HL Deb 07 March 1991 vol 526 cc1494-5

3.30 p.m.

Lord Dormand of Easington asked Her Majesty's Government:

What proposals they have to assist the Northern Development Company in its business plan for 1991–92.

Lord Hesketh

My Lords, I am pleased to be able to tell your Lordships that after careful consideration of their respective plans for 1991–92 my honourable friend the Parliamentary Under-Secretary of State for Industry and Consumer Affairs has today announced the levels of grant in aid awarded to each of the five regional development organisations for their inward investment activities. Out of a total of £4.5 million available for all the RDOs, the Northern Development Company has been offered £1.33 million, which represents a generous uplift of 13 per cent. over 1990–91.

Lord Dormand of Easington

My Lords, that sounds promising, but it could have been better. Does the Minister agree that the Northern Development Company has an excellent record, and that one reason for its success is that when it was formed, and since, it had the full support of all the political parties, the private sector, the local authorities and the trade unions? It is a model of co-operation. Does he recall that the Northern region still has the highest unemployment rate outside Northern Ireland? Having regard to all those factors, does he accept that this is not a begging-bowl exercise? Every penny is needed to sustain and improve the Northern region and in so doing to improve things in the country as a whole.

Lord Hesketh

My Lords, I am sure that the excellence to which the noble Lord, Lord Dormand, referred was one of the reasons my right honourable friend agreed to go way above the rate of inflation. On his second point with regard to unemployment in the North, I point out that nearly 97 per cent. of the working population in the North East is covered by assisted area status. That is the highest percentage of any region. Those are the areas which benefit from all DTI aid schemes.

Lord Gisborough

My Lords, is my noble friend aware that the great difference now compared to previously is that many new businesses are setting up their head offices in the region as opposed to their branch factories, and that therefore when there is a downturn matters do not go so badly as they did 10 years ago? All the help given is being used to the best advantage.

Lord Hesketh

My Lords, I am sure that all in your Lordships' House are well aware of all the shining examples of success. It is worth remembering that the United States is investing in the United Kingdom 60 per cent. of every dollar it spends in Europe in anticipation of 1992. Japan is spending some 40 per cent. of its inward investment in Europe. One has only to drive along the motorway past Washington New Town to see the material evidence of that investment.

Lord Williams of Elvel

My Lords, is the Minister aware that we welcome the contribution of the noble Lord, Lord Gisborough, to which he did not reply; that many firms are setting up in the North East with their own headquarters, and that the control is therefore in the North East rather than in Japan or the United States? Is it not further the case that as much effort as possible should be expended on the North East because of the high quality and skill of the workforce there and the excellent industrial relations that have prevailed?

Lord Hesketh

My Lords, I am well aware of that fact. I have to point out to the noble Lord, Lord Williams, that I referred to the Nissan plant at Washington in response to my noble friend's question. I am sure that noble Lords are also well aware of the Vickers' plant on Tyneside which made a notable contribution to the support of our forces in the recent Gulf endeavours.

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