week trying to find in the various accounts to which bodies the money has been on-lent. I have not been able to find out. That may be a deficiency on my part. But I find on page 4 of the Financial Statement for 1972 that under "Public Debt"—or so it seems because loans and advances are made—money goes to the Northern Ireland Housing Executive, to the Government Loans Fund, which seems to be the on-lending agency, to the Craigavon Development Commission, to the Antrim and Ballymena Development Commission and to the Londonderry Development Commission. Then there is the Capital Purposes Fund. Neither in that nor in the rest of what I have looked through this week do I find mention of the new electricity organisation. Nor do I see any reference to the Transport Holding Company. It may be that this information is available somewhere and that my failure to find it is a deficiency on my part.

When one looks at the accounts relating to issues from the National Loans Fund in 1970–71, whereas for the rest of the United Kingdom there is information which accountants and politicians concerned in running local government and public corporations would revel in, all that one finds is loan transactions appearing in the National Loans Fund Account, in respect of which no account is included in this volume relating to the Northern Ireland Exchequer. In the one book giving the kind of information that one is seeking, one does not find it. I have not been able to find it anywhere else. It is important and it should be available. It may be that I have been looking in the wrong place. But I should like some help on that not just for the purposes of this debate but because hon. Members should be able to obtain this information easily.

On local government, is there to be any different method of allocation as a result of the new local government bodies which have been set up and for which there were to be elections? I shall say more about that in a moment. There are new local government bodies in Northern Ireland. Is procedure for on-lending to them by the Northern Ireland Government to be the same, or is it to be changed in any respect?

Arising out of that is the fact that, regrettably, there have been no local government elections. Who is to be the responsible person in law for these new local authorities which are being set up? I ask the question not because I believe that this should be the way, but are commissioners appointed who will be responsible for these local authorities? We are supplying the money. It is important that we know the Government's thinking in this respect.

As I said, my hon. Friend the Member for Salford, West will ask and discuss many of the questions which arise on the ground in Northern Ireland. I said that there were only two that I wished to ask, and I have asked one of them.

My second question relates to the Macrory reforms. As a result of orders in this House we have set up area boards. We discussed how people were to be allocated to these boards. It has been brought to my attention that on one area board in the west of the Province, out of 25 people on it, 17 are Protestant and 8 are Catholic. I am told that in the area the balance of the population is the other way round. I am the first to say that to allocate people to any sort of board on the grounds of religion would be foolish and that to have a statutory Protestant or a statutory Catholic would also he wrong. However, it has been put to me that in that part of the Province it stands out clearly that is under-representation of the Catholics in the area. It has been put to me, "It is the same old story. Everyone talks about reform and about putting matters right. We have had Macrory and the setting up of the area boards. But at the end of the day nothing is different when it comes to the kind of person who finds himself on an area board." I hope that we shall have some comment from the Government on this point, since these matters are probably of greater importance to people in Northern Ireland than the overall financial questions that I am asking. However they have to be asked from a House of Commons point of view, and I shall return to them.

In Clause 2 the Bill talks about grants and says that they will be about £60 million. The clause refers to grants-in-aid. The Minister spoke about them. May we have some information about these grants? When I first looked at the Bill I thought that these were local government grants. I began looking at the Bill in the context of block grants, percentage grants and unit grants. But is that so? If they are not just local government grants, what other forms of grants are implied and how do they differ from the system here?

What control does this House have over them? As I understand it, these payments are extra. They are on top of the £133 million about which the Minister spoke earlier this year and which was noted in the White Paper. Are we now saying that this is not £133 million extra to Northern Ireland but more like £200 million, or is it subsumed in the earlier figure of £133 million referred to by the Minister and in the White Paper? Then again, what is this extra money for? I imagine that some of it will be for additional pay awards, but it will be interesting to know about the rest of it.

Moving on to Clause 3, the Minister has given us a great deal of information about public accountability, for which the whole House is grateful. It is a point that we raised earlier. The hon. Gentleman has explained what is meant by "presenting accounts" to the House. May I raise one matter in respect of this? In past months there has been much talk about how we are to handle Northern Ireland business in the House. I confess that I find myself looking at it differently now, in November, from the way that I looked at it in July. I suppose that that is inevitable because a changing pattern of legislation is coming forward. But on the subject of public accountability, I presume that these accounts will be able to be looked at by the Public Accounts Committee in this House. I choose my words carefully because the selection of Members to serve on the Public Accounts Committee is not for a Government Department. Nor is it for the Opposition. It is done in a House of Commons sense. It is important that people with knowledge of Northern Ireland should be on the Committee in some way or another that would enable them to investigate these accounts. I have no clear idea of how this should be done, I only know why it should be done. Perhaps the Government, through the usual resources at their control, can look at this.

I am mainly concerned about the National Loans Fund and the questions I have been asking are directed towards that. Large sums of money are being provided by the Westminster Parliament and it is important that we should have the information readily available so that we know how the money is being spent. Above all, it is important for all of us to get our facts right. I do not look at this like some Irish absentee landlord looking at the peasants and saying, "How good we are to provide money for the poor." I am simply looking at this from a House of Commons point of view and saying that large sums of money are provided and we should know what they are. It seems that no one really knows but that it is a lot of money is for sure. Whenever I try to work it out I get my arithmetic wrong but it is something between £200 million and £300 million. We have to take into account the expenditure as a result of 18,000 troops in Northern Ireland.

It is important to look at the reality of the situation from a financial point of view. We must note the hard words spoken by the Prime Minister in Northern Ireland yesterday. Paraphrasing his hard remarks, what he said very firmly was that if anyone wants UDI there will not be a penny of the £200 million. The right hon. Gentleman may have been using the £200 million in one context. It is more than that. That is yet another reality which we will have to face up to. It is the taxpayer of the United Kingdom, and that includes the taxpayer in Northern Ireland, who is concerned with the provision of this money.

We would be foolish if we did not face up to another reality, which is that increasingly people in this country are questioning the worth of this expenditure. I make no value judgment on it; I simply say it is happening and we should take it into account. When a few months ago an attempt was made on the life of Mr. William Craig, many people here—I was one—thought how terrible it was. I said so at the Labour Party Conference. It made the people of this country say, "How terrible. What a country it is we are trying to help." The same people will be saying the same thing this morning when they hear that those whom we are attempting to help have attacked the wife of a Stormont Member of Parliament. They must be a brave crowd to attack a woman! Just as we attacked the attackers of Craig, so we do the same thing now. It is not irrelevant to the provision of money because this simply weakens the resolve of people here.

There has been one important aspect of reality and for this I thank the Minister of State. He has given us much information about the general financial situation. If he can help us on the National Loans Fund provisions I should be grateful. We must consider the money we are providing to Northern Ireland and bear in mind the need for accountability to this House.

11.55 a.m.

Mr. Stanley R. McMaster (Belfast, East)

Speaking as an Ulster Unionist Member I welcome on behalf of other Unionist Members and everyone in Northern Ireland the generous provisions made in this Bill. As the Minister of State pointed out, the sums involved are considerable—£350 million is the increase in the limits set in the Finance Act, 1970, on the sums to be advanced by the National Loans Fund to the Northern Ireland Exchequer. I was a little disappointed that we did not receive more details about the way in which the money is to be allocated. We welcome the statement that a large proportion of it is to go towards housing and that other sums are to be made available to the Finance Corporation to assist industry.

Surely when such massive sums are being allocated, when in previous debates the same figures have been quoted, we might have expected to hear a little more of the detail? I am not talking about accountability, as did the hon. Member for Leeds, South (Mr. Merlyn Rees). I am talking about the ordinary methods of dealing in this House with appropriations and estimates for future expenditure. Some indication might have been given about the estimates on which these calculations have been made.

Will my hon. Friend say something about the Government's thinking on how this money is to be serviced—that is, the source from which repayments of capital and interest will be met? In so far as money will be spent on housing which we badly need, do the Government expect that the rents from such houses will be adequate to pay the interest, which at present rates will be heavy, as well as repaying the capital involved? In so far as the money is made available to industry, will there be an element of subsidy to new industries and to enable existing industries to expand? Will industry pay the full commercial rate of interest or will there be help in servicing the loans?

It will be seen that the money being made available falls under two clear heads. First, very large sums are required in Northern Ireland to restore the damage of the last three years. I have seen the Belfast Co-operative building in my constituency attacked three times. Millions of pounds' worth of damage was done when the main building was burned down. The Prime Minister passed what is now a vacant spot where this magnificent building stood. It was moved and set up again nearby. That building has been attacked twice in the last few months. The damage done to shops, factory premises and so on throughout Northern Ireland is substantial. This is one of the first claims of Northern Ireland on the Treasury. It is a claim we are not at all happy to make but which nevertheless falls upon the British taxpayer.

Secondly, and perhaps more fundamentally, there is the need of industry to meet the traditional problems of Ulster which we have often debated. Problems are arising from the rundown of the traditional industries, like shipbuilding and linen, and increasing mechanisation in industry and agriculture. They have led to an extremely difficult employment situation in Ulster which many people believe to be one of the root causes of the unrest and rioting, which has been escalating since 1969.

If these problems are to be dealt with at source, public money must be made available—and the Bill makes public money available—to attract new industry to Northern Ireland. I welcome what my hon. Friend the Minister of State said when he referred to the industry which has approached him and which is considering setting up in Northern Ireland. It was estimated before the troubles commenced that we needed three or four major industries to set up factories in Northern Ireland each year merely to keep up with redundancies from the traditional industries without making any inroads on unemployment. Substantial sums of money will need to be spent on building advance factories, rate subsidies and other inducements to persuade firms to come to Ulster. Since Stormont has been suspended, this Chamber is the only place in which the matter of financial provision can be considered. I expect more details about finance to be laid before the House by the Government.

