HC Deb 11 December 1978 vol 960 cc12-4
13. Mr. Kenneth Clarke

asked the Secretary of State for Industry whether he will make a statement about Government financial assistance to the Kirkby workers' co-operative.

Mr. Les Huckfield

My Department has made £4.915 million available to Kirkby Manufacturing and Engineering Co. Ltd. in selective assistance under section 7 of the Industry Act 1972. The negotiations based on the recommendation of the working party, which was set up at the request of the directors of KME, have unfortunately collapsed. The interim assistance to KME to enable it to continue trading while the working party completed its report has now ceased.

Mr. Clarke

I am grateful for that reply. Will the hon. Gentleman confirm that there is no question of any more interim assistance being given in this case, because there can be no question of putting in any more taxpayers' money following the £5 million which has already been lost on this abortive enterprise? Will he let us know whether, following the collapse of negotiations with Worcester Engineering and the working party's recommendations, he will agree to call in a receiver so that the assets can be sold to someone and some jobs preserved in a viable enterprise?

Mr. Huckfield

I only wish that hon. Members opposite and the Conservative Party would show as much concern for the preservation of jobs as they do for cutting public spending, except where it affects their own constituencies. My Department is ready to consider any application for assistance which is based upon projects which have viability in them. I hope that the hon. Gentleman will be content to await the outcome of the mass meeting which my right hon. Friend has been addressing on Merseyside this morning.

Mr. Cryer

Does my hon. Friend agree that, although KME has received almost £5 million, the cost to the taxpayer to keep those 750 jobs going over the same period in lost tax and dole payments—which the Opposition seem to relish giving to other people—would have been about £9 million? Will he urge the Secretary of State to reconvene the working party with a view to retaining the co-operative? Will he accept that private enterprise alternatives are simply a means of grabbing the 10 per cent. of the radiator market that KME has built up, with the accompanying loss of jobs? Will he urge the Secretary of State to set up the working party again and keep the co-operative, which is an important means of keeping jobs in a time of high unemployment and is an important symbol for the trade union and Labour movement?

Mr. Huckfield

I and many of my hon. Friends recognise my hon. Friend's strong feelings on this issue. To date, KME has received £5.672 million. My understanding of the situation emerging from the mass meeting this morning is that Mr. Jack Spriggs may well be coming to us with another proposal on Wednesday.

Mr. Biffen

Does the hon. Gentleman agree that it would be most inappropriate for the National Enterprise Board to be required to take an interest in this venture unless it were of its own volition?

Mr. Huckfield

The hon. Gentleman is correct in so far as the guidelines for the NEB are concerned. Those guidelines advise the Board to have regard to the commercial viability of such investment. This is also a case in which my right hon. Friend has said that he is not prepared to use his powers of direction.

Mr. Heifer

May I draw my hon. Friend's attention to the resolution of the national executive committee of the Labour Party, of which he happens to be a member, which urges the continuation of KME and urges the Government to give it further support in order to put the co-operative on a new basis? Will he indicate whether, following the mass meeting on Wednesday, such could be the attitude of the Government? If not, why not?

Mr. Huckfield

As a fellow member of the NEC of the Labour Party, I recognise the strong feelings among members of that body about this matter. I am un- able to give a specific answer to my hon. Friend because I have had only a quick and verbal report of what transpired this morning. But, obviously, anything which emerges by way of an application will get the fullest possible consideration from the Government.

Several Hon. Members rose—

Mr. Speaker

Order. I should tell the House that this subject is to be discussed early tomorrow in the debate on the Consolidated Fund Bill.