§ Mr. Powellasked the Secretary of State for Northern Ireland whether he has any statement to make on the financial position of the Newry gas undertaking.
292W
§ Mr. MoyleNewry and Mourne District Council informed the Department of Commerce in March that its financial projections for 1976–77 showed that an April, tariff increase of 49 per cent. would be necessary—assuming no reduction in demand—to keep the gas undertaking viable following the end of payments by the Department of Commerce under the price restraint compensation legislation.
The council did not consider this to be a realistic step, bearing in mind the already very high price of gas, and advised the Department that it had it in mind to close the gasworks unless further Government assistance was offered. The undertaking supplies some 3,000 customers, including one of the major employers in the area.
The gas industry as a whole in Northern Ireland faces serious problems, and the Department has commissioned an expert study by the British Gas Corporation which has now started. It would be unfortunate if a final decision on the Newry undertaking were to be taken before the conclusions of the study became available. The Department of Commerce has, therefore, made an offer to the council that, provided the gas undertaking increased its tariff by 25 per cent. the Department would pay to the council a sum equivalent to the difference, for the six months following the date of the increase, between actual revenue from sales of gas and the notional revenue that would have been earned from the same level of sales at tariffs increased by 49 per cent.