HC Deb 23 July 1979 vol 971 cc3-7
2. Mr. Buchan

asked the Secretary of State for Industry if he is now in a position to make a statement regarding any plans he may have for the denationalisation or withdrawal of public financial support for any of the following National Enterprise Board assisted companies: Computer Analysts and Programmers Ltd., Computer and Systems Engineering Ltd., Data Recording Instrument Co. Ltd., Ferranti, International Computers Ltd., Inmos Ltd., Insac Data Systems Ltd., Systems Designers Ltd., Systems Programming Holdings Ltd. and Systime Ltd.

20. Mr. loan Evans

asked the Secretary of State for Industry whether he is yet in a position to announce his proposals regarding the future activities of the National Enterprise Board.

The Minister of State, Department of Industry (Mr. Adam Butler)

I refer the hon. Member to my right hon. Friend's statement of 19 July.

Mr. Buchan

It is precisely because of the right hon. Gentleman's statement that I am anxious about the situation. Is it the case that the Prime Minister has intervened in order to prevent the right hon. Gentleman's support of the microelectronics industry? Is it also the case that the future of the National Semi-conductors factory proposed for Greenock has been thrown into jeopardy? If the Prime Minister has intervened, has she not out-Heroded Herod in relation to the right hon. Gentleman?

Mr. Butler

The position was made clear by my right hon. Friend's statement. Perhaps the hon. Gentleman will put down a specific question in regard to the companies to which he has referred.

Hon. Members

The hon. Gentleman has done so.

Mr. Ioan Evans

The right hon. Gentleman said in his statement that if the private sector is unable to provide a solution to a company's difficulties receivership will be the order of the day. The previous Tory Government saved Rolls-Royce, and a Labour Government saved British Leyland, from going into receivership. If such a situation were to arise again, would it be the Government's policy to allow Rolls-Royce or British Leyland to go into receivership? Does not the Minister realise that such a decision would involve not only the workers in those firms but thousands of small firms supplying component parts?

Mr. Butler

My right hon. Friend made the position clear. He said that receivership would be the normal practice. In exceptional cases—and I take it that the examples given by the hon. Gentleman would fall into that category—other circumstances would arise.

Mr. Grylls

Does my hon. Friend accept that there are many who believe that the Inmos and Nexos projects are technically and commercially rather dubious? My right hon. Friend has said that there is a contract with Inmos, but will he think again? As only £6 million has so far been spent on that contract, would it not be better to break it and meet the penalty clause rather than to throw good money after bad, which is what many people believe will happen?

Mr. Butler

I know that my hon. Friend is expressing the concern of many people about the commercial viability of Inmos, but on the other hand my right hon. Friend made it clear that there is a contractual commitment towards Inmos of £25 million, and the intention is that the NEB should review that project at the appropriate time.

Mr. McNamara

In reply to my hon. Friend the Member for Aberdare (Mr. Evans), the hon. Gentleman spoke about other factors to be taken into consideration. Why were those other factors not taken into consideration with regard to British Tanners? Why are nearly 1,000 of my constituents threatened with unemployment because of the Government's failure to support what had become a viable concern? Why will not the Government give the necessary money to ensure that the jobs of my constituents in an area of very heavy unemployment with grievous regional problems can be maintained rather than letting these people go on the dole or the scrap heap?

Mr. Butler

The hon. Gentleman rightly expresses the anxiety which I know exists in his constituency and other areas where there are factories of this company. Negotiations about the future of the company had broken down and there was no alternative but for the management to seek receivership. At the moment, various negotiations are taking place, and there is a hope that at least part of the company will be saved and will go on to a prosperous future, which is what is really needed.

Mr. Renton

I appreciate the difficulties of my hon. Friend the Minister of State and my right hon. Friend the Secretary of State in not wishing to make any statement that will be damaging to the future of Inmos. Does not my hon. Friend think that the investment of the NEB and therefore the British investment in Inmos is a question of too little too late, and that it would therefore be better to invest in the application of microprocessors rather than in their manufacture?

Mr. Butler

There is considerable investment in all sectors in microprocessors. On the question of Inmos, I can add nothing to what my right hon. Friend has said and to what I have just said.

Dr. Bray

Does the hon. Gentleman realise that the doubt cast over the future of the National Semi-conductors works in Scotland as a result of recent announcements by the Government about their regional policy makes it all the more necessary to go ahead with the Inmos project, and as quickly as possible? Is the hon. Gentleman further aware that there are already bottlenecks in supply to some key integrated circuits in this country and that it is imperative that we have our own capacity?

Mr. Butler

The problem I find is that there is a great number of advisers on this subject all holding different views. We have made our position clear on our general policy towards this matter.

Mr. John Silkin

As my hon. Friend the Member for Renfrewshire, West (Mr. Buchan) could hardly have been more specific in his question 2, may I ask how many questions in exactly the same form does the hon. Gentleman expect to receive before he will properly answer? Does not he realise that a very large number of people and a very important sector of the economy are in a state of total uncertainty because of the Secretary of State's drift?

Mr. Butler

I am still unable to find the company mentioned by the hon. Member for Renfrewshire, West (Mr. Buchan) in his supplementary question.

Mr. Buchan

On a point of order, Mr. Speaker. In view of the highly unsatisfactory nature of the reply to a highly specific question, I beg to give notice that I shall seek to raise the matter on the Adjournment at the earliest opportunity.