HC Deb 24 June 1980 vol 987 cc158-9W
Mr. Kilfedder

asked the Secretary of State for Northern Ireland what is the estimated cost of a gas pipeline from Northern Ireland to Great Britain; and how this cost compares with the estimated cost of closing down gas manufacturing plants in Ulster, the cost of compensatory payments to workers' unemployment benefit, and of any payments to tenants for conversion to other energy, and allied costs.

Mr. Giles Shaw

As I told the hon. Member for Antrim, South (Mr Molyneaux) on 12 June—[Vol. 986, c. 779]—the total capital costs associated with a gas pipeline are presently estimated at £120 million, while the total capital costs associated with closure of those undertakings which have decided to cease supply of piped gas are estimated to be of the order of £78 million. In addition, not only would substantial support be required to maintain the industry while a pipeline was being constructed, but the industry would, on all the evidence available, continue to incur heavy revenue losses after the project had been completed.

I am aware that it has been argued in some quarters that the figure of £120 million might be reduced by a grant of up to 40 per cent. from the European regional development fund. The Government were aware of, and took into account, the possibility of such a grant being available for a viable project, but this did not change our conclusion that natural gas could not be made available on an economically viable basis.

The figure of £78 million is confined to capital costs and therefore makes no provision for the other costs to which the hon. Member refers. It is not possible at this stage to give overall costs for these elements. For example, final costings of redundancy payments must await the outcome of negotiations between gas undertakings and their employees, and unemployment benefit payments will be determined by the rate at which alternative employment is found.