HL Deb 05 November 1986 vol 481 cc1138-45

5.10 p.m.

Baroness Hooper rose to move, That the draft order laid before the House on 27th October he approved. [33rd Report from the Joint Committee.]

The noble Baroness said: My Lords, I beg to move that the International Fund for Ireland (Immunities and Privileges) Order 1986 be agreed to. Your Lordships will recall that an agreement between the United Kingdom and the Republic of Ireland was signed on the 18th September 1986 to establish a fund to promote the economic and social development of those areas of both parts of Ireland which have suffered most severely from the consequences of the instability of recent years. The two governments have agreed that the fund should give priority on a value-for-money basis to the stimulation of private sector investment and to projects of benefit to people in both parts of Ireland, in particular to improve communications and greater co-operation in the economic, industrial and research fields.

They have also agreed that the money should be used to improve the quality and conditions of life for people in areas facing serious economic and/or social problems and to provide wider horizons for people from both traditions, including opportuniities for industrial training and work experience overseas. Approximately three-quarters of the fund's resources will be spent in Northern Ireland. The agreement was published as Cmnd. Paper No. 9908 and presented to Parliament on the 27th October. The United States has made available to the Fund a sum of 50 million US dollars in the United States financial year just ended, Canada has promised 10 million Canadian dollars over 10 years, and New Zealand has pledged 300,000 New Zealand dollars. Contributions from other countries may follow. These resources will be administered and disbursed by an independent board to be appointed jointly by the two governments. The board will be formally appointed when the agreement establishing the fund comes into force. We intend to appoint Mr. Charles Brett, a successful Belfast solicitor and past chairman of the housing executive to chair the board. Its other members will be six people from both parts of Ireland who have appropriate administrative and business experience.

Articles 5(2) of the agreement provides that the fund shall have legal capacity to contract, acquire and dispose of property and to institute legal proceedings. It shall have power to enter into agreement with any donor consistent with the provisions of the agreement, provided that neither government has indicated any objection. Without these powers the fund would find it difficult to carry out these tasks which we have set in the agreement. The fund shall also have exemption from taxes on income and capital gains. We are not seeking any other form of immunity but we believe it right that the Government should not take part of another state's contributions through taxation. The order before the House would give effect to these undertakings and enable the fund to work efficiently and effectively. I beg to move.

Moved, that the draft Order laid before the House on 27th October by approved. [33rd Report from the Joint Conitnittee](Baroness Hooper.]


Lord Prys-Davies

My Lords, we are grateful to the Minister for explaining the background to the order and also for the information which she has given the House about the board and the allocation of the fund between the Republic and Ulster. We welcome the fund and the draft order, and particularly the draft order because it gives legal personality to the International Fund. In our view, it is one of the happier consequences of the Anglo-Irish Agreement.

Therefore, we unambiguously welcome the promise of co-operation between the United Kingdom Government and the Government of the Republic to promote economic and social development north and south of the border. We also welcome the international support for such co-operation, which is necessarily implied by the existence of the fund. It seems to me that when one looks back to 1921 one sees that it is one of the tragedies of Northern Ireland that no serious attempt was made by successive administrations in the United Kingdom or in the Republic to encourage co-operation one with the other. However, with the Anglo-Irish Agreement and with the International Fund we think that this situation if beginning to change.

The names of the six board members and the Chairman who will manage the fund were announced a month ago. They are distinguished men who bring many gifts to their task, and we on these Benches are grateful to them for accepting their new responsibilites. Already the board—I believe it is the board—is moving speedily toward identifying the initial priorities to which its efforts will be directed.

I have just a few questions that I should like to ask the Minister, which are really for information. First, can the Minister confirm that when this order is approved by the Privy Council all the procedures in connection with the setting up of the fund will have been completed at least in the United Kingdom, and if that is so, when will the appropriate procedures in the Republic be completed? Secondly, the Minister has told us that donations are forthcoming from other countries. Will the arrangements governing those donations be published in an agreement between those countries and the two governments? Thirdly, can the Minister confirm how the funds made available to the two investment companies for venture capital will be distributed? Are we to accept that two thirds—or is it three quarters?—will go to the investment company operating in Ulster and the remaining quarter or a third go to the investment company operating in the Republic?

