I have to inform the House that I have received a further letter from the right hon. Member for Walsall, North (Mr. Stonehouse) dated 31st July:

"Dear Mr. Speaker,

Further to my previous letter I am writing to confirm my request for a personal statement to be made in the House. I am copying this letter to the Leader of the House.

Yours sincerely,

John Stonehouse".

On a point of order, Mr. Speaker. You will recollect that yesterday the Leader of the House, when I asked whether he would move a motion similar to Motion No. 622, stated: it would be sensible to wait until we have a specific request from the right hon. Gentleman. As I understand the position, we have not yet had a specific request. If we receive one, we shall have to consider it. The House will have to decide the matter".—[Official Report, 31st July 1975; Vol. 896, c. 2053.] As you, Mr. Speaker, have that letter from the right hon. Gentleman and a copy of the letter which I put into the hands of the Leader of the House, and as the right hon. Gentleman has now made an application to be heard, may I ask you whether the Leader of the House has made any representation to you to make a statement or to allow that motion to be moved?

No, I have had no such request, nor do I think that the Leader of the House has had time to consider the matter. Now that I have informed the House of the letter, the matter will be considered.

With your permission, Mr. Speaker, I will make a statement about business to be taken in the Council of Ministers of the European Community. The Council will not meet during August. The monthly forecast for September was deposited yesterday. It is likely that Foreign Affairs, Finance, Agriculture and Environment Ministers will meet during October, but the dates have yet to be confirmed.

At present six meetings of the Council of Ministers are proposed for September. Foreign Ministers will meet on 15th and 16th; Finance and Budget Ministers on 22nd; Agriculture Ministers on 9th and 29th and 30th September, and Energy Ministers on a date not yet fixed.

At the Foreign Affairs Council, Ministers will have before them the 1976 scheme of generalised preferences. It is likely that they will have a preliminary discussion of the result of the Seventh Special Session of the United Nations General Assembly which is to take place from 1st to 12th September. Ministers will also have before them progress reports on relations with Portugal and Iceland. There are likely to be discussions on the negotiations with Spain and with the Maghreb, on mandates for negotiations with Malta and the Mashraq and on matters arising out of the EEC-Greece Association Council which was held in Athens on 28th July.

In addition to their usual review of the economic situation in the Community, Finance Ministers will have before them proposals for Euratom loans, on joint Community borrowing and on the Community exchange rate system. Ministers at the Budget Council will consider the Communities' preliminary draft budget for 1976.

Agriculture Ministers on 9th September are expected to continue their discussions on the restructuring of the wine régime and on 29th-30th September on part of the basic sugar regulation dealing with imports from ACP countries.

Items that may be discussed at the Energy Council include guidelines of a policy for developing energy resources inside the Community and within a wider context of international co-operation, the financing of the energy policy and support for common projects in the hydrocarbons sector.

It is too early to say what the October Councils will consider, but I shall deposit in the House at the end of September a written forecast of business likely to be discussed in the Councils in October.

Is the Minister aware that we received only a very short time ago notice that the statement was to be made? I gather that the fault almost certainly lies in Brussels rather than here, but I am sure the right hon. Gentleman understands that it is extremely inconvenient for the Opposition to receive notice of statements of this sort on a Friday morning and to have statements made on a Friday morning.

The Minister said that the Council of Ministers would have a report before it on the Seventh Special Session of the United Nations General Assembly and that much of it would be devoted to commodity prices, the Prime Minister's Kingston initiative and so on. It is strange that the right hon. Gentleman should mention only the Seventh Session and not the preparations for reconvening the Paris conference between the oil producers and consumers now that the principle that other commodities should be covered has been accepted, and bearing in mind that we are coming to the time when crude oil prices may well be raised. All these matters should be considered together. Can the right hon. Gentleman say whether the Council of Ministers will be doing so?

I also note that the statement says nothing about Cyprus. There have been reports from Helsinki in the last day or two that the European Community envisages some kind of intervention in that dispute in a mediatory or other capacity. Under what head would that fall, and what is the machinery under which such a Community initiative could be established?

Finally, with reference to the guidelines on a policy to develop energy resources in the Community, relations between this country and the Community do not seem very good in that regard. In view of Mr. Simonet's strictures in the European Parliament and the attitude taken by the Secretary of State for Energy, what will be the position in that respect?

I am sorry that the Opposiion have been inconvenienced by the announcement of this statement today. We are always in difficulty over Community business statements. The House does not regard them as among the most important items in the daily, weekly or monthly agendas. I try to fit them in at a convenient time for the House. I know that sometimes the arrangement may be inconvenient to Opposition Members. However, I am glad to note that the short notice did not prevent the hon. Gentleman asking me a number of detailed questions.

On the Cyprus initiative, about which no doubt the hon. Gentleman has read something in the newspapers today and yesterday, if such an initiative is mounted—and my information from Helsinki is identical to the hon. Gentleman's—it will be put through the machinery of political co-operation in the EEC. That is not a formal Council procedure and is not the subject of today's statement. I have no doubt that when at Council meetings we consider the Seventh Special Session of the United Nations and commodity agreements, there will be a related discussion on energy matters and a consumer-producer conference relating to raw materials, but that is not a formal item on the agenda.

The hon. Gentleman misstates or misunderstands the attitude of my right hon. Friend the Secretary of State for Energy towards a Community energy policy. My right hon. Friend is, of course, a member of the Government and understands, and accepts willingly, that we have a part to play in all Community policies. I have no doubt that he will forge worthwhile relationships with other members of the Community.

Is the right hon. Gentleman aware that we are delighted to see all this Community activity taking place? Can he say when the Tindemans Report is expected to be received and how it will be discussed? Will there be an evaluation of the Helsinki conference of 35 nations which aims at committing itself to a freer exchange of people and information in Europe? It would be very strange to have a meeting of Ministers attended by Prime Ministers or Foreign Secretaries and for them not to discuss Helsinki.

Discussion of Helsinki is appropriate for the Community Heads of Government and Foreign Ministers, but if that is carried out in a Community setting rather than at an informal meeting at Helsinki it will be carried out through the political co-operation machinery. I anticipate that there will be such a meeting in the autumn in the capital of the country which has the presidency at the time. But that would not be a formal meeting of the EEC Council. It would not involve decisions amounting to secondary legislation in this country. It is not our practice to make announcements about when such meetings are to take place or about the subjects included in the agenda.

On the Tindemans Report, the position is that Mr. Tindemans said in London that he was more interested in producing a report which was acceptable and workmanlike and applicable to all nine members of the Community than in rushing conclusions and bringing out documents which were declarations of principle rather than blueprints for action. The main report will take longer than we originally anticipated, but if that is the situation the time spent will be worth while.

Does my right hon. Friend agree that back-bench supporters of the Government are also affected by announcements made on Community business on a Friday and that we believe that next Monday might have been a more appropriate day for such a statement? Will he say a little more about the foreign affairs meeting on 15th and 16th September, with particular reference to the discussions on the general system of preferences? Will the Overseas Development Ministers be present also, since this is a matter which affects those Ministers as much as it affects Foreign Ministers?

Further to the questions asked about the Tindemans Report, may I remind my right hon. Friend that there is a Commission document about European union? Could he tell the House to whom the document will go? Will it go to the future summit or to a formal meeting of the Council?

I think that the Commission document will go as a contribution to the investigation being carried out by Mr. Tindemans. I hope my hon. Friend does not believe that a Commission document has any special status in that it might be more likely to be acceptable to the Nine than would any other document. The Commission document is a contribution to the general debate.

As for the Council of Ministers and discussion of the generalised scheme of preferences, there is no objection among the Council of Foreign Ministers to their colleagues in related departments joining them at meetings. This happens from time to time. If it is being suggested that the question of the GSP can be discussed only in the presence of Overseas Development Ministers, Her Majesty's Government would encourage such a move. A more appropriate procedure might be for Foreign Ministers to decide these matters at one stage and then for Ministers of Overseas Development and their colleagues to meet in their own special Council later.

I support the views which have been expressed about the House being given these statements on a Friday morning. This is not a time convenient to the House in general.

Will the reference on the agenda to Iceland at the Foreign Ministers' meeting include consideration of fishery matters in that context? If so, will the Minister give an assurance that it will in no way hold up the bilateral proceedings between Her Majesty's Government and the Government of Iceland?

I can give that assurance to the right hon. Gentleman without qualification. The discussions on Iceland are basically on trade matters but, as the right hon. Gentleman anticipates, when we take part in those discussions we shall remember our fishing interests and the relationship which we have with Iceland because of that interest. But this matter will not hold up discussions in another place.

If under the heading of political co-operation a paper were to be submitted to the Council of Ministers under the heading of Cyprus, what would the Government's attitude be in view of their decision not to intervene in any of the current talks? In terms of the Council of Ministers coming to a decision about the future, will my right hon. Friend encourage or discourage any conclusion of that kind?

My hon. Friend is stretching the rules governing business statements almost to breaking point. Let me compound that process by saying that Her Majesty's Government's reaction to such a procedure would be the reaction which we have made in the last year—namely, a willingness to take part in initiatives or schemes that seem likely to bring a lasting, peaceful solution to the Cyprus problem but with the proviso that anything that results in precipitate action might do more harm than good.

I endorse what has been said about the inconvenience of having these Community business statements on Fridays. The Minister said that such statements might not be regarded as being among the most important items of Government business. That may be due to the fact that we are not given sufficient detail about forthcoming business or that Ministers are not likely to be taking any important decisions in future. Will the Minister confirm that during the long recess no major decisions are likely to be taken of an irrevocable nature without the House having an opportunity to discuss them, and also that no decision will be taken on any matter which is awaiting debate in the House following a recommendation of the Scrutiny Committee?

I assure the hon. Gentleman that during the recess the Government will abide by their promise concerning scrutiny procedures. As long as an immediate matter of detail affecting the national interest does not arise, we shall preserve the proper rights of this House which have been set down in the scrutiny procedure.

On the point about Community business statements being made on a Friday morning, I understand that there is a good case to be made for a regular day being allotted to such statements in the same way as we have a regular weekly day for announcing the business of the House. That would be convenient not only to the House but also to some Foreign Office Ministers.

I echo the comments made about today's statement. Will my right hon. Friend bear in mind that it is difficult as the House moves into recess to give a great number of details about the items that are likely to come before ministerial meetings?

Are not the arrangements on the subject of sugar not merely a matter of adjustment but a matter of examining the whole régime? Therefore, would not the time of Agriculture Ministers be better spent in discussing the changes in agricultural policy which are needed to pursue our anti-inflationary process? In regard to the Tindemans Report, is it satisfactory that there will be a debate in the Council of Ministers before the House of Commons has an opportunity to debate it?

I note my hon. Friend's last point. However, debates in this House are essentially matters for my right hon. Friend the Leader of the House.

As regards the ACP sugar regulations, which will not occupy all the days of the Agriculture Council during the month of September, my hon. Friend can be absolutely assured that there is no change in policy. Indeed, the meeting in September is to implement the policy and to pass the regulations that make the 1.4 million tons agreement part of official Community policy instead of the simple declaration that the Government obtained during renegotiation.

