Appropriation (No. 2) (Northern Ireland) Order 1996

HL Deb 28 June 1996 vol 573 cc1155-76

1.2 p.m.

The Parliamentary Under-Secretary of State, Northern Ireland Office (Baroness Denton of Wakefield) rose to move, That the draft order laid before the House on 5th June be approved.

The noble Baroness said: My Lords, I beg to move that the draft Appropriation (No. 2) (Northern Ireland) Order 1996, laid before the House on 5th June, be approved.

The draft order before us today authorises expenditure of £3,617 million for Northern Ireland departments in the current financial year. This is in addition to the sum of £2,821 million voted on account in March, and brings total estimates provision for Northern Ireland departments to £6,438 million, an increase of 6.2 per cent. on 1995–96.

I know that your Lordships continue to take a close interest in the prospects for economic development in Northern Ireland and I should like to say a few words about the local economic situation before turning to the contents of the estimates. Both official data and survey evidence show that there is a marked improvement in the recent performance of the Northern Ireland economy and that future prospects are now brighter than for many years.

The latest data for the main economic indicators presents a positive picture. The output of manufacturing and production industries continues to rise at a rate well above that achieved at national level. Over the past five years, Northern Ireland's manufacturing sector has increased output by just under 12 per cent. compared to a 3.1 per cent. rise nationally. Over a similar timescale there has been a significant improvement in the Province's gross domestic product relative to the United Kingdom, with GDP per head rising from 77 per cent. of the national average in 1989 to around 82 per cent. by 1994. Between 1991–92 and 1994–95, exports by Northern Ireland companies (to countries outside the United Kingdom) increased by 48 per cent., significantly outperforming growth in exports in the United Kingdom of 30 per cent. On inward investment, recent survey evidence shows that the value of potential planned investment in Northern Ireland from overseas companies already operating in Northern Ireland is in excess of £270 million, with 73 per cent. of firms planning further investment in Northern Ireland. That is an enormous tribute to the workforce of Northern Ireland.

1995 saw the seventh consecutive rise in visitor numbers, with a record 1.5 million people coming to Northern Ireland, a 20 per cent. increase on 1994 and, spectacularly, a 67 per cent. increase in holiday visitors. Visitors to Northern Ireland spent £214 million in 1995, an increase of 17 per cent. on the previous year. Combined with recent survey evidence, that suggests a very favourable outlook for the future.

At March 1996 the number of employees in employment in the province stood at 573,880, the highest March figure on record. In addition, the seasonally adjusted unemployment rate has fallen for eight of the past 12 months to reach 11.1 per cent. of the workforce.

All that is very welcome news for the people of Northern Ireland and I am confident that the performance of the economy will continue to be sustained. But a brighter economic future will, without doubt, be put at risk if violence were to continue.

I now turn to the main items of expenditure covered by the order as detailed in the estimates booklet; all the figures are, of course, in pounds sterling. I shall start with the Department of Agriculture. The net provision in the two agriculture Votes amounts to some £164 million. In Vote 1, some £20 million is to fund EU and national agriculture and fishery support measures. The net provision covers the pre-funded market support measures under the common agricultural policy which total £135 million. The Vote includes some £6 million for various capital environmental and other grants to assist structural improvements. Some £14 million is for the hill livestock compensatory allowance scheme to provide support for farming in special areas, while £6 million is in respect of processing and marketing of fishing.

Vote 2, includes £144 million for regional services and support measures. That includes £60 million for the development of the agriculture and agricultural products industries and for scientific and veterinary services. Some £27 million is for farm support, enhancement of the countryside, and fisheries and forestry services. There is £24 million for central administration, including information technology and specialist accommodation services; and £5 million is for the rural development programme. Some £18.4 million is for watercourse management. This Vote also contains net provision of £9.3 million in respect of the EU peace and reconciliation programme which incorporates agricultural, rural and water based projects.

In the Department of Economic Development's Vote I, some £134 million is for the Industrial Development Board. This will enable the board to continue to attract and support industrial development in Northern Ireland, mainly through the provision of factory buildings and selective financial assistance to both new and existing companies. In 1995–96 the board supported some 35 inward investment projects offering almost 5,000 jobs.

In Vote 2, £32 million is for the Local Enterprise Development Unit, Northern Ireland's small business agency. This will allow the agency to maintain its excellent track record in developing, strengthening and improving the competitiveness of the important small firms sector in Northern Ireland. Some £15.5 million is for the Industrial Research and Technology Unit, primarily to promote the competitiveness of local companies through encouraging innovation, industrially relevant research and development and by technology transfer. That underlines the importance the Government attach to helping Northern Ireland industry to grasp the technological opportunities which underpin successful economic development. Finally, in this Vote, £14.6 million is for the Northern Ireland Tourist Board.

In Vote 3, £212 million is for the Training and Employment Agency. This includes £73 million to fund 16,000 training places under the Jobskills training programme. Some £46 million is for the action for community employment and community work programmes, which will provide some 8,000 places for long-term unemployed adults in projects of community benefit. Some £24 million is to assist companies to improve their competitiveness by developing the skills of their workforce and providing training for management careers in industry.

I now turn to the estimates for the Department of the Environment. In Vote 1, £180 million is for roads, transport and ports. This includes some £147 million for the development, operation and maintenance of Northern Ireland's public road system. Maintenance of the road system remains a priority with some £72 million being spent this year.

Vote 2 covers the important area of housing. Some £210 million will provide assistance, mainly to the Northern Ireland Housing Executive and to the voluntary housing movement. When net borrowing and the Housing Executive's rents and capital receipts are taken into account, the total resources available for housing will be some £607 million. This is some £5 million more than in the previous year and will enable the Housing Executive to start some 900 new houses while housing associations will start some 1,250 new dwellings.

In Vote 3, gross expenditure on water and sewerage services is estimated at £181 million. Some £75 million is for capital expenditure and £106 million is for operational and maintenance purposes, as well as for administration costs.