I wonder how individual firms are to be assisted. My hon. Friend the Minister of State referred to Harland and Wolff. I particularly welcome the sums which have been devoted to modernising that great shipyard. It is one of the finest shipyards, not only in the United Kingdom, but in Europe. Its building capacity, with its dry dock and giant crane, is equal to anything to be found in the world, even including Japan. Ships of up to 1 million tons can be laid down and built in the yard. With the new fabrication sheds, this places the Belfast yard in an enviable position among the leading shipbuilders in Europe and elsewhere.

The hon. Member for Leeds, South commented on the order for the computer. It has been said that ICL, an international company with a large factory providing considerable employment in Northern Ireland, is one of contenders for the order. Has my hon. Friend the Minister of State anything to say about this matter?

That leads me to a more fundamental matter. What degree of control do the Government intend to exert over companies such as Harland and Wolff and ICL through which large sums of Government money are invested? My hon. Friend the Member for Down, North (Mr. Kilfedder) will, if he gets the opportunity, deal with this matter in more detail. It is sufficient for me perhaps to say that, while I should not like to see day-to-day interference in the management of firms like Harland and Wolff and Short Brothers and Harland. I should like to see at the end of the year some form of accountability to this House and some degree of control over companies a large proportion of whose finance comes directly from Government funds.

Mr. Merlyn Rees

As far as I know, the company is no longer known as ICL. Another company is being formed. We should know something about this matter in terms of public accountability. How does it get its money?

Mr. James Kilfedder (Down, North)

It is now IEL.

Mr. McMaster

My hon. Friend the Member for Down, North, in whose constituency the company is situated, will deal in more detail with this matter.

I do not want to see interference in the day-to-day running of Harland and Wolff. For a firm engaging in international business as competitive as shipbuilding, it is important that it should be able to pick the best machinery for the job. The decision should be left to the experts. They will assess the tenders. They must be free to take what they judge to be the best commercial decision. However, hon. Members must be told how they arrived at their decision, and there must be accountability of how these large sums have been spent.

Part of the money being made available to the Finance Corporation should perhaps be made available to the aircraft industry. A firm in my constituency, Short Brothers, has drawn substantially on Government money. We all know the difficulties of the aircraft industry and the need to rationalise it, not only in Britain, but in Europe. This subject has Common Market implications. What will be the result for Short Brothers? It is an ideal employer of labour in Northern Ireland. If the employment situation in Short Brothers were to be adversely affected, it would have very damaging repercussions in Belfast, not only directly among those employed in the firm, but among the many people dependent on it, including shopkeepers.

It is a matter of concern that the diversification which Short Brothers attempted has come to an end. The factory at Newtownards has been closed. I wonder whether adequate consideration is being given by the management to the diversification of the company. It is engaged on very valuable work—first, podding the Rolls-Royce engines for Lockheed; secondly, developing the Skyvan and Skyliner, which appear to be doing well; and, thirdly, on the missile side.

Should not a longer-term view be taken of the future of employment in Short Brothers? Is sufficient support being given to the chairman and managing director of the company? In what way do they account for the manner in which the money advanced has been spent? Are the accounts of the firm to be made available to hon. Members so that we can scrutinise and consider how public money is being spent and whether it is in the long-term interests of the firm? Information on these matters must be made available to the House or to the appropriate Committee of the House which scrutinises and vets the expenditure of the money involved.

I turn to other matters covered by the Bill. The money is to be spent, not only on industrial development, but on industrial training. That is vital to the future of Northern Ireland, and I hope that my hon. Friend the Minister of State will say something about it.

The companies I have referred to have been playing their part in industrial training, and quite a bit of public money has been spent there, but does this provide adequate breadth of training? After all, the future of Ireland depends very much on the availability of a highly trained, skilled industrial force. What thoughts are being given to extending the technical college to assist other companies to establish their own training schemes so that young people in Ulster, who have suffered most from the troubles of the last three years, can acquire skills which are suitable to the 1970s and the hopes of expansion of industry which come from our entering the Common Market?

I will leave that subject of industry to turn briefly to housing. Perhaps the sector which has suffered most from the troubles in Northern Ireland is that of housing. We have some shocking slums in Belfast. My hon. Friend, during the past six months, since he has been acting as one of the Ministers responsible for Northern Ireland, has, I know, seen some of them. I refer to parts of my own constituency where the Prime Minister was travelling yesterday; I refer to those areas where the rioting has been most severe—in the New Lodge Road, Falls Road, and Shankill Road, well known to the hon. Member for Belfast, West (Mr. Fitt) who represented them in the Stormont Parliament.

Very generous sums of money must be made available for the housing industry. Is my hon. Friend satisfied that the portion of money which is to be spent on housing and industrial building will be adequately spent by the construction industry in Northern Ireland? When such considerable sums of money are to be devoted to the construction industry, some consideration should be given to the adequacy of our construction industry in Northern Ireland and to the demands which will be made on it in the years ahead.

Other items which are included in the accounts and which other hon. Members will mention in the debate include health and welfare. We are proud of our hospital schemes, particularly the Royal Victoria Hospital in Belfast and the City Hospital. I feel that my hon. Friend might deal just a little more with the hospitals and the amounts to be spent under this part of the accounts. Because we have such a small representation from Northern Ireland it is important that those of us who do come from there should be able to examine the ways in which public money is spent in Ulster, and to do so with the same degree of care as would be given them if the money were being spent anywhere else in the United Kingdom.

Part of the sums are spent on road schemes, and perhaps my hon. Friend would say what the Government's plans are for expenditure on the roads in Northern Ireland. What are the plans for the motorways and dual-carriageway roads? If the Province is to be adequately developed industrially, success will depend primarily on having a good transport system, and this basically turns on the adequacy of the roads which we have, not only the main roads in Ulster and those connected with the M1 and M2, but also other roads in the more remote parts of Northern Ireland, particularly those border areas where one hopes to see some new industry being set up in order to deal with their unemployment problems which, in many ways, are more difficult and intransigent than those in the City of Belfast and the new city which we are attempting to set up in Northern Ireland.

The hon. Member for Leeds, South referred to the security situation. I feel, as, indeed, I am sure, hon. Members on both sides of the House do, that it is fundamental to our problems. The hon. Gentleman referred to the deplorable attack on Mrs. Currie last night. I agree with what he said. It is a very tragic aspect of the problems of Northern Ireland that many women have suffered because of them. I have figures: 76 women and 40 children have been killed in recent months in Northern Ireland—killed. Till we can deal effectively with terrorists who are seeking to achieve a political end by a vicious and deliberate terrorist campaign, till that can be adequately dealt with, then perhaps it is superfluous to talk in this House, as we are, of the expenditure of sums of money for building up industry and the like. Perhaps my hon. Friend would add a word on this subject.

I read with great interest the remarks of the Prime Minister following the luncheon yesterday. He was issuing an appeal to the public in Northern Ireland to end the violence, but I would just add one comment to that. How does my right hon. Friend the Prime Minister expect the ordinary man in the street to deal with armed terrorists? How can he deal with the gunmen? Surely that is the job of the security forces. I hope that my right hon. Friend does not expect too much from the ordinary man in the street. The ordinary man in the street is being intimidated; he is being terrorised by people who, motivated and often assisted from outside Northern Ireland, are acting in a deliberately seditious manner.

We must turn our attention to the problem of outlawing the IRA throughout the length and breadth of the United Kingdom so that no longer can the IRA hold parties in Britain to raise money to buy bullets to shoot soldiers in Northern Ireland. It is a scandal; an absolute scandal. It is no wonder that a body like the UDA is set up, when many people doubt the sincerity of the Government in dealing with this problem, because they see that the Government are not even prepared to outlaw the IRA in Britain.

I do not want in this debate to elaborate on that topic, but it was mentioned by the hon. Member, and while we welcome all the Government are providing financially, and while I listen carefully to what the Prime Minister says, we would ask the Government to remember that the problem we are dealing with is perhaps a little beyond the control of the ordinary man in Northern Ireland.

I finish by welcoming once again the very generous financial provisions which are made to Northern Ireland. I hope that many of the points of detail will be covered as closely as possible by my hon. Friend when he is winding up the debate. Perhaps, if he is not able to deal with them in sufficient detail today, we may have a full debate on the financial affairs of Northern Ireland another time, when he can deal with these matters which have caused concern and which have been commented upon by the hon. Member for Leeds, South and others and myself in this debate and on the loan order earlier this week.

12.17 p.m.

Mr. Gerard Fitt (Belfast, West)

From the speeches we have heard this morning from the hon. Member for Leeds, South (Mr. Merlyn Rees) and the hon. Member for Belfast, East (Mr. McMaster) it will be clear that there is a degree of unanimity, which, I think, will be shown further as the debate proceeds. We should like to have spelt out to us the exact financial relationship between this House and the Government of Northern Ireland. For many years we have had figures given to us: once we heard of £75 million and it went to £150 million, and then it was £200 million and £300 million, and now it is £350 million.

There are in Northern Ireland those who will dispute all the figures. The leaders of the Vanguard movement would argue that there is absolutely no truth in saying that Northern Ireland is being subsidised to the extent of £200 million or £300 million per year, because the figures are used to make the case that Northern Ireland is being subsidised from this House. I believe that there are vast subventions of money from this House to Northern Ireland, but as yet no one knows the exact figure.

It is not only a question of financial provision to Northern Ireland; there are serious political overtones, because once the figures are clear in Northern Ireland as to the financial relationship, then people can decide whether or not they want to support a particular political ideology.

There may be people in Northern Ireland who are labelled as Republicans and who, when they see the exact relationship, may wish to support it. There may be others on the Vanguard, UDA or Unionist side of the political fence who, when they are fully aware of the financial implications, will not want to vote "Yes" in the plebiscite. Until the figures are made clear there will be a great deal of confusion.

There is no Government in Northern Ireland to spend the money which is channelled from the United Kingdom, and the local authorities are on their last legs. The members of local authorities have, understandably, lost much of their interest, because they are not sure what form the new council elections will take and whether the system of proportional representation will be adopted, as has been promised. A great deal of responsibility, therefore, devolves on the elected representatives to this House in querying how, when and where the money is being spent.