Concerning today's statement, the Government are anxious to provide as many details as possible. I hope that in regard to this matter right hon. and hon. Members who complain that the details of today's statement are not perhaps as full as they ought to be have seen the written statement of business which is always deposited in the House 24 hours before the oral statement is made, and have discovered the great detail that appears there.

I am disappointed to hear the Minister, in giving details of the agenda for September, say that the Ministers of Agriculture will meet on 9th September apparently to discuss wine and sugar only. In view of what happened in the House yesterday and the statements made by the Minister of Agriculture, will the Minister of State pass on to his right hon. Friend the message that it is absolutely essential to include in the September agenda two items: first, that the beef arrangements for fat cattle will continue into 1976 and through 1976, and secondly that British egg producers will have a real chance of exporting surplus eggs to the EEC and that the barriers which have been erected against this trade, in particular by France, may be expunged?

I am sure that my right hon. Friend the Minister of Agriculture will take note of that.

If I might again refer to the details that are available, I should not like hon. Members in making comments about this to be under any illusion. A statement is deposited every month in the House, whether there is to be an oral statement or not. If hon. Members did not know about that I am sorry, but they ought to have known and they can always get the details from the deposited statement.

Will my right hon. Friend note that those of us who are prepared to accept the principle that this House sits a five-day week—and sometimes nights as well—are concerned not so much with the day on which the statement is made as with the advance notice? Will he consider this so that we may have a reasonable exchange of views when statements of this character are made?

May I also ask my right hon. Friend about the words in his statement to the effect that the Community is considering intervention in the Cyprus affair? Will he enlarge on that a little and let the House know what information the Government have about such possible intervention and what opportunities are provided for the Government to comment on such a proposal?

I think, with respect to my hon. Friend, that I did not give that impression. I think my hon. Friend the Member for Tottenham (Mr. Atkinson) gave the impression that the Community ought to be involving itself in the affair, and he asked me a hypothetical question about how we would react if it did. Perhaps unwisely, I gave a hypothetical answer to that hypothetical situation, but nothing I said, as opposed to what was said by my hon. Friend, implied that the Community was considering that.

I should like with permission, Mr. Speaker, to make a statement about the report of the Porter Committee on the Rent Restriction Law of Northern Ireland. This report, which my right hon. Friend received in April, has not been published to date because of printing delays. However, it is now clear that it will be published during the recess, and while detailed discussion of this complex report must await publication I believe that it would be right to indicate now the general drift of the committee's recommendations and my right hon. Friend's reaction to them.

The report sets out the very grave problems of the private rented sector in Northern Ireland. There is a vicious circle of very low rents, with about half the tenants paying less than 50p per week and three-quarters paying less than£1 per week, an average of 90p per week—lack of repairs and maintenance and a rapid decline in the number and condition of privately rented dwellings. In 1974 over 48 per cent. of these were unfit and nearly 70 per cent. lacked at least one basic amenity.

The Porter Committee's recommendations can be summarised as follows: public acquisition and redevelopment of the privately rented houses in the worst condition; generous State assistance for the repair and improvement of the remaining houses, including encouragement to tenants to buy their homes; and a system of rent regulation broadly similar to that which operates in Great Britain, including the introduction of rent allowances.

My right hon. Friend shares the committee's view of the urgency and seriousness of the situation and has to some extent anticipated the recommendations. For example, he has decided to accelerate the purchase of the areas scheduled for eventual redevelopment, and new legislation is being prepared on house improvement grants, with special emphasis on repairs, on action to arrest the decline of the "twilight" areas and on additional assistance to promote the development of housing associations, especially to purchase and improve older properties.

While the pressure on resources for housing, as for public services generally, must be taken into account, it is my right hon. Friend's intention to give a high priority to these objectives. Action to cope with the worst aspects of the physical condition of the privately rented stock will represent the first and immediate response to the report.

A further response—to those recommendations which are concerned with rent levels and rent allowances—will follow consultation with the interested parties in Northern Ireland. I shall be writing to them when the report is published inviting their reactions to it and especially to its proposal for the introduction of a system of rent regulation. Once these reactions have been received and assessed, my right hon. Friend will consider the content and timing of legislation on rents.

In the present difficult economic situation, additional public expenditure for improving the condition of the private rented sector in Northern Ireland and, if this is the ultimate decision, for introducing a system of rent regulation with rent allowances can be accommodated only by a reassessment of priorities, including those for housing itself. Nor can there be any doubt that part of the solution must lie in a readiness by tenants to pay higher rents as a contribution towards the improvement of living conditions. In conclusion, I would add that I hope it is intended to debate all aspects of housing at the first meeting of the Northern Ireland Committee after the recess.

I should like to thank the right hon. Sir Robert Porter, QC, and his committee for delving into this matter in very great detail and the Minister of State then in office, Lord Windlesham, for setting up the committee on 16th May 1973.

Are the hon. Gentleman and his right hon. Friend aware that this is a sobering statement and one that is long overdue? The report was first commissioned on 16th May 1973 under my right hon. Friend, and we are all indebted to Sir Robert Porter and his Committee for the work they have done.

It is unfortunate that we have not the report in our hands and are dependent on a short statement, so that it is difficult to comment usefully on this report, but we welcome the statement as far as it goes. We welcome the legislation which is promised on home improvement grants, on generous State assistance for repair and improvement, and also for the promotion of housing associations.

On the question of rent regulation and allowances, may I ask the hon. Gentleman whether this is in parallel with the fair rent legislation in Great Britain, whether it is intended to proceed on roughly parallel lines, and whether this will take place in stages of about 12½ per cent.? In the terms of reference of the Porter Committee, which were outlined on 20th February 1975, one of the factors to be taken into consideration was the maintenance of a balance between the interests of tenants and the interests of landlords. Will the Under-Secretary say a little more on this question, and whether he is also aware that this relationship must be right if the private sector is to thrive?

Will he also bear in mind the 1974 Rent Act of Great Britain? If it is also intended to advance on these lines in Northern Ireland, it could mean that there would be less rented accommodation becoming available on the market. I hope that it is his intention, in order to improve the overall housing stock in Northern Ireland, to encourage the private sector.

Finally, we note that the subject is to be debated in the Northern Ireland Committee the next time it meets, and we welcome that.

I can only apologise to the hon. Member and to Northern Ireland Members for the fact that they have not got the report. This is due to no fault of mine. I would like to have it published as soon as possible because it will help me in my task of getting over to the people of Northern Ireland just what are the basic problems of housing there.

Most of the other points the hon. Gentleman mentioned are dealt with in the report. Housing legislation in Northern Ireland has lagged far behind that in this country. We have just introduced a rent rebate scheme in Northern Ireland, but unfortunately few people are taking advantage of the scheme, for reasons which to some extent I understand. The take-up is very low, though there must be thousands of people in Northern Ireland paying more than they should be. Getting it over to the people there is a slow process.

All the other matters are open for discussion. I hope that we shall be able to enlarge on them when the hon. Member has had a chance to study the report in detail and I hope that we shall be able to have a thorough discussion in Committee after the recess.

May I thank the Minister for his statement and ask him some questions about the recommendations? When did the Porter Committee report? How many houses under private landlords are vacant in Northern Ireland? How many lack basic amenities such as bathrooms, internal water closets, and a hot and cold water supply? Will the Housing Executive be the body responsible for the houses acquired under these recommendations? Does not the Minister agree that already the Housing Executive has too much to handle in connection with this type of property? I can safely say that in my constituency—and I am sure that many of my hon. Friends can say this of their constituencies—the Housing Executive has too much of this type of property on its hands at present. In North Belfast many houses lie vacant for two or three years—

Order. The hon. Member must not debate the matter now. He should ask questions. I understand that the matter is to be debated upstairs.

Will the Minister give us some further idea about his statement that generous State assistance should be made available for the repair and improvement of the remaining houses? This is welcomed. The Housing Executive has already cut back its spending on repairs to its own property. How can it give assistance to privately rented houses?

Finally, I again thank the Minister and welcome the statement he made about rent regulations and rent allowances. Will the Westminster Rent Act apply to Northern Ireland just as it does to the rest of the United Kingdom?

I thank the hon. Gentleman for some of the things he said. One of the basic questions he was trying to ask me concerns the standard of the houses. What I said about substantial State aid is a recommendation in the Porter Report. I am not saying that it will be done at the moment. I shall have to juggle with the money available to me to do some of these things. I have promised to take most of the slums in the redevelopment area under our umbrella by 1980. This will make the Housing Executive of my Department the biggest slum landlord in Europe This is obviously the only way we can tackle this.

In 1961 there were about 128,000 rented properties. By 1971 the number had fallen to about 70,000. In 1974 the number was just under 60,000. Of that number, the total number unfit is 29,120, or 48.7 per cent. The number lacking five basic amenities, including those listed by the hon. Gentleman, is 3,370, or 5.6 per cent. The number lacking at least one basic amenity is 41,690, or 69.7 per cent. The number without a fixed bathroom represents 61.2 per cent., without an internal water closet 63.2 per cent., and on average 13.7 per cent. do not have a water closet, inside, outside, or at the bottom of the garden. Sixty-six and a half per cent. lack wash hand basins, 41.6 per cent. lack a hot and cold water supply, and 5.8 per cent. are without a sink.

That is the problem. This is the vicious circle of low rents. Landlords, given the best of intentions, cannot, as they have told me, go about repairing these houses when the cost of the rent represents a packet of cigarettes a week.

I beg to move Amendment No. 1, in page 15, line 44, at end insert— '(2) The Commissioner shall arrange his sittings so as to facilitate the attendance of any such judge and, subject to paragraph 2(4) above, shall put to the witness any questions suggested to him under this paragraph.'. The amendment provides that, on the taking of evidence on commission in Northern. Ireland, to assist the court of trial in the Republic the commissioner shall arrange his sittings for the taking of such evidence so as to facilitate the attendance of any visiting judge from the court of trial and shall put any questions suggested by the visiting judge to the witness, provided that such questions do not infringe the rules relating to immunities and privileges of witnesses which, under the Bill, are determined in accordance with the law of Northern Ireland.

The Government have brought forward this amendment because it brings the Bill into line with the Bill at present going through Dublin. The House will be pleased to hear that yesterday morning the Senate passed the Bill and the Bill will now go to the Dáil.

Hon. Members who were present in Committee will know that I then resisted amendments because we did not want to alter the Bill and make it out of line with the Bill which was going through the Dublin Parliament at the same time.

Surely the right hon. Gentleman cannot tell the House that the Bill as presented to the Dáil will not be amended. How can he justify his argument that he does not want to alter the Bill in any way in this House when the Irish Bill could be altered? If that were to happen, would he bring subsequent amendments before this House.

I accept the validity of the hon. Gentleman's point. We brought this amendment forward because there was strong pressure in the Irish Parliament for the strengthening of this clause. The amendment strengthens the Bill. It does not dilute or weaken it. The Irish Government had the choice of diluting the clause in their own Bill to a strength which matched the provision in this Bill or asking us to bring our clause into line with that which was going through the Irish Parliament.

This provision will strengthen the Bill. It will give judges the right to have questions put and answered both in Northern Ireland and the Republic where examinations will be taking place under the Bill. I therefore urge the House to support the amendment.

