HC Deb 25 October 1982 vol 29 cc723-4
10. Mr. Cowans

asked the Secretary of State for Industry whether he has had any recent discussions within the European Economic Community about policies for shipbuilding; and if he will make a statement.

The Minister of State, Department of Industry (Mr. Norman Lamont)

No. There are no Commission proposals before the Council regarding Community policy on shipbuilding aids. Intra-Community discussions on the successor to the fifth directive are currently taking place at official level.

Mr. Cowans

I thank the Minister for that illuminating answer. I am sure that the shipyard workers will be duly impressed. However, is it not abundantly clear that no policies will be forthcoming from the EEC to save the United Kingdom shipbuilding industry as we know it from virtual destruction? Is it not time that the Government took action and increased not only demand but the intervention fund amount? Is it not also time that they increased the levels at which the intervention fund can be used? Is the hon. Gentleman aware of the terrible situation facing the shipbuilding industry on the Tyne, the Tees and the Wear? Does he intend to wait until the industry is destroyed before taking any action?

Mr. Lamont

The hon. Gentleman's constituents may be more impressed by the fact that the Government have put more than £600 million into British Shipbuilders. Putting more money—via the Common Market—into an industry with gross over-capacity is not the right answer.

Mr. Colvin

What discussions has my hon. Friend had with the Secretary of State for Defence on the repair in British yards of Royal Fleet auxiliaries damaged in the Falklands campaign?

Mr. Lamont

I have been in touch with my right hon. Friend. For some time the policy has been for a considerable proportion of ship repair to be done in such yards, but I know that my hon. Friends are anxious that the private sector should also receive its share of such work.

Dr. John Cunningham

Is it true that British Shipbuilders on Wearside are being denied the opportunity offered by two overseas orders simply because the credit terms and financial arrangements are not forthcoming and the ECGD will not give support to British Shipbuilders for those orders? Should not the Government at least get such things right? The corporation has won the opportunity to build the ships but the Government will not allow British Shipbuilders the financial arrangements to enable it to get on with the job.

Mr. Lamont

It is all very well to say that, but the Government have made available a combination of favourable credit terms and production subsidies. The two together compare very favourably with the aid given to shipbuilding in many other countries.

Sir David Price

Is my hon. Friend aware that the chairman of British Shipbuilders has provided both me and the Department with information that shows that we subsidise our shipbuilders and owners to a lesser extent than any other EEC country? Why do we play according to the EEC rules when every other EEC country plays according to its own rules?

Mr. Lamont

I do not agree with my hon. Friend or with his conclusions. One must consider the credit and production aids together. Taken together, they show that we compare well with other countries. Indeed, that is before the £600 million of unremunerated public dividend capital that has been gut into British Shipbuilders is taken into account. Our aid compares well with that given by other countries. What we lack is productivity.