Shipbuilding (Hansard, 17 March 1993)

§ 8. Mr. Ronnie Campbell
To ask the President of the Board of Trade what plans he has to meet the European Commission to discuss the future of shipbuilding; and if he will make a statement.

§ Mr. Sainsbury
I have no plans to meet the Commission at present, but shipbuilding will be on the agenda at the informal Industry Council meeting in Denmark which I shall be attending later this week.

§ Mr. Campbell
Why are the British Government unable to help our shipbuilding industry when the Germans are able to help theirs? Or are the circumstances the same as coal, which can be subsidised in Germany but apparently cannot be subsidised here?

§ Mr. Sainsbury
I suspect that the hon. Gentleman is aware of the Communitywide rules affecting aid to shipbuilding. Our agreement with the Commission forbids the paying of subsidy to companies that were privatised as warship builders.

§ Mrs. Currie
Does my right hon. Friend agree that there are a number of industries, including shipbuilding, that have been dramatically affected by changes in defence requirements and that that includes the aerospace industry in areas such as Bedfordshire and Hertfordshire? [Interruption.] Would my right hon. Friend care to give Opposition Members and me whatever information he has—[Interruption.]—about European Community funds to assist in the reconstruction of defence-related industries?

§ Mr. Simon Hughes
On a point of order, Madam Speaker.

§ Madam Speaker
Order. Points of order, as the hon. Member knows, come later—[Interruption.] I have been attempting to listen to the hon. Member for Derbyshire, South (Mrs. Currie) and I might have been able to hear her but for the noise in the Chamber.

§ Mr. Sainsbury
I, too, was attempting to listen to my hon. Friend. Obviously, the shipbuilding industry, like other industries in many parts of the country are affected by the reduction in defence orders. We welcome the reasons for that reduction and we recognise—I hope that my hon. Friend agrees—that it is for the companies concerned to take the right commercial decisions, in the light of their individual circumstances, as to how best they restructure their businesses to contend with the reduction in orders from the Ministry of Defence.

§ Mr. Loyden
When will the Government respond to the growing demand in the House for the revival of Britain's merchant fleet? Do the Government appreciate that Clydeside, Merseyside and north-east shipyards would 277 greatly benefit from the revival of shipbuilding in those areas? There would be jobs for British shipbuilders and crews to man the British ships, if and when they were built.

§ Mr. Sainsbury
As the hon. Gentleman knows, sadly there has been a long period of decline in British shipbuilding. I suspect that there would be widespread agreement that the unfortunate labour relations in the industry decades ago contributed to that. Now, the industry is becoming competitive and it is my intention to remove subsidies and to create a fair trade between countries in shipbuilding, as in other areas.

§ Mr. John Marshall
Would my right hon. Friend care to remind the House of how many billions of pounds have been poured down the gullets of British shipbuilders? Does he agree that the best hope for employment in the shipbuilding areas in the north-east of England has come not from shipbuilders, but from the advent of Nissan to Sunderland?

§ Mr. Sainsbury
I agree that many billions of pounds have been paid out in subsidies to shipbuilding. Of course, the industry is still receiving significant subsidies. I very much agree with my hon. Friend about the contribution to the north-east region that has been made by Nissan, which contributes not only directly through employment, but through its influence on employment among those companies that supply its factory.

§ Mr. Fatchett
Given the Minister's answer and the prejudiced comments by his hon. Friends, it is hardly surprising that the United Kingdom shipbuilding industry has lost 76 per cent. Of its employment over the past decade, while the German industry has increased by 37 per cent. It is also hardly surprising that United Kingdom output has fallen by 81 per cent., while German output has increased by 96 per cent.
German yards have access to intervention funds. Now that the Government have at last discovered the importance of manufacturing industry, is not it about time that they gave British shipbuilders the opportunity to compete on a level playing field? Is not it about time that they protected British jobs and British industry and gave us the same conditions as exist in every other European country?

§ Mr. Sainsbury
I fear that the hon. Gentleman appears to have overlooked the reunification of Germany in the statistics that he quoted. European Community rules affect the level of shipbuilding intervention that can be made. Those rules are the same throughout the Community, including reunified Germany and Britain. I recently announced that we were continuing with a shipbuilding intervention fund level of 9 per cent. for this year, which is the same level as last year.