In Vote 4, some £200 million is for environmental and other services. This includes provision for the environment and heritage service, planning service, construction service and land registers of Northern Ireland, which all achieved agency status in April 1996. Some £37 million is for urban regeneration measures, which continue to be targeted at areas of social, economic and environmental need. These measures provide a catalyst for higher overall investment through partnerships with the private sector. Some £25 million has also been made available under the EU peace and reconciliation programme, of which some £18.5 million is being funded from EU receipts.

The estimates for the Department of Education seek a total of £1,422 million, an increase of 2.5 per cent. over last year. Vote 1, which now incorporates the provision previously provided in Vote 2, includes £877 million for recurrent expenditure by education and library boards, an increase of £34 million over 1995–96. This includes £829 million for schools and colleges of further education. Also included is some £48 million for libraries, youth services and administration and £39 million for the boards' capital projects. The sum of £134 million is for recurrent expenditure by voluntary and integrated schools, while £35 million is for capital projects in voluntary and integrated schools. These amounts include £24 million for integrated schools, which is an increase of £9 million over 1995–96.

Vote 1 also includes £116 million for universities, £125 million for mandatory student support, £17 million for arts and museums and some £3 million for community relations.

In the Department of Health and Social Services, Vote 1 includes £1,432 million for expenditure on hospitals, community health, personal social services, health and social services trusts, family health services and certain other services, which is an increase of 2.5 per cent. on last year.

In Vote 3, £26.5 million is for expenditure on certain miscellaneous health and personal social services. Costs of the services now borne on this vote were previously provided for in Vote 3 administration and miscellaneous services. The provision sought is 12.1 per cent. higher than last year's final net provision.

The sum of £150 million in Vote 4 is for the department's administration and other miscellaneous costs. This includes £99 million for the Social Security Agency, £7.5 million for the Northern Ireland Child Support Agency; £9 million for the Health and Social Services Executive and £4 million for the Health Estates Agency.

In Vote 5, £1,628 million is for social security benefit expenditure administered by the Social Security Agency. This represents an increase of 9.2 per cent. on last year. An amount of £370 million in Vote 6 is to cover expenditure on the independent living funds, housing benefits, the social fund and payments into the Northern Ireland national insurance fund.

Finally, I turn to the Department of Finance and Personnel where, in Vote 3, some £5.8 million is sought for the community relations programme. In addition, some £3 million has also been available through funding from EU receipts under the EU peace and reconciliation programme. This, I hope, illustrates the importance which the Government continue to attach to this important area in Northern Ireland.

I hope that this necessarily short summary of the main components of the estimates is helpful. I commend the order to your Lordships.

Moved, That the draft order laid before the House on 5th June be approved.—(Baroness Denton of Wakefield.)

1.15 p.m.

Lord Williams of Mostyn

My Lords, I thank the Minister for her exposition and introduction. It is heartening to hear of the marked improvement she speaks of. I am sure that everyone present in your Lordships' House welcomes it, in particular her references to housing and tourism. I congratulate the Minister specifically on her work which was successful in obtaining 300 new jobs in Cookstown in the mid-Ulster constituency. Obviously, everyone is extremely pleased to hear of that.

We have to bear in mind that local scrutiny in Northern Ireland is not possible. Speaking for myself, I am always conscious that we do very little by way of detailed scrutiny on these occasions. We have to bear in mind that in many areas of Northern Ireland wage levels are unacceptably low.

Perhaps I may ask one or two specific questions. The first relates to our old friend the Criminal Injuries Compensation Board. I have been asking the same question for some years now. The Minister always smiles charmingly and says that the Government are thinking about it. I wonder whether the thought will end at some stage and action ensue, because the Northern Ireland scheme is different to that in the rest of the United Kingdom. I urge the Minister to maintain the more generous scheme in Northern Ireland. It cannot be left in limbo forever.

I turn specifically to the question of BSE, which has had a devastating effect in Northern Ireland. I believe it to be the case that 80 per cent. of Northern Ireland beef production is exported, mainly to Europe. There are no fewer than 16,000 farms dependent to some extent on that trade. There is widespread concern, perhaps despair, as to whether the levels of compensation are going to be fair and adequate. With so many farmers—that means families—dependent on the beef trade and forced, through no fault of their own, to sell their animals at a price which inevitably means that their annual income will be severely attacked, if not wiped out, is the Minister able to give any word of comfort and reassurance in respect of the levels of compensation?

It would be helpful also to have words of assurance about the backlog which, I understand, is increasing and causing great concern to farmers who have to maintain their stock at great expense. I know that the Minister is well aware of these concerns because, on an earlier occasion, she mentioned that traceability is much easier and more advanced in Northern Ireland. Ninety per cent. of herds are grass fed and there is a very low incidence of BSE. Is the Minister able to say something specific about what is contemplated as regards the staged scheme which the Prime Minister mentioned in another place on his return from Florence? Is it anticipated, bearing in mind the positive advantages of the Northern Ireland beef herd, that an early removal of the ban can be looked to there, even though its removal in stages may take place later in England and Wales where there are different problems. Can the Minister say what the likely cost of the ban will be? Her colleague in another place gave the figure of £2.5 billion. May I ask how much of that will be attributable to Northern Ireland—that is, if it is possible to make a distinct calculation?

Electricity is another serious problem in Northern Ireland. I know that the most favoured words in the English language are "I told you so"—but I did. At the time of the electricity privatisation—it was not this Minister who was answering questions on Northern Ireland—I ventured the widely held view that the privatisation of the electricity supply industry in Northern Ireland would lead to high prices and unconscionable profits. Last year, Northern Ireland Electricity paid £500 million for electricity and made a profit of £150 million. Those profit figures are simply not acceptable. I should be grateful for a word or two from the Minister about what is suggested. It is no answer to say that the Government provide help to the consumer when the real point is that those profit levels are unreasonably and unsustainably high.

The Minister mentioned the health Vote. Is it a fact that the Royal Victoria Hospital is to close operating theatres for five weeks this summer? I would not regard it as an acceptable response to say that it happens every year unless the Minister can say that it is a common occurrence throughout other surgical institutes in the rest of the United Kingdom.

