HC Deb 01 February 1979 vol 961 cc1650-1
2. Mr. Cryer

asked the Secretary of State for Northern Ireland if he will give further details about the contract between De Lorean Cars and Lotus Cars Ltd.

The Minister of State, Northern Ireland Office (Mr. J. D. Concannon)

The contract between the De Lorean Motor Company and Lotus Cars Ltd. is an agreement between the two companies, to which Government are not a party. I cannot, therefore, provide details of its terms. A joint statement issued by the two companies on 16 November 1978 indicated that Lotus would co-operate in the completion of the design and development of the DMC 12 sports car to be produced in Northern Ireland and that the work would include the building and testing of prototypes.

Mr. Cryer

I welcome the Government's efforts to provide jobs in West Belfast, but will my right hon. Friend provide me with ammunition to use against those critics who argue that the contract with Lotus to provide research and development indicates that subscribing £53 million to De Lorean Cars was perhaps a little hasty, on the basis of two prototypes? I am alarmed when my right hon. Friend says that the Government are not involved in the contract, because they are providing far and away the largest sum of money. Does not this indicate that the research and development have not been fully completed?

Mr. Concannon

If my hon. Friend wants ammunition, all I can say to him is that the assistance on this project consists of grants and loans. From the outset of the negotiations I was aware that further design and development work would be required. The selection of the company to undertake the work was a matter entirely for the De Lorean Motor Company. I was delighted to learn that Lotus had agreed to undertake the task, in view of its well-known ability and experience. It would be intolerable if the Government were to require every commercial agreement made by companies to be vetted and agreed by the Government. In the case of the De Lorean company, with such financial criteria being applied to the company, I can assure my hon. Friend that we keep the matter very much under control. We have nominee directors—or the Northern Ireland Development Agency has nominee directors—on the board.

Mr. Gow

Will the Minister of State confirm that the maximum possible commitment by the Government to this project is £65 million? Will he tell the House what will be the rate of return on that part of the £65 million which is not a grant?

Mr. Concannon

The hon. Gentleman has got it wrong again. He has upped the ante already, from £53 million to £65 million. He might be adding to the £53 million, which was granted by way of loan, the £13 million which has come from private sources to De Lorean, which the company is using.