§ Mr. Allan Stewartasked the Secretary of State for Scotland whether he has any plans to revise the Scottish electricity boards' external financing limits for the current year.
§ Mr. YoungerIn the light of representations made to me by the boards I have decided to increase the external financing limit for 1979–80 to the South of Scotland Electricty Board from £47.5 million to £55 million, and to increase the limit for the North of Scotland Hydro-Electric Board from £52 million to £64 million.
The increase in SSEB's limit has been necessitated by variations in the board's cash flow and its trading circumstances compared with the assumption on which the limit was based. The board has reduced its planned capital expenditure by some £15 million, principally by means of the deferment of expenditure which, though essential, need not be incurred in the current financial year, but even with further savings in revenue expenditure it has been able to cover only a part of this unexpected additional financing requirement.
The necessity for a revision of NSHEB's limit arises out of an unforeseen increase in the deficit on the board's account relating to the supply of electricity to the British Aluminium Company's smelter at Invergordon, caused by increasing fossil fuel prices and a change, after the forecasts on which the existing limit was based were prepared, in assumptions about the timing of the return to service of reactor 4 at Hunterston B.
I am satisfied that the boards have taken all reasonable steps to absorb these unforeseen increases in their financing requirements.