HC Deb 07 December 1994 vol 251 cc298-9
5. Mr. Macdonald

To ask the Secretary of State for Scotland if he will make a statement on the economy of the highlands and islands.

Mr. Lang

Good progress is being made in promoting economic regeneration and diversification of industry throughout the highlands and islands. The area is well placed to take full advantage of the wider economic recovery that is now under way as a result of the Government's prudent economic policies.

Mr. Macdonald

Will the Secretary of State confirm that objective 1 status was conferred upon the highlands and islands because of the region's problems of persistent high unemployment, the sparsity of population, the remoteness of communities and poor communications? Does he agree that those factors should be the criteria by which objective 1 funding is allocated within the highlands and islands? Is he surprised to learn that the programme partnership is yet to devise a formula to ensure that that happens? Will he therefore urge the partnership to produce such a formula as early as possible to ensure that aid is effectively targeted?

Mr. Lang

I certainly hope that progression of the entitlement to objective 1 status is carried forward quickly. The highlands and islands obtained objective 1 status because, although the area did not meet all the criteria for objective 1 status as laid down, the Scottish Office persuaded the European Commission that the case deserved to be met under those criteria. As a result, £240 million will go to the highlands and islands over five years.

I am sure that the hon. Gentleman will be as encouraged as I am by the fact that unemployment in the highlands and islands fell by between 5 and 6 per cent. last year and that it now stands at below the Scottish average, which, in turn, is below the United Kingdom average. That is a reflection of the strength of the regeneration of the economy of the highlands and islands, which was set in train by the Government.

Mrs. Ray Michie

I understand that the Northern Ireland Office is about to approve the spending of £5.2 million on the necessary infrastructure to establish a ferry link between Ballycastle in Northern Ireland and Campbeltown in my constituency. Will the Secretary of State urgently consider seeking Treasury and Highlands and Islands Enterprise approval for the necessary spending for the Campbeltown end, which, at £2.2 million, will cost much less? Crucial decisions must be made very soon. The right hon. Gentleman will agree that the link would give a tremendous boost to Kintyre, Argyll and Scotland.

Mr. Lang

I shall certainly look at any details that the hon. Lady cares to send me. I hope that she will be encouraged by the fact that, under the recent public expenditure announcement, the Government were able to find an extra £1.6 million to help the shipping and infrastructure of ferry services to the islands, the northern isles and the western isles. I hope, too, that she will welcome the announcement today that a new vehicle ferry service across the Sound of Harris has been approved and should go ahead for tenders to start construction next April.

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