European Investment Bank: Loans (Hansard, 13 February 1984)

§ Lord Orr-Ewing
My Lords, I beg leave to ask the Question standing in my name on the Order Paper.

§ Lord Lyell
My Lords, since 1973 the European Investment Bank has made available to companies in the United Kingdom loans to a total value of £554 million. This figure includes facilities, made available to banks and other financial institutions under global loan arrangements for on-lending to small firms, which are not yet fully utilised.

§ Lord Orr-Ewing
My Lords, I am most grateful to my noble friend for that information. Much of the help that we get from the EEC is not widely publicised in this country and that information will be widely appreciated. Can my noble friend form an opinion as to whether this investment is going into areas which badly need new jobs? Is it going to areas of high unemployment, and have extra jobs been created as a result of this investment?

§ Lord Lyell
My Lords, I thank my noble friend for drawing attention to this benefit from our membership of the European Community. I should like to draw to his attention, and to the attention of your Lordships, the fact that the decision to borrow from the European Investment Bank is essentially a matter for the company concerned. The European Investment Bank has responsibility under the Treaty of Rome to contribute to the balanced development of the Community. The bank grant these medium- to long term fixed interest loans to contribute to the economic development of regions in difficulty which, in the United Kingdom are the United Kingdom assisted areas and Northern Ireland. Secondly, these areas are of common interest to more than one member state. Thirdly, they involve, in certain cases, modernisation or conversion of undertakings or the creation of fresh activities. As for the number of jobs which have been created by the European Investment Bank's loans, I am afraid that I am not able to give an answer to my noble friend today, but I shall inquire and write briefly to him.

§ Lord Lloyd of Kilgerran
My Lords, so that the answer of the noble Lord the Minister can be complete, is he able to tell the House now or at a later date the amount of loans specifically directed to companies in Wales?

§ Lord Lyell
My Lords, I can do that at a later date and will write to the noble Lord.

§ Lord Cledwyn of Penrhos
My Lords, can the noble Lord say whether the Government are satisfied that the United Kingdom is receiving its fair share of the total amount lent by the bank and can he say what percentage comes to this country? Secondly, can he say what assistance is given by the Department of Trade and Industry to the small industries which make these applications? It is within my knowledge that, in certain cases, small industries have found it difficult to obtain advice about the ways and means of making these applications. Is he satisfied that full information is available to firms throughout the country?

§ Lord Lyell
My Lords, I would stress to the noble Lord that loans from the European Investment Bank are a matter for the companies themselves and it is for the companies to apply in the first instance. As regards the percentage coming to this country, I am afraid that I do not have the figures but I can find out for the noble Lord and will write to him. The noble Lord will be aware that the Department of Trade and Industry acts as a wholesaler in this matter of European Investment Bank loans. One of the retailers or agents for these loans is the Welsh Office, and the Welsh Development Agency is another arm of the Department of Trade and Industry.

§ Lord Cledwyn of Penrhos
My Lords, is the noble Lord satisfied that small industries throughout the country—in the north of England, Scotland and Wales—are aware of this facility and of the way in which applications should be made? For example, can he tell the House how a small industry in the north of Scotland or in west Wales would go about getting information if it wanted to take advantage of this facility?

§ Lord Lyell
My Lords, in the first instance this is a matter for the small company, but I think that information on these loans and grants is available from the Scottish Development Agency and the Welsh Development Agency. If a small firm wished to have any assistance, then, in the first instance, it would normally go to its bankers. The clearing bank is the primary source of supply for small companies. It is usually this channel of communication which is available to the small company.