I understand that people have been appointed by the Secretary of State to area boards in Belfast and in the six counties, but they do not have the responsibility that elected representatives have. In areas of high unemployment the unemployed will expect their Members of Parliament to make representations about attracting industry to that area. They will not expect the same degree of attention from someone who has been appointed to an area board. In the spending of the money much more information should be made available to hon. Members who represent Northern Ireland constituencies.

I understand why the hon. Member for Belfast, East welcomed the Bill so vociferously. In his constituency there are two major industries—to which he never fails to give a "commercial"—which have received vast subventions. I do not quibble about that, because they are the linchpin of industry in Northern Ireland. I hope that any financial provisions will not be concentrated solely on attracting industry to Belfast. I live in Belfast and know just how serious is the unemployment problem there, but there is also a serious problem of unemployment throughout the rural areas.

The hon. Member for Belfast, East has rightly drawn attention to the necessity for training schemes being introduced and built up in Belfast to provide a pool of skilled labour, but it is necessary also to introduce such schemes in the rural areas. There is a tremendous need for industry to be brought to County Tyrone and Fermanagh. I recognise that a start has been made in Derry. I am perhaps asking rather a lot, but I should like to know what the Government have been doing to attract industry to areas of high unemployment in the Province. What type of industry do they envisage being able to attract? It needs to be labour-intensive industry employing a lot of unskilled labour, because a large pool of unskilled labour is available. That would immediately take up some of the unemployment and, in line with bringing labour-intensive industry to the area, a training or retraining scheme could be introduced for those who do not have the necessary skills to enable them to work in industry in Belfast.

There are no political divisions between the hon. Member for Belfast, East and myself on the question of the provision of financial aid to Northern Ireland. We both represent Belfast constituencies, where a great deal of damage has been done to industry and housing and even more to the people who live there. I regret that the hon. Member for Belfast, North (Mr. Stratton Mills) is not here, because I am sure that he would agree with me on this. Where shops and factories have been damaged or destroyed by explosions the Government have acted with great alacrity to compensate the owners. For example, the Government immediately made available to the Cooperative £10 million to restart the industry in another part of Belfast. I appreciate that speed is necessary, but I urge the Government to be as speedy in helping private individuals, particularly those who have lost their homes. Since 1968 and 1969 many people, Catholic and Protestant, have left their homes in Belfast because of intimidation. The houses remain unoccupied and the people who have left them have been given no compensation.

Some months ago the hon. Member for Belfast, North and I appeared before a committee set up by the Secretary of State in Northern Ireland to explain the tremendous hardship caused to people who were still attempting to pay off the mortgage on their old home while at the same time having to pay rent for the house in which they were now living. We were told that the Government recognised the urgency of the matter—but that was six or eight weeks ago. Yesterday morning I was in touch with the Housing Executive, but nothing has emerged from that body. In the spending of the money consideration should be given to ordinary people who have suffered tremendous loss because of the political chaos. They should be given equal treatment with industry.

The hon. Member for Belfast, East rightly drew attention to the needs of hospitals and the health service in Northern Ireland. Some hospitals, even major ones, would say that they are not getting adequate financial provision. Naturally, I think first of the Mater Hospital, the City Hospital and the Royal Victoria Hospital. There is a great need to develop the hospital services in Belfast. I am the first to admit that hospitals in Belfast can be compared with those in any other city in the world. The people working in the health service in Northern Ireland are dedicated people. Many improvements could be made to the heart unit in the Royal Victoria Hospital in which there is a dedicated surgeon who is renowned throughout the world for his professionalism and brilliance. The important work done at this hospital would be greatly helped if he were to be given further financial assistance.

I hope that when a committee is set up it will be composed of Northern Ireland Members, but not to the exclusion of other hon. Members because, after all, he who pays the piper calls the tune so there would have to be on the committee people representing constituencies other than those in Northern Ireland. The experience, insight and knowledge of hon. Members representing Northern Ireland constituencies would be valuable on the committee.

In conclusion, I would say that this is not the time to engage in a full-scale debate about security, but one has only to know the situation in Northern Ireland to recognise how serious the problem is. The Minister of State is now almost resident in Northern Ireland, and he will be aware of the great distress which exists—the total fear, particularly in Belfast, where almost nightly people are losing their lives because they are either Catholics or Protestants. I may take an opportunity on some future occasion to illustrate how many people are involved. The vast majority of those who have been assassinated recently were Catholics. I am not pleading the Catholics' case only because they are Catholics but because I do not want to see anyone getting killed in Northern Ireland.

Last night there was a dastardly attack on Austin Currie's young wife in Dungannon. In all the Irish newspapers yesterday morning, and in some English newspapers, there were reports that Austin Currie would not be at home last night. Those who engaged in this dastardly, cowardly and brutal attack on a young defenceless woman with three young children at home must have known that Austin Currie would not be at home. In these circumstances, would it not be possible for the police or the security forces to keep an eye on houses such as Austin Currie's house, which is in an isolated part of the country and which has been attacked many times previously?

I recognise that the security forces cannot give adequate protection to every household in Northern Ireland, but where it is known that a house has been attacked previously and that attempts have been made on the life of Austin Currie, surely this could be done. Now we have had this vicious, brutal attack on his wife.

The hon. Member for Belfast, East talks of terrorism in Northern Ireland. He says that the security forces must do what they can to stamp out the terrorism and that people in Britain would be prepared to give adequate financial resources to that end. But he seemed to be selective in his condemnation of terrorism. He said that the IRA should be outlawed in Great Britain because it collects funds to propagate its campaign of terror. But surely other terrorist organisations in Northern Ireland, when money is being supplied for security forces, should also be prevented from continuing their activities. One only has to read the Irish newspapers this morning to see that the IRA did not like the fact that the Prime Minister did not meet its representatives yesterday. Last night, members of the IRA went out with all sorts of arms and fired thousands of rounds, not at the security forces but into the air, just to let the Prime Minister know that they were armed. They were showing their resentment by firing their guns into the air. The security forces should take it as being their prime and urgent responsibility to try to retrieve those weapons which were fired last night. Weapons held by any private army, whether the IRA, the UDA or the Vanguard movement, are a danger to the whole of society in Northern Ireland.

Mr. McMaster

Of course I condemn terrorism of every kind, but I was being selective, because I was speaking almost as a lawyer. The reason for the trouble and disturbances in Northern Ireland is that the IRA, whether the provisionals or the officials, has set out with bombs and bullets to achieve a political end. The rest is reaction to it. More than 650 people have been killed and more than 7,000 have been seriously mutilated during the last three years. More than 90 per cent. of those killed were killed by the IRA, which boasted of it. Of course, this has provoked a reaction. It is only logical. It is human nature that there should be some retaliation. We have to get to the root of the problem, and that is those who are determined on the use of violence to achieve a political end, the IRA. These are the people who should be dealt with first and foremost.

Mr. Fitt

I cannot agree with the hon. Gentleman. It seems from his remark, "Of course there has been a reaction", that he is almost apologising for the existence of the UDA. Any terrorists in Northern Ireland are a danger to the whole society and steps should be taken to prevent their activities, particularly steps against those terrorists who are known. The UDA has been engaged over the past weeks in a campaign of terror. The security forces should be quite certain that they are not seen to be acting in a partial way against one section of the community or one section of terrorists.

In the chaotic political situation in Northern Ireland even the provision of all this money cannot bring peace. The people of Northern Ireland should now stand up and be counted, to help to see what they can do to end terrorism. There can be no military solution. Military forces and security forces alone cannot end the campaign of terror. In the final analysis it will be the Catholic and the Protestant communities who will drive the terrorists from their districts and eventually drive them from Northern Ireland.

I know that the Minister is very much involved in the housing situation in Northern Ireland. I welcome the Bill but I appeal to the Minister to give urgent consideration to the payment of compen- sation to the thousands of families in Belfast who have lost their homes because of the present disturbances.

12.37 p.m.

Mr. Rafton Pounder (Belfast, South)

Like everyone who has spoken in the debate thus far, I warmly welcome the Bill. I was particularly glad to hear my hon. Friend the Minister of State pay such a fair tribute to the state of Ulster industry at present and the fact that it is still, despite all the adversity, very much in business.

One of the things that inevitably, by virtue of television cameras and reports, has had an effect on English would-be customers has been the sight of disturbances they see in their news programmes. Some have assumed that the whole of Northern Ireland is in this state and that orders are not being fulfilled. However, from information I have had from the Northern Ireland Chamber of Commerce, I think I am right in saying that as yet no one has failed to fulfil orders which have been entrusted to him by customers. A tremendous tribute must be paid to managements and trade unions and everyone in Northern Ireland who has kept the wheels turning.

If I may inject a personal note on this matter, I happen to be involved in an organisation in Northern Ireland which was bombed last Thursday. I got there on Friday morning to find the place back in business. There was hardboard in use and quite a lot of mess, broken glass, and so on, on the floor. But there was no question of taking the weekend off and starting again on Monday. We started the next morning. That is indicative of the whole determination of Ulster industry and commerce. I was very glad, therefore, that my hon. Friend referred to this. No praise is high enough for the way in which the trade union organisations in Northern Ireland have kept the troubles off the shop floor.

Inevitably, in any discussion on Northern Ireland, whether we are discussing a financial measure such as this Bill or something else, people will say that the thought uppermost in their minds is the security situation. It is very easy to become bogged down in the agony of terrorism. After four years of so much death, injury, destruction and suffering, inevitably people will be distressed and depressed. I may be an incurable optimist—although I do not think so—but I believe that terrorism will end, that peace will be restored and that Northern Ireland will be a first-class place in a few years, when all this damage is repaired and the economy is back on its feet again.

If I thought differently, I would emigrate, and the last thing I intend to do is to leave the country of my birth, when I have an absolute faith that we shall be back on the road in due course. I must stress that I totally deplore and deprecate terrorism, from whatever source and in whatever manifestation.