We welcome the amendment. We believe that it strengthens the position of the judges, for the reasons given by the Minister of State. We prefer to make no further comment on the position in Dublin. We agree that the amendment strengthens the position under Schedule 4.

Amendment agreed to .

I have to notify the House, in accordance with the Royal Assent Act 1967, that the Queen has signified Her Royal Assent to the following Acts and Measures: 1. Appropriation Act 1975 2. Finance (No. 2) Act 1975 3. International Road Haulage Permits Act 1975 4. Litigants in Person (Costs and Expenses) Act 1975. 5. Conservation of Wild Creatures and Wild Plants Act 1975 6. Mobile Homes Act 1975 7. Guard Dogs Act 1975 8. Salmon and Freshwater Fisheries Act 1975 9. Safety of Sports Grounds. Act 1975 2447 10. Public Service Vehicles (Arrest of Offenders) Act 1975 11. Limitation Act 1975 12. Statutory Corporations (Financial Provisions) Act 1975 13. Coal Industry Act 1975 14. Remuneration, Charges and Grants Act 1975 15. Scottish Transport Group (Port Ellen Harbour) Order Confirmation Act 1975 16. Dundee Harbour Order Confirmation Act 1975 17. Dundee Port Authority Order Confirmation Act 1975 18. British Transport Docks Act 1975 19. Plymouth City Council Act 1975 20. Westminster Abbey Act 1975 21. Dart Harbour and Navigation Authority Act 1975 22. British Waterways Act 1975 23. Church Commissioners (Miscellaneous Provisions) Measure 1975 24. Ecclesiastical Offices (Age Limit) Measure 1975

I intervene shortly beause I know that other hon. Members wish to speak on Third Reading of the Bill. The Bill was described on Second Reading as an act of faith. We then made it quite clear that we welcomed it as a first step forward. We had certain reservations which came out in Committee and I shall not repeat those points now.

I must place firmly on record that there are a number of flaws in the Bill which might be highlighted by a renewed campaign of violence in this country and elsewhere. These were points very much in the mind of the Committee. For instance, we could be faced with citizens of the Republic who escaped from here after causing explosions. I mentioned these difficulties at the time.

The Minister of State mentioned the question of reciprocal legislation in Dublin. We understand that all stages of the Bill will not be completed in the Dail for some time. Indeed, they may not be completed until Christmas. Therefore, we are entitled to express the view that not too long a period should elapse before the legislation comes into operation. We must recognise that the Dublin Government have recently acted with admirable firmness against certain people. We should not criticise them on that account.

When the two Bills become law—I am referring to the Minister of State's remarks in Committee—and are operable, perhaps the question of a further meeting between Irish and United Kingdom judges could take place, similar to the meetings of the Law Enforcement Commission, to make a further examination of this difficult problem.

The delays that have occurred have made this legislation appear somewhat irrelevant to a number of people in Northern Ireland. It was drawn up to deal with a problem that was regarded in December 1973 as urgent and serious. If it does not become operative until 1976, it appears that, in the absence of any retrospective provisions such as my hon. and learned Friend the Member for Wimbledon (Sir M. Havers) mentioned on Second Reading, it will deal only peripherally with the problem that it was originally designed to meet.

It is not my intention to pour cold water on these provisions. I wish to draw attention to what I think we all understood was second best legislation. None the less, the positive aspect exists and must be stressed. I hope that all those who are thinking of any new campaign of terror will look upon this legislation as a warning. It is certainly a symbol of democratic Government in London and Dublin, designed to unite and defeat armed terror. For those reasons, we welcome Third Reading of the Bill.

11.46 a.m.

When a country is faced with terrorist attacks there is a great need for the necessary machinery to be available to resist and to defeat such attacks. No country in the world has ever had to face guerilla attacks like Northern Ireland so greatly ill-equipped. At the beginning of the trouble in Northern Ireland the lines of defence were removed by the folly of this House of Commons. There was the destruction of Ulster defences, the disarming of the RUC and the disbanding of the Ulster Special Constabulary. We then discovered that we did not have the machinery in law to deal with terrorist attacks. Therefore, Northern Ireland found itself in a difficult position when facing up to terrorism.

The Bill is important, because I suppose it is the first time since the Irish Treaty that the Dublin Government and Her Majesty's Government have co-operated in a piece of legislation of a constitutional nature. As a representative from Northern Ireland I must look at this legislation carefully. The Minister of State, referring to the process of the Bill in Dublin, said They are at the moment, as we are, discussing amendments and we hope for a speedy process for the Bill."—[ Official Report, Standing Committee J , 1st July 1975; c. 18.] The Bill has not had a speedy process in Dublin. It has not been welcomed or given any blessing by the Opposition in that Parliament.

On 28th November 1974 the Bill was introduced in the Dail. It was to have a Second Reading on 12th December 1974. Something happened to it. It became lost and was not discovered until 9th April 1975. It was then withdrawn completely from the Lower House. It was introduced to the Senate of the Dublin Parliament on 10th April. A unique thing happened to it. There was a vote on First Reading, which is an unusual occurrence on a Bill in that House. It scraped through only by a very narrow majority. It continued its passage in Committee, and only now has it finished the process. It cannot be reintroduced into the Dail until October. I understand that the Government have a majority of only two in that House. The Opposition have made it clear that if the Bill is passed they will challenge it in the courts. Immediately it is challenged in the courts I understand that it cannot be operated as the law of the country. Consequently it could not come into operation until very late in 1976. It is not making speedy progress in the Dublin Parliament.

The second matter is that it is quite likely—and we would be blinking our eyes at the obvious if we did not face the fact—that if the Convention in Northern Ireland comes up with some sort of solution to the problem of government in Northern Ireland, there will be those in Northern Ireland intent on destroying the possibility of that solution taking effect by legislation. They will be intent in a campaign of the most dastardly and diabolical violence on overthrowing any solution that the Convention may suggest. Members of the Convention must face the fact that if they are successful they will face renewed violence.

The trouble is that we have not the necessary control under this legislation to deal with such an outbreak of violence which could occur as a result of the Convention succeeding in making proposals generally acceptable for the government of Northern Ireland. So Northern Ireland finds itself in a very difficult position.

We have had—and the hon. Member for Belfast, West (Mr. Fitt) referred to them yesterday in his speech on the Adjournment motion which I was reading this morning—the killing of members of the Royal Ulster Constabulary, the killing of members of the British Army and the killing of members of the civilian population, both Protestant and Roman Catholic. In the past few days we had a brutal and dastardly murder in Dungiven where two police officers sought to do their duty and to keep that town from having a bombing in its main street. One was shot down in cold blood. The other was very seriously injured and after he was shot those guilty of the murder robbed him of his weapon. We do not know where those assassins are. They could be across the border in the South of Ireland. If they are, this legislation does not help us at all. I do not blame Her Majesty's Government for this. I believe that the blame lies with the Southern Government for not being prepared to have a straight extradition treaty.

This is a similar point to that made by the hon. Member for Abingdon (Mr. Neave). If an act of criminal violence takes place and the person or persons responsible enter the Republic, whatever citizenship they have they could then be tried under this legislation and be brought to justice if they were arrested. This legislation will ensure that people in either part of Ireland can be dealt with. It is not exactly the type of legislation that the Government or this House may have wanted. There are more simple and straightforward means of dealing with this situation. But we have to deal with it as we find it. However such a case as that outlined by the hon. Gentleman could be dealt with.

I am afraid that I must take up this point with the right hon. Gentleman. This is very important. He is not right in what he says. This legislation is not retrospective and the Prime Minister of the Republic has given an assurance that those responsible for any crimes committed before this Bill becomes law in the South of Ireland will not be dealt with at all. Those are the facts of the situation and the right hon. Gentleman should be aware of our concern about those facts.

I take the point fully. I accept that the legislation is not retrospective. When I intervened just now I was referring to an incident which might occur when this legislation had become law. We can move in that direction only when it is on the statute book and accepted by both Parliaments. From then on, any crime can be dealt with. But I accept that this legislation is not retrospective.

I am obliged to the right hon. Gentleman. I was dealing with the killing of the police officer in Dungivan and using it as an illustration. But we have also had the dastardly killing of four members of the British Army in Fork Hill. We have had the killings on the Newry Road. If the people responsible are now across the border, this legislation will not help us at all to bring them to justice.

I am trying to be fair to the right hon. Gentleman. I know that this state of affairs does not exist because of the attitude of his Government or of the previous one. It is because of the resistance of the Dublin Government to a straight extradition treaty.

We have heard a great deal in this House about the Irish dimension. We have also heard a lot about the United Kingdom dimension. But let us be clear that this Bill has no United Kingdom dimension. That is its great weakness. The right hon. Gentleman should know that there could not only be a terrible campaign of violence too horrible to contemplate in Northern Ireland but that it could be brought across the water. Acts of terrorism such as that which happened in Birmingham could be repeated on this side of the water. The tragedy of this Bill is that we have not the United Kingdom dimension in it, and it is a serious weakness.

I turn to another matter. If this Bill goes before the Dail Eireann and certain amendments are made, and if the Government there have to make certain concessions to the Opposition to get it through at all, can the right hon. Gentleman say today what he will do? Shall we have to scrap this Bill and have an entirely new one? It could be that amendments moved and accepted in the Dail Eireann would weaken some of the matters in this Bill that we have sought to strengthen. If those matters are diluted in the Dail Eireann, shall we have to have new legislation? What procedure will the United Kingdom Government adopt? The right hon. Gentleman had better face the fact that this Bill will run into the heaviest of water in the Dail Eireann.

indicated assent —

I see that the hon. Member for Belfast, West agrees with me. We know the situation in Dublin in regard to this Bill. We know the savage attacks which have been made upon the Law Officers of the Crown in Northern Ireland in the course of the debate in the Senate in the South. We know about the savage and uncalled for remarks about the RUC and the British Army.

We have before us a piece of legislation which does not deal positively enough with the situation. I know that the hon. Member for Abingdon said that we should welcome it although it was second best. We welcome anything which will help in this matter. We cannot get all that we want, and therefore we must he prepared to accept some sort of compromise. But our feeling is that this is more than a compromise. Our feeling is that there has been a failure on the part of the Government to force this issue on the Dublin Government.

Let me quote from the report of the Law Enforcement Commission from which this legislation came. The British judges made a vital point which has never been answered by Dublin. Here we come to the kernel of the argument. There is no internationally recognised distinction between the propriety of trying a fugitive political offender and surrendering him to the authorities of the place of the offence. The Dublin Government are saying that they will try him in their territory. They have tried to say that this is because of international law. However, the British judges have emphasised that there is no difference in international law and that he could be delivered up to the authorities in Northern Ireland and be tried in Northern Ireland.

I suggest that the only way of tackling this matter is to have a straight extradition treaty. The Lord Chancellor, speaking in the House of Lords, demonstrated that this is the real difficulty for Dublin. He said about Dublin, It has been ruled there time and time again that if a man who is a terrorist appears before a court in the Republic and says 'Yes, but I did it as a member of the IRA', and then it is immediately classified as being an offence of a political character and therefore not extraditable."—[ Official Report, House of Lords , 24th February 1975; Vol. 357, c. 558.] This is the great problem before us. The Government must again take up this matter because the South of Ireland, which to a certain extent has not suffered from this terrorist campaign, could in the near future have to face a serious terrorist problem. While we give a Third Reading to the Bill we should put up the warning lights for Northern Ireland and let the people know that until the Bill becomes law in another place it cannot help the situation and there is no machinery to face the present bleak prospects on terrorism in Northern Ireland. We need to face that fairly and squarely this morning.