I turn finally to quangos. During our last discussion the Minister was helpfully able to say that the Government were well aware of the fact that more representatives of constituents were needed on quangos as that would mean that consultation would be more widely spread. I wonder whether she can say something about the progress made.

I repeat how grateful I am for the care, courtesy and clarity with which the Minister discharges her work.

1.21 p.m.

Lord McNally

My Lords, this is my first contribution in this House on Northern Ireland matters. It gives me great pleasure to speak when the noble Baroness, Lady Denton, is to respond. When I lost my seat in the other place and found my earnings in the public relations profession, the noble Baroness was already a doyenne of that industry before being tempted into public service.

What has struck me over the past 20 years as I have observed Northern Ireland Ministers going about their business—this was evident in the Minister's introduction also—is that whatever the background and whatever locality of Britain from which Ministers for Northern Ireland come they quickly acquire a dedication and a commitment to the success of the Province which does them great credit. That has been true of Labour Ministers as well as Conservative Ministers. The story which the noble Baroness reported of the upturn in investment in Northern Ireland is a great tribute to the continuing efforts of her department.

I suspect that the upturn in tourism reflects something else—the outpouring of goodwill for the people of Northern Ireland and our good wishes for the success of the peace process and the ceasefire. It is a tragedy that the ceasefire has broken down here on the mainland. One hopes that it does not damage either tourism or investment in Northern Ireland. When I was a Member of the other place I served on the Select Committee on Trade and Industry which carried out a study of inward investment into Northern Ireland. We noticed that the industries and nationalities that came to Northern Ireland liked what they found. They were sometimes surprised by what they found, but they quickly asked for more in terms of expansion or were followed there by other industries from their own country. Northern Ireland has a good story to tell about inward investment and the department is to be congratulated on its continuing good work in that area.

There are three small and specific points on which I should be grateful for some ministerial comment. First, I refer to the Action for Community Employment schemes. I understand that the budgets of those schemes have been cut and that their future has been severely curtailed. There is no dispute about the fact that the schemes perform an extremely valuable function for the local economy and the local communities of Northern Ireland. Will the Minister consider providing more funds for those valuable schemes?

My second point has already been raised by the noble Lord, Lord Williams of Mostyn, but I should like to associate myself with his remarks about seeking clarification from the Minister on how she and her department estimate that the BSE crisis has affected Northern Ireland and its beef farmers. The beef industry is particularly important in Northern Ireland and some clarification of what the Government are doing for beef farmers there would be most welcome.

My third specific point relates to integrated education, something that my party and its sister party in Northern Ireland, the Alliance Party, have been keen to advocate. Some 5,000 pupils currently benefit from integrated education in Northern Ireland. We believe that it is a very good investment and one that is well worth making. I should be interested to hear the Minister's comments on the future of integrated education.

I have now made my specific points, but with those specifics go my enormous good wishes and my hope that the Minister and her department will continue to carry out for as long as it is needed the task which in very difficult circumstances attracts the admiration of us all.

1.27 p.m.

Lord Cooke of Islandreagh

My Lords, it was a real pleasure to listen to the Minister describe—accurately, I thought—the improvement in the economy and the many different events that we have seen in the past year which show how the economy of Northern Ireland is improving. Investment is increasing. The IDB has done very well this year and business life generally is positive and moving forward. The Minister omitted to mention her part in that. The noble Baroness is the Minister responsible for the economy of Northern Ireland and she has been leading its industrial and commercial development from the front. It is obvious that she works tirelessly; she gets around; she listens and she visits many firms to see for herself just what is going on. On behalf of many of us in business, I cannot thank her too warmly for the work that she is doing.

One can question and discuss many things under this Appropriation (No. 2) Order, but I shall confine my remarks to one subject which may take some time. I know that I can reasonably expect the noble Viscount, Lord Brookeborough, to deal with other important matters. I should say first that we are fortunate in Northern Ireland that the size of the total Vote is large enough to do all that has to be done. Our comments relate more to administration and how the money is spent than to the total sum, which is handsome.

Energy costs are very important to domestic and industrial users in Northern Ireland and for many years we enjoyed electricity prices similar to those in Great Britain. However, since privatisation the cost of electricity has increased each year while there have been reductions in Great Britain. Numerous comparisons have been made between manufacturers in Northern Ireland and those in Great Britain with similar load patterns and they show a 20 per cent. disadvantage to Northern Ireland—that is after taking into account £50 million government assistance this year, which amounts to around 3 per cent. of the cost.

In November of this year the nuclear levy will be removed in Great Britain—that amounts to 6.3 per cent.—and without that government assistance the adverse difference will amount to approximately 29 per cent. If the existing contracts with the generators are not amended in any way, Northern Ireland costs will increase in line with inflation whereas Great Britain costs are expected to be lower than inflation, so that by 2010 when the contracts with the generators expire it is not unreasonable to suggest that Northern Ireland industry could be paying 40 per cent. more than industry in Great Britain.

The present government assistance totalling £60 million is most welcome and this year enables a reduction of approximately 3 per cent. in charges. However, the Department of Economic Development has not yet said how that assistance will be applied in the remaining three years. Power-users hope that it will be applied to reduce the bulk supply tariff, thus helping all users, and it will be helpful if the Minister can say that next year and in the following years the £15 million will be applied to the bulk supply tariff.

The elements in the high costs of electricity in Northern Ireland are more clearly understood now than a year or two ago. Northern Ireland Electricity is responsible for distribution and sales of power purchased from the generating stations, which are owned by three companies. NIE has done and is doing much to improve its own productivity and to improve the distribution system, which was out of date. Its efforts are to be commended and the regulator is now looking at NIE's cost and profits and has power to regulate its prices. If the regulator regards NIE prices to be excessive he has powers to alter those, and we await the regulator's report in the autumn. I expect that his report will be fair to both parties. However, for large customers, NIE costs are only 20 per cent. of the total price.

The most adverse cost element derives from availability payments to the generators in accordance with long-term contracts offered to generators by the Government.