A statement by the Minister of State at a Press conference at Stormont on 27th July, to which he has already referred, contained a sentence referring to a matter which I assume will be covered by the Bill—tourism. He said: The importance of the tourist industry within the services sector is recognised. Looking forward to the resumption of the expansion in tourism, legislation will be made shortly which will provide for a new scheme of capital grants for hotel development. Since there is a capital grant element in the Bill, is it reasonable to assume that tourism will benefit from the Bill?

A great deal has been said about the desirability, and indeed the vital nature, of having full and total financial accountability in this House for such monies as are granted to and spent in Northern Ireland. As one who for seven or eight years now has been trying to unravel the financial complexities of the arrangements between the Treasury and the Northern Ireland Ministry of Finance, I must say that anyone who has the idea that somebody somewhere is trying to be secretive is being very unfair.

The arrangements are enormously complex, totally interwoven, and the existence of the Joint Exchequer Board—I say this in no spirit of criticism—also adds to the difficulties of itemising what money is given to Northern Ireland and what it is spent on. I unreservedly welcome any efforts by any body to try to work out under any known head the financial arrangements between this House and Northern Ireland. Inevitably, people get the idea that someone is hiding something. This is bad, when I am convinced that there is no desire to be secretive in any way about the amount of money or the manner in which it is spent.

The report of the Public Accounts Committee has been mentioned. I realise that this is outside the scope of my hon. Friend's responsibilities—he will rightly say that he has enough to worry about without that—but, for the last two or three years, there has been a Northern Ireland Member—myself—on the Public Accounts Committee. I presume that we shall continue with this practice when the time comes, and that someone from Northern Ireland, as is the case with someone from Scotland, will continue to be a member.

I know that it is argued that there should be a sub-committee to consider erstwhile Stormont expenditure. I would not go that far, because there would be an equal case in relation to Scottish expenditure. I would advocate having two sub-committees or none at all. But it would be wrong to add further complications to the work of the committee by singling out Northern Ireland especially in this regard.

I want to turn briefly to the Northern Ireland Finance Corporation. My recollection is that, up to this Bill, one-eighth of the National Loans Fund was made available for the Northern Ireland Finance Corporation. I am assuming that this remains the same under this Bill.

The Northern Ireland Finance Corporation, although it has been in existence for a relatively short time, has been doing a good job. Its terms of reference are absolutely vital to Northern Ireland at this time, including the power to offer financial assistance to undertakings threatened with closure or contraction, and to help where there are reasonable prospects of solvency in the long run. This always raises the question whether the assistance should be primarily for manufacturing industry, or whether the retail industry and the distributive trades should benefit also.

The subject which keenly concerns Belfast members is the state of the city centre. The various memoranda produced by the shopkeepers show that they are going through a very lean period. It is not sufficiently appreciated that, in that relatively compact area which the IRA made a positive determination to destroy by last December, there are 10,000 jobs at stake.

There are always difficulties when one draws a line, such as for a rate rebate, when there is an equal case for helping those on the periphery. Could my hon. Friend be slightly more generous in drawing the boundary of the city centre for those who are to obtain financial assistance? The situation at the moment is very serious. However, I in no way minimise the Government's assistance already to city centre traders.

The Housing Executive lies very much within the ambit of this legislation. Perhaps in what I am about to say I shall not choose my words too carefully, and for this I apologise in advance. Anything that I say which may be remotely critical is not intended to knock the concept of the Housing Executive. It is a vast structure, which has existed a very short time, and it has had substantial and at times acute administrative difficulties in operating during the changeover period from the old local government structure to the new centralised structure, at a time when housing has been a major problem in Northern Ireland. One hopes that it will shake down and become an effective organisation.

But there are some very serious problems within the work of the Housing Executive. For instance, there is the situation relating to housing lists, which virtually do not exist any longer. As soon as a house is completed nowadays, before it has been handed over to the Housing Executive squatters take up residence. I understand that the Executive has done all it can do, which is to legitimise these squatters by issuing them with rent books when they are available. But it is serious that the housing lists, except for the emergency list, are in abeyance at the moment. I realise the problems and no doubt my hon. Friend will do what he can, with the help of the Housing Executive, to revalidate those important lists.

Yesterday at Question Time, my hon. Friend the Member for Belfast, North (Mr. Stratton Mills) referred to the Executive purchasing houses whose owners have had to leave and who have found it extremely difficult, if not impossible, to sell. I understand that a Govern- ment statement is hoped for fairly soon, and I hope that it will be sympathetic to this problem. People are moving away and leaving houses vacant because they cannot sell them except at ludicrous knock-down prices. It is serious that owner-occupiers should suffer this additional hardship. As I said yesterday, some arrangements should be made for the Executive to take over from building societies properties in troubled areas which, for good reasons, the mortgagor has left and which cannot be got rid of except at a knock-down price. This, too, could perhaps be added to the stock of houses taken over by the Housing Executive.

This morning I received a letter from a constituent who is moving out and who wanted to know whether there is any provision for financial assistance when moving house, not when moving from one property to another in Northern Ireland but when moving to England. My constituent's husband has a job in England and it will be very hard to sell the house. Presumably this sort of case will be dealt with in the working party report, but I should like to know what assistance is available for furniture removing and so forth. I hope that if this question cannot be answered now my hon. Friend will consider it later and give an answer at a subsequent date.

12.51 p.m.

Mr. James Kilfedder (Down, North)

I should like to take up a point which my hon. Friend the Member for Belfast, South (Mr. Pounder) has just mentioned concerning the Housing Executive. I was in the House at Question Time yesterday when the Government were urged to help people who sought mortgages. Many people in Northern Ireland need houses for rent. I know that many would like to buy their houses, but, at the same time, more houses should be provided by the Housing Executive for rent by people who at the moment are living in the face of terror and have nowhere to go.

I know of many people in Belfast who are desperately trying to get out of what are known as terror areas but who cannot be accommodated by the Housing Executive. It is deporable that these people should have to suffer so much. The Housing Executive ought to spend more money on getting houses built. There is quite a bit of unemployment in the building trade in Northern Ireland. Certainly in North Down there are builders who would undertake more work, and these people should be employed on building more houses.

I have in my constituency a landlord who purchased rows of houses in what is now the Republican area of Belfast and which, believe it or not, is still regarded as a no-go area. He purchased those houses in order to provide a reasonable income for himself on retirement. Today he is seeking national assistance because there is no money coming from those houses. People are living in them but they refuse to pay rent. It is a very Irish situation that this poor man is being hounded by the Belfast Corporation demanding that he repairs these houses. In fact, summonses have been issued. The man cannot get into the area. I asked my hon. Friend's colleague, who is responsible for development, for police protection to be given to this man so that he could carry out the repairs himself. The noble Lord said that the police cannot provide protection for a landlord who wants to carry out repairs to his houses. That is a deplorable state of affairs. We hear a lot from the Prime Minister about Ulster people helping themselves, but I think they are the ones who need assistance.

I have often said that I deplore any violent or unlawful action by Loyalists. I condemn the IRA campaign, which has been going on for years, since long before the Loyalists demonstrated that they were not going to tolerate the IRA terrorist campaign without doing something to defend themselves. Apart from the beneficial effect of such action by Loyalists on the IRA, it also has a detrimental effect on public opinion in the rest of the United Kingdom.

I want to refer to the Prime Minister's visit to Northern Ireland yesterday. As I have long desired such a visit to be made I welcomed his decision to go to the Province and talk to the people. That, I gathered, was the whole purpose of the visit—not to engage in a public relations exercise but to talk to the people. I think it was foolish of him to go there and seek opinions from so wide a spectrum as possible and then refuse to meet representatives of the Orange Order and of Vanguard. How can he understand what those people are thinking unless he speaks to them? By refusing to meet them he annoyed people who are not in the Orange Order or in Vanguard, because they thought that he was adopting a high and mighty attitude.

He spoke in my constituency in the Culloden Hotel—a luxury hotel where the staff of the Northern Ireland Office stay, at great expense to the taxpayer. Speaking for myself, they are welcome to stay there. I am always glad to see Northern Ireland's hotels benefit in any way possible. But in that hotel my right hon. Friend made a speech in which he lashed the people of Northern Ireland. As my hon. Friend the Member for Belfast, East (Mr. McMaster) has said, does he expect the ordinary people to fight IRA terrorists with their bare hands? What can they do against the gunmen and the bombers? Remember, also, that the very atmosphere of Northern Ireland creates such tensions and frustrations that the people are driven to deplorable actions. Ulster at present is like a patient suffering from cancer and screaming to her doctor—Dr. Heath—because he has not stopped the spread of the cancer, and, because she is screaming hysterically, her doctor is castigating her and telling her to help herself and trust that in good time he will cure her. But time is not on the side of the patient or of the doctor. Time is not on the side of Northern Ireland or of this Government. My right hon. Friend's speech showed a lack of understanding the harshness of his speech was certainly not welcomed by the ordinary, moderate people in Northern Ireland.

On the 1 o'clock news yesterday a statement was put out, presumably from the Prime Minister's office, announcing that the Prime Minister had gone straight from Sydenham Airport to Short Brothers and Harland, where he talked to the workers who told him how they had prevented sectarian violence there. The strange thing is that the Prime Minister never visited Short Brothers and Harland yesterday morning. At 6 p.m. the BBC put out a statement withdrawing that news item. People in Northern Ireland rightly got the impression—

Mr. Deputy Speaker (Mr. E. L. Malallieu)

Order. Will the hon. Gentleman relate his remarks more to the Bill, which is about capital expenditure in Northern Ireland?

Mr. Kilfedder

I shall try to obey your ruling, Mr. Deputy Speaker. I was saying that the Prime Minister had referred to the money which had been given to the Ulster people and had said what they should do in return, and I was pointing out that Ulster people may misunderstand my right hon. Friend's visit as a public relations exercise.

