HL Deb 10 April 1968 vol 291 cc345-8

3.30 p.m.

LORD SHACKLETON

My Lords, if I may at this point I should like to make a Statement on the Malta Dockyard. In my statement to the House on April 3 I undertook to give the House details of the additional financial help which we shall make available to the Malta Government as a result of our recent talks with the Prime Minister of Malta about the Malta Dockyard. The Malta Parliament in the early hours of this morning unanimously—and I stress the word "unanimously"—passed legislation bringing the Malta Dockyard into public ownership, thus ensuring its continued operation. It is the intention of the Malta Government to develop and diversify the Dockyard and to make it more competitive.

Under this legislation the Malta Government have acquired the shares of Bailey (Malta) Limited against payment of such compensation as may be determined by the Maltese courts, in accordance with Section 38 of the Malta Constitution. Provision is made by the legislation for the transfer to a newly established corporation of the assets of Bailey (Malta) Limited necessary for the running of the Dockyard and certain of its liabilities. The legislation also provides for the winding up of Bailey (Malta) Limited. The price for the assets so transferred, to be paid to the liquidator, will be established by the Maltese courts.

The responsibility for the Malta Dockyard now rests wholly with the Government of Malta. I am glad to say that we are able to make an important contribution towards meeting the cost to the Malta Government of putting their plans into effect. First, we intend to pay over to the Malta Government a sum not exceeding an amount equivalent to our receipts as creditors in the winding up of Bailey (Malta) Limited in respect of our loans to the Dockyard.

Secondly, in recognition of the importance of the future prosperity of the Dockyard, we are allocating for the Dockyard £3 million of the £51 million made available to the Malta Government under the Financial Agreement of September, 1964. The Malta Government will be able, if this should prove necessary, to draw on this £3 million for purposes related to the transfer of the Dockyard to Malta, the balance being devoted to the development and diversification of the Dockyard. At the end of the 10-year period—that is, the 10 years following the 1964 Agreement—covered by the Financial Agreement an additional £3 million of aid will be provided for development projects. This Money will be disbursed by March 31, 1976. In addition we intend to provide a feasibility study of the development and diversification of the Dockyard. The two Governments are already in contact over this, and we hope that arrangements for the study can be completed soon.

The result that we have achieved is that the Malta Government have been able to acquire the Dockyard undertaking and are in a position to develop it for the benefit of Malta. I am sure that your Lordships are as satisfied as I am that we have been able to bring to a successful conclusion a problem that has for so long created such difficulty to the Governments both of Malta and of the United Kingdom.

LORD CARRINGTON

My Lords, the House will be grateful to the noble Lord for having made that Statement and also for its contents. I think all noble Lords will share the Government's satisfaction at the end of this chapter. I am sure that everyone in the House will recognise the dependence which the economy of Malta still has upon the Dockyaid, and that the assurance of the Dockyard's future will make a great deal of difference to that economy. Incidentally, we ought also to recognise that it is a very good Dockyard; when it was a Royal Naval Dockyard it did excellent work. I think the House will recognise also that with the run-down in our defence commitments in Malta we had, to a very large degree, some duty to the people of Malta to safeguard their economy. In this connection, too, we must be pleased at the outcome of these talks. I wish to ask the noble Lord only one question because I am not qualified to judge whether this sum of money, which is very large, is adequate. Have the Government of Malta expressed satisfaction at the size of this grant?

LORD SHACKLETON

My Lords, I do not know whether arty Government ever really expresses satisfaction. I can only say that privately they have expressed the greatest satisfaction. I know that, after some pretty hard bargaining, the talks ended in an atmosphere of great good will, and I remarked before I left that I hoped I should not be in trouble when I got back to England. I think the noble Lord will appreciate from the Statement that no extra cost will be falling on the taxpayers in the next few years. There is a diversification of funds to produce a final total. I think myself that it is a very satisfactory agreement and that it is very satisfactory (and very remarkable) that this Bill was passed unanimously by the Malta Parliament.

LORD BYERS

My Lords, I, too, should like to welcome the Statement and to say once again how grateful we are for the work the noble Lord has done in this connection. If I may venture to express a personal opinion, I would say that the diversification of the Dockyard may perhaps be counted as the most important aspect of the Statement. I should like to ask the noble Lord whether he is in a position to say what organisation will be entrusted with this very important task—whether private enterprise in the United Kingdom will have the opportunity of helping in this diversification.

LORD SHACKLETON

My Lords, I regret that I cannot answer that question at the moment. These are very important matters, and they are primarily matters for the Malta Government. But in practice they will depend a great deal upon the results of the feasibility study which the British Government have offered to provide. I would not rule out any particular type of development—including British private enterprise. I would merely hope that some of it will be more successful than it has been in the past.

LORD WALSTON

My Lords, may I ask my noble friend whether he can tell us the total amount of money that has been given to the Malta Government since the Naval Dockyard was abandoned and how this compares with the actual cost to us during its period as a naval dockyard? I should like to say that I imply no criticism in any way of the arrangement, which I think is admirable and reflects credit on my noble friend personally.

LORD SHACKLETON

My Lords, first may I agree with the noble Lord, Lord Carrington, that it is a very fine dockyard indeed and well equipped. So far as my noble friend's question is concerned, I think I should be unwise to attempt to answer in detail such a clever question, which I am sure was put for information but which is beyond my limited capabilities. The British Government's loan to the Dockyard amounts to £8½ million, including accrued interest calculated on April 9, 1968. The sum is very considerable.

LORD CONESFORD

My Lords, may I ask a question about something which, I think, was in the Statement made by the noble Lord; but I am not certain whether I heard it aright. He said the value of the compensation was to be determined by the Maltese courts. Was the amount to be determined in accordance with legislation already on the Statute Book or with the legislation that was passed last night?

LORD SHACKLETON

I have not seen the legislation; but, as I understand it, it applies the provisions of Section 38 of the Malta Constitution as to compensation and it derives from that particular section. This provides that adequate compensation will be paid for the shares acquired; but that what is adequate will be determined by the Maltese courts in accordance with Section 38. Any claims which may be advanced against Bailey (Malta) Limited by C. H. Bailey Limited or the directors of Bailey (Malta)—I am talking about claims as creditors as opposed to shareholders—will be dealt with by the liquidator in the usual way in the winding-up of the company.