The regulator has no powers to interfere but he is requesting that NIE enter discussions in the next few months in an effort to see what can be negotiated to reduce costs. It is hoped that some easements can be negotiated but I have no doubt that government involvement will be required at some stage in order to ensure that the generator's charges relate much more closely to those current in Great Britain. This is a vital matter of great importance to industry in Northern Ireland and I know that the Industrial Development Board, which is doing an excellent job in attracting new industry, finds the high cost of electrical power to be a considerable disadvantage which, if action is not taken, may well be a critical disadvantage by the end of the century.

Can the Minister undertake to keep closely in touch with these discussions and, if necessary, become involved if the long-term contracts prevent a satisfactory outcome? It is also important that, when the first generator contract expires next year, the Minister should permit NIE to seek competitive tenders for power from interested generators.

In Northern Ireland, consumers have to pay for the consequences of environmental legislation, whereas in Great Britain the generators pay. The conversion to gas in Ballylumford and the future flue gas desulphurisation, (FGD), will each add 4 per cent. to future electricity prices. At Ballylumford the price to be charged for gas was fixed before privatisation and is more than twice the current gas price on the mainland. It will provide a quite unplanned-for profit to British Gas. I hope the Minister will be able to oversee an amendment to the contract which will ensure transparent open market pricing of gas, pending which the station at Ballylumford should be licensed to burn oil when it is economically beneficial.

There is already agreement to delay FGD at Kilroot for two years. That was a voluntary arrangement whereby part of the Great Britain bubble has been transferred to Northern Ireland. In the meantime, the emissions bubble allocation to Northern Ireland should be examined, as Great Britain has space in the emissions bubble due to the low emissions from combined cycle gas stations.

The Industrial Pollution Control Order in Northern Ireland is presently being revised. Can the Minister ensure that that legislation will not include any new specific constraint on existing plant? Energy costs can of course be reduced by energy-saving measures and the Minister's department is promoting the efficient use of energy in a variety of schemes. Building heating costs, both domestic and industrial, are a high proportion of total spend on energy. It happens that new building regulations are presently out for consultation in Northern Ireland and those are close to the English regulations. They will make a 20 per cent. to 25 per cent. reduction in heating costs but this is an opportunity to go beyond the English regulations. Why not aim for a 50 per cent. reduction in heating costs? That is not difficult and would add perhaps 3 per cent. to building costs, which of course would be recovered by fuel savings many times in the life of the building. I urge the Department of the Environment in Northern Ireland to have courage and take a real step forward, and perhaps move closer to the standards that have existed for many years in Denmark. If it does, it will be forever thanked for the greater comfort and lower heating costs throughout the life of new buildings.

To indicate what is practicable, I work in a traditional-looking office where the energy requirement is around one-third that of an office built under the current regulations. I must declare an interest in insulation but that is far from being the only element in energy saving.

Gas is about to come to Northern Ireland. It is an exciting new power source which will be landed at the end of this year. If gas can be supplied throughout the Province at prices comparable to those in Great Britain it will revolutionise the energy scene. Indications of gas prices so far are extremely high and there is great absence in transparency. It will be helpful if the Minister could say what European Union grant was provided for the undersea gas main from Moffett in Scotland to Ballylumford. It would also be interesting to know if grants are available for the high pressure line which will shortly be laid from Ballylumford to Carrickfergus. Every encouragement should be given to companies undertaking to develop the distribution system throughout the Province.

I make no apology for speaking in detail on energy matters. Energy costs are an important element in the economic prosperity of every country or area.

1.40 p.m.

Viscount Brookeborough

My Lords, I, too, thank my noble friend for her introduction of this appropriation order, thereby giving us the chance to say a few words about how Northern Ireland's finances are arranged. I am sorry that I shall be unable to keep to one subject, but we from Northern Ireland are rather thin on the ground today. I have several points on different subjects that I should like to raise.

First, I welcome the money available for agriculture, but it would be remiss of me not to mention that, department in the light of the BSE crisis. Northern Ireland is a society based on agriculture, and 80 per cent. of the beef is normally exported outside the Province. At this stage I must declare an interest not just in farming but in tourism linked to farming.

The farm diversification scheme, which was discontinued last year, would seem to be a positive way of helping farmers in difficulty to become less reliant upon traditional farming. It supported the introduction of activities such as fishing ponds, golf driving ranges, and, in my case, a small business centre. Can my noble friend tell us when that scheme might be introduced? The other schemes available—such as rural development and cross-border community regeneration schemes—are not available to the private sector and individual farmers who are suffering now as a result of this other crisis.

On the tourism and IDB fronts, can my noble friend the Minister say whether there is a fair distribution of funds for new projects between those two areas? The IDB seems to have unlimited funds while tourism—one of the foremost industries in the world and equally important in the Province—is capped at £3 million to £4 million in the tourist development scheme. I heard the overall figure that my noble friend gave, but that was in the new projects tourist development scheme. Will my noble friend confirm an undertaking given by a predecessor of hers—Peter Viggers—who said: No worthwhile project in tourism will fail for lack of Government support"? However, the projects—for example, hotels on the Causeway coast—to take us into the 20th century now frequently cost more individually than the total amount. Perhaps my noble friend would look at that important issue, give us an answer and give the industry some hope.

On education, I note that two of the five education boards are to go. According to the Minister for Education that will save money. In the light of that, I should like to ask about the funding of Tirella Primary School in County Down. Of the pupils at that school, 95 per cent. are children of soldiers in the garrison regiment at Ballykinla, who change over every two years. At changeover times, normal transitory payments for each pupil are paid, but Tirella's position is unique as 95 per cent. of its pupils change over in a short space of time every two years. In addition, the pupils arriving during the last changeover came from, for example, no fewer than 23 different schools in England during a four-month period. During that period the children leaving-95 per cent. of the pupils from the previous regiment—had to be assessed, reported on and prepared for their new schools, while the incoming children went through a similar process.

That is an abnormal task for the staff of any school, and we should remember that that happens every two years in this case. Consideration has also to be given to the permanently enrolled resident pupils who have to continue their classes during that time. An added burden is presented by 11 children with learning difficulties, and two more are to arrive shortly. That is apparently not an unusual number for any regiment.

