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Northern Ireland (Loans)

Volume 892: debated on Monday 12 May 1975

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10.17 p.m.

Order. Will hon. Members withdrawing from the Chamber do so as quickly as possible, and continue their conversations outside if they wish.

I beg to move,

That the Northern Ireland Loans (Increase of Limit) Order 1975, a draft of which was laid before this House on 22nd April, be approved.
This order increases by a further £100 million the amount available for lending from the National Loans Fund to the Consolidated Fund of Northern Ireland. The Consolidated Fund of Northern Ireland, as hon. Members will know, has two main sources of income: first, its attributed share of United Kingdom taxes, and, secondly, a grant in aid carried on the Vote of the Northern Ireland Office. It also receives direct the bulk of the proceeds of the rates in Northern Ireland. In addition, money is raised by borrowing—for instance, by the issue of Ulster Savings Certificates and of development bonds—and by the sale of Treasury Bills. But its main source of borrowed money is the National Loans Fund.

The present order is concerned solely with Northern Ireland's borrowing from the National Loans Fund. The Finance Act 1970 provided that a total of £200 million could be lent from the National Loans Fund to Northern Ireland. When this limit was reached in 1972 the Northern Ireland (Financial Provisions) Act 1972 increased it to £350 million, which is where it stands at present. The 1972 Act also provided power for the Treasury to increase this £350 million, on one occasion only, by a further £100 million, to £450 million. It is this last £100 million which is the subject of the present order.

Under the terms of the Finance Act 1970 the purposes for which Northern Ireland may borrow from the National Loans Fund are defined as
"any expenditure which in the opinion of the Treasury is of a capital nature".
In practice, the moneys are lent mainly by the Northern Ireland Department of Finance to the Northern Ireland Housing Executive, the Northern Ireland electricity service, the Northern Ireland Finance Corporation, and the district councils. The loans are made available for capital purposes where there is statutory authority to borrow. About half the sum borrowed has been for housing. This pattern seems likely to continue, with the proportion for public sector housing tending to rise.

Northern Ireland has not yet reached the existing limit of £350 million but is likely to do so soon. It is expected that the further £100 million now being asked for will last until about this time next year. There will, of course, be an opportunity to consider Northern Ireland's Supply expenditure in detail in July when the appropriation order relating to Northern Ireland's Estimates for 1975–76 comes forward for consideration. The present order has no implications for additional expenditure. It will merely assist Northern Ireland to finance capital expenditure within the Public Expenditure Survey limits.

I commend the order to the House.

10.22 p.m.

In view of what the hon. Gentleman said about our being able to debate Supply in July, it is the desire of the Opposition that the order should go through expeditiously so that there might be more time to discuss the second order.

10.23 p.m.

As I represent a Scottish constituency which is facing ever-increasing unemployment, I am a little disturbed to see more and more of the United Kingdom Government's money going to subsidise firms and capital expenditure in Northern Ireland.

I intervene in the debate because I have a case in my own constituency of a Scottish firm concerned with the provision of concrete pipes for infrastructure developments in Scotland being undercut substantially by a firm in Northern Ireland. Macrete Limited in Northern Ireland submitted a tender for a sewer development in my constituency which undercut by 30 per cent. a local firm, Trocol Industries (Scotland) Limited.

In normal circumstances, when dealing with small items, transport costs mean very little. However, when it comes to concrete pipes, the cost of transport becomes an important factor in any tendering. As a result, people in Scotland are beginning to ask whether we are subsidising Northern Ireland industry to such an extent that it is putting Scottish workers and Scottish industry out of business.

In the contract of which I speak, Macrete Ltd. submitted a tender sum of £16,145. Trocol Industries (Scotland) Ltd., in my constituency, put forward a tender sum of £22,953. The firm in my constituency submitted the lowest tender received from a mainland company, and the figures tendered ranged up to £26,826. In fact, the further away from the urban area, the higher the tender price becomes because transport costs are important. It seems strange to me and to my constituents who will be out of work that a Northern Ireland firm can supply concrete pipes into Scotland at 30 per cent. below the price at which a local firm can produce them.

