§ Mr. Barry JonesTo ask the President of the Board of Trade is she will make a statement about the application by British Aerospace for launch aid for the Airbus 340X. [27297]
§ Mrs. BeckettI am pleased to announce that the Government have agreed to a public/private partnership with British Aerospace involving a long-term investment of up to £123 million in British Aerospace towards the design and development of the wing for the new Airbus A340. This represents a major step forward for the UK's involvement in Airbus Industries, which enjoyed its most successful year to date in 1997; it is also a further486W demonstration of British Aerospace's world class expertise in wing design and manufacture—expertise which it has brought to all Airbus programmes to date.
The agreement with British Aerospace continues the Government's drive to create a new partnership between Government and industry. The investment by the Government is repayable and will be on a commercial basis. The terms of the partnership reflect the risk that the taxpayer has been asked to share. The Government will monitor the programme carefully to ensure that the employment and other economic benefits are fully realised, and that all the conditions of the partnership are met.
The new Airbus A340–500 will be the longest range aircraft on the market, operating up to 8,500 nautical miles. Seven launch customers have already placed orders and commitments for around 100 A340–500/600 aircraft; this represents an excellent start which I hope bodes well for the success of the programme.
I am also delighted that Rolls-Royce will provide the engines for the new aircraft, taking the overall British interest in the aircraft to around 50 per cent. The Government announced in November that they would support Rolls-Royce in its engine development programme for this aircraft.
British Aerospace is a major investor in R&D in the UK and much of its technology is diffused to other sectors of the UK economy. Some of the new technology to be incorporated in the new wing has been researched with support from the DTI's Civil Aircraft Research and Technology Demonstration (CARAD programme.
My Department will be discussing the investment with the European Commission.