My next question is concerned with the advisory committee. Is it envisaged that in practice applications for assistance under Article 7 of the agreement of the 18th September will be determined by the board and its advisory committee, or will they be determined by the sole decision of the board? Having regard to the wording of Article 6 of the agreement, can the two governments, acting jointly, give instructions to the board in any circumstances, or is that ruled out by the provisions of Article 6? Again, can the Minister tell the House when the members of the advisory committee and the joint chairmen will be appointed? Finally, can the Minister give us an indication of the manpower requirements of the board? Will it have an office in Ulster and an office in the Republic?

I should be grateful if the Minister would respond to those few questions or, if that is not convenient, if she will write to us. We shall come back persistently in the future to probe the activities of the board and the fund, as well as to prompt and to encourage. Meanwhile, we believe that the order will provide a stimulus for cooperation between the two governments and we therefore give it our support and our goodwill.

Lord Hampton

My Lords, I. too, should like to thank the noble Baroness for introducing this order, which we on these Benches welcome unreservedly. It is clearly a most welcome change that money from the other side of the Atlantic should be devoted to what we may well call constructive ends, unlike the funds subscribed to Noraid that have gone to promote violence, disruption and destructive purposes.

This aid looks like being generous and valuable, and we can thank the Anglo-Irish Agreement that is so much maligned by the Unionists for helping to bring about the necessary arrangements. I believe that only those people will object for whom the whole idea of co-operation and understanding between the two parts of Ireland is objectionable and total anathema.

I should like to ask the noble Lord, Lord Lyell, two questions. The noble Baroness touched on the point, but I should be grateful for rather more detail on what the proposed sum in aid is likely to be and whether it will be ongoing for a number of years. Secondly, to what end is it proposed that the funds should be put? The noble Baroness touched on that point. She mentioned communications and the quality of life in impoverished areas and how the projects will be checked by those in control. With that, I repeat that we support the order.

Lord Blease

My Lords. I support and concur with the points made by my noble friend Lord Pry's-Davies and by the noble Lord, Lord Hampton. I welcome the token of friendship and practical goodwill presented by the order's principles—principles of international concern for the economic and social advance of the peoples of both parts of Ireland.

I should like to take the opportunity to express my confidence—confidence has also been expressed by my noble friend Lord Prys-Davies—in the seven men who it was announced on 1st October have accepted

membership of the International Fund for Ireland Board. I have confidence in their integrity and their independence of party-political motivation or influence. They deserve the warmest commendation for their public spirited action in accepting the daunting and difficult work which will arise from this challenging and international body. It is an international organisation which has sadly been misrepresented and subjected to political controversy. The standing and reputation of those men in public, commercial and community life in Ireland are beyond reproach. I wholeheartedly concur wth the remarks already made about their deserving of our warmest praise for their assistance in bringing the organisation into operation.

While that confidence and support are wholehearted on this side of the House, I consider it prudent, in the general public interest, that the board's operations and results should be subject to an annual report to the United Kingdom Parliament. Can the Minister give us any information about what is intended in that respect?

Article 10 of the agreement was referred to by the noble Baroness. It relates to the advisory committee. How will the advisory committee be made up? The Article mentions two representatives of the Government. Are those ministerial representatives or representatives from the Civil Service or the secretariat? I again concur with my noble friends on this side of the House and give the order my wholehearted support.

The Parliamentary Under-Secretary of State, Northern Ireland Office (Lord Lyell)

My Lords, I am sure that we are all grateful for the attention to detail which has been paid by all noble Lords who have spoken in this little debate. We are also grateful for the welcome that has been given to the fund. Your Lordships will agree that that is very much in line with all the efforts that have been made to set up the fund. I am sure that the report of your Lordships' debate will go out to the United States, Canada and New Zealand. I am also sure that what has been said will be carefully noted.

