HC Deb 26 January 1994 vol 236 cc272-4
2. Mr. Macdonald

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

The Parliamentary Under-Secretary of State for Scotland (Lord James Douglas-Hamilton)

The establishment of Highlands and Islands Enterprise and the success of the campaign to secure objective 1 status have greatly strengthened confidence in the economy of the highlands and islands. I share this confidence and am committed to the policies on which it is based.

Mr. Macdonald

The Minister must know that two issues are causing great concern, especially in the west highlands and the outer islands. One is the continuing crisis in the salmon industry because of Norwegian dumping and the continuing blockheaded refusal of the Treasury to endorse the safeguard actions that are necessary to protect that vital industry. The other is of more concern to my constituency and concerns the apparent proposals now emerging from some officials in the Ministry of Defence to wind down or close down the testing range in the Uists. I ask the Minister for a commitment that the Scottish Office would fight to the bitter end any such attempt. He knows as well as anyone that that would devastate the economy of the southern isles.

Lord James Douglas-Hamilton

The hon. Gentleman raises two important issues. On salmon, we welcome the Commission's introduction of emergency safeguard measures in the form of minimum import prices, which provide a ternporary floor in the market while the longer-term problems facing the industry are addressed. We welcome the Commission's request to the farmed salmon industry to update information submitted to it about alleged Norwegian dumping in 1991. It would be helpful if the representatives in the hon. Gentleman's constituency forwarded the evidence to the Commission so that it can carry out the necessary investigation. I shall keep in touch with the hon. Gentleman on that.

As for Benbecula, as the hon. Gentleman will know, the Ministry of Defence is carrying out its review and hopes to complete it in the near future. An announcement will be made as quickly as possible. I will ensure that the points that he has made are put before the Ministers concerned.

Mr. Matthew Banks

Will my hon. Friend join me in welcoming the success of Highlands and Islands Enterprise? Does he agree that the economy of the highlands and islands is inextricably linked with the rest of Scotland, which, significantly, now enjoys lower unemployment than the rest of the United Kingdom? On average, it has not been lower since the 1920s. Does he further agree that it is significant that Scotland enjoys record levels for manufactured exports, for investment in wholesaling and retailing and for manufacturing industry —something of which Scotland should be rightly proud?

Lord James Douglas-Hamilton

Many of the points that my hon. Friend has made are absolutely right. For the first time since the 1920s, unemployment in Scotland is now below the United Kingdom average, and has been since January 1992. Manufactured exports were at a record level in 1992. Highlands and Islands Enterprise is doing very well and its funding—some £76 million for next year —is substantial. When one takes into account the fact that some of the funds for tourism and marketing will be transferred, that represents an increase. Its morale is very good.

Mr. Maclennan

Does the Minister recognise that, although objective 1 status was a welcome achievement in the highlands, there is now widespread concern that the Government are undermining that achievement by slashing public expenditure and waiting for the European Community to pick up the tab? Does he not realise that not only are those cuts damaging to the highland economy but they risk the effectiveness of objective 1, because they will deny the additionality principle, which is a key to the Community's financing of those projects?

Lord James Douglas-Hamilton

The funding is additional. The £250 million funding represents the highest per capita allocation in the United Kingdom for objective I and recognises the special circumstances of peripherality and sparsity of population.

There have been many successes recently in the hon. Gentleman's constituency. Rockwater won a £25 million contract for 80 jobs at its fabrication yard near Wick; Caithness Glass is creating some 20 new jobs within the next two years; and Norfrost is to create at least 120 jobs. The prophecy of doom and gloom is not met by the facts.