We, in Northern Ireland, are fighting for our very existence and our lives. My hon. Friend the Member for Antrim, South (Mr. Molyneaux), the leader of the United Ulster Unionist Coalition Party, said yesterday that while others in this House are concerned about the well-being and comfort of their constituents during the recess, we are concerned about the very lives of our constituents.

This morning as we pass the Bill let us not think that it puts into the hands of either the Government or the security forces any immediate weapon that can be effectual in dealing with the scourge of terrorism in Northern Ireland. As we pass the Bill let us have the right attitude to what is happening in Northern Ireland and what can happen there. There is a situation in which the Government of the United Kingdom do not have the power to get these criminals back from the South for proper trial in Northern Ireland. Extradition has been a one-way street—we have been extraditing to the South of Ireland but the South has not extradited one person accused of a terrorist crime. Let that be put fairly and squarely on the record.

I and my right hon. and hon. Friends will not be voting against the Bill. We shall be giving it our support, but we should point out that it does not help us in the present dark hour we face in Northern Ireland.

12.5 p.m.

Before the House parts with the Bill on Third Reading I believe that the right hon. Gentleman the Minister of State should formally repeat—as I know he is able to and will—the assurance about the Bill being brought into effect. The clear understanding is that this Act will not be brought into effect by the Secretary of State unless and until the Secretary of State is satisfied that simultaneously equivalent legislation will come into force in the Irish Republic. I know that the right hon. Gentleman the Minister of State at an earlier stage has said this, but he will appreciate that the importance is such that it is only right that it should be confirmed upon Third Reading, which is our last opportunity. That is the more cogent, for a reason which has just been stated by my hon. Friend the Member for Antrim, North (Rev. Ian Paisley).

The House, on Report a few minutes ago, made a last amendment to the Bill upon the basis that it would thereby be in unison with the Bill before the Irish Parliament. However, as my hon. Friend has pointed out, it may well be that the Irish Government, in order to secure the passage of their Bill, will have to accept or will decide to make appreciable amendments to the corresponding legislation. In that case I am afraid that Her Majesty's Government will find themselves in a difficulty because unless those are very minor matters, the Secretary of State will be unable to alter this legislation. That is why the Government have been unwise and have disregarded advice in this respect which was given earlier to clarify this situation through all the stages of the Bill before a similar point had been reached in the Irish Republic.

Therefore, we now require—and I am sure that the right hon. Gentleman will understand this—that the assurance shall be not only that this will not be activated without the activation of the same legislation in the Republic, but that if the legislation in the Republic is appreciably amended, this Bill will not be put into effect without the corresponding amendments having been made here. I am sure that this is implicit, but I am equally sure that the right hon. Gentleman will recognise that it has to be made explicit at this stage.

I do not wish to detain the House, but I wish to make one other point. It is, unfortunately, a point which may become very live in the coming months. Therefore, what I am saying, like so much that is said from this bench, is very much in the interests of Her Majesty's Government. After this Act has become effective, if it ever does, and if outrages were committed in Great Britain by persons who then sought refuge in the Irish Republic, there would then be an outburst of criticism against Her Majesty's Government for having failed to secure for this legislation what my hon. Friend called a "United Kingdom dimension".

We all understand the difficulties. The right hon. Gentlemen may find what I am asking him to do a help in days of trouble. On Second Reading on 19th June the right hon. Gentleman's right hon. and learned Friend the Attorney-General recognised the desirability of what we may call the "United Kingdom dimension". As reported in column 1740 he referred to a gap in the protection which we seek to give by this legislation. Therefore, Her Majesty's Government have recognised publicly that there is a gap in that protection. The right hon. and learned Gentleman also recognised that the point was taken by Her Majesty's Government and, indeed, that they had considered whether they should not have, as it were, a dormant provision in this Bill so that if the agreement of the Republic to a United Kingdom application was obtained, that could be put into effect at once.

He finally said: We"— that is, Her Majesty's Government— should no doubt see whether the Irish felt that that degree of extension of their legislation as well as of ours, might be put into effect."—[OFFICIAL REPORT, 19th June 1975; Vol. 893, c. 1740–41.] What I want to ask the right hon. Gentleman to do is simply to confirm the implication of those words of his right hon. and learned Friend so that if the unhappy event which I have indicated should occur, then at any rate Her Majesty's Government and we on these benches can say, "At any rate, it is perfectly clear that the United Kingdom has done everything in its power, has made all the representations it could, to secure that there is reciprocity not merely between Northern Ireland and the Republic but between the United Kingdom and the Republic." At least that will be some protection to him and to us if that day of trouble comes and people ask why they are not given the redress that they would have if the crime had been committed in Northern Ireland for a crime which has been committed in Great Britain.

I hope, therefore, that the right hon. Gentleman will be able to respond to both those appeals.

The Clerk at the Table informed the House of the unavoidable absence of Mr. SPEAKER from the remainder of this day's Sitting .

12.12 p.m.

I thank the House for the brief but significant debate we have had today on Third Reading.

The hon. Member for Abingdon (Mr. Neave) made some welcome remarks about the Bill, as did other hon. Members. The Government recognise that this is not perfect legislation. I think that someone said this moning that it was imperfect. We live in an imperfect world. We should not underestimate the changes which will take place when this legislation, we hope, has gone through the Dail and through both Houses of our Parliament. I shall say something about the position in the Republic, as the Government understand it, in a moment.

I take the point made by the hon. Member for Abingdon regarding the judges, and whether it might be useful to have another meeting when both Bills have become law. The Government will take due note of that point and look at it at the appropriate time.

At this stage I should like to pay tribute to the co-operation of the Garda from the South and the RUC in the North. The co-operation between these two police forces has never been better. There is an understanding about dealing with terrorism on either side of the border, a border which we are all well aware is about 300 miles long. It takes a great deal of work to monitor and cover it. The co-operaton is to be welcomed.

The hon. Member for Antrim, North (Rev. Ian Paisley) and the right hon. Member for Down, South (Mr. Powell) raised the question of what would happen if the parallel Bill were substantially altered in Dail Eireann. I think that we can take confidence from the fact that that Bill was passed in the Senate by 25 votes to 13, and the Bill was not weakened but strengthened. We are hopeful that the Bills will go through both Parliaments without major amendment.

Coming to the specific point, however, it is only correct to say on behalf of the Government that unless the two Bills are substantially reciprocal, they cannot work. I do not want to deal with a hypothetical question today. I am sure that the hon. Member for Antrim, North was not posing a hypothetical question, although he asked what would happen if such-and-such amendments were made. We have confidence and we take note of the strength of the desire on the part of the Irish Government that this legislation will not be significantly altered. In fact, the amendment I moved earlier this morning, which strengthened the Bill, was to meet a claim made in the Upper House of the Irish Parliament that on this one aspect the Irish Bill was tougher than the British Bill. Therefore, we have strengthened our Bill.

The right hon. Member for Down, South asked me to reiterate in the House the statement I made in Committee that the Bills will be put into effect simultaneously. They will be enacted simultaneously. Obviously, the two Bills are reciprocal and they go in tandem. One Bill would not be of any value without the other. The Government accept that. Therefore, we would want to see a joint date for the operation of the major part of this legislation. There is a minor part, as has been recognised, that we can implement as soon as we have obtained the Royal Assent, but it would be the Government's intention—it is the only logical thing—that the two Bills should come into force simultaneously and operate from an agreed date, we hope. Therefore, I hope that that meets the point raised.

The right hon. Member for Down, South raised a further point regarding the operation of the Bill within the United Kingdom. I can confirm that should the situation warrant it, Her Majesty's Government will not hesitate to take up again the question of the extension to the United Kingdom with the Irish Government. I give that undertaking to the right hon. Gentleman.

That is very helpful. I wonder whether I might make a minor addition to it, if I can take the right hon. Gentleman so far. He said, "If the situation warrants it, then"—and that is hypothetical, too—" in the future the Government would take certain actions". What I am putting to him is that it would be advisable for Her Majesty's Government, as well as for all of us, before there is time for such a situation to arise, to be already in communication with their opposite numbers in the Republic and to be able genuinely to say that so far as they are concerned, they are endeavouring to secure that extension. I hope that the right hon. Gentleman will not limit his assurance to something which starts only after something we do not want to happen has indeed happened.

I am trying to help the House and the right hon. Gentleman, and to take the point as far as it is possible to take it today from the Government's point of view. There are continual discussions, obviously, as I have outlined, between the RUC and the Garda, for instance, affecting terrorism and about halting terrorism. I take the point the right hon. Gentleman has made, I cannot go beyond what I have said. I am certain that this debate will be read not only throughout the United Kingdom but also in the Republic. Certainly my right hon. Friend the Secretary of State would want to act at the earliest opportunity if the situation warranted that. Perhaps I could leave the matter at that point. I think I have gone a long way to meet the right hon. Gentleman.

Perhaps the right hon. Gentleman has missed the point that my right hon. Friend was putting. It is not a matter of acting if the situation should warrant it. It is a matter of acting if the situation should warrant it. It is a matter of making preparation now against that evil day. What my right hon. Friend is asking the right hon. Gentleman to impress upon the Secretary of State is that he should now have discussions with the Government of the Republic to deal with the eventualities. As my right hon. Friend has said, it is often too late to act.

I take the point, and I think that I have gone a long way to meet it. I will draw my right hon. Friend's attention to the remarks made this morning and I am sure that they will be noted both in the Republic and by Her Majesty's Government.

The Bill is a positive step forward. Extradition has been mentioned, and that was the British Government's first position. Despite the political reality, we must not underestimate the courage of the stand of people in the Republic in facing up to their situation.

With those words, I hope that the Bill be given a Third Reading.

Question put and agreed to .

Bill accordingly read the Third time and passed, with an amendment .

I beg to move, That the Diseases of Animals (Amendment) (Northern Ireland) Order 1975, a draft of which was laid before this House on 2nd July, be approved. The object of this order is to give added protection to Northern Ireland's favourable animal health position, upon which the agricultural export trade of the Province is highly dependent. It is because it has this objective that it has received such widespread acceptance during consultation.

The order seeks to improve controls on the importation of animals and animal products and to extend those controls to cover the importation of anything which is capable of bringing disease of animals in its train. Provisions are also included which will enable controls to be applied to the distribution and use within Northern Ireland of certain materials, both animate and inanimate, and certain ancillary matters.

Article 3 extends the provisions of the Diseases of Animals Act (Northern Ireland) 1958 to allow importation controls to be applied to inanimate objects such as dirty agricultural machinery, which has been found to be as capable of transmitting disease as matters relating to animals themselves. Also, the article is applied to an extended range of animate objects, such as livestock ova, the movement of which is becoming important. They can in adverse circumstances be disease-carrying organisms.