Due to small financial difficulties, two teachers are to be made redundant on 31st August 1996. The mothers, who have accompanied their husbands to Northern Ireland on the assurance of good education for their children, are very concerned. I was surprised when I met them to find how strongly they felt that they had been let down. That is one additional worry that soldiers' families in an operational environment could do without.

I know that over several years the school's deficit has risen to £100,000, but surely in that case the department could find a way of providing some additional annual funding to do justice to our soldiers' families in this unique and difficult situation. Perhaps it could find funds from abolishing two of the boards.

I have read the correspondence between my honourable friend Mr. Ancram, the school and parents, and I am disappointed at the intransigence shown. I ask my noble friend to convey the parents' concern about this state of affairs to Mr. Ancram.

I should like to say a few words about the management of the health service in Northern Ireland. Before I do so, I must declare another interest in that I have been a non-executive director of the Green Park Healthcare Trust since it was set up three-and-a-half years ago. My comments, although relating largely to that trust, bring out examples of what is happening in other areas, which I have no time to study.

This trust provides many of the regional services for the Province, such as the cancer centre and orthopaedics. Since the formation of hospital trusts in Belfast, there has been an unhealthy open war between them over which hospitals should supply particular services, and indeed which ones should survive in any reorganisation.

The health wing of the Civil Service, otherwise known as the Management Executive (ME) should be controlling the future development of hospitals and should be insisting upon the trusts getting on with the job of running their own businesses not those of other trusts. For example, the Campbell Report has said that in an ideal world, in line with the Calman Report in England, the cancer centre should be moved from Belvoir Park Hospital to an acute hospital site.

After consultation, an option appraisal will be carried out, as has been announced, and the result will be announced in the spring of 1997. It should be noted that, due to the complexity of moving radiotherapy, that move could not be completed until 2000 at the earliest, and a sum in the region of £40 million would have to — be dedicated to it. I should like to ask my noble friend how, if that decision is taken, it will be guaranteed to be funded in total.

Continual discussion and comment in the public domain is extremely damaging to the service at present. Staff are worried about their future careers, and the public is most concerned. It must be remembered that one person in three suffers from cancer at some stage in their life. That is not only in Northern Ireland. The ME seems to do little to alleviate those concerns. I ask my noble friend why the NIO has not put more pressure on it to do so.

In addition, Professor Bob Stout, a member of the Eastern Health Board, which is in practice a Department of Health agency, was quoted in the News Letter on 13th June as saying at the board meeting: first, that Green Park Healthcare Trust could be dissolved; and, secondly, that the management of Belvoir Park should be transferred to the City Hospital as soon as possible. Not only does that fuel the fire when the process of option appraisal will be taking place within a year, but why does the ME permit him to speak like that?

It is interesting that Professor Stout is also—this is rather worrying—a consultant geriatrician at the City Hospital. Does my noble friend agree that it seems most inappropriate for Professor Stout not to withdraw from that discussion while he has a foot in both camps? Yet again, the ME does not seem to care as it allows a person with a vested interest to use the Eastern Health Board to suggest that his trust hospital should take over the services of another trust.

Mr. Dan Thompson, chairman of the Eastern Health Board, is also keeping the fires burning in Belfast. He is quoted as saying: There are too many trusts in the Eastern Health Board and is it not time for a reduction to take placer? Will my noble friend tell us why a reduction in the number of health boards is not on the agenda? Their workload has almost halved now that they no longer have to administer hospitals which have become trusts. I can see great savings in doing that. It would create far greater efficiency. We should remember that patients come first and it is the Civil Service bureaucracy which should look at itself, especially when dealing with a King's Fund accredited hospital trust, which the Green Park Healthcare Trust is. It is the first NHS trust to achieve that standard in the UK.

Earlier this year the Minister, Mr. Moss, announced a 3 per cent. reduction in funds to health boards and therefore a 3 per cent. cut in their buying power. Presumably that was done after consulting the ME. A 3 per cent. cut overall was announced, but of course that could not come out of acute services—those dedicated to life-threatening problems (casualty, cancer and so forth). It took some time, and a great deal of work and money by the health boards and hospitals to show that, if 3 per cent. overall could be saved, it would have to come out of a reduction in elective surgery and procedures such as hip replacements and wheelchair provision. However, a 3 per cent. overall reduction made in those circumstances would have meant a 50 per cent. reduction in them. Eventually the decision was partly reversed. However, it should never have been put forward if the ME and others had done their research. While that was going on there was a virtual halt in such treatment, the boards delayed in signing contracts, and waiting lists grew. And we were all worried about the Citizen's Charter. The public, the patients and the professional staff became very concerned. They are now somewhat reassured. However, none of that should have occurred if the ME had done its homework. I ask my noble friend to put it to Mr. Moss that people are rightly concerned about the ability of the management in that department.

I turn to my final point. The noble Lord, Lord Williams of Mostyn, mentioned quangos when, unfortunately, I was out of the Chamber. My point is related directly to the management of the hospital trusts in general. I believe that the health service is not looking forward to the new year when the appointments of the present non-executive directors end. We were on a steep learning curve with the chief executive and non-executive directors who had previously been clinicians and so forth. They did not have management experience and therefore, three-and-a-half years ago, we were all learning together. However, when the non-executive directors finish their terms of appointment in six months' time half of the board members will be totally new. I wish to know how the Minister expects those changeovers to take place in the interests of the continuity and efficiency of the trust boards. If we are to widen the catchment area for the membership of those boards, surely we should have heard something about that by now. The Northern Ireland Office should be looking at new appointees.

I have been privileged to be a member of a trust board and I have learnt more from it than I suggest it has learnt from me. I am not sure how the posts will be advertised because the income is £5,000 before tax. If one advertises an appointment at that level of income, requiring the amount of attention that we have given it for three-and-a-half years, one could receive applications from many people in the dole queue, which may be appropriate. However, I suggest that the office must do some fairly hard canvassing to find people appropriate to the post.

In conclusion, I support the appropriation order and I hope that the NIO can take some action to rectify the problems which I have pointed out.

1.51 p.m.