The firm referred to by the hon. Gentleman operates in my constituency. Indeed, members of my family are employed by the firm. To the best of my knowledge—I hope that the Minister can confirm it—that firm is not in receipt of a Government subsidy of any kind. In fact, it is a highly competitive, well-organised company. I am proud that, as the hon. Gentleman has made clear, it can compete at this level with mainland companies.

I think that the hon. Gentleman should have declared an interest before intervening. Although he and his family are doing well, unfortunately my constituents and my family are doing badly. It is all right to say that the firm does not receive direct financial help, but indirectly it does, because infrastructure contracts in Northern Ireland are financed from this money. My point is that Northern Ireland firms are using this money to help them to compete for mainland contracts in the United Kingdom. Indeed, conditions are even worse than I have been stating.

I wonder whether I might ask my hon. Friend to look at another aspect of the situation. He is claiming that, whether we like it or not, an element of dumping is going on because of the price at which the Northern Ireland firm has obtained the job. The hon. Member for Armagh (Mr. McCusker) said that this firm is receiving no subsidy from any Government Department which would enable it to tender so cheaply. Has my hon. Friend examined the possibility of sweated labour being employed to ensure that these tenders are so cheap compared with tenders by Scottish firms which observe trade union rates and conditions of labour?

I do not mind answering questions by hon. Members from Northern Ireland who have a vested interest in this matter, but I object to answering a question from one of my Scottish colleagues. It is not a matter of sweated labour.

The point is that we are subsidising industry in Northern Ireland. We are giving money to finance big infrastructure housing schemes, but that money is being used to compete unfairly with Scottish firms in Scottish contracts. I do not mind Northern Ireland firms staying in Northern Ireland and using United Kingdom Government money to keep people in work in Northern Ireland, but I object to them coming to Scotland for the first time.

If this had been a traditional export from Northern Ireland I should have accepted it, but this is the first time that a Northern Ireland firm has submitted such a tender. Right hon. and hon. Members know that when dealing with concrete pipes firms cannot put in a competitive tender outwith 50 miles of where the pipes are manufactured.

This Northern Ireland firm—I submit, using United Kingdom taxpayers' money—is putting my constituents out of work. Indeed, this is not the only case. This Northern Ireland firm, just across the Irish Sea, can not only take the pipes from Northern Ireland into Ardrossan and transport them directly a very short distance by rail or road, but, even worse, transport them 200 miles from the port of Ardrossan, the nearest major port to Northern Ireland, to the area of Aberdeen where it has gained contracts and Scottish and United Kingdom mainland firms have lost contracts.

I represent a Scottish constituency and have many contacts, as my hon. Friends will know, with colleagues in Northern Ireland, representing an area like Kilwinning with No. 0 Masonic Lodge, and all the rest which goes with it, with a tremendous tradition of association across the Irish Sea.

We are beginning to get worried. We do not mind their adopting our traditions. We do not mind their supporting our football teams in Glasgow, be it Rangers or Celtic, but we object to their taking the jobs of Scottish people. Before I support the order I want the Government to give me a guarantee that if we continue to give money to Northern Ireland it will not be used by industrialists in that country to take jobs from my constituents.

Together with my colleagues from Northern Ireland I have fought against the dumping of textiles. The all-party textile group has joined groups from North-West England, Scotland and Northern Ireland to take action in this regard. I do not intend to join my Northern Ireland colleagues in deputations to prevent the dumping of textiles only to find that people from their areas are dumping pipes in my constituency and putting my constituents out of work. I shall need a convincing answer before I support the order.

If I may have the leave of the House to intervene at this point, I am seized of the concern expressed by my hon. Friend the Member for Central Ayrshire (Mr. Lambie) over the unemployment that is affecting his constituents, but I have to say to him that he has got the wrong end of the stick on this occasion.