Provision is also made in that article for the detention on board a vessel or aircraft or other craft and the subsequent re-export of unlicensed cargoes arriving in Northern Ireland. Cargoes of particular concern would include consignments of meat, animal products, hay and so on, any of which could from the moment of landing constitute a threat to Northern Ireland's disease-free and therefore highly susceptible livestock and poultry population. At the moment, the Department of Agriculture, which is the originating Department of this legislation, has powers to deal only with unlawful imports which have actually been landed. It would be an advantage to prevent landing of these disease-bearing products.

Article 3 also provides extended powers for inspectors to enter vessels and aircraft so that they may check that the regulations have been complied with. At present, inspectors may enter vessels only if they have a lively suspicion or reasonable grounds for supposing that the regulations under the existing legislation are being breached. The idea is that they will have a right to enter and inspect vessels to see that regulations are being complied with.

The possession by any person of anything which has been imported in contravention of the diseases of animals legislation becomes an offence under Article 3(4), but it is provided that where the defendant can satisfy a court that he acquired the thing concerned in good faith the charge against him will be dismissed.

The enforcing authorities must first prove that the person was in possession of anything imported in contravention of the order. If they can do that, it is then up to the person in possession to prove that he acquired it in good faith.

The only offence provided for under existing legislation is that of bringing an illegal import into Northern Ireland, but such an import may be discovered some time after the date of importation. For example, illegally-imported meat could be found in a cold store and by that time it might be impossible to prove that a particular person was responsible for the act of importation. By holding the person in possession responsible, however, it will, to the extent that those in possession can demonstrate their lack of complicity, be possible to isolate the guilty party.

Finally, under Article 3 the Department of Agriculture will, as an alternative to the existing power of slaughter, have a power to order the re-export of animals in quarantine which are suspected of being diseased. Sometimes animals which are tested do not give a positive or a negative reaction and it cannot be decided whether they are diseased. In those cases the Department will be able to re-export rather than slaughter.

Article 4 provides power to regulate the distribution and use within Northern Ireland of anything capable of spreading animal disease. The main purpose of this provision is to permit the exercise of controls over the disease-causing organism. Under this article the Department will have power to control the operations of establishments like knackeries and poultry waste processors to ensure the maintenance of satisfactory health and hygiene standards.

Power is provided under Article 5 for the Department to require persons engaged in the livestock, poultry and meat trades to keep documents, invoices, bills and all the rest and to produce them for inspection when requested. In certain exceptional and well-defined circumstances the Department will have powers to seize such documents if voluntary co-operation is not forthcoming. There is a number of ancillary provisions in the order.

Article 6 removes the Department's liability to the payment of compensation to the owners of animals who are slaughtered in quarantine because they are suspected of being diseased. The situation is totally different from the slaughter of animals already in the country. After all, importing is a positive act by the importer. He knows that he is running a risk of importing disease and he can insure against it. In those circumstances, the Department and the Government do not feel that compensation should rest on the shoulders of the taxpayer.

Article 7 repeals an outdated provision of the Administrative Provisions Act (Northern Ireland) 1926 whereby the Department of Agriculture is obliged to pay half the expenses incurred by local authorities in the discharge of duties imposed upon them by the diseases of animals legislation. As a result of successive legislation, local authorities in Northern Ireland no longer have any heavy, specific obligations under the Diseases of Animals Act (Northern Ireland) 1958. Article 7 removes the Government's liability to pay half those expenses. It is merely a tidying-up provision.

The order has been generally welcomed by the interested parties consulted before it was laid.

12.29 p.m.

Among the first words heard or read by visitors landing in Northern Ireland from ship or aircraft are the warning by the Ministry of Agriculture—I do not know whether the use in the notices of "Ministry" instead of "Department" is nostalgic or prophetic—to those who may have been in recent contact with livestock or poultry. That always brings home to me the commendable vigilance of the Northern Ireland authorities.

The administration and the public in the Province—particularly those who earn their living from agricultural production and its export to the mainland of the United Kingdom—recognise how vital is this vigilance and the kind of measures which the Minister has outlined, and he was right to stress the importance of the export trade. I shall sit down in a moment because Members of Parliament representing constituencies in Northern Ireland may wish to speak. But may I ask the Minister to utter words of cheer to the poultry farmers in Northern Ireland, who are losing money? Eighty per cent. of all the eggs produced there are transported to the mainland, although recently there has been a decrease in egg production. I understand from the Ulster Farmers' Union that between 4,000 and 6,000 jobs in poultry farming, hatcheries and ancillary activities are now in danger. If the Minister can give some information and encouragement, many people in the Province will be grateful.

12.31 p.m.

I welcome the order, which stems from the Diseases of Animals Act (Northern Ireland) 1958. A similar order stemming from the Act was the draft Diseases of Animals (Northern Ireland) Order 1975. The only difference is that the word "(Amendment)" does not appear in the previous order. The order was considered in the Standing Committee on Statutory Instruments in February.

The equivalent British measure to the Diseases of Animals Act (Northern Ireland) 1958 is the Diseases of Animals Act 1950, from which stemmed the Rabies Act 1974. There is no equivalent Rabies Act in Northern Ireland.

The previous legislation, which this order amends, stemmed from two orders. I refer to the Rabies (Control) Order 1974 and the Rabies (Importation of Dogs, Cats and Other Mammals) Order 1974. That is a United Kingdom measure.

Will this order deal with the importation of dogs and cats into Northern Ireland? The document mentions animals but does not specify them. If the order concerns rabies, I should have thought that it would be helpful to make that clear in the order. Perhaps it should mention some of the worst diseases, one of which is rabies. Those who saw the film which dealt with rabies two nights ago in the Palace of Westminster cinema will know of the horrific nature of this disease and that there is no authenticated case of a man recovering from it.

The explanatory note to the order says that it extends the powers of import control. However, the import of animals into Northern Ireland, either by sea or by air, is different from the importation of animals from the Republic. A chaotic situation exists on the border between Northern Ireland and the Republic of Eire. Many customs posts are unmanned, especially at night. There are other difficulties.

Has consideration been given to implementing the order under the conditions existing today in the border area? Will a similar order be enacted in the Republic? I asked a similar question when the previous order was discussed in Committee. The Government said that they were in close consultation with the Republic. However, it was not made clear whether similar provisions were being enacted in Eire at the same time. If rabies is not controlled, there will be a major gap and loophole.

12.35 p.m.

I welcome any measure to help control animal diseases in Northern Ireland. This order deals with the importation of meat originating in a country where disease is rife.

This is the second piece of legislation dealing with animal diseases in Northern Ireland which we have considered this year. Why is it necessary for there to be piecemeal legislation? Cannot the legislation be combined and passed at the same time? In that way we could go into the details of the legislation much more thoroughly. Could this legislation be tied closer to that existing for the rest of the United Kingdom? In some respects the law is much more stringent in Northern Ireland than elsewhere in the United Kingdom or Eire. There should be parallel legislation wherever possible.

Article 5 of the order states that a justice of the peace must be satisfied by complaint on oath. Is it reasonable that a justice of the peace should give authority to persons to enter premises and seize documents? It is a serious matter. Would it not be wiser for this power to be given to a resident magistrate in court rather than to a justice of the peace?

Article 6 of the order deals with the payment of compensation and the slaughter of animals as a result of disease originating from a source unconnected with the animals in a quarantine station. Control is strict in quarantine stations, although we can never ignore the possibility of diseases being transmitted in the station. It would be difficult to prove that the disease had been transmitted in the station. In those circumstances is it right for the Department of Agriculture to have the deciding voice? There should be an independent tribunal or investigation so that all persons concerned are satisfied with the fairness of the procedures for determining whether compensation should be payable by the Department of Agriculture.

Article 7 of the order deals with payments to district councils. The Minister said that not much money was involved. The ratepayers of Northern Ireland will object to unnecessary payments, especially at a time when rates are soaring. Can this provision be reasonably accepted? We have no idea what may happen in future. The law might be changed again and a great burden laid upon district councils.

The report of the Joint Committee on Statutory Instruments refers to the fact that the controls in Northern Ireland are more stringent than those in Great Britain. Will Northern Ireland be allowed to retain its high standards in the light of our membership of the Common Market? That is a cause of deep concern to the farming community, especially to the breeders of high-quality animals for export. We should like an assurance from the Minister that livestock disease in Northern Ireland will be controlled and that we shall not have to lower our standards to comply with the rules of other countries which have lower standards in controlling the diseases of animals.

On page 8 of the report of the evidence to the Joint Committee on Statutory Instruments there is a reference to— importation from any other place". I understand "any other place" to include the rest of the United Kingdom but not necessarily Eire. Northern Ireland and Eire form a single area for the control of animal diseases, but the legislation in the two countries is not precisely the same. The import requirements into Northern Ireland and into Eire are different, especially for female stock. Some people I have spoken to in the farming community are concerned that female stock is brought into Eire and subsequently re-exported from Eire into Northern Ireland. Should that situation be allowed to continue? In view of the grave situation which exists in border control between Northern Ireland and Eire, is the Minister satisfied that stock carrying brucellosis infection is not crossing the border into Northern Ireland from Eire?

There have been a large number of unexplained and inexplicable outbreaks of brucellosis in Northern Ireland, although it was thought at one time to be practically free of the disease. There seems to be no reason for these outbreaks unless they are caused by diseased stock brought in from somewhere else. The only country from which that diseased stock could come is Eire. I know that the Eire authorities would not wish such exports to take place, but we have recently been made aware in the House of the large amount of smuggling that occurs between North and South. Is there any reason to suppose that unscrupulous persons are not engaging in this illegal traffic resulting in brucellosis being brought into Northern Ireland? Will the Minister undertake to try to close this possible gap in our defences?

12.42 p.m.

The hon. Member for Esher (Mr. Mather) properly raised the subject of rabies, which is mentioned in the order, and asked for clarification. Rabies is not such a minor matter as one might imagine. I remember some years ago being approached by a close friend who was in considerable difficulty because his wife had taken her dog to Great Britain, and when she attempted to return the dog was put in quarantine at the port of embarkation. The man's wife would not depart from Great Britain without her dog, and the dog could not be released. I was asked what action I would recommend. In exasperation I put to him the question "If it came to a choice, which of the two would you want most?" I am not sure that he acted on my advice and I am not even sure that the advice was sound. Perhaps what the Minister says in clarification may help my friend if he finds himself again in that position.

I shall briefly reiterate the subject raised by my hon. Friend the Member for Londonderry (Mr. Ross) of the worrying question of illegal importation. The Minister of State will remember that the Public Accounts Committee expressed grave concern at the scale of expenditure of public funds in the operation of the brucellosis scheme. At one period we all hoped that Northern Ireland was completely free of this scourge, but then we had a series of outbreaks for no obvious reason.

The Public Accounts Committee suggested that the outbreak tended to occur in an area adjacent to the border with the Irish Republic and that the incidence of the disease decreased as one moved inland from the border. In these days of fast transport and mobile smugglers, outbreaks are beginning to occur in what we have hitherto regarded as fairly safe areas.

The Minister of State and his noble Friend who is responsible for agricultural matters in Northern Ireland know the tragedy which an outbreak means for a farmer who has worked for years to build up a valuable herd—perhaps a pedigree herd—which is wiped away in the space of a few days because of negligence on the part of someone who wants to make a fast pound out of a smuggling operation. There is far too much of that going on.