The Earl of Harrowby

My Lords, I rise in the gap to make one brief point supplementary to a remark made by the noble Lord, Lord Williams of Mostyn. He referred to BSE and compensation levels and I should have liked him to mention the timescale. I make a general point that cashflow is vitally important in the industry. It may well be the deciding factor in the survival of many farmers in Northern Ireland, as in the UK. The House cannot expect banks to be able or willing to bail out farmers indefinitely.

I hope that my noble friend the Minister will be able to comment on that subject. I make the point generally and not specifically with regard to Northern Ireland. I hope that the House and the Minister will forgive me if I have to read her answer because I have to leave for another appointment.

1.53 p.m.

Lord Fitt

My Lords, of all the Ministers in the Northern Ireland Office, the noble Baroness has most responsibility. She is in charge of the Departments of Economic Development and Agriculture. They are the two main facets of life in Northern Ireland without which Northern Ireland could fall apart. Since the noble Baroness took over those responsibilities two or three years ago she has undoubtedly proved to be a very efficient and compassionate Minister in both those areas. I rise for only a few minutes to make a specific appeal in relation to some of the problems that we have in Northern Ireland.

West Belfast, the constituency which I represented for many years, has always been a problem constituency. Many people on this side of the water will have seen that 22,000 people in West Belfast voted for Sinn Fein in the recent Forum elections. Many people will mistakenly believe that all those people were voting in support of Sinn Fein and therefore in support of the campaign by the IRA. That is definitely not so.

I have been in touch with people in West Belfast since I became a Member of this House. Many of those votes were cast because in that area there is social deprivation. Of all the constituencies in Northern Ireland there is a higher incidence of employment in West Belfast and in the adjoining constituency of North Belfast. Many of the votes which were cast for Sinn Fein were cast out of a feeling of desperation. Many people in that constituency feel that they have been pushed to the side and are regarded as being republican activists and therefore not worthy of consideration. That would be a mistaken point of view.

I know that in recent weeks announcements have been made with the object of attracting industry into West Belfast. But what we have achieved is a small drop in a very big ocean. I know that the noble Baroness has travelled the world in an attempt to attract investment into Northern Ireland. However, if there is ever to be a solution and a change in the attitudes of those people who appear to be voting out of desperation for paramilitary spokesmen, I believe that the noble Baroness should do whatever she possibly can to attract more industry into West Belfast. Of the 18 constituencies in Northern Ireland West Belfast has been sorely neglected.

It may be due to the image that has been projected to the outside world that potential investors are reluctant to set up industries and to invest in that particularly troublesome area. However, those 22,000 votes cast in West Belfast for Sinn Fein were not cast in support of the IRA campaign. They were cast because people feel neglected and there is an air of despair in the area. Many young people over the age of 18 who voted in that constituency did not vote for Sinn Fein as spokespeople for the IRA. They voted because they had no job and saw no prospect of getting a job.

The noble Baroness has a record in Northern Ireland which far exceeds those of her predecessors. The noble Lord, Lord McNally, mentioned that when Ministers are appointed to their various portfolios in Northern Ireland they go "native", for want of a better word, and begin to develop a feeling for the Province. The success of the noble Baroness has been due to the fact that she has never been over-political in any way towards one community or the other. People accept her for what she is trying to do as a Minister in support of the whole community in Northern Ireland.

The noble Lord, Lord McNally and I were MPs in another place, and I have to say to him that a previous Secretary of State for Northern Ireland was not accepted by the whole community as not being political. I refer to the noble Lord, Lord Mason, now a Member of this House. The noble Lord in fact created untold difficulties in Northern Ireland. The noble Baroness has been able to carry out her functions with the support of the whole community in Northern Ireland.

Finally, the noble Baroness will know that there is great fear that the Royal Victoria Hospital may be stripped of its role in Northern Ireland and eventually close down. If that happens West Belfast would see that the hospital to which all the communities give their allegiance will be taken away. That would not be good for the morale of people who live in that area.

2 p.m.

Baroness Denton of Wakefield

My Lords, I thank all noble Lords who have spoken for their interest and concern in Northern Ireland and for the knowledge which is brought to any debate on the subject. I also thank noble Lords for their courtesy. I should say to the noble Lord, Lord McNally, that I believe that being a Northern Ireland Minister is one of the best jobs in government. I particularly enjoy my work as the Minister responsible for the economy because I believe that working for jobs provides the best cement for peace.

The noble Lord, Lord Cooke, was extremely generous in his remarks. I should tell him that I love visiting companies. But that creates paperwork. My officials will confirm that I do not have such a deep affection for that.

We always welcome the noble Lord, Lord Fitt, on these occasions. He omitted to mention that a major part of my portfolio is to deal with women's issues. The women in the Province create enormous strength. However, as the noble Lord said, my job is to ensure that there is hope and prosperity for all in the Province.

I welcome the noble Lord, Lord McNally, to our debates on Northern Ireland. His noble friend the noble Lord, Lord Holme of Cheltenham, always brought great experience to our debates. I am sure that he would be proud of the support which the noble Lord, Lord McNally, has given today to everyone in the Province.

The noble Lord, Lord Williams, and I have long debated these issues and, as he pointed out with great courtesy, we have long discussed the issue of criminal injuries. The noble Lord said that he is not too unhappy that the long grass is the shape that he would wish it to be. After every debate I draw the remarks of the noble Lord to the attention of my honourable and right honourable friends. This is an issue on which decisions must be taken. But there is constant change in the situation in the Province and hopes rise and, unfortunately, fall. Again, I shall take back the message of the noble Lord to my right honourable friend.

Your Lordships have rightly identified two major issues which concern Northern Ireland at present. The first is the agricultural situation brought about by the BSE crisis; the other is the question of energy costs. I too am extremely concerned about those issues, which have major implications for the economy. The beef and dairy industry represents 4 per cent. of our GDP. I wish to clarify that before the crisis, more than 50 per cent. of our beef was exported but more than 70 per cent. represented sales outside the Province, including the United Kingdom market. Fortunately, that has not gone away completely because there is great respect for the quality of Northern Ireland beef. We continue to have outlets there; we continue to try to build on that.

