§ 7. Mr. Cryerasked the Secretary of State for Northern Ireland when, pursuant to his answer of 8 December, Official Report, c. 536–37, he expects the target of 2,800 jobs to be reached on the Lear Fan-jet project.
§ The Minister of State, Northern Ireland Office (Mr. Adam Butler)The financial assistance agreement signed on 14 September 1982 between Her Majesty's Government and Lear Fan Ltd. envisages a target of 2,826 jobs in Northern Ireland by 31 December 1987. This agreement was an important step forward in the history of the project. The provision of about two-thirds of the funding needed to take the aircraft to certification and beyond represents an expression of considerable confidence by the private sector interests concerned.
Nevertheless, despite the progress being made, there continues to be a substantial element of risk involved, and the build-up to the employment target over the next five years may be influenced by a range of factors, including the need to make the most effective use of resources and the commercial prospects for executive aircraft.
§ Mr. CryerEvery effort to obtain jobs in Northern Ireland—or anywhere else in the United Kingdom—is 1057 very welcome, but will the Minister explain why the taxpayer has now lost control of the project after contributing significant sums to it? Is not one of the lessons from the De Lorean project that the taxpayer, having been a significant contributor—indeed, the major contributor—should keep control to ensure that the project comes to fruition, as everyone wants it to do?
§ Mr. ButlerThe best prospects for a company are when the private sector is prepared to put in its funds, preferably to the extent of meeting most of the funds required, and that is the situation in this case. Nevertheless, there is very strict financial and technical monitoring of the project on behalf of the taxpayer, and there are two directors on the taxpayers' behalf on the boards of Lear Fan Ltd. and Fan Holdings Incorporated.
§ Mr. MolyneauxWill the Minister of State do his best to remove the confusion caused by a recent Sunday Times article, which was absolutely bewildering in its conclusion, particularly when it asserted that the project was doomed to failure because it was likely to be successful?
§ Mr. ButlerI share the hon. Gentleman's concern that anxiety should have been caused by the article. One had to read almost to the end of it on an inside page to find words to the effect that the prospects for the project were now improving. I echo those words and not the headline which caused the anxiety in the first place.
§ Mr. ColvinWill my hon. Friend confirm that the prospects for the Lear Fan—a revolutionary aircraft—are extremely bright as seen through civil aviation eyes? will he comment on the Sunday Times article and say whether he feels that, in spite of his hopes for private investment in the project, the British taxpayer will get any return on the investment already made in the project?
§ Mr. ButlerI welcome my hon. Friend's remarks, made with his particular experience of the industry. The return to the taxpayer will be represented by fairly substantial royalty payments, which will accrue against aircraft and spare parts sold to a maximum of $33.75 million, plus whatever dividend accrues from the 5 per cent. shareholding. One also has to include the benefit to the taxpayer in the sense that the jobs that are being provided by the project, which we hope will increase over the coming years, represent the best that can be done for the people of Northern Ireland.
§ Mr. SoleyDoes the strict financial monitoring to which the Minister referred apply only to the Government money that is put in, or does it cover the overall financial position of the company? If he can give us an assurance that there will be very strict financial monitoring of the total position of the company, that will allay some of the rumours.
§ Mr. ButlerI can give the hon. Gentleman the categoric assurance that the monitoring applies to the full accounts of the company.