My hon. Friend the Member for Londonderry said he did not think that the Eire Government would condone such operations, and I am sure that is true. Although the Eire regulations are not perhaps as strict as the Northern Ireland regulations, enforcement of the Eire regulations would go a long way towards resolving these problems. The trouble is that they are not enforced even within the territory of the Irish Republic. It has been said to me that although the Eire agriculturists have an excellent rule book, it is of little use because they do not read it.

It is a great pity that this tragedy should occur as a result of slack enforcement. In Northern Ireland we make a determined attempt to control the disease and we are proud of our record in animal health. Should the enormous trouble and expense of that effort be set at naught because of the carelessness of our neighbours south of the border?

Will the Minister ask his noble Friend whether he is satisfied that the officials of the Northern Ireland Department of Agriculture are pursuing as vigorously as they might the enforcement of the regulations and whether they are being sufficiently determined in their efforts to crack down on the offenders?

When one attends a branch meeting of the National Farmers' Union and hears verbal accusations and names mentioned one wonders whether these facts are known to officers of the Department—particularly to enforcement officers—and, if the facts are known, why there is not a more obvious attempt to take action to prosecute and, if necessary, deal harshly with the offenders.

All Northern Irish Members who represent agricultural constituencies or who are involved in agriculture are proud of their record and would wish us to give our support to the order.

12.48 p.m.

I give my support to the order and I hope that it will proceed through the House speedily. It is in the interests of Great Britain, Northern Ireland and the Republic of Ireland that they should remain one effective unit for animal health purposes. It is essential that the quality and standard of the controls for animal health purposes in Great Britain, Northern Ireland and the Republic of Ireland should remain as effective as they have been in the past.

The veterinary department of the Department of Agriculture in the South of Ireland is highly effective and highly efficient. In my practical experience, in some respects it is more efficient than our Ministry of Agriculture in animal disease and animal health matters. It has some highly-qualified officials who provide an effective service very conscientiously.

I recognise that it is mysterious how these outbreaks of animal diseases occur in the North of Ireland from time to time, but brucellosis can be spread other than by the contact of an infected animal with non-infected animals. There are many ways in which it can be spread. One way to which possibly insufficient attention is being paid is the passage of a lorry which has carried infected animals, say, south of the border, proceeding to the North of Ireland and not being properly disinfected on passage, and thereby passing on the brucella germs to clean cattle in the north of Ireland.

It is important that we continue to try to strengthen the external barrier of what I call the animal health unit of Great Britain, Northern Ireland and the Republic of Ireland. It is vital to many thousands of farmers in Great Britain, particularly in the Midlands and the North, that the traditional trade of Irish store cattle, nearly all from the Republic, amounting to 300,000–500,000 every year, should continue to come over in the numbers required and untramelled by veterinary inspections, other than the normal 24-hour check that they now undergo at the port of entry at Birkenhead.

This animal trade, this flow of store cattle, upon which the prosperity of many farmers in Britain depends, should continue completely unfettered. It can continue only if the health regulations in the three areas of Great Britain, Northern Ireland and the Republic march along together hand in hand. Many farms in Great Britain depend upon receiving the exports of Irish store lambs, for instance, without which they would be in difficulties. They need them to finish them at the end of the year. There is a great two-way passage of animal traffic between Great Britain, Northern Ireland and the Republic, which flows unhampered by restrictions other than brief examination at the port of entry. That can continue only if the three areas march in parallel with regard to animal health regulations.

That is why I share the concern of the hon. Member for Londonderry (Mr. Ross), who said how important it was to keep our animal health regulations intact, especially now that we are full members of the EEC, bearing in mind that membership could at a not-too-distant date require us greatly to relax our animal health regulations. It is in the interests of the successful and working health unit of the three areas that we should resist any attempt to lower the very effective standards of hygiene, animal care and animal examination which we have at our points of entry from abroad.

We have already heard that it is desirable that parallel legislation should be going through the Dublin Dail, because it will make nonsense of our animal health unit if it is not. The House would like the Minister's confirmation that it is going through.

I can see no reference in the order to an increase in penalties. As far as I can see, there is no mention of penalties. With the prevalence of disease in all its forms, and with new diseases continually threatening, it is no use leaving penalties based on an Act of 10 or 15 years ago. Low penalties are no deterrent. To keep a dog in quarantine for the six-month period costs nearly£200 today. When we are dealing with animal disease, and with the cost of animals which are imported and exported being what it is today, it is essential that realistic penalties be provided for offenders.

With those few comments, I welcome the order.

12.56 p.m.

I wish briefly to draw attention to a problem that I came across during the past few weeks. It would allow a horse and cart to be driven through the legislation that the Minister is introducing. It has to do with the overall security situation in Northern Ireland.

The security forces have obviously felt for a long time that explosives, firearms and so on might well be going to various parts of the Province on cattle lorries and so on. Over the past 15 months they have built a garage at Long Kesh to which they take the lorries, unload the beasts, search the lorries, reload the cattle, and send them to their eventual destination.

In our system of brucellosis control, certification has always been required to move cows or heifers from one part of Northern Ireland to another. Apparently, the Army was not aware of this, and it was bringing the cattle to Long Kesh, unloading them into a pen, taking them away, and then bringing in another lorry and repeating the process. The system of recording, control and disinfecting had broken down.

I have brought the matter to the attention of the Defence Department, and I believe that it may at last be taking action on it. It would be a great help if the Minister and his hon. Friend would assist me in the matter.

12.59 p.m.

We have had a brief debate which has illuminated certain aspects of the order and drawn attention to one or two problems.

The hon. Member for Epping Forest (Mr. Biggs-Davison) drew attention to the parlous condition of the poultry industry. The Department of Agriculture is aware of it. The situation is primarily caused by the high price of poultry feed. The problem is under active consideration by the Department of Agriculture with a view to finding a solution.

The hon. Members for Antrim, South (Mr. Molyneaux) and Esher (Mr. Mather) referred to the problem of rabies in Northern Ireland. As the Minister responsible for piloting the most recent Rabies Act affecting Great Britain through the House, I am well aware of the seriousness of the problem. We intend to introduce in the very near future Northern Ireland legislation equivalent to the Rabies Act. We have plans afoot to do that.

A number of references have been made to the question of the importation of animals from the Republic and how we control it. The hon. Member for liar-borough (Mr. Farr) summed up the attitude in an interesting speech which will be taken on board. We have informed the Republic that we are putting the order through the House and the appropriate authorities in the Republic will consider what legislative action they should take. I cannot go further than that. Her Majesty's Government are not responsible for any action taken by the Government of the Republic.

Nevertheless, the problem of the border is particularly important and a number of hon. Members have referred to it. Complete control of the movement of livestock across the border in Ireland is virtually impossible, although the departmental officials as well as the security forces and, as far as possible, customs officials, do their utmost to keep it under control not only because of the disease of animals implication but because of all sorts of other implications. But the border is over 300 miles long and runs through much uninhabited country. Hon. Members know the problem as well as I do because we have discussed it many times in the House.

It is disappointing to the Department of Agriculture that it has not been possible to eradicate more quickly the remaining brucellosis infection in Northern Ireland, but there are hopeful signs that the percentage of infected herds is beginning to fall and that the situation is not out of control. Insofar as there is movement, it is in the direction of decline. Nevertheless, the battle will continually have to be fought and it will not be made easier by anybody who is so ill-advised as to smuggle without making proper provision for ensuring that the herds are disease free. We are continually fighting smuggling along the border, because there are other incentives which have affected the situation.

The hon. Member for Londonderry (Mr. Ross) raised the question of female stock. The importation into Northern Ireland of female stock is not permitted, in the interests of preventing the introduction into the Province of Johne's disease. This is another control which we apply. We consider that justices of the peace are the appropriate people to issue the warrant.

The Minister is no doubt aware that, although the importation of female stock is prohibited from the rest of Great Britain, it is in certain circumstances allowed from Eire.

I shall have to look into that point and write to the hon. Gentleman, but I am advised that the importation into Northern Ireland of female stock is not permitted. If there is doubt about that, I shall see what can be done to clear it up.

Is there any reason why resident magistrates should not be able to issue warrants apart from justices of the peace? Would not that be helpful?

It might well be, but the services of justices of the peace are regularly available to the inspectors, who can apply to them and obtain the documents that they need. There is no reason why resident magistrates should not be approached, but we have decided upon justices of the peace for the purposes of this legislation.

The hon. Member for Londonderry also raised the question of compensation and pointed out that compensation will not be paid to importers whose animals contract any disease while in quarantine. He said that disease could be introduced into the quarantine station. Nevertheless, the movement of cattle is a risk, and people are well aware of it when they undertake the movement of cattle. They can therefore insure against it, which is the appropriate way to deal with the problem.

Great Britain has the cordon of the sea round it and it has given it a fairly favourable position regarding animal disease. Therefore, Ireland, which is an island beyond an island, is in an even more favourable position. The Government will fight hard to ensure that our defences against the importation of animal disease are not lowered as a result of membership of the Common Market. I understand that the Common Market is to review these matters in 1977. We have a derogation from the regulations applying in the Common Market. We shall fight to maintain it and we have every confidence in our success. Just as there is a cordon sanitaire formed by the sea between Great Britain and the Continent, so there is one between Northern Ireland and Great Britain, of which we have made use and of which we shall continue to make use.

On the question of allowing local authorities to recoup their expenditure under the Diseases of Animals Act, I should point out that in the last few years expenditure by local authorities under this heading has amounted to£3.25. Therefore, we do not feel that we should go ahead with retaining this redundant piece of legislation.

I am happy to inform the hon. Member for Harborough that under the previous Diseases of Animals Order the penalty was raised from£200 to£500. We are now strengthening the system for the application of the regulations and for the prevention of disease by giving the inspectorate greater powers. The hon. Gentleman referred to the question of disinfecting lorries. Powers in the order will enable conveying vehicles to be disinfected and for us to ensure that they are disinfected to a greater degree than has been possible hitherto.

I promise the hon. Member for Armagh (Mr. McCusker) that I shall look into the problem which he raised to see whether it can be solved.

No one has opposed the order and, therefore, I have much pleasure in asking the House to approve it.

Question put and agreed to .

Resolved , That the Diseases of Animals (Amendment) (Northern Ireland) Order 1975, a draft of which was laid before this House on 2nd July, be approved.

I beg to move, That the Shipbuilding Industry (No. 2) (Northern Ireland) Order 1975, a draft of which was laid before this House on 9th July, be approved. The main purpose of this draft order is to bring Harland and Wolff Limited into full public ownership, in fulfilment of the Government's decision which I announced to the House on 26th March 1975. The order also provides for the financial assistance which is needed if the company is to meet its existing commitments and to have a further chance of survival.

Pending this order becoming law, the financial assistance required to keep the company in funds is being provided by means of loans under the Shipbuilding Industry (Northern Ireland) Order 1975 which came into effect on 21st May. That order will be revoked by the act of making the order now before the House; and whatever amount of money has been by that date advanced under the earlier order will be covered by the provisions of this new order.

