§ Mr. Maloneasked the Secretary of State for Trade and Industry whether he has concluded negotiations with the European Commission on a new intervention fund regime for shipbuilding.
§ Mr. Norman LamontYes. The new arrangements, which apply to orders taken from July 1984 and last until December 1986, permit an increased rate of up to 20½ per cent. intervention fund plus 2 per cent. shipbuilders relief. For vessels over 70,000 dead weight tonnes built in Northern Ireland, the maximum may be increased to 25½ per cent. plus 2 per cent. shipbuilders relief. The Commission has indicated also that it will be prepared to consider payments above these levels on a case by case basis particularly for orders where there is no EC competition.
I believe these new, more generous arrangements provide a satisfactory basis for the industry until the end of next year. The United Kingdom industry must use the opportunity offered by these measures to continue to improve its competitive position, so that in the future it may survive with steadily reducing levels of assistance.
Intervention fund assistance is essentially intended as a temporary aid to merchant shipbuilding and it is provided only for contracts taken on a non-profit basis. Aid of this kind will thus not normally be appropriate for, nor provided to, yards which have been or are to be privatised by British shipbuilders. The Commission has, however, agreed to consider any case where exceptionally, for reasons related to the maintenance of defence capacity, intervention fund support might be given.