HC Deb 10 February 1971 vol 811 cc185-6W
Mr. Peter Rees

asked the Secretary of State for Trade and Industry how much money has been made available by Her Majesty's Government to Upper Clyde Shipbuilders Limited since the company's formation and on what terms; to what extent interest has been paid on such moneys; how the repayment of such moneys has been secured; and whether such security is now considered adequate by Her Majesty's Government.

Mr. Ridley

1. Assistance to Upper Clyde Shipbuilders Ltd since February, 1968, is as follows:


(a) From the Shipbuilding Industry Board under Section 4 of the Shipbuilding Industry Acts 1967 to 1969 £4.7 million, made available in tranches between February, 1968 and May, 1969 at the National Loans Fund rate of interest appropriate at the time each tranche was paid. Repayable in equal six monthly instalments between 31st December, 1975 and 30th June, 1983 and secured by a floating charge on the assets of the company subject only to prior charges in respect of Bank borrowings up to a total of £5 million plus two years interest. £1.2 million of this loan was made to Upper Clyde Shipbuilders Ltd. on behalf of Yarrow (Shipbuilders) Ltd. and will become the responsibility of the latter company if Upper Clyde Shipbuilders dispose of their shareholding in that company. Interest on the loan has been fully paid but has been wholly offset by grants in relief of interest under Section 5 of the Shipbuilding Industry Acts.

(b) From Government directly £7.0 million at 9⅛ per cent. per annum, repayable in equal six monthly instalments between 1st June, 1976 and 1st December, 1988; unsecured and subordinated to all other creditors of the company. The loan was paid to the company on 17th February, 1970. The company have the option, which they have so far exercised, to capitalise interest due on this loan up to and including 1st December, 1972.


From the Shipbuilding Industry Board £20,805 under Section 2 of the Shipbuilding Industry Acts. £5.5 million under Section 3 of the Shipbuilding Industry Acts, paid to the company between February and July, 1969. These grants are not repayable and do not bear interest.

Equity Investment

By the Shipbuilding Industry Board under Section 6 of the Shipbuilding Industry Acts £3 million in 12 million 5s. A Ordinary shares. Four 5s. A shares have equal voting rights with one £1 Ordinary share, but each 5s. A share qualifies for dividend on equal terms with each £1 Ordinary share. This investment was made on 28th August, 1969. 2. Upper Clyde Shipbuilders Ltd. have also benefited from general measures of assistance to the shipbuilding industry or to industry in development areas such as the Local Employment Acts, Shipbuliders Relief, Regional Employment Premium, etc. 3. A statement on the Government investment in Upper Clyde Shipbuilders Ltd. will be made in the near future.