The moneys at issue in this order have nothing to do with industrial development. They are purely and simply matters relating to infrastructure of the sort that I discussed—the Housing Executive, the electricity service and possibly a modest amount of the sums going to the Northern Ireland Finance Corporation.

That last category might be the sort to which my hon. Friend refers, but the benefit that any individual firm will get from the fall-out from infrastructure expenditure of this sort will be minimal, and I assure my hon. Friend that that would not be a factor that would be working to the detriment of his constituents.

I am sure my hon. Friend would be the first to agree that unemployment in Northern Ireland is very serious and that anything that can be done by the central taxpayer to improve conditions in that part of the United Kingdom would have the support of the House, within the limits set by the constraints on public expenditure generally. What he is concerned about is that there should be more assistance to his part of the country, rather than less to Northern Ireland. I have to say to my hon. Friend that on this occasion he is barking up the wrong tree. The order has nothing to do with industrial development. I give him that assurance, and if he wishes to raise that subject he should do it on another occasion when that sort of finance subject is before the House.

10.34 p.m.

Throughout the years that I have been in the House I have listened to passionate speeches from hon. Members from Scotland urging help for this part of the United Kingdom and I have welcomed what they have said. They have demanded their fair share of the national cake to deal with unemployment, the housing situation, and so on. However, when the hon. Member for Central Ayrshire (Mr. Lambie) talks about United Kingdom taxpayers' money he must remember that part of that money is paid by taxpayers in Northern Ireland and they are, therefore, entitled, as the Financial Secretary said, to help to deal with unemployment and the lame duck industries which exist in Northern Ireland as happens elsewhere throughout the United Kingdom.

I wish to make two brief points. First, I propose to refer to the Welrex hosiery manufacturing company in Bangor, with another branch at Newry in the constituency of my right hon. Friend the Member for Down, South (Mr. Powell). That factory has been given three months' reprieve from 1st May. Those people will be thrown out of work and have no other work to do. They have families to support. I hope that we shall be told tonight that something will be done to save this firm. We have lost enough firms already in the North Down area, and I shall resolutely oppose any further closures.

Second, I hope that those building workers who are unemployed can be given work building homes. There is a drastic shortage of homes for people in North Down. We should not accept a situation in which married couples and elderly people are living in squalid and overcrowded conditions. Hon. Members opposite would not accept that, and I will not accept it while I remain a Member of Parliament. That is why I hope that the Government will help us tonight.

10.36 p.m.

I seem to be placed in the position of an honest broker between my colleagues and my opponents. I detected a note of chagrin in what my hon. Friend the Member for Central Ayrshire (Mr. Lambie) said. We have heard of Harland and Wolff receiving £16 million, of Northern Ireland being given £380 million to help in its economic difficulties, and of the cost of the British Army and the security forces there. I can understand my hon. Friend's objections to this money being given to one part of the United Kingdom to the detriment of another.

The Minister said that Northern Ireland had underdrawn on these funds by £100 million. We have heard that this money will be given to the Housing Executive and local authorities. Northern Ireland having undergone the tragedy that it has, I should have thought that the Northern Ireland Office could have worked out a scheme to allow the Province to draw to the limit of what Parliament was prepared to allow, particularly for the provision of housing, not only in North Down, but in West and North Belfast and other areas. There is work to be done by the Belfast City Council in clearing up what the Secretary of State has called the "ravages of war".

So, although I agree with my hon. Friend's voicing his objections to what he sees as a never-ending pouring out of money with very little compensation, I as a Northern Ireland Member fully support the Government's proposals in the hope that they will be used in the right direction.

10.39 p.m.

The hon. Member for Central Ayrshire (Mr. Lambie) launched a strong criticism of, if not an attack on, a very reputable firm in the North of Ireland. We should like a clear answer from the Government on this matter. The Minister simply said that the order had nothing to do with the matter which concerned the hon. Member, but he did not say that the firm is not being subsidised by the Northern Ireland Office. That is the heart of the matter.

