HC Deb 23 July 1987 vol 120 cc467-9
1. Mr. Nicholas Brown

asked the Secretary of State for Northern Ireland to what extent his Department has subsidised Harland and Wolff Shipbuilders over the last five years; and how much money is committed to further subsidy.

The Parliamentary Under-Secretary of State for Northern Ireland (Mr. Peter Viggers)

The amount of subsidy provided to Harland and Wolff over the last five years was £225.6 million. Provision of £40.5 million has been made in the Main Estimates for 1987–88.

Mr. Brown

Is not the Minister's problem this: Harland and Wolff now require a subsidy of well over 40 per cent. of its turnover, whereas the EEC sixth directive on shipbuilding means that subsidies at other shipyards are restricted to 28 per cent.? What steps will the Government take to bring their subsidy to Harland and Wolff into line with the subsidies that they are prepared to provide for mainland merchant shipbuilding yards, or will they continue to subsidise Harland and Wolff in excess of the levels that they are offering to mainland shipyards?

Mr. Viggers

The hon. Gentleman is wrong to think that Northern Ireland is exempt from the EEC sixth directive on shipbuilding subsidies. If he believes that the subsidy given to Harland and Wolff is large, I remind him of the figure quoted by my right hon. and learned Friend the Chancellor of the Duchy of Lancaster on 7 July in the House, when he said that British Shipbuilders — with which Harland and Wolff is not connected — has been subsidised to the tune of £1,750 million since 1979.

Mr. Kilfedder

Will the Minister confirm that the Belfast shipyard is essential to Northern Ireland and that it plays a vital part in the economy by directly employing 3,700 workers and indirectly employing many thousands? Will he also confirm that 740 companies in mainland Britain do business with the shipyard, and that during the last financial year companies in Britain have secured orders worth £50 million from Harland and Wolff for the supply of components and materials? Does that not contrast with the 600 companies in Northern Ireland which secured orders to the value of £7 million in the same period?

Mr. Viggers

The hon. Gentleman makes sonic important points. We are aware of the importance of Harland and Wolff to industry in Northern Ireland, and we are doing all that we can to assist Harland and Wolff in winning further orders, upon which the future of the yard depends.

Mr. Maginnis

Will the Minister remind the Secretary of State for Defence of the exact terms of his statement in the House on 24 April, when he said that Swan Hunter should be given a preferential opportunity to bid for AOR2? He also stipulated that AOR2 should be of the same design as AOR1 and that the terms, conditions, cost and programme should be no less favourable to the Ministry of Defence than that which could be obtained from Harland and Wolff for a follow-on ship. Will the Minister continue to press that point and remind the Secretary of State of his statement in the House?

Mr. Viggers

The commitments made at the time of placing the AOR1 order were quite clear. It was confirmed that the order was unsubsidised and comprehensively costed. As the hon. Gentleman will be aware, independent assessors are ensuring that there is no overrun on the cost of the construction.

Mr. Teddy Taylor

Is my hon. Friend aware that, having spent my working life in shipbuilding, on a recent visit to Harland and Wolff I was immensely impressed by the efficiency of the yard, the quality of the output and the spirit of the work force? Has he received any approach from the EEC Commission which might put the future of that splendid yard at risk?

Mr. Viggers

My hon. Friend's interest in this area is well-known and I welcome his recent visit to the yard. The Government are determined to do all that they can to assist in the winning of future orders for Harland and Wolff. We welcome the recent flexibility that has been shown by the work force at Harland and Wolff, which should ensure that the manner in which it tenders for further orders is assisted.

Mr. James Marshall

Does the Minister accept that there is agreement in all parts of the House that Harland and Wolff is vital to the economy of Northern Ireland? In the light of that, will the Minister state how many thousands of jobs have been lost to the yard since the Government came to power in 1979? Will he give projected figures for the number of employees in the yard over the next five years?

Mr. Viggers

I welcome the hon. Gentleman to his Front Bench with his new responsibilities. We very much look forward to his future contributions.

The subsidy that has been given to Harland and Wolff has enabled it to continue with its merchant shipbuilding orders. The future of that yard will, of course, depend upon the winning of further orders and I cannot speculate with the hon. Gentleman how the yard will succeed. However, the flexibility that the work force has recently shown in its approach to management problems should assist in winning further orders.

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