The noble Lord, Lord Prys-Davies said that he wished to ask me a few questions. As we all know, he does his homework thoroughly. I shall attempt to fill him in tonight, but if I miss anything I shall accept his invitation to write to him. First, he asked about the fund and its legal personality. As he pointed out, the fund's legal personality is provided for in Article 5(2) of the agreement. That provision will come into force when the steps necessary for the implementation of that sub-paragraph are completed. That will be when the Republic of Ireland and the United Kingdom have completed the various procedures. In our case that involves the approval of the draft in your Lordships' House and another place where I understand that has already taken place.

The order then has to be submitted to the Privy Council. The date of the coming into operation of the order then has to be gazetted in London, Edinburgh and Belfast. That date will be agreed with the Government of the Republic. I hope that gives some indication of the fund's legal personality. I understand that for constitutional reasons the agreement will have to be submitted to the Dail and an order on the question of legal capacity and tax exemptions would be made. That order is subject to annulment by the Dail. That is the procedure for the Republic of Ireland. The United Kingdom procedure is as I explained it to the noble Lord. I understand that the important aspects of what is stated in the order and in Article 5(2), are the legal personality, legal capacity and the tax exemptions. I understand that the legal capacity and the tax exemptions are needed to make the order bite. Does the noble Lord wish to intervene? I see him looking keenly.

Lord Prys-Davies

My Lords, can the Minister assist? Can he give us an indication, in terms of weeks or months, as to when the board will be active in the market place?

Lord Lyell

My Lords, I was coming to that matter. I was snared by the legal procedures, the legal personality, the legal capacity and the tax exemptions. If the noble Lord has any further points on that perhaps I may write to him.

The noble Lord has raised a number of points, and I hope to cover most of them. We hope that the fund will come into being as quickly as possible. We hope that all the necessary procedures will he completed here and in the Republic before Christmas. I understand that that is the target date.

The noble Lord asked when we might start the fund moving. I understand that the board will invite people with commercial experience, especially in the international field, to participate in the management of the two companies which are mentioned in Article 9. Those companies will identify risk capital needs for ventures of existing or indeed new commercial and industrial enterprises. They will provide, on sound commercial criteria, equity capital or loans. The companies' aims will he to stimulate viable and self-sustaining growth in the private sector of both parts of the island of Ireland.

A query was raised about the split in Article 3 on page 4. I quote from the agreement contained in Cmnd. 9908: Because of the special problems in Northern Ireland associated with the instability of recent years, approximately three-quarters of the resources of the Fund shall be spent there". I hope that this will be of some help to the noble Lord. There was also a query about the board and its independence. The noble Lord, Lord Blease, was interested in this matter. I stress that the board is independent. Any question of the Government's involvement in the administration of the board will be covered by the independence of the board.

I have to say that the Government will have the right to offer advice through an advisory committee. We expect that there will be detailed work to evaluate possible projects. It would normally be the case—I stress this advisedly—that this would be carried out by government departments. But the board would be free to seek any other advice it wished. The board has power to enter into agreements with any donor consistent with the provisions of the agreement provided that neither government has raised objection.

There was also a query about the composition of the board and its administration. If your Lordships House follows another place by approving these arrangements, we would hope to appoint the seven people—Mr. Charles Brett and the other six members—who, I understand, have been designated. There are, however, further procedures that have to be gone through before we can say that they, are in practice members of the hoard and that the hoard will be functioning.

The fund will be administered by the board. The board, appointed jointly by the two governments, will serve according to terms and conditions agreed by the two governments. I was asked when we might see legislation passed in the Republic of Ireland. I had said that this would be achieved by, Christmas. I have now another note which says "In the very near future". I hope that this covers the query. Another question related to offices and manpower. Meetings will be held initially at various venues. There will be no permanent offices. The meetings are likely to be held in Belfast or Dublin but there will be no permanent offices for the holding of meetings. The meetings will take place on an ad hoc basis. They will be held initially at various venues.

