HC Deb 15 February 2001 vol 363 cc437-8
1. Mr. John Wilkinson (Ruislip-Northwood)

How much launch aid for civil aerospace projects in the United Kingdom was invested by his Department over the past 10 years; and what royalties on sales in the civil aerospace sector were received by the Government in this period. [148999]

The Minister for Competitiveness (Mr. Alan Johnson)

The Government receive a return on their launch investments through levies on the sales of engines and aircraft.

In the financial years 1990–91 to 1999–2000, £999 million was awarded in launch investment; in the same period, £915 million was received. Further returns will be received from launch investments. The details of individual investments remain commercially confidential, but the Government expect to receive a substantial real rate of return on all launch investments made in the past 10 years.

Mr. Wilkinson

Does the Minister agree that those returns are broadly satisfactory? The programme of launch investment in the Airbus series of aircraft initiated by Baroness Thatcher, with some £220 million for the A320, is now to be followed by Government investment of some £250 million in the engine sector for the Trent 600 and 900 power plants? Does that not show that Governments of both persuasions recognise the strategic importance of the British aircraft industry as a whole to the United Kingdom, and that the money is well invested and well spent?

Mr. Johnson

I agree entirely with the hon. Gentleman's comments—it has been a great success. Money is still being received for the A320, which was introduced in 1988, which shows that the aid was a good investment for the British taxpayer.

Mr. Peter L. Pike (Burnley)

Does my hon. Friend accept that launch aid has been crucial to retaining aerospace jobs resulting from the Airbus work in Burnley and north-east Lancashire? It is welcome, and we want it to continue. Aerospace is an important part of the local economy and the British economy as a whole.

Mr. Johnson

My hon. Friend makes an important point. This is a great British success story. The aerospace industry has contributed an average of £2 billion to our balance of trade over the past 21 years. The venture that my hon. Friend mentions—the A380, previously known as the A3XX—will create 22,000 new jobs and safeguard 62,000 existing jobs.

Mr. Gerald Howarth (Aldershot)

Welcome as the news was, it was unfortunate that on the "Today" programme the Secretary of State did not pay tribute to the previous, Conservative Government. As my hon. Friend the Member for Ruislip-Northwood (Mr. Wilkinson) made clear, a Conservative Government looked carefully at the A320 programme and decided that, even though politicians were not generally the best at making commercial decisions, a decision could be made. The result was that all launch aid for the A320 was repaid with interest by December 1999. The Government are now receiving dividends on Britain's most successful post-war civil aircraft programme.

Mr. Johnson

On the issue of aerospace, the whole House can unite in supporting a great British industry. As for the previous Government's record, even a broken clock is right twice a day.

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