The hon. Member seems to be saying that it is all right to give money to Northern Ireland to help with problems of unemployment but that if the firms concerned start making something and exporting it in a competitive market, if those goods are cheaper than goods in his part of the world, we should have nothing to do with them. That seems to rule out any effort made by Northern Ireland to make itself a prosperous industrial part of the United Kingdom. Good Scottish firms in Northern Ireland are doing the same, and if they are able to under-cut firms from Ballymena—which is the Scottish part of Northern Ireland—well and good. We make no objection to that.

Northern Ireland is part of the United Kingdom, as is Scotland, and this is the Parliament of the whole United Kingdom. The Northern Ireland firms have every right to have a market in Scotland. We resent the suggestion that the work is done by sweated labour. The trade unions in Northern Ireland are just as ably led as are Scottish trade unions. They are out to see that decent wages are paid and decent hours are worked.

In view of the success of the Northern Ireland firm in capturing Scottish markets, my hon. Friend the Member for Central Ayrshire (Mr. Lambie) wondered whether the firm was subsidised. My hon. Friend the Financial Secretary said that it was not being subsidised. Can the hon. Member for Antrim, North (Rev. Ian Paisley) positively say that the firm in question is observing the fair wages clause?

Order. We are getting a bit too far out of order. The Minister has explained that the order does not apply to development. I suggest that the Minister, if he wishes, with the leave of the House, should reply, and that that should end our discussion on the order.

No Ulsterman likes not to answer a question that is asked of him. I cannot positively say, but I believe, that the firm lives up to its reputation in the country. Trade unionists in Northern Ireland would see to it that it did live up to its reputation.

I understood that the order would go through on the nod, and I took part in the debate only because this is a matter that needs to be answered, so that what could be a slander on the good name of the firm can be repudiated.

10.43 p.m.

Perhaps I may speak again with the leave of the House, Mr. Deputy Speaker. I am on my feet rather more than I expected in this debate. I say straight away that the order has nothing whatever to do with development for industry or finance for that purpose. I cannot emphasise that too strongly.

I do not have at my disposal information about whether the firm in question is subsidised. I believe that it is not, but I cannot give that as a categorical answer. Without notice of that question I am unable to give the assurances for which I have been asked. If the hon. Member for Antrim, North (Rev. Ian Paisley) will write to me, I will have the matter looked into. I am sure that we can get the information he seeks.

My hon. Friend the Member for Belfast, West (Mr. Fitt) may have misunderstood the purpose of the order. It is not a question of Northern Ireland drawing down less than its allocation of funds. The order is simply a routine alteration of the borrowing requirement which extends the limit to £450 million as was contemplated in previous legislation. I cannot emphasise too strongly that it involves no implications for additional public expenditure. It is just the way in which already approved expenditure is being financed by the Northern Ireland authorities.

I agree with the hon. Member for Down, North (Mr. Kilfedder) about the need for housing in Northern Ireland. That is beyond dispute, and I am sure hon. Members on both sides of the House are aware that a great deal of Northern Ireland's social expenditure is governed by the principle of parity of services, with adjustment from strict parity where necessary under the control of the United Kingdom Treasury. Of course, there still remain very serious gaps betwen the living, general housing and social conditions in Northern Ireland and the rest of the United Kingdom.

I say to my hon. Friend the Member for Central Ayrshire (Mr. Lambie), whose concern I recognise in this matter, that I think it is worth remembering that Scotland is not without its share of development funds. In fact, the whole of Scotland is a development area. It is always open to my hon. Friend to fight his corner and to say that his part of the country needs more. Indeed, that is why he is sent here, and I have no doubt that his constituents will be grateful to him for his contribution along those lines tonight, but that is not what this order is about.

Question put and agreed to.

Resolved,

That the Northern Ireland Loans (Increase of Limit) Order 1975, a draft of which was laid before this House on 22nd April, be approved.