HC Deb 12 February 1981 vol 998 cc973-5
5. Mr. Bruce-Gardyne

asked the Secretary of State for Northern Ireland why, in view of the statement he made in August 1980 that the Government's obligation to consider applications for further financial assistance for the de Lorean Company had been discharged, he decided to consider a further application from that company.

Mr. Adam Butler

I considered a further application for a Government guarantee in respect of commercial loans to help the company resolve a short-term cash problem and take the DMG 12 car through tho market launch. I have now agreed in principle to the provision of a time-limited guarantee for commercial loans of up to £10 million, subject to certain acknowledgements which record the company's acceptance that neither the Northern Ireland Development Agency nor the Department of Commerce has any financial obligations towards the company and which confirm that royalties remain payable as agreed.

Mr. Bruce-Gardyne

Does not my hon. Friend realise that those undertakings were given to the House six months ago? Is there not a danger that my right hon. Friend, in his dealings with Mr. De Lorean, will come to resemble the young lady from Riga who went for a ride on a tiger? Is my hon. Friend aware that Mr. De Lorean apparently has a T-shirt on which is emblazoned the slogan "I am a con man"? Would he consider sending him a character reference? Can he seriously give the House the assurance that it needs that we shall have an opportunity to debate the matter and vote on it before any further money is given to that con man?

Mr. Butler

My hon. Friend does not help his cause. It is a serious matter whether more money is put behind that project. In fact, no more money is being provided but purely a Government guarantee behind commercial loans to help the company to launch a car that it believes has good market prospects. The obligations were removed in the agreements last summer but, because of certain press statements about the beliefs of one or two parties to the arrangement, I felt it necessary to come to a firm written understanding with Mr. de Lorean that no such obligations now exist.

Mr. J. Enoch Powell

Is the Minister aware that a fraction of the sums that have been invested or, as the case may be, sunk in de Lorean would be sufficient to produce an improvement in links, especially the transport links, between the Province and the mainland, with the result that far more employment than can be envisaged from de Lorean would be created and maintained?

Mr. Butler

The original decision to support that project was taken by the previous Labour Administration. Last year, the Government were faced with an approach for further funds. I have been approached again. I have explained to the House what our practice has been in the circumstances. I must make it clear that we have told the company that the Government have made a sufficient provision of public funds to support the DMG12 car project, and that it must look elsewhere for further funding. The company accepts that.

Mr. Michael McNair-Wilson

Will my hon. Friend give an assurance that, if Mr. de Lorean requires further money for his cash flow problems and approaches the Government for a further guarantee, no such guarantee will be given unless the contract, which is so favourable to Mr. de Lorean, is renegotiated?

Mr. Butler

I made it clear in my response to the previous supplementary question that no more selective assistance would be given to the DMG12 car project. The company is well aware of that.

Mr. Cryer

Will the Minister confirm that the jobs involved in that company are highly expensive, no matter how welcome they are, at £77 million? Will he confirm also that de Lorean, contrary to statements by members of the Minister's Department of Commerce, has given the fullest information? Will he confirm that audited accounts are now available, contrary to the accounts of the Northern Ireland Development Agency issued yesterday? Will he ensure that the Comptroller and Auditor General has full right of access to the accounts and circumstances of that firm?

Mr. Butler

The hon. Gentleman is right to say that the jobs have been expensive. But again, I must stress that the decision that I have taken has not been to provide more money, but to ensure that the car comes to market launch. If we had not taken that decision, there would have been serious unemployment consequences in Northern Ireland. The House must recognise that fact. I am satisfied with the information that my Department received in coming to the decision.

Mr. Adley

In his previous incarnation, my hon. Friend will remember that not only did the Department of Industry not take steps to save MG, but it almost deliberately drove it into extinction. Is he aware that some of us who watched that with dismay now watch the saga with de Lorean with even more dismay? Will he allow me, and perhaps one or two of my knowledgeable constituents, to visit de Lorean so that we can look at the project and determine whether my constituents are receiving good value for their taxes?

Mr. Butler

My hon. Friend knows that his interpretation of the Government's attitude towards MG is different from that of Ministers. I am sure that if my hon. Friend writes to de Lorean, that company would welcome his visit to the factory at an appropriate time.

Mr. Concannon

The Minister must be aware that there is more to this issue than simply the de Lorean project. It has always been recognised that the project would have spin-off effects both in Northern Ireland and in the remainder of Britain. Jobs both in Northern Ireland and in Britain are affected by the spin-off from that project. For example, the steel industry in Scunthorpe will provide the steel for the project. About 80 per cent. of the company's requirements come from the United Kingdom. We have to consider the balance sheet of security as well as politics. The car is coming on stream. While I was in America last week, there was a great deal of publicity for the car, which is eagerly awaited. We must remember that we are talking about employment in Northern Ireland. We should give the car a fair wind and all the help that we can—

Mr. Speaker

Order. Even a Front Bench spokesman must ask a question, rather than have an argument.

Mr. Butler

The right hon. Memberfor Mansfield (Mr. Concannon, takes the right attitude towards that car.

Mr. Bruce-Gardyne

On a point of order, Mr. Speaker. In view of my hon. Friend's reply, I shall seek to raise the matter on the Adjournment of the House.