The noble Lord, Lord Hampton—we are grateful to him for his remarks—asked about the amount of the fund. We have so far received definite commitments from the United States of 50 million United States dollars, as my noble friend stressed, and 10 million Canadian dollars over the next 10 years. Half the sum from Canada will, I understand. be in the form of loan contributions. New Zealand is contributing a sum of 300,000 New Zealand dollars. I am advised, too. that other countries may wish to contribute. At the moment we have those three amounts.

The United States Congress has also approved an authorisation Bill that provides for a contribution of 120 million United States dollars in the period up to 1988. The sum of 50 million United States dollars has already been approved and appropriated in the United States fiscal year, ending, I understand, on 30th September this year. The Bill will authorise another 35 million United States dollars in the year to 30th September 1987 and a further 35 million United States dollars in the year to 30th September 1988. I hope that this information assists the noble Lord. I was asked how the sum might be used. This will be for the board to decide on the basis of each application. Various persons and organisations will be able to apply to the board. Indeed, we hope that they will apply for finance from the fund.

In general, we expect the fund to give priority, as my noble friend stressed, on a value for money basis, in four main areas. The first is the stimulation of private sector investment. The second relates to projects of benefit to people in both parts of Ireland, north and south. One example is improved communications. Then there is greater co-operation in economic and educational research. The third covers projects to improve the quality and conditions of life for people in areas facing serious economic or perhaps social problems. The fourth includes projects to provide wider horizons for people from both traditions in Ireland including opportunities for industrial training and work experience overseas. That is a fairly wide spread of examples of what we see the fund being used for. But decisions will be taken by the board. We place our trust in its considerable judgment.

We are grateful for the support shown by the noble Lord, Lord Blease. I am advised that there will be an audit, although whether there will be a formal report to your Lordships, or indeed to Parliament, I am not able to say today.

5.30 p.m.

Lord Prys-Davies

My Lords, that information is given, I believe, in Article 12 of the agreement.

Lord Lyell

My Lords, I am indebted to the noble Lord. There will be an opportunity to present an annual report that will also go to donors to the fund. I understand that there will be a professional audit and that this will be the responsibility of the board itself. I hope that these remarks complete any answers to queries raised by noble Lords. If any points have been missed. I shall write to noble Lords. I commend the order to your Lordships.

Lord Blease

My Lords, before the noble Lord sits down, I have not had an opportunity to consult my noble friend on the Front Bench. I must say, however, that I am less happy now than I was when the order was introduced. I am particularly, concerned about the Minister's reference to ad hoc arrangements for the board. I feel sure. knowing fairly well those who will comprise its membership, that they will be unhappy with an ad hoc arrangement over meeting places. There was also mention of the manner in which the Government would interfere with decisions of the board. I uphold the right of the Government to correct a subordinate body. But the manner in which the noble Lord described the position did not accord, I believe, with the spirit of intent that should exist between the two governments as contained in the agreement. I hope that when I read the Minister's remarks I shall see them in a different light.

Lord Lyell

My Lords, I should like to place this matter beyond doubt. I have already stressed twice, but will stress again, that the board is independent. I did, however, say that the Government will have the right to offer advice. I hope that the noble Lord will take that remark in the spirit in which I put it forward. I do not believe that there will be heavy-handed advice or anything approaching the darker thoughts that may have been in the noble Lord's, or anyone else's, mind. We would have the right—this does not mean that either or both governments would in fact carry this out—to offer advice through the advisory committee. But again we would expect the detailed work to be evaluated by government departments. That is usually the case.

However, I stress once again that the board will be free to seek and to take other advice wherever it wishes. The board will have the power to enter into any agreement with the donor which is consistent with the provisions of the agreement: that is, provided that neither government has raised any objection. I think that is also consistent. But there is certainly no question of either government interfering with any decisions of the board.

The noble Lord asked about this matter. I stress again that accommodation will be provided but we do not think that a permanent headquarters would be appropriate, especially after what I have said.

Lord Blease

My Lords, that is much better than ad hoc arrangements.

Lord Lyell

My Lords, I reiterate what I said earlier. But there is no question of either government interfering with the decision of the board. I hope that that reassures the noble Lord.

On Question, Motion agreed to.