HC Deb 01 November 1989 vol 159 cc312-3
12. Mr. Clay

To ask the Secretary of State for Trade and Industry what are his latest intentions concerning the future of North East Shipbuilders Ltd; and if he will make a statement.

Mr. Douglas Hogg

British Shipbuilders will continue discussions with those who have shown interest in purchasing parts of North-East Shipbuilders Ltd., following the statement by my right hon. Friend the Secretary of State for Social Security who was then Chancellor of the Duchy, on 13 July, with a view to a speedy resolution of the future of the NESL sites.

Mr. Clay

Does the Minister accept that it is nonsense for his Department to tell British Shipbuilders that in the case of the Anglo-Greek bidders, who are bidding for the North Sands yard for ship repairs and conversion, they have to sign a legally binding agreement not to construct ships there until December 1993 at a time when they require no subsidy from the Government to build ships, as they want to build them on their own account? Britain has a rapidly mounting trade deficit which will be made worse by the closure of our shipbuilding capacity. Given that the Minister admitted a fortnight ago to the Select Committee on Trade and Industry four different points that the Government had got wrong about this tragedy and farce, is it not time that he recognised that he has got the whole thing wrong and allowed people who want to build ships to get on with it, and to re-employ workers in Sunderland?

Mr. Hogg

Until the hon. Gentleman reached the penultimate and last parts of his question, he was doing rather well because he was asking a perfectly respectable question. It is nonsense to attribute four errors to me and it is even more foolish to attribute a total error to the Department.

On the substantive question. the hon. Gentleman will recall that I gave evidence to the Select Committee on Trade and Industry on 18 October and that I gave an extremely full response to questions such as the hon. Gentleman's. The plain fact is that I would not support any shipbuilding project in Sunderland in the next five years because it would result in an unpicking of the package of remedial measures put in place in December 1988. The future of Sunderland lies with that package rather than with a small shipbuilding venture.

Mr. John Marshall

Will my hon. Friend remind the House of the amount of money that taxpayers lost since the shipbuilding industry in Sunderland was nationalised?

Mr. Hogg

I do not have the exact figure in my mind, but I know that no contract has been built to cost in the recent past, and during the past five years Sunderland was losing 50 per cent. on each contract.

Mr. Henderson

Does not the Government's latest provision finally prove to the House that they have been trying to assassinate not only Sunderland but all British merchant shipbuilding?

Mr. Hogg

The hon. Gentleman does not do himself credit. If he had listened to the statement by my right hon. Friend the Chancellor of the Duchy in December 1988, he would recall that the remedial package that was put in place provided for about £45 million worth of expenditure or forgone tax, most particularly an enterprise zone, and £10 million for retraining for the assistance of small business. To try to characterise that as assassination is plain nonsense and does the hon. Gentleman no credit.