I welcome the Bill because it helps to tidy up a number of loose ends resulting from the hastily contrived Northern Ireland (Temporary Provisions) Act. The National Loans Fund is an essential part of the operation of central government in the country and the Northern Ireland Government has operated long- and short-term loans through the fund for local authority and general development purposes for more than 20 years.

The fact that larger sums are needed today is a measure of the quickening tempo of the five-year development programme, quite apart from the effects of the terrible destruction being wrought in Northern Ireland by the violence and bombing of the IRA. One of the Government's first acts in June, 1970, was to underwrite the five-year development programme. Since I say harsh things about the Government I should like to say now what a generous gesture that was when they were faced with so many difficult problems at the time. Of course, they were taking over what the Labour Government had said they would do financially for Northern Ireland.

Basically, the plan was to create more work and build more houses, and despite the terror campaign the efforts have been reasonably successful. As the programme gets into its stride—at the moment it is only at the half-way stage—with improved housing, more rapid slum clearance, road building, harbour extensions, urban and rural development, and aid to industry over the whole range of economic activities, it generates greater capital requirement. This is all to the good, and we are glad to see it. It might have been better to increase it slightly last year. At the same time greater flexibility in decision-making at local level in Northern Ireland, aided by wider borrowing powers, might have given greater scope to the superseded Stormont Parliament.

The old Stormont Parliament is frequently criticised, but we should remember that it never had the power or the money which the Government have for implementing their policy. It might have enabled Stormont to take some of the measures taken by the Secretary of State since last March. Of course, my right hon. Friend has the great advantage of direct contact with his Cabinet colleagues in the Treasury, which makes a great difference.

But Northern Ireland has been starved of money for years. One reason has been the lack of interest shown in the Province by successive British Governments. As a region of the United Kingdom, Northern Ireland did not get its fair share of the affluence of the post-war years, as I am sure hon. Members will agree. I agree that parts of Scotland and Wales and some parts of England could tell the same tale. Since last March we have seen in Northern Ireland a story similar to that about the Londonderry Commission. The commission was given three times the staff, who were much better paid, and four times the income of the Londonderry Borough Council. The commission has accomplished a great deal, but with the same liberal backing from the Government the democratically-elected Londonderry Borough Council would have had just as much success.

There is great confusion in Northern Ireland, as there appears to be in the House, over the subsidy figure of £300 million. In his speech yesterday the Prime Minister seemed to have amended the figure to £200 million. But whatever the figure, no one is clear about how it will be made up. Does it include increased borrowing powers provided by the Bill and the Northern Ireland loans order which the House discussed earlier this week? Is it part of the cost of the development plan, or is it additional money? What allowance has been made for Northern Ireland's contribution to the general wellbeing of the nation?

There is a great deal of confusion, and we look to my hon. Friend to clarify these points. Of course, the Bill provides for the laying before the House of accounts and reports which would normally have been laid before Stormont. I am glad to see that. With increased borrowing powers it is only right that the House should have full details and an explanation of just how the money has been spent.

Yesterday, at Business questions, I drew the Leader of the House's attention to Early-Day Motion No. 47, which stands in my name and which deals with the need for Harland and Wolff, which is in the constituency of my hon. Friend the Member for Belfast, East, to buy a British computer. I am sorry that the hon. Member for Hitchin (Mrs. Shirley Williams) is not here, because she also has an interest in supporting British computers. I demanded time from the Leader of the House to debate the Motion at an early date and he replied that as far as he could see I would be in order to raise the matter in today's debate.

Although it is vitally important to ICL that the Belfast shipyard should buy or rent one of their 1903 series computers it is even more essential to the future of International Engineering Ltd. at Castlereagh in my constituency that the shipyard should opt for the ICL computer. IEL does not manufacture the computer but it makes the peripheral equipment which the computer requires. The value of the computer which the shipyard wishes to install is £300,000. The managing director of the shipyard, Mr. Hoppe, is reported to have said that the yard has decided to rent an American IBM machine for two years at a rental believed to be between £90,000 and £100,000 a year.

I do not know what will happen at the end of two years—whether the yard will then buy the machine and so waste about £200,000, no doubt of taxpayers' money, but about £30,000 of the computer order could have been accounted for by IEL, which employs 1,700 workers. The work is needed by the factory. More important, it is needed to keep IEL in the computer field, manufacturing data preparation and peripheral equipment which it has manufactured in the past when it was within the ICL group.

Northern Ireland's industry and economy benefit from the skill and ability which clearly exists at the IEL factory at Castlereagh. We are not talking here about private commercial firms. ICL, the Belfast shipyard, and IEL all have Government support and it would be fair to say that Harland and Wolff is virtually owned—to use the correct phrase—lock, stock and barrel by the British Government. The Government are an important shareholder in IEL and the remainder of the shares are owned by ICL, which is dependent on Government support.

The Government have made a point of their desire to maintain a British computer industry, as did the Labour Government. But what has happened in other cases where the taxpayers' money was involved? In the Computer Weekly of 31st August this year we saw one precedent. It stated that Glasgow University had intended to buy an IBM computer but that the Department of Trade and Industry had rejected that proposal and said that it wished it to purchase an ICL computer.

A document issued by the Northern Ireland Ministry of Commerce on behalf of my hon. Friend the Minister when IEL was established stated: The company will be looking for the fullest co-operation and backing of all personnel and the respective trade unions in order to ensure the success of the new venture. IEL is a company in which 62.5 per cent. of the shares are held fey the Northern Ireland Ministry of Commerce. The statement says that my hon. Friend, then Under-Secretary, had said: Considerable effort has been put into this venture, which is of extreme importance in the Northern Ireland economic situation … the new company clearly has a significant contribution to make to Northern Ireland's high technology industrial capabilities. The immediate task ahead will not be easy. But the Government with its investment of some £2½ million believes that the new company, provided it receives the continuing support of all those concerned, is extremely well placed for a effective rôle in the industrial and economic future of the province. How does that statement compare with what has happened? I wrote to my hon. Friend urging him to persuade the Belfast shipyard to purchase the ICL computer. His reply of 15th September stated: The Ministry was assured by the Harland and Wolff management that ICL was being given a full opportunity of persuading them of the merits of purchasing an ICL computer. It would have been inappropriate "— an extraordinary word— for the Ministry to go further and attempt to direct Harland and Wolff as to their choice of equipment. He rightly points out that in one sense the choice must be left to the commercial and technical judgment of Harland and Wolff, adding: I am sure that whatever choice the management finally settles on, they will have gone into all the very complicated issues very fully. How does that compare with my hon. Friend's statement, when IEL, was set up in May this year, that it depended upon the continuing support of everyone? I ask my hon. Friend now to give that support to ICL and indirectly to IEL, which needs the work to keep its 1,700 employees fully employed.

I also wrote to my hon. Friend the Minister for Industrial Development, who showed in his reply of 2nd October that he had applied some pressure to the shipyard. He said: I wrote to Mr. Hoppe subsequently to underline my concern. However, Mr. Hoppe has now written to say that, after taking my views fully into account and after meticulous investigation (which I understand has included outside independent advice) the company's decision has had to be in favour of IBM. I know that this decision will come as a disappointment to you, as it has to me. But I think we must recognise that the Harland and Wolff management have a very difficult task ahead to make the shipyard viable, and for this reason I believe there is a limit to the amount of pressure that the Government can properly bring to bear on the company where commercial judgments must be made. Why cannot the Northern Ireland Office ask the Government to force the shipyard to buy an ICL computer in the same way as they persuaded Glasgow University not to buy an IBM computer? It is clear from the Minister for Industrial Development's letter that the managing director of the Belfast Shipyard, Mr. Hoppe, has told my hon. Friend that independent advice recommended IBM. Despite that statement, it is widely believed in business and commercial circles in Belfast that the independent consultants who carried out the evaluation of the ICL and IBM computers did not recommend that the shipyard should purchase the IBM computer. It is also believed in those circles that three-quarters of the board and management of the shipyard were in favour of purchasing the ICL computer but were overruled by Mr. Hoppe and the new data processing manager, who has previously always worked with IBM equipment.

There must be serious doubts about the shipyard decision. I demand that the whole matter be subjected to a thorough examination, especially as the taxpayer's money is involved.

ICL stresses that the advanced shipbuilding technique called Autokon, as implemented by Harland and Wolff on the Queen's University ICL computer, is the envy of many European shipbuilders, ICL contends that there is absolutely no reason why such a high standard of excellence should not be achieved for all Harland and Wolff's requirements on an ICL computer. ICL has considerable experience of the British shipbuilding industry, including the British Ship Research Association, and of the heavy engineering industry in general.

Harland and Wolff is to be congratulated on its plan to computerise its shipyard, as the Japanese have done, but it is not too late for the Department of Trade and Industry to subsidise a computer development project at the Belfast shipyard which would then be available to the rest of the shipbuilding industry.

The trade unions in Northern Ireland are concerned. Mr. Blease, Chairman of the Irish Congress of Trade Unions, has made loud and urgent demands that the Government should persuade the Belfast shipyard to opt for the ICL computer. The Lord Mayor of Belfast has made the same demands. Everyone in Northern Ireland who is connected with the industry wants the Government, who have invested so much money in the shipyard as well as in IEL, to persuade the shipyard to purchase the ICL computer.

My hon. Friend the Member for Belfast, East referred to Short Brothers and Harland. That is the firm which closed down one of its factories in Newtownards, in my constituency. Hundreds of people were thrown out of work. I should like to see something being done to provide work in North Down. The factory in Newtownards should not have been closed. I fought against its closure, but my words fell upon deaf ears, as did the words of the trade union movement. I hoped that Short Brothers and Harland would maintain its factory, but it did not do so.

In North Down there is a high density of population, and it is a growing population. Houses are being built—they are the type of house that I want to see all over Northern Ireland—but work is not being provided for the people who are living there, or who will live there. The Government should see that factories are established in North Down, in Newtownards and other parts of my constituency. Perhaps the Minister of State can tell me how many Government factories have been established in North Down. If he cannot tell me today, perhaps he can tell me at a later stage. I want to know when the last factory was established and what plans the Government have to build more factories and to induce firms to go to North Down. There is a rising population and, therefore, a great demand for employment.

