HC Deb 25 April 1977 vol 930 cc704-5
11. Mr. Pattie

asked the Secretary of State for Industry whether he is yet in a position to announce which British aerospace projects will receive funding support in 1977–78.

10. Mr. Tebbit

asked the Secretary of State for Industry if he has yet decided which new civil aircraft projects should be granted launching aid under the Aircraft and Shipbuilding Act during the current financial year.

Mr. Kaufman

British Aerospace, which takes control of the vesting companies this Friday, 29th April, is not yet in a position to reach conclusions on the civil aircraft options before it. British Aerospace will normally finance new projects from its corporate resources, including public dividend capital and borrowing from the National Loans Fund, rather than by launching aid for specific projects.

Mr. Pattie

Can the Minister say when the sales requirements of the airlines will be fed into the forward planning of the new Aerospace Corporation? Is he aware, for example, that British Airways are now contemplating purchasing the Boeing 737 aircraft for their air tours in preference to the BAC111 aircraft, which has always been a profitable aircraft for British Airways and which, after all, is one of the few remaining civil projects in British industry?

Mr. Kaufman

Questions about the procurement policy of British Airways are for my right hon. Friend the Secretary of State for Trade. However, I assure the hon. Gentleman that in our own consideration with British Aerospace of possible future projects we have to take account of what we calculate will be the sales requirements of airlines. This is one of the most important factors in deciding upon new projects.

As for the BAC111, the hon. Gentleman will know that without the underwriting aid which this Government have provided the BAC 111 would be dead and many jobs in his constituency would be lost. As it is, we have saved the project and the jobs.

Mrs. Hayman

With reference to his earlier reply, is my hon. Friend aware that we have the perfect subsonic candidate for funding at Hatfield, the HS146? Is he aware, further, that although what the Government have done so far has been extremely useful in preserving jobs, the time has now come when it is essential for the market for the plane, for the morale of the civil airframe industry in this country and for the future of the Hatfield factory that we should have a full-scale favourable decision to go ahead and fund this project as soon as possible?

Mr. Kaufman

I recognise the importance of this potential project to the factory whose workers my hon. Friend represents so effectively. It is very much as a result of representations such as hers that the Government have placed the holding contract and have maintained it, and, as my hon. Friend knows, we renewed it only recently. On Friday, that holding contract will be taken over by the first publicly-owned industry to be vested for 10 years, and that industry will have the right to make a decision on whether the HS146 shall go ahead.