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British Steel Corporation (Subsidiary Companies)

Volume 981: debated on Monday 24 March 1980

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asked the Secretary of State for Industry if any grants or loans to the British Steel Corporation are outstanding in connection with Redpath Dorman Long; under what statutory powers these were granted; what conditions were placed upon the grants particularly in connection with equipment; and whether there will be any variation in conditions if Redpath Dorman Long is disposed of.

[pursuant to his reply, 21 March 1980, c. 347]: Redpath Dorman Long Limited is a wholly-owned subsidiary of the British Steel Corporation. The financing of the activities of the Corporation, including its wholly-owned subsidiaries, is by way of advancement of moneys under section 18 of the Iron and Steel Act and by short-term borrowings (overdraft, money market, and so on); prior to March 1978 the Corporation received NLF loans and also foreign currency loans (from ECSC, EIB etc.). The Corporation has funded RDL out of its total borrowings. The annual accounts of RDL at 31 March 1979 show that they have capital, reserves and an advance account from the British Steel Corporation, totalling £22·5 million, representing fixed assets of £13·9 million and net current assets of £8·6 million.To date Redpath Dorman Long Ltd. have received regional development grants amounting to £1,448,421 payable under the Industry Act 1972 and no claims for grants are outstanding. The grants on plant and machinery are made subject to conditions requiring the grantee to notify the Department if the asset ceases to be used on qualifying premises in a Development Area. The conditions operate for a period of four years and are closely monitored, including visits to the premises by the Department's inspectors. If assets cease to be used or notice is not given as required by the conditions, the grant becomes repayable in whole or in part and recovery of grants is rigorously pursued. If the person to whom an asset is transferrerd continues to use it on qualifying premises in a development area, and formally undertakes to abide by the conditions, the grant is not normally repayable. It is not intended to vary these conditions.