As regards support for the industry, the whole policy is based on the fact that the Government's aim is to ensure that there is an industry after the crisis is over. We have based our compensation and support packages on that premise. We are determined to keep the industry. I confirm the figure which my honourable friend announced in another place. The Government will be bringing forward something in the order of £2.5 billion to ensure that there is still an industry when the crisis is over and that, because of its needs and because of the great success it had in export markets, Northern Ireland will receive more than its fair share of that. In addition, I should point out that I was able to negotiate for Northern Ireland a special programme to deal with the bulls in Northern Ireland in connection with the Dutch consumer market. Therefore, we do have support for that very serious health and safety problem which must be dealt with.

I praise those in the industry in Northern Ireland. We have received enormous co-operation; we have worked together. The noble Lord, Lord Williams, referred to traceability. Because of that and because of the high standard of the veterinary service in the Province, we have managed to cope with the problem better than in other parts of the United Kingdom. I assure the noble Lord, Lord Williams, that the backlog in Northern Ireland is coming down very rapidly due to the level of co-operation we have received. I know that some of my colleagues have had much greater difficulties than those I have experienced in the Province.

In some cases it is not necessary but we continue to draw to the attention of other European countries the high standards that exist in Northern Ireland. We do have BSE but we are dealing with it. And there is a much smaller incidence there than in other parts of the United Kingdom. The average number of cases per month is running at between nine and 12 which indicates that the measures we are taking are working. Again, that is because the farmers have abided by the requirements.

My noble friend Lord Harrowby is no longer in his place but I should tell him that we well understand the problems of cash flow. I have great experience of Northern Ireland and I have seen that the banks play a sustainable role. We are grateful to them. But as a government we have arranged that payments of some £300 per animal should be paid on account. Also, I have asked that my officials should work overtime to ensure that all payments due to farmers go out as quickly as possible. Therefore, we are dealing with the problem and we seem to be having some success.

Electricity and energy prices are high. However, the situation is changing. I am well aware of the needs of the Province in that regard, in particular those of residential users. Competition is coming, and we look forward to welcoming gas to the Province. I am delighted also that one of the largest users, Shorts, has committed itself to combined heat and power. The company's experience in that regard will prove a very good role model for other large users. I look forward to that coming on stream.

I understand the question asked by the noble Lord, Lord Williams, but I believe it inappropriate for me to comment on the financial performance of a private company. The regulation of the electricity industry is now the responsibility of the independent Director General of Electricity Supply for Northern Ireland. When his appointment was announced, I was extremely pleased that it was praised both by NIE and the chairman of the Electricity Consumer Council. That marks the respect in which he is held. The director general is currently engaged in the first electricity price controls review since privatisation and his proposals will take effect from 1st April 1997. The director general also published in January 1996 a consultation paper on the introduction of greater competition and consumer choice in the electricity market in Northern Ireland. He plans to issue a further paper with his definitive proposals shortly.

It is more expensive to produce and distribute electricity in Northern Ireland than in most regions of Great Britain. Power stations are small, the spinning reserve margin is higher and the customers, on average, are more dispersed. When making comparisons, it always appears that we are behind in the privatisation programme by about two years. That has an effect. However, I also believe that a more relevant comparison is not with London prices but with prices in Cornwall.

I should tell the noble Lord, Lord Cooke, that the Government will continue to encourage both efficiency and competition. We believe that there is a role for all in that respect. As I said, the discussions between NIE and the generators about the revision of the generator contracts are a matter for the companies concerned. It is the regulator who has the responsibility to examine the proposals arising from discussions to amend an exiting generator's contract and, if not content, to consider a possible referral to the Monopolies and Mergers Commission.

The noble Lord, Lord Cooke, also raised the question of prices at Ballylumford. I should tell him that negotiations are taking place and the contracts between the parties concerned can be amended. The Government are watching the situation keenly. The noble Lord also asked that I, as Minister, should, if necessary, ensure the involvement of government in matters concerning regulators and private companies. I can assure the noble Lord that I am keeping a very close eye on the situation because it is important when attracting inward investment.

We believe that we should await the outcome of the regulator's efforts to introduce greater competition, and his initial review of NIE's price controls, before deciding on the use of the remaining £60 million which was made available to the Province. I hope that the noble Lord will appreciate that that is a sensible decision. We hope there will be a change in the situation to the benefit of users.

The noble Lord will be pleased to know that the recently published sulphur strategy for the United Kingdom proposes a new system of control which will in effect remove the concept of the regional bubble. It future, it is proposed that an application will be made in respect of individual plant based on the principle of best available techniques not entailing excessive cost. When the proposed Industrial Pollution Control (Northern Ireland) Order comes into effect next year, it is anticipated that the authorisations for the Northern Ireland electricity industry will take effect from mid-1998. I suspect the noble Lord will think that that is too slow. I promise him that it is being done with all due speed.

The noble Lord also raised the question of EU assistance for the natural gas project. The EU is providing a total of £49 million between 1994 and 1999 for the undersea natural gas pipeline between Scotland and Northern Ireland, and a grant of £14 million will be available for the high pressure main from Ballylumford to Carrickfergus. We in Northern Ireland have reason to be very grateful to the European Union for the support that it shows.

There was considerable comment both from my noble friend Lord Brookeborough and from the noble Lord, Lord Williams, on the question of priorities and the ability to manage the issues, which are enormous, in the health service. I should point out that the health service in Northern Ireland is funded at 14.5 per cent. more per capita than in England. But, even so, priorities have to be set so that the service may live within its budget. A reduction of services in low priority areas will enable additional resources to be found for community care, which is so important, renal services and additional drugs for cancer patients.

However, there is always an issue. The noble Lord, Lord Williams, raised the suggestion that operating theatres may close at the Royal Victoria Hospital. I am afraid that I do not have knowledge of that but I shall write to the noble Lord on the matter. My noble friend Lord Brookeborough and the noble Lord, Lord Fitt, also asked what was happening as regards the hospital and spoke about the position of affection in which it is held within the community. The proposals which have emerged from Dr. McKenna's committee are with my honourable friend and are being considered. The results of that consideration will be made known.