Although I have issued a detailed memorandum in response to the request from Members for more information, this order has major implications for public expenditure and for employment in Northern Ireland. It may help hon. Members in considering the Government's proposals if I relate something of the background to this measure. I hope that this information will help the House.

Although it is not alone in this among United Kingdom shipbuilders, Harland and Wolff has a sorry financial record. Despite massive financial assistance from the Government, it has failed to make a profit over the last 10 years. No ordinary dividend has been paid since December 1964 and no preference dividend since June 1966.

Total Government assistance to the company between 1966 and March 1975 was just over£81 million. In fairness to Harland and Wolff, it must be said that some£22 million of this aid has been of a standard type, including regional employment premium, such as is available to industry generally in Northern Ireland and to most other United Kingdom shipbuilders. Of the balance, some£33 million has been provided by means of grants and loans to develop the excellent facilities which the shipyard now enjoys. This still leaves£26 million which has been provided in the form of grant, equity and loan specifically to save Harland and Wolff from closure.

The figure of£81 million refers to aid given in the past, until March 1975. Since that date some£8 million has been provided, including some£5.7 million under the interim order. Putting these figures another way, if the draft order is approved and if all the money is taken up, the company will have received in the period from January 1966 to March 1979 a total of£119 million in special assistance. To that must be added some£23 million of standard assistance to date.

Reverting to my main theme, despite all this assistance the company could not get out of its troubles. In the summer of 1974 the directors had to come to the Government and say bluntly that they could not meet their liabilities as they fell due and that in the absence of Government guarantee they would have no alternative but to cease trading. The Government gave that guarantee subject to certain conditions, one of which was that a thorough reappraisal of the order book and of the company's prospects should be undertaken. As the House knows, a project team was appointed for this purpose and its review was completed earlier this year. The financial forecast submitted by the company assumed a very substantial improvement in productivity. Even so, on an order book of about£270 million at the end of 1974 a loss of£41 million was estimated between 1975 and 1978, when the last ship on order is due to be delivered.

Harland and Wolff possesses excellent facilities in the shape of the building dock and of the other capital facilities which have been provided largely at public expense and which are now largely operational. The company also has a long tradition and technical capability for building fine ships. Set against these attributes are the enormous financial and organisational problems with which the company is faced.

There is no hope for the company other than by a massive co-operative effort The Government believe that this can be achieved only by genuine industrial democracy and full worker participation. This means not merely good industrial relations but bringing the workers into decision-making processes themselves. Towards this end the Government have made a positive start. The discussion document "Industrial Democracy—Workers' Participation" has been published. Trade unionists and management are discussing this in detail and the Government hope to have their proposals in the very near future as a basis for action.

When this order is passed, it will be necessary to reorganise the company, and not least the board. The Government are hopeful that we will be able to proceed with worker representation directly from the shipyard itself on such a reconstruction. We are talking about worker participation not only at board level but at all levels throughout the company.

An important step towards the reconstruction has already been taken with the appointment of the new managing director, Mr. R. S. Punt. Unlike the previous appointment, this post was publicly advertised: 93 applications were received and a short list of six was finally interviewed. The interview panel was under my chairmanship and included two trade unionists—Mr. Sandy Scott, elected by the shipyard with a 78 per cent. ballot of all workers, and Mr. Andy Barr, appointed by the Belfast Confederation of Shipbuilding and Engineering Unions. A leading industrialist, Sir Arnold Weinstock, accepted my invitation to be a member of the assessors.

I am pleased to say that this experiment was an outstanding success and a consensus of opinion was arrived at with the appointment of Mr. Punt. I think it is fair to say that no company of this size and importance throughout Western Europe has had such an experiment in the selection of its managing director. I believe that this augurs well for the future of Harland and Wolff and I would want to wish Mr. Punt every success in the difficult task he has undertaken.

In an industry such as shipbuilding, with a difficult history in industrial relationships, only by the co-operation of the workpeople can we hope to achieve success. That is why the Government place such importance upon genuine and full industrial democracy.

Harland and Wolff has a special problem. Nearly 10 years ago the company took a decision to concentrate on the construction of large oil tankers and bulk carriers in a building dock, in contrast to the variety of ships which it had previously built on traditional slipways. That decision called for corresponding changes in the organisation and management procedures of the company. Quite simply, developments in management techniques and structures have failed to match the production needs associated with the investment programme.

A secondary factor has been the delay in bringing into full operation the new capital facilities themselves. In addition, the world market for large tankers has collapsed and its future is uncertain.

Harland and Wolff is not the only company that has been geared for this type of production. Shipyards all round the world have been equipped to build large tankers. It is, however, fortunate in having a successful engine works which has a good export record. Every possible avenue of diversification will be explored, but the fact remains that the yard has been constructed to build ships. When the world's market eventually revives, the skill of its workers and its modern facilities could put Harland and Wolff in a strong competitive position, provided that the necessary reorganisation has meanwhile been completed and has by then become effective. In the meantime the Government have undertaken to put the company on a sound economic footing.

I should like to inform the House what is involved financially in providing this last chance. It means that under the powers provided by the order new money will be put into the company to meet its cash needs. Article 6 (1) of the draft order limits the amount of new money to be provided out of public funds to£60 million. It also means that a financial reconstruction of the company, involving in part the writing off and in part the capitalisation of outstanding loans from the Government, will be undertaken. Under Article 6(2) of the draft order, these transactions involving old money already spent will not count against the£60 million limit.

Those Members who have studied the company's annual report and accounts for 1974, copies of which I arranged to be placed in the Library, will have seen that at the end of last year there was an accumulated adverse balance on profit and loss account of almost£60 million. But for the Government guarantee of July 1974, the company was hopelessly insolvent. The issued share capital of£11 million had been lost five times over. Clearly, if the company is to have a chance of survival it must stand on its own financial feet and be creditworthy in its own right. We must therefore put the company into a position of solvency so that it can continue trading and seek new orders without the support of the present Government guarantee.

It is also important for reasons of internal discipline that all those within the undertaking should realise that they are working within the constraints of limited liability. There is a full order book until 1978 and the company will have sufficient funds on current assessment to cover losses on that order book. However, next year it will be necessary for the company to be finding new orders; and these new orders will have to meet the criteria laid down by my right hon. Friend in March, namely, that all direct costs and overheads will have to be covered.

Members will have seen from the 1974 accounts that a large part of the accumulated deficit of£60 million is due to a provision of£41 million in respect of estimated losses still to be incurred on outstanding orders. Since these future losses will be progressively incurred—until the orders are finally worked off—it follows that the company does not need today all the cash that it will eventually require. Cash will be provided as necessary and it is for this reason that Article 5(4) of the order sets a time limit as far ahead as 31st March 1979.

In the light of these considerations, we propose to reconstruct the finances of the company first by writing off sufficient of the outstanding loans to eliminate the losses already incurred and to convert the remainder of the loans into share capital: and secondly to provide for future losses by an outright grant, which will be paid only as the cash is needed. These are the bare bones of the operation. I am quite deliberately not quoting figures in this context as we are not dealing with a static situation.

Members will appreciate that part of the£41 million provision is already being translated with the passage of time into actual losses, and cash is already being provided under the powers of the interim Order in Council, which we debated in the House on 8th May. Moreover, there are other important aspects to be taken into account. We have to provide cash for the remaining cost of the new facilities now nearing completion in the yard and to adjust for variations in stock levels, depreciation and so on.

The means by which the Government assistance will be given are set out in the order and it is desirable that there should be flexibility. The key condition associated with this special aid remains as I indicated to the House on 26th March. Government approval will be required before any new shipbuilding contracts are concluded, and this approval will not normally be given unless the Department of Commerce is satisfied that they will not be loss-making. The company may develop, but not without the Department's approval implement, diversification plans—possibly in conjunction with other companies. I want the company to feel free—and, indeed, to feel duty bound—to explore all possibilities for new production which might seem likely to improve viability. But we must be realistic about the limitations on substantial diversification in the short term. This is a shipyard: its skills are basically shipbuilding skills.

I should like to make one final point about financial assistance to ensure that there is no possibility of misunderstanding. I have spoken today and on previous occasions about the last chance, about there being no bottomless pit of public money and about the need for the company to demonstrate long before 1979 its ability to take on new work without loss—and I have said that if the company cannot do this it will be time for the Government to call a halt and to permit the rundown and even closure of the business.

In saying these things I have not meant to imply that Harland and Wolff will be excluded from aid which may be available to industry generally in Northern Ireland—for example, standard capital grants and regional employment premium —or to the United Kingdom shipbuilding industry in general, such as the current assistance under the Home Shipbuilding Credit Scheme. That is a very different matter, however, from leaving open a door to yet more special aid to pull the company out of fresh difficulties. I simply do not see this being possible.

It is intended, following the financial reconstruction of the company, that the Government's guarantee will be withdrawn as the company will then be creditworthy in its own right. Thereafter the board of the company must operate within the principles of limited liability under the Northern Ireland Companies Act.

We have been listening to a mass of statistics and figures, which are very important, and none of us in the House would want to argue with the reasons my right hon. Friend has outlined for the massive financial assistance to the shipyard. That would be difficult when we have heard in the past few days about Norton Villiers and other industries in our own areas, so to speak.

In listening very carefully to what has been said, one of the factors that made the maintenance of this shipyard attractive to me was that it would supply employment for many people and that this would mean a move towards a much more balanced labour force than we have been led to understand exists. Is there anything in the criteria which have been outlined that will lead to the establishment of a more balanced labour force in the shipyard? If this were so, it would justify spending these massive sums in this industry.

I thank my hon. Friend for his remarks and his understanding of the position. I have discussed with the trade unions and management the work force at Harland and Wolff. We hope to tackle the problem my hon. Friend has raised by bringing in apprentices, from either community, in a manner which will bring more skills in to the shipyard.

Apart from the 10,600 workers in the shipyard itself, there are many thousands of others in all parts of the Province doing subcontract work for Harland and Wolff, and these workers are representative of both communities. But I take the point made by my hon. Friend. The Government do not underestimate it and are looking at it with seriousness.

I turn now to Article 4 of the order, which deals with compensation to existing shareholders. It is well known that Harland and Wolff by now would have ceased to exist but for the massive amounts of aid which have been injected by successive Governments and but for the present Government's July 1974 guarantee of the company's liabilities. The share capital has been lost five times over. The company is now insolvent. Without the support of successive Governments, the company would have gone into liquidation and the shareholders would have received nothing for their holdings.

But Harland and Wolff is the only major shipbuilder which has received Government aid whose shares have continued to be quoted on the Stock Exchange. Between July 1974 and 26th March 1975—that is, the date on which I told the House of the Government's intention to take the company into public ownership—the shareholders reasonably could have inferred that the company would continue in its present form and that their investment would be protected by the then current Government financial guarantees. Perhaps for this reason, trading in the shares had continued on the Stock Exchange throughout this period.

Taking account of these considerations, and after close scrutiny of share prices over varying periods of time, the Government have decided that the sums shown in Article 4(2) represent fair compensation to the private shareholders. I must emphasise that this decision has been reached in the light of the very special circumstances of the Harland and Wolff case. The combination of circumstances is unique and is not found in any other shipbuilding company in the United Kingdom. We believe that these compensation proposals are fair, to the general taxpayer as well as to the shareholder.

