Shipyards (Hansard, 13 July 1989)

§ Mr. Teddy Taylor
To ask the Chancellor of the Duchy of Lancaster if he will make a statement outlining the powers of the European Economic Commission in relation to investment proposals for shipyards, with particular reference to proposals to re-open shipyards.

§ Mr. Newton
If shipbuilding were to resume at North East Shipbuilders Ltd. without their agreement, the Commission would be in a position to take infraction proceedings against the United Kingdom under article 85 of the treaty of Rome. The Commission could also open a procedure under article 93(2) of the treaty of Rome into all matters notified last December. As a result of such a procedure the Commission could require state aid that they decided was outwith the terms of the sixth directive on aid to shipbuilding to be repaid.

§ Mr. Teddy Taylor
To ask the Chancellor of the Duchy of Lancaster what is the policy of Her Majesty's Government concerning companies seeking to re-open shipyards owned by British Shipbuilders without intervention assistance, being required to submit proposals.

§ Mr. Newton
I refer my hon. Friend to my statement today.

§ Mr. Teddy Taylor
To ask the Chancellor of the Duchy of Lancaster whether he has consulted the European Economic Community Commission on proposals ro reopen shipyards when the purchasers were not seeking any intervention assistance; and if he will make a statement.

§ Mr. Newton
In December 1988 the Government notified their intention to close North East Shipbuilders Limited as part of a package covering all aspects of support for the corporation under the sixth directive on aid to shipbuilding with the exception of the terms for the disposal of Govan which had already been cleared. The Commission took the closure into account in deciding not to raise objection to the extensive assistance that British Shipbuilders had required and to the manner in which the Government proposed to deal with this. Any proposal for a return to shipbuilding at North East Shipbuilders Limited would give the Commission grounds for re-opening all the matters cleared last December. In these circumstances we could only proceed sensibly on the basis of consulting the Commission about possible proposals.