The noble Lord, Lord Williams of Mostyn, and also my noble friend Lord Brookeborough, referred to quangos. I take this opportunity to pay tribute to the people who serve on quangos in Northern Ireland. We place great demands on those people. We invite people to take up positions. We say the position will take up half a day a month but they quickly realise that they have to devote two days a week to the post in some instances. I have witnessed high levels of commitment from those people. They are experienced but in many cases they experience a big learning curve, as my noble friend said. However, they are always anxious to offer the best service.

We are conscious of the need to spread the posts among as many people as possible. I am particularly proud that the percentage of women serving on public appointment boards in Northern Ireland is higher than in the rest of the United Kingdom. We are always seeking to extend that. Since I took office I have seen councillors serving in this capacity. We have tried to spread appointments as widely as possible. My noble friend referred to the appointment to the HSS trust boards. Those appointments are made by the Department of Health and Social Services with the approval of the Secretary of State. The department seeks to achieve equality of representation. We are all well aware of the need to balance experience with the need to introduce new views and new experiences to the board.

As regards Northern Ireland, we shall, of course, implement the suggestions made by the committee of the noble and learned Lord, Lord Nolan. However, we have to bear in mind the fact that the two communities there do not always agree—I say that gently—but both must be involved in decision making. I must inform my noble friend Lord Brookeborough that Belvoir Park Hospital has rightly developed a tradition of high quality care which is much respected by those who have been treated there and by their relatives and friends.

The cancer working group's report is the subject of public consultation until 10th July. Everyone is well aware of the issues involved. Even if the results of the consultation exercise and an option appraisal support the relocation of services from Belvoir Park Hospital, that could not realistically be carried out before the year 2000. There is no question of services currently provided at Belvoir Park Hospital being run down or diminished. I understand the anxiety of my noble friend as regards the insecurity generated by media reports. However I am sure my honourable friend the Minister for Health in Northern Ireland would always be pleased to reassure people who have anxieties in that regard.

My noble friend also referred to the comments made by Professor Stout. I assure him that Professor Stout is not a member of the cancer services working group. Nor has the HSSB been involved in any of the decisions relating to the location of Green Park's services. People who have experience of this matter have a right to comment. However, I have great respect for the tradition of your Lordships' House of declaring an interest before making such comment.

My noble friend also referred to tourism funding. There are great opportunities in the tourism industry. The Government may now adopt a different role in that area because of the opportunities for enterprises to make a return on investments. My predecessor, Mr. Viggers, made the comment that at one time one almost had to glue tourists onto aircraft seats and into ferries to get them to Northern Ireland. There was a difficult climate at that time. However, there has been a 67 per cent. increase in numbers of tourists this year. The funding of the Northern Ireland Tourist Board has been consistently increased over recent years. We seek to support a wide range of projects as tourism will play an important part in Northern Ireland's future prosperity.

The noble Lord, Lord Fitt, referred to West Belfast. I have sympathy with his anxiety for that area but I am more hopeful than he appears to be. I believe that our targeting social needs policy is beginning to make a difference. I spent much time in West Belfast last August trying to learn about people's concerns. One anxiety was that if one applied for a job with a BT 13 postcode the chances of being accepted were much reduced. I believe that the position is now changing. People are learning to overcome that problem.

I am delighted to tell the noble Lord that unemployment in West Belfast has reduced by nearly 14 per cent. That is nearly three times the national average. We have companies such as Fujitsu, the Europa Tool Company and Colorite. There is the significant announcement by F G Wilson which seeks to take 400 jobs into West Belfast. Now that people can achieve aspirations, I hope that it will give them more confidence.

There is also the growth of local companies in the enterprise parks which the Government have created throughout the area. Glenwood Enterprise Agency, which I visit frequently, has some thriving, growing small companies. I believe that there is hope, and I think that there is change.

The noble Lord, Lord McNally, raised the question of integrated education. I assure him that the Government remain fully committed to supporting viable proposals for new integrated schools. There are now 28 integrated schools with an enrolment of almost 6,000 pupils but with potential to achieve enrolment in excess of 7,500. A number of new integrated schools, two secondary and two primary, will open in September 1996. The recurrent expenditure on integrated schools is estimated to be £15.4 million in 1996–97 with capital expenditure of £7.3 million. I hope that I reassure the noble Lord that we are not considering lessening our support. However, those proposals have to be viable, and wanted by the parents of the pupils.

On education, my noble friend raised the issue of Tyrella Primary School. It is obviously important that we ensure that children who travel with parents who are part of the security team in the Province are provided for. I assure my noble friend that that school has a high per capita expenditure level compared with the average for primary schools in that area. It is receiving its full budget allocation. That makes allowance for the extra-curricular pressures which a small school faces with fluctuating enrolment of children from Army personnel. However, as my noble friend requested, I shall draw the matter to the attention of my right honourable friend the Minister responsible for education.

Perhaps I may reply to the ACE issue raised by the noble Lord, Lord McNally. It is a matter of concern. The percentage reduction is not the 40 per cent. that was mentioned in another place; the figure has been 25 per cent. But it was based on the number of people in place at the time. The balance had to be made without full consultation because the issue was a budgetary matter and could not be discussed ahead of the announcement of the financial issues. There has been intense consultation since. The aim in making that reduction was to balance our training towards ensuring that the jobs we create in the Province go to the people in the Province. We moved away from community work to ensuring that we skewed training for the jobs available. At present we have a record number of vacancies in Northern Ireland. That was the reason that that balance was made.

The opportunities are easing through and we have been working closely with other departments using the service of ACE employees and in the development of the community work programme. In it we work with companies to try to ensure that people go into specific work opportunities which put them at the top of the ladder when jobs come along. We hope to see a great increase in the number of opportunities and, therefore, in the amount of trust we can expect from the long-term unemployed by showing that we are dealing with the problem. The decision was not made lightly and it was made on the policy that, I am pleased to say, the economy is growing.

I thank everyone in your Lordships' House who has taken part in the discussion on how we plan the future of the Province. If I have not dealt with any matters, I shall ensure that I write to noble Lords. With that, I commend the order.

On Question, Motion agreed to.