It has been admitted that the road programme is behind schedule. In North Down—in fact, close to my home—the standard of the roads is deplorable. I ask my hon. Friend to drive along the roads closer to my part of North Down. He will find that many of them are in a dreadful condition. He will find that many roads urgently need improvement. I hope that I can have my hon. Friend's assurance that he will look at the condition of the roads in North Down.

It is thought in my area, and at times I think correctly thought, that because the people of North Down are law-abiding and there are no riots, and relatively little violence, they are being punished for their good behaviour. If they behaved as some people in Londonderry have been behaving people would be pouring millions of pounds into creating factories, houses and all sorts of community centres, but because they are law-abiding the people in North Down are not getting any of those advantages.

For example, I heard only last week of an organisation in Newtownards which looks after mentally retarded children. It is looking desperately for money. It has asked the Government for money to build a small hall on land which it has purchased in Newtownards so that it can provide facilities for these unfortunate children. But the Government have turned a deaf ear to its appeal. That is a deplorable state of affairs.

1.25 p.m.

Mr. Stanley Orme (Salford, West)

We have had an extremely informative and useful debate. It is unfortunate that these debates always take place in a different atmosphere from that which exists in Northern Ireland. However, we must try to pursue a policy which can bring economic stability to Northern Ireland, which will lay some basis of growth and full employment and in turn help to provide the political solutions that are so urgently needed.

The Bill deals with a large amount of money. We have had all sorts of speculation from both sides of the House as to how much money the Government may be subventing to Northern Ireland. The figure which the Prime Minister gave yesterday has been contradicted and other figures suggested. But all these figures on economic aid must be put alongside what is now spent on military expenditure. I said earlier—and my hon. Friend the Member for Leeds, South (Mr. Merlyn Rees) emphasised the point—that it is impossible to say within £50 million how much is the net outgoing. However, I am certain that the British people in this part of the United Kingdom are now sure that they are subsidising Northern Ireland and that Northern Ireland is not subsidising the rest of the United Kingdom.

Captain Orr

That goes for many other parts of the United Kingdom as well.

Mr. Orme

I take the hon. and gallant Gentleman's point. However, I think that some of the other regions might look with envious eyes on the money that goes into Northern Ireland.

The analysis which we have been given this morning is very informative. The opening statement of my hon. Friend the Member for Leeds, South, with his deep knowledge of public expenditure, took us through the labyrinth of information and knowledge which he possesses. My hon. Friend gave an analysis of public expenditure which can be used in a much wider context as more and more public money is used. Such expenditure has to be more accountable. We must understand how the money is spent and who controls it. That is what we are trying to do today by the questions which we are putting to the Minister of State. We welcome the fact that there will be parliamentary supervision of such expenditure and that the House will be able to have the reports of the Public Accounts Committee. All this underlines the urgent necessity of getting a political settlement and getting matters on a much more rational basis.

In many aspects there is government by civil servants in Northern Ireland. Despite the work that the Ministers do, it is impossible for them to fulfil all the duties that are demanded of them. The new local government elections are required urgently. My hon. Friend the Member for Belfast, West (Mr. Fitt) talked about the local authorities which are now at a standstill, awaiting the creation of the new authorities and new structures. Excellent bodies have been appointed and are working, but they are not accountable to the electorate. That is an important democratic point that must be dealt with.

I want to put one or two questions to the Minister about the Northern Ireland Housing Executive, the Craigavon Development Commission, the Antrim and Ballymena Development Commission, the Londonderry Development Commission and the health services. The money which we are spending and the additional money which will be sub-vented from this House to Northern Ireland is such that this House and the British people are entitled to know how it is being spent, because there are many matters which need to be dealt with urgently.

Productivity, production and employment are the basic economic issues with which we have to deal. Coming to the more specific, work is now getting under way on the first phase of a proposed large industrial estate at Knockmore. When will the first factory unit be ready for occupation, and can the Minister say how long it will be before the 20-acre site itself is developed? I quite understand if the Minister is not able to give immediate answers to those questions. No doubt he will seek other means of informing the House. However, the questions need to be asked because of their vital importance to the economy of the locality and because they get down to specific points about which people wish to know.

We notice that in October, 1972, the unemployment rate in Northern Ireland was 7.3 per cent. That is double the figure in the United Kingdom, which itself is far too high. But it is west of the River Bann where unemployment is highest. Looking at the figures of male unemployment, one sees a rate of 16.9 per cent. in Derry, 18.5 per cent. in Newry, and 21.2 per cent. in Straban, and one realises the magnitude of the job facing any Government in this economic situation. The unemployment situation is but one reason why we wish to know how the money being directed to Northern Ireland is being allocated and whether special note is being taken of the needs of areas like those that I have mentioned. Of course, this does not exclude Belfast which itself is facing heavy unemployment. We understand that the troubles are not helping the situation. We want to knew from the Government the policies that they intend to develop in the coming weeks and months.

A number of references have been made to Harland and Wolff and to Short Bros, and Harland. They are very important firms not only in Northern Ireland but in the British context. To those who advocate UDI I say that if UDI occurred tomorrow, Harland and Wolff would not last six months since UDI would involve our taking out the £42 million of tax payers' money that the British Government have already given. We want to see a strengthening of those firms because they represent the skilled basis of the economy of Northern Ireland. They are an important industrial centre.

I come from an industrial centre in the United Kingdom. In the North-West we are seeing a rundown of heavy industry, especially heavy engineering. That can have disastrous effects on communities such as that which I represent which are not in the same category as Northern Ireland in terms of unemployment. When people talk glibly of standing on their own feet and at the same time about the lower standards in the Republic of Ireland, which we acknowledge economic-ally to be lower, I wonder what standards would be like if we took away the British subvention and left Northern Ireland on its own.

I was interested in the speech of the hon. Member for Down, North (Mr. Kilfedder) and his well-documented case about the computer, which he developed at some length. Harland and Wolff will not have heard a better case made for public ownership in a long time, such are the advantages to a firm like ICL of having public money put into it. We live in strange times. We find ourselves getting more and more support for Labour's economic policies. We should not look a gift horse in the mouth when an hon. Member on the Government benches makes the case for us.

Mr. McMaster

But surely the final criteria must be the most efficient shipyard or the use of facilities to produce the most efficient manufacturing unit. If a company in which a lot of Government money is invested is obliged to take on something which is less useful to a competitor, the disadvantage must be quantified and made up from taxpayers' money.

Mr. Orme

The hon. Member for Belfast, East (Mr. McMaster) is underlining my point and that made by his hon. Friend the Member for Down, North. We are dealing with British taxpayers' money and increasingly taxpayers on this side of the Irish Sea will want to know, especially in the economic climate that we face at present with the freeze, that the money is being spent properly. In this case the Minister is obliged to give full explanations and to take into account the very strong points which have been made.

Housing in Northern Ireland is an aggravating and difficult situation. My hon. Friend the Member for Belfast, West told me about a case yesterday concerning the occupation of houses. Apparently one family was sent to eight different houses in Belfast only to find them all occupied by squatters. The Housing Executive is finding it very difficult to control the situation. I believe that the short answer is a rapid expansion in house building. More houses will have to be provided. House building figures for 1971 show that there were 13,797 completions. That is the highest figure on record in Northern Ireland. Are housing completion figures in Northern Ireland available for the first half of 1972?

According to figures issued by the Nationwide Building Society, the percentage increase in the price of a new house over the past five years has been 46. The average house in Northern Ireland costs about £5,244. While that may be a good deal less than in many other parts of the United Kingdom, when set against economic standards in Northern Ireland it is exceedingly high. I believe that the situation calls for some extension of the public money being directed towards Northern Ireland into the provision of houses by the public authority.

People are experiencing great difficulty. Instances have been given of people selling and buying houses in Northern Ireland, especially in troubled areas. I hope that the Minister will say what action the Government are taking to help people who have to leave, who want to sell their houses and find it difficult to do so. Irrespective of what a house in a trouble area might fetch, have the Government considered the possibility that they may have to even up the figure so that people will be able to buy and sell houses at the proper market price? Governments have had to do this in the past with clearance areas so that people could receive adequate compensation to purchase new homes.

Mr. Pounder

The hon. Member has quoted an interesting figure of new house costs in Northern Ireland. Is this private or public sector, or both? It is a shatteringly high figure.

Mr. Orme

It is for the private sector. The source is the Nationwide Building Society and the figures are for the second quarter of 1972. There is anxiety over the housing problem which deserves serious examination and prompt action.

I understand that phase 1 of the Belfast urban motorway will begin early next year. Can a more definite programme be announced? This type of development is labour-intensive and because of the high unemployment rate and the nature of the labour force in the Province, which is not highly skilled except for some pockets, we need such projects. Many hon. Members will know that while there are some excellent roads in Northern Ireland, there are some very poor ones. There is need to extend and improve the roads west of the Bann, in the Londonderry area, in Belfast and other places.

I understand that there is a proposal to bring back the Belfast central line. May we have some information on this? What will be the cost? What employment possibilities are involved? I look to this to be a labour-intensive undertaking. I understand that the construction of a new station is being considered in the Maysfield area.

I turn to deal with the power situation. There is room for improvement here, as all hon. Members would agree. It has been decided to build a new oil-fired electricity generating station at Kilroot, County Antrim. We are told that work will begin in 1973. Is it possible to announce a firmer timetable? We hope that this will lead to increased employment. Perhaps we can be told how many jobs will be created. Does this type of development lead to any form of economic co-operation with, for instance, the Republic of Ireland? Electricity knows no boundaries and it would be to the advantage of Northern Ireland and the Republic if some such development took place. Has there been any consultation with the Republic on this point?

