HC Deb 26 October 1988 vol 139 cc286-7
11. Dr. Godman

To ask the Chancellor of the Duchy of Lancaster when he last met the chairman of British Shipbuilders Ltd; and what subjects were discussed.

Mr. Newton

I last met the chairman of British Shipbuilders on 17 October. We discussed a range of issues of current interest to the corporation, including the position on the disposal of its subsidiary companies.

Dr. Godman

It is not for me to praise the chairman of British Shipbuilders—he might suffer a wage cut as a result—but may I say to the Minister that one of the proposed sales, Clark Kincaid, would be aided immeasurably if the yard were to secure the Kvaerner engine order? Will the Minister give every support to Mr. John Lister with regard to the order for the Mauritian ferry? I believe that there is aid and trade provision agreement funding to be obtained for that ferry. Both these questions are of critical importance to my constituents who work in Kincaid and Ferguson. May I remind the Minister that when those yards are sold off, as with other acquisitions, people's lives are bought by the purchaser, so let us have decent terms and conditions for the employees?

Mr. Newton

The hon. Gentleman will be aware that discussions are going on with Kvaerner about the engine to which he refers. I cannot comment on the exact position in the negotiations, but I am sure that his words will have been noted. As for the ferry for Mauritius, I had some discussions recently with the Mauritian Government, which touched on that matter, among others, and it is clear that there is a real interest in the possibility of that ferry. Undoubtedly there will be keen competition for it. If, as we all hope, privatisation is successfully achieved, the terms and conditions of the work force after privatisation must be a matter for negotiation between the parties.

Mr. Clay

In recent years, the Minister's predecessors used to tell the House that British shipyards had to close because they had no orders. What does the Minister believe the British people would think of a Minister who closed a shipyard that had the imminent prospect of two orders worth over £200 million, one of which had been withdrawn from a shipyard in Korea to be built at North-East Shipbuilders Ltd. in Sunderland?

Mr. Newton

Part of the answer to the question that the hon. Gentleman asked me is that it would depend on the prospects of those ships being built at a profit rather than a loss, against a background where the history has been one of massive losses incurred by British Shipbuilders over the years. I hope that the hon. Gentleman will at least acknowledge that.

Mr. Gould

Does the Minister accept that there is now unmistakeable evidence of an upturn in world demand for shipping and that the NESL yard in Sunderland is the European yard that is best equipped and best placed to take advantage of it? In those circumstances, does he not accept that to close that yard now would be an act of industrial vandalism?

Mr. Newton

Part of the answer to the hon. Gentleman is precisely that which I have just given to the hon. Member for Sunderland, North (Mr. Clay). One must judge the position against the background of the likelihood that the ships will be built so that a profit and real jobs are provided. One must also look at the longer-term prospects, not just at the reports that the hon. Member for Dagenham (Mr. Gould) mentioned.

Perhaps it will be helpful if I say clearly to the House that British Shipbuilders received a number of bids for North-East Shipbuilders Ltd. by the deadline of 30 September, which are still being evaluated. Further additional information has also been submitted by some of the bidders, including a recent amendment to one of the bids. The Government are, of course, concerned—I assure the hon. Member for Dagenham again of that—to ensure that every avenue has been explored before a decision is taken. I have therefore asked John Lister, the chairman of British Shipbuilders, to invite each of the bidders to submit any final amendments that they wish to have considered by noon on Friday 28 October. Thereafter, I shall make a full statement to the House as soon as the evaluation is complete.