HL Deb 08 July 1992 vol 538 cc1138-9

3.11 p.m.

Lord Desai asked Her Majesty's Government:

Whether any progress has been made in speeding up payment by them of European Social Fund payments to agencies.

The Parliamentary Under-Secretary of State, Department of Employment (Viscount Ullswater)

My Lords, the employment department continues to make significant improvements in the speed with which European Social Fund grants are paid to project sponsors once the money has been received from the European Commission. All outstanding 1992 first advance claims for national programmes have now been paid.

Lord Desai

My Lords, I thank the Minister for that Answer. Does he not agree with his right honourable friend the Chancellor who said during his Budget speech that businesses not paying their bills promptly was one of the great causes of distress? Is it not the case that there have been long delays in making the first advance payment while there was a dispute between the Government and the EC about such matters? Will he assure us that prompt payment will be made in the future?

Viscount Ullswater

My Lords, I recognise fully the difficulties which late payment creates for any sponsor. Of course, that is particularly damaging to the voluntary sector groups which have no other sources of funding. However, my officials make every effort to give the payments priority once the money has arrived in the United Kingdom. It is an extremely bureaucratic system and it is up to the European Commission to make certain that the money arrives in this country as quickly as possible.

Baroness Turner of Camden

My Lords, is the Minister aware that delays in that area can put training programmes at risk and that for some organisations it puts them in real difficulty? One organisation in contact with me has said that, the interest charge on the £1 million we are owed for training programmes we established from 1 January, on the basis of government grant promises, is mounting daily". Can anything be done about the interest payments?

Viscount Ullswater

My Lords, I am afraid to say to the noble Baroness that the answer is no. The rules of the European Social Fund do not allow the European Commission to reimburse applicants or member states for interest charges. Sponsoring organisations understand the system before they enter into it.