Industrial training is extremely important. I spoke earlier of the skill in Northern Ireland. There is a need to lay down a base of skill. We depend upon our ability to produce in what is a highly technological, industrial society. We cannot afford areas which are wilting. There are nine training centres in Northern Ireland at the moment providing 2,600 jobs. New centres are to be built at Belfast and Derry, while the Newry centre is to be expanded. Has the Minister of State any idea when these projects will be completed and how many extra places will be provided?

Are the Government doing what has been done in this country and enabling young people to be taken into training centres in areas of high unemployment to receive a 12-month period of training in the hope that that will set them on the road to an apprenticeship? This will have to be done more frequently, certainly in this country, if we are to reduce the growing number of young people finding it impossible to get a job when they leave school. This problem is central to many of the difficulties in Northern Ireland.

Does the Minister see a general improvement in the economic situation? He spoke of this earlier and called for new industries in the Province. He tried to make a brave job of it, but he was able to tell the House that only one new industry has been brought to Northern Ireland recently. We regret this as much as the Government because we want to see economic development improve rapidly. The questions which have been put by my hon. Friend the Member for Leeds, South, by myself and by other hon. Members are linked to this increased expenditure of British taxpayers' money. This debate takes place against the general political situation. We have spoken of security and the deteriorating situation which consistently damages the economic steps that are taken. We on the Labour side of the House cannot over-emphasise the urgent need for some political basis which will enable us to look forward to economic growth and development.

Reference has been made to the dastardly attack made last evening on Mrs. Austin Currie. I know Austin Currie and his wife, and I realise the pain that they must be suffering now. Just as we condemn without qualification the dastardly attack on Mr. William Craig, so we condemn the attack on Mrs. Currie. We must say to people in Northern Ireland, "If you want jobs, economic expansion and a fuller life, you will not get them through actions of this sort."

The warning given yesterday by the Prime Minister merely echoed increasing feeling and impatience in this country about Northern Ireland. When we discuss the border Bill next week that feeling will perhaps be reflected more widely. This is not the time to develop the argument. However, my hon. Friend the Member for Leeds, South has sent a message on behalf of this side of the House to Mrs. Austin Currie wishing her a speedy recovery. We must say to people in Northern Ireland, "Violence will not achieve your economic or political aims". We are trying to develop some form of political framework and economic stability in a worsening economic situation throughout the United Kingdom.

The Opposition welcome and support the Bill. However, we shall be increasingly alert about the question of expenditure. We are now moving into a new phase of post-Stormont legislation. It will be virtually new legislation and the House of Commons will have to examine it, pass its opinions on it and monitor it. We shall have to consider how money is spent and how developments take place. We welcome the Bill against that background and in that limited sense. This economic debate has been useful and important.

1.53 p.m.

Mr. David Howell

rose—

Mr. Deputy Speaker (Sir Robert Grant-Ferris)

Does the Minister of State have the leave of the House to speak again?

Hon. Members

Yes.

Mr. Howell

With the leave of the House I shall attempt to answer some of the many questions raised in this wide-ranging debate on all aspects of economic, industrial and social life in Northern Ireland as well as on certain aspects of the security situation which permeates so much of life in Northern Ireland. I shall not be able to cover all the questions which have been raised, and I should like to answer those which cannot be covered today in correspondence or at an appropriate time next week when we will have the opportunity of again discussing financial matters and the expenditure of public money.

I should like first to deal with a small point raised by the hon. Member for Leeds, South (Mr. Merlyn Rees). He asked what other sources besides the National Loans Fund could be drawn upon for on-lending to local authorities and other public bodies. They are very small, but they exist—for example, Ulster Savings Certificates, Ulster Defence Bonds and borrowing from the Belfast Savings Bank. That is, by the nature of things, a very small proportion of on-lending. Capital funds can be borrowed from areas of that kind as well as from the National Loans Fund.

The major point which the hon. Member for Leeds, South raised applies to Clauses 1 and 2. He asked what were the means of control of the loans for which authority is given under the Bill and the grant-in-aid. The authority for expenditure is inherent in the normal appropriation and supply procedure and is made when the policy giving rise to the expenditure is decided and has to come before the House for approval. We are here concerned more with the build- ing of the pipeline than with the flow through it.

Every item giving rise to expenditure which calls upon capital and therefore upon loans from the National Loans Fund, and every item giving rise to expenditure for which grant-in-aid is needed, is subject to the full rigours of the supply procedure. The Government are held to account for the policy, for the expenditure to which the policy gives rise and the procedure by which the expenditure is authorised by the House. That is worth making as a general point. There is no question of weakening control over the expenditure being made in Northern Ireland as a result of policy decisions made in recent months. We are here concerned with the means for transferring both loans and grant-in-aid to meet expenditure arising from policy decisions.

The hon. Member for Leeds, South raised the question of the interest paid on loans. The rates are specified by the Treasury. There is no special rate for Northern Ireland.

The hon. Member for Leeds, South and other hon. Members have referred to the question of the Northern Ireland Finance Corporation. When the order relating to the Finance Corporation went through the House, we discussed the question of accountability. The overall activities and expenditure of a body like the Northern Ireland Finance Corporation are subject, like every other major expenditure of Government, to the procedures for accountability and departmental accountability. But I think that the hon. Member for Leeds, South had more in mind than that, namely, the question of ministerial control.

In the debate on the order we made clear—and I think it was accepted by the House—that one of the objects of setting up a new agency of this kind is to delegate a certain amount of control and to allow room for innovation and flexibility in the organisation's operations. I have every confidence in the way in which the corporation is developing. As one hon. Member rightly said, it has only just started work and plainly it is feeling its way in many respects. It has been extremely helpful in making arrangements with the Northern Ireland banks for assisting city centre traders with liquidity problems. It has been involved in a number of cases. I have every confidence about the way in which it operates.

The corporation has a board on which sit representatives of the Ministry of Commerce and of the Government. Therefore, there is an adequate flow of information and understanding about its operations. But these are early days and it would be wrong to expect the corporation to be ready to rush into print with a mass of detail about its operations when it has only just started work. That would not be the way to encourage a body of this kind to help, as I believe it will, the development of Northern Ireland industry.

The question of International Engineering Ltd. kept coming into the debate in two separate ways. There was the question of how it was set up and how it was financed. The operation to take a Government majority shareholding was financed under the Industrial Development Act and not by the Northern Ireland Finance Corporation. The Government are a majority shareholder in the body. ICL is a minority shareholder, and under the agreement for the takeover it has a legal obligation to provide a certain amount of work to IEL, Castlereagh.

The other way in which ICL came into our deliberations was on the computer at Harland and Wolff, with a good deal of to-ing and fro-ing as to why this had not gone to IBM, on the assumption that it would somehow have helped ICL, and why it had gone to IEL. The facts of the matter are that by computer standards this is quite a small computer; though I agree that £300,000 is a lot of money, it falls below the lower limit of sums for expenditure on computers to be governed by the Government's procurement policy. That gives an indication of its limited size.

Points have been made in the debate which it is perfectly legitimate for politicians and the Government to put publicly and to put to bodies whether they are entirely State-owned, which is not the case with Harland and Wolff; or whether there is in them a majority Government shareholding, which also is not the case with Harland and Wolff; or whether there is a substantial minority shareholding, which happens to be the case with Harland and Wolff. In return, however, it has to be recognised, particularly in a small, complicated area like this, that if Harland and Wolff's judgment is—as it is—that technically the most suitable computer is the IBM, then, whatever views hon. Members opposite or anyone else may have about the virtues of State-owned industry, we could not operate a system of interference in the way that has been suggested so that the views of Harland and Wolff would be over-ruled.

An obligation on ICL to place an order for a computer which would have to be built to meet a difficult and very specialised requirement at IEL would have been sharply different from past practice. If it had been done, I doubt very much whether the effect on jobs would have been anything more than negligible.

The future of IEL, for which the Ministry of Commerce is responsible, rests upon our getting full orders and interest from outside. We have a number of avenues which we are exploring. I am not without hope that we can continue to develop the possibilities, but I do not think that the issue of a small computer for Harland and Wolff would have affected the matter one way or the other. That is my clear judgment of the situation.

Mr. McMaster

It has been suggested by ECL or ICL that some joint committee should be set up with Harland and Wolff about the building and construction of computers of the kind suitable to the shipbuilding industry. This would help the IEL. Would my hon. Friend like to comment on that, or give his blessing to such a programme of research and development?

Mr. Howell

I would welcome in principle something of this kind. I am not at the moment technically qualified to judge on the possibilities, but if we could get something of this kind going it would be something which I should very much welcome.

The question was raised by the hon. Member for Leeds, South of the degree of control and the disciplines within which the nationalised industries or their equivalent in Northern Ireland operate. The answer is that they are overseen by the Treasury and the Ministry of Finance. The disciplines are similar to those being applied to public sector bodies under Treasury machinery—public sector operations, such as now exist for the electricity service, a new body and in the past a disparate body, operate in particularly difficult circumstances, such as the non-payment of bills and things of that kind, but the same disciplines apply as elsewhere in the United Kingdom. The hon. Member for Leeds, South asked where he might look for information: from the Northern Ireland Government, the Northern Ireland Office, the Treasury, the Ministry of Finance. Full details are to be found of these operations in the accounts which are published. If they are not in this House I will certainly see that they are provided. But I understand that they are in the Library.

He asked whether local government reform would affect the question of lending. It will make a difference in the sense that a great many more functions under the Macrory reforms would be financed direct out of the Northern Ireland Exchequer and out of lending by the central Government, rather than by going through the particular local authority in question. In other words, we shall see the kind of operation which functions for the Housing Executive, which is financed directly by lending from the central Government in Belfast or by grant by the central Government in Belfast, so that we shall make a change in that respect. But what is intended, and is the spirit of the Macrory reforms, is that fewer functions, on capital expenditure account at any rate, will be carried out by the new local authorities.

The hon. Member mentioned the membership of the area boards. It is slightly outside the range of what we are discussing today, but I know there has been some anxiety on this matter and it has been raised with me before. I will look precisely into the points he raised. But account has to be taken of the elected members of the area boards, who are not there at present and will not be till the new local authorities come into being—alas, now at a postponed date. When the elected members are there, the hon. Member may find that the points which he raised will look a little different from the previous figures of appointed members. They are to be bodies with a strong elected representation, rightly, for matters affecting their areas.

The hon. Member then asked about this extra £60 million or so being the amount of grant in aid, and what would be the extra spending in Northern Ireland. The answer to this strictly speaking lies in the Appropriation No. 3 Order which comes before the House next week, but there is an explanation in the autumn Supplementary Estimates published on 26th October and available in the Vote Office. There are set out a number of additional expenditures amounting to some £53 million or £54 million, which demonstrate the kind of money which will need to be covered by grant in aid—of about £60 million we are talking about here. The main items were expenditures arising first from the package for stabilised and increased employment which I announced on 27th July—a figure of £10 million; second, part of the already authorised and agreed payments to Harland and Wolff. Lastly there is the sadly inevitable item: compensation, including emergency financial payments made through arrangements we have for those badly hit. These are in the autumn Supplementary Estimates. I am sure hon. Members will already have seen them. They all add up to the sum of which we talking now: £60 million.

The hon. Member, finally, mentioned the question of the Public Accounts Committee and its membership, a point to which my hon. Friend the Member for Belfast, South (Mr. Pounder) also referred, reminding us that he was on the Committee. This is a matter for the House of Commons, but I am sure these points will be noted.

I think that that covers most of the points raised by my hon. Friend the Member for Leeds, South.

My hon. Friend the Member for Belfast, East (Mr. McMaster) asked about details of the £60 million. I hope I have guided him by drawing his attention to the autumn Supplementary Estimates. He will appreciate that this is where the full details are. I have mentioned some of them.

My hon. Friend mentioned the firm of Short Brothers and rightly praised what it is doing. It is doing extremely well. My hon. Friend mentioned additional support for a further development programme for the firm. There are various ideas existing there for the future. The company is doing very well on existing lines. It is a matter which will be of real concern because it is an important part of industry. It is a matter we can look at. I applaud the lively management going on at a very able and famous firm.

Industrial training was mentioned by my hon. Friend the Member for Belfast, East, and the hon. Member for Salford, West (Mr. Orme). Industrial training has for some years been tackled with great vigour. In relation to population, the number of people under training in Northern Ireland is running at nine times the level for the rest of the United Kingdom—a staggering comparison. A month or two ago we announced the expenditure of an additional £4 million for further industrial training. Several revolutionary and interesting ideas on training have been pioneered and developed in Northern Ireland, particularly the integrated training unit which brings together people who develop a special skill which might be useful in a modern engineering or advanced development firm and who are then kept as a unit in training as a career. That means that we get away from the grisly business of a person being trained for a year and at the end of that time going back on the street, which is of no help to anybody.

The hon. Member for Belfast, West (Mr. Fitt), in raising several important issues, commented on the confusion about the way in which Northern Ireland finances work, and what is a subsidy and what is not—a point that has run through the whole debate. I hesitate to plunge further into this matter for fear of increasing the confusion, but it is not quite so confusing as some hon. Members have suggested.

The basic elements are fairly clear. Northern Ireland, given that it pays taxes in much the same way as the rest of the United Kingdom, receives its share of the so-called reserved revenues, that is, income lax and so on, which amounts this year to about £272 million. It raises in local taxes about £37 million. Over and above that it receives a variety of special payments under various arrangements and schemes which, at the time of the White Paper published earlier this year by my hon. Friend the Chief Secretary to the Treasury and my right hon. Friend the Secretary of State, were running at a little over £133 million.

The White Paper made clear that there would be extra expenditures, precisely those that came forward in the autumn Supplementary Estimates. The £133 million or slightly more plus the extra spending of this kind adds up to about £200 million. Over and above that there is a lending rate of £100 million to local authorities and other bodies—the sort of thing we discussed on Clause 1. The £200 million is a valid and clear figure over and above the share which Northern Ireland gets by virtue of its population in relation to the whole of the United Kingdom. The £100 million in loans from the National Loans Board is also valid.

Those are the figures to bear in mind. Arguments may be made one way or the other about them but they are fairly straightforward figures which are worth bearing in mind, particularly when one sees the dedication to destruction of the crazier elements of the IRA who are determined to squander the future of Northern Ireland, and the head-in-sand talk of the UDA. They are both of equal madness when one considers the economic future of Northern Ireland.

The hon. Members for Belfast, West and Salford, West also commented on areas of high unemployment—the ghetto area aspect, very localised areas of high unemployment. The Government have sought to focus and direct funds specifically to these areas. For instance, we have announced promising new developments in West Belfast, which both hon. Gentlemen pointed to as something which in the broad generality tends to be subsumed in general propositions about Belfast versus the rest. Belfast is in need of additional employment. I have been to look at industrial sites which we are in the process of negotiating and on which we hope to be able to develop advance factories, and I am pushing ahead with this. Do not let us forget that, having built factories and introduced training units, we have to attract investment which—and I make no bones about it—will be very difficult. I believe that we shall be able to produce the possibility of extra jobs and the opportunity to work in these areas which in the past have been lacking.

It is with the thought of labour-intensive operations that the proposal has been put forward for the development of a direct labour force—"Enterprise Ulster"—for the whole of Northern Ireland, which will provide worthwhile employment—not unemployment relief—for many hundreds of people, in major public works projects, major reclamation schemes and other labour-intensive activities.

Security has also been mentioned, and Mr. Deputy Speaker allowed this subject to be discussed. The House will not expect me to go into these matters in great detail. Of course, I deeply deplore the continuing series of ghastly incidents, of which the murder yesterday of a policeman and the beating up of Mr. Currie's wife are, alas, two more appalling examples. My right hon. Friend the Secretary of State has expressed his sympathy to Mrs. Currie on this horrific happening and I echo him. These actions must be condemned as being quite unacceptable in a civilised society.

My hon. Friend the Member for Belfast, South mentioned tourist grants. Certain parts of certain loans that are drawn through the lending process, which the Bill makes easier, will go for tourist grants and the development of tourism.

My hon. Friend also mentioned city centre traders and the need to maintain the life of central Belfast. This has been and remains a major aim of Government policy. My hon. Friend was kind enough to recognise the considerable subventions, including the latest employment grants, that have gone to city centre traders. There are worries about there being so much security in the centre of Belfast that shoppers are prevented from going into the shops, but against that has to be balanced the fact that if shoppers can get in too easily so can bombers, hoodlums and killers. We have to balance this as we go. It has always been open for detailed discussions to be held between the Army, the police, the Belfast local authority and the city traders, and I welcome such discussions at any time. I authorised such discussions last Monday on the question of barriers being too restrictive of the movement of shoppers in certain side streets in central Belfast.

Many points have been made about housing, which is vitally important. I am not trying to duck this issue because it is central to our concern for Northern Ireland, but I propose to refer a number of detailed points to my hon. Friend the Member for Wokingham (Mr. van Straubenzee) who carries ministerial responsibility for the housing sector in Northern Ireland. I know that he will read them with interest.

On certain other aspects of housing I shall be glad to go into more detail when we consider the appropriation order next week. I note the serious and valuable points which have been made, particularly about compensation. Compensation is always a problem because in Northern Ireland everyone suffers and very few are able to insulate themselves totally against misfortune. I recognise the validity of the points that have been made. I will look into them and pass some of them to my hon. Friend the Member for Wokingham.

The hon. Member for Down, North (Mr. Kilfedder) asked about advance factories. There are two in the planning stage in his constituency at Bangor, and they are going forward.

The hon. Member for Salford, West raised many questions which I do not think he will expect me to answer in detail today. He returned to the question of high unemployment areas, which the Government regard as extremely important. We believe in taking specific and selective action both to attract new industries to areas of high unemployment and in providing the opportunities for them to come, through good advance factories, good facilities, good training and so on. We have announced a number of new advance factories in Londonderry, which is one of the most important areas in this respect.

The whole slant of our policy is designed to encourage firms or to give some inducement to firms to go to areas of high unemployment. Over and above that, the situation in Northern Ireland generally has to be made attractive for them, which, as many of them inevitably see things through the lens of the TV camera or in news headlines, is alas not easy unless they can be persuaded to come and see them themselves, which happily some of them do.

The hon. Gentleman mentioned a number of other major development programmes, a railway development and the new station, and capital spending on roads. These are going ahead in line with the development programme targets. Where there are difficulties they are difficulties less of administrative machinery than of the security situation, which intrudes on the business of building roads, houses and so on, in an awkward and sometimes very frustrating way. But these programmes are going ahead. So is the development of our energy programme. We did have the inter-connector with the Republic and we should be very glad to see that restored, although there are certain local difficulties in getting complete coverage for the work force that would have to operate all aspects of the inter-connector, particularly in very remote areas. But this is something we should like to see restored. The hon. Gentleman mentioned training, too. I have said that I consider this of great importance.

I have not covered all of the points but a great many of them. I think that the debate has shown that all sides recognise the need for Northern Ireland to continue on its not unsuccessful path of industrial development as a region of the United Kingdom. I think that people recognise, too, the truth of the points made yesterday by my right hon. Friend with great vigour: that the proposition that somehow Northern Ireland can break away and go it alone, on the one hand, or the proposition from the Provisional IRA, on the other hand, that somehow Northern Ireland can be bombed into a different view of its own future, are the propositions of people who have opted out of a sane, prosperous and just future, the propositions of people who will damage and not strengthen the Northern Ireland economy.

By contrast, our efforts will help in that direction and the Bill will enable us to go through with our programme. I commend the Bill to the House.

Question put and agreed to.

Bill accordingly read a Second time.

Bill committed to a Committee of the whole House.— [Mr. Gray.]

Committee upon Monday next.