Finally, I should like to summarise the main arrangements which will follow the assumption of full public ownership. First, the status of the company will not be that of a nationalised corporation. It will remain that of a limited liability company under the Northern Ireland Companies Act. Secondly, work has already begun to plan and effect the financial reconstruction to which I referred earlier.

Thirdly, there is the whole question of the relationship of the company with the Government, closely linked with which is accountability to Parliament. Work is quite well advanced on drafting strategic guidelines for the future conduct of the company's business and for detailed monitoring of future progress. In other words it will be for the Government, who are providing the financial sinews, to regulate the relationship with the company and to set down a precise stipulation of the conditions on which this financial support is being continued. It will be for the board to run the company in accordance with those guidelines. In the last resort it is, of course, for the House, during the present period of direct rule, to determine its relationship with Harland and Wolff, as on any other matter.

However, in the meantime Ministers envisage that they will continue to deal with questions from Members as they arise on general policy and on matters concerning the use to which the financial assistance is being put.

Will Harland and Wolff now come under the investigation of the Select Committee on Nationalised Industries?

We will examine this point. It raises wider issues. There are other limited liability companies of 100 per cent. shareholding which are under the Government's control. The Government will put no barriers in the way of Parliament examining this issue in the best manner that Parliament determines. One of the differences between nationalised industries and 100 per cent. public ownership on this basis is that Ministers will answer questions about the company in the House, as opposed to what happens in the case of nationalised industries, which make a yearly report and are not answerable in the House. This is an important point for people who are interested in parliamentary accountability to take into account.

Lastly, there is the question of the company's relationship with British Shipbuilders. The Government having taken the view that Harland and Wolff should be treated separately from the rest of the United Kingdom shipbuilding industry, and having stressed the desirability of the company being—and being seen to be—owned by and responsible to the people of Northern Ireland, it will be essential to ensure that there is effective liaison between Harland and Wolff and the board of British Shipbuilders when that body has been set up. I cannot say today exactly what form these arrangements will take.

The right hon. Gentleman referred to the company being owned by the people of Northern Ireland. In what sense is it owned by the people of Northern Ireland more than by the people of Cornwall?

The right hon. Gentleman and I have had this argument before. In the special circumstances of Northern Ireland the Government took a decision to exclude the company from the public ownership proposals. The Department of Commerce will have a function of monitoring and control in helping the company. We believe that when, as we hope, a satisfactory form of devolved government is arrived at, the Northern Ireland people will have a vested interest in this shipyard. That is Government policy.

I ask the right hon. Gentleman to take this point seriously. I accept that the form of public ownership and of administration is special to this company, but I ask him not to state what I believe not to be the case, namely, that the ownership of this company is in any respect special to the people of Northern Ireland as opposed to any other part of the population of the United Kingdom. It is a liability of the United Kingdom as a whole. The money is being raised on the credit of the United Kingdom and partly by the taxpayers of the United Kingdom, and the management will be responsible, through the Treasury Bench in this House, to the electorate of the United Kingdom.

The right hon. Gentleman has raised an important and fundamental point. There are many people in Northern Ireland who would use the arguments he is using as a basis for indefinite and continuing public money support irrespective of what was happening in the shipyard. The Government have said quite fairly to people in Northern Ireland that some account must be taken of expenditure in Northern Ireland in relation to the expenditure in this shipyard. I believe that no other shipyard in similar circumstances in any other part of the United Kingdom would have been maintained under these proposals. This is happening because of the special position and the realities of Northern Ireland.

In presenting this draft order for acceptance to the House today, I have spelt out many of the difficulties facing Harland and Wolff. Everyone who works in the yard will have to make a great effort if the difficulties are to be overcome. By 1978 we will know whether Harland and Wolff has won through. None the less, despite these problems, the Government look forward with confidence to the future success of this new publicly-owned company, the success of which will be of benefit not only to the workers themselves but also to the people of Northern Ireland.

1.36 p.m.

I shall try to be brief, and I shall certainly not repeat anything I said in the debate on the interim Order in Council.

The first point I want to make is of a constitutional or, at least, a procedural kind. I understand that the order is a hybrid instrument. In normal times the nationalisation of shipbuilding in Northern Ireland, which is what the order is about, would hardly have been undertaken in a debate lasting not more than one and a half hours and there would surely have been a Bill. The rights of the subject are affected as much by the order as if there were not an order but a Bill. If there had been a Bill, I suppose that a Select Committee might have been set up to deal with it as a hybrid Bill.

The House knows that the Hybrid Instruments Committee in another place has been considering this draft Shipbuilding Industry (No. 2) (Northern Ireland) Order. Forty-three petitions have been lodged against it. According to the First Report from the Hybrid Instruments Committee in the other place, a memorandum from the Northern Ireland Office explaining the background to the order and giving comments on the petitions has been considered. The Committee, according to its First Report, has come to the conclusion that there should be a further inquiry by a Select Committee into the basis of compensation set out in Article 4(2) of the order and, secondly, the basis on which the relative treatment of preference and ordinary shareholders was determined.

I fear that someone might accuse this House of proceeding to consideration of the order without making sure that those who are drastically affected by its provisions will enjoy opportunities which they would have enjoyed if the Government had brought in a Bill—which would have been the case in normal times—for the nationalisation of Harland and Wolff instead of resorting to an order under the Northern Ireland Act 1974. We are not presented with a Bill. We are confronted with an instrument that we cannot amend.

I understand the difficulties of the Government and the urgency with which they are trying to act in this very difficult matter, but I hope that before agreeing to the motion the House will be assured by the right hon. Gentleman that the Government will take account of the position in the other place and of the misgivings which I have expressed and, if necessary, return to the House and proceed further by way of a separate order.

Taking the hon. Gentleman's last two questions, the Government and the House would have to consider any recommendations coming from the other place. On this specific point, the fact that any recommendation has been made in another place does not preclude us from proceeding today, as the hon. Gentleman said. On the central point of the matter that the hon. Gentleman raised, I understand that discussions will be going on next week on this point in the other place, and I do not want to say anything which might prejudice those discussions.

I am obliged to the right hon. Gentleman. I do not say that we are acting incorrectly in any way. This is less a point of procedural propriety than one of political morality. One would have expected so grave a matter to be the subject of a Bill if the times in Northern Ireland were not so troubled and if the situation were not so urgent. It is because there is no Bill that the hybrid Bill procedure in this House has not been resorted to. There is no procedural fault. I was trying to make it clear that people outside will expect this House to respect at any rate the moral right of those affected by this legislation.

In a sense, this point conflicts directly with what the right hon. Member for Down, South (Mr. Powell) said. One of the problems with Northern Ireland legislation is that we treat it separately, and Northern Ireland Members insist on parliamentary time to debate and to put through orders in their own right. The hon. Gentleman will realise that the Government have set aside a full day of parliamentary time on the Floor to deal with important Northern Ireland matters today, and we are dealing with a relatively small part of the United Kingdom, albeit an important part.

I shall not press that point further in view of the assurances which the right hon. Gentleman has given, because I want to keep my remarks as brief as possible. But it is strange that, in the space of a dog watch and from benches which are less than crowded, it is proposed to take into full public ownership a concern whose giant cranes against the Belfast sky symbolise its historic dominant position in the Northern Ireland economy—the company which contributed so much to the nation in war time.

I have already touched on the question of compensation for those expropriated in connection with what I said about the hybrid nature of this order. In view of that, I simply ask the right hon. Gentleman on what basis the definitive calculation of compensation given in Article 4(2) of the order was made and whether there has been a recent share valuation.

Then I have one or two questions touching on what the Government propose to do with their new piece of property. The argument has to be met that, even if it were decided to close down Harland and Wolff altogether, the loss of jobs might not be as serious as has sometimes been said, and, now that the work force in Harland and Wolff has declined from about 25,000 in 1960 to about 10,000 today, the point has to be considered whether men having the skills and being of the quality that we recognise could not find engineering employment elsewhere in the United Kingdom. I should be grateful to have the right hon. Gentleman's views about that. We referred to it briefly in an earlier debate.

I am a little confused about the matter on which the right hon. Member for Down, South (Mr. Powell) intervened, namely, the intention to keep Harland and Wolff separate from other plans for the shipbuilding industry but to forge positive links between Harland and Wolff and a future aircraft and shipbuilding board. I was disappointed that the Minister of State was not able to take us any further into his confidence or to let us know how he thought it was likely to work out than he did on 8th May.

I draw my remarks to a conclusion now because I know that Northern Ireland Members wish to contribute, in addition to my hon. Friend the Member for Newbury (Mr. McNair-Wilson), who has a special knowledge of these matters. I put one final question to the Minister of State, whose interest in the welfare, employment and retraining of Ulster workers is much appreciated. He men- tioned some of the proposals in the discussion paper, "Industrial Democracy". Where have we got to in regard to the possibility of an advisory board? We were told that the stewards were asked whether they would be willing to serve on such a board if it was set up. Can the right hon. Gentleman tell us a little more about that?

We welcome the stern intention which the right hon. Gentleman expressed of imposing very strong financial controls and of putting a bottom to this pit of expenditure which successive Governments have lavished on Harland and Wolff.

1.46 p.m.

This is a very limited debate, and there is a certain irony in that, having saved time on the previous draft order, we are unable to use it on what must be one of the most important measures for Northern Ireland to have come before the House under the 1974 Act.

I want first to thank the Minister of State for the trouble which he took in providing the House with the documentation on the company, despite the printing difficulties which prevailed. I hope that the right hon. Gentleman will, as speedily as possible, ensure that in some form the document is made available to the public in the normal way, for they have as much interest as we have in learning these facts.

Having supplied it first to right hon. and hon. Members, we have now made it available to the broadcasting media and the Press. If the right hon. Gentleman so desires, the Government will make it available to the public as well.

I think Her Majesty's Stationery Office should take steps to make it generally available since it is a matter of public interest, not only in Northern Ireland.

However, the document is defective in two respects. First, it does not contain what this House will insist on having, one way or another, and that is a post mortem upon the years 1971–73.

I shall not discuss today the form which that post-mortem should take. But we must know what happened. We must know what degree of responsibility attaches to the administration of the day and, if there were facts discreditable to the then management of the firm—a firm which existed only as a result of the expenditure of public money—those facts must be known publicly.

The second deficiency is that, however much the document is strong, valuable and clear on history, it is weak on the future. We are told that the project team carried out a thorough reappraisal of the prospects of the company and its future organisation. There are some hints of this in the document; but there is still a South Sea Bubble element about the proposals, because we are not told in any detail the result of that reappraisal or what the form of reorganisation is to be.

My right hon. Friend the Member for Belfast, East (Mr. Craig), who is prevented by reasons of health from taking the part which by right belongs to him in this debate, was perfectly right when on 8th May he said that it was not enough that we should have a Civil Service examination of the state of the yard and of the Government's responsibilities but that we wanted a broader examination of the structure and problems of Harland and Wolff". The hon. Member for St. Pancras, North (Mr. Stallard) was referring to the same point when he intervened.

There are three general considerations which I believe we must have firmly in mind in judging what we are to do. The first is that a loss such as we are contemplating in this case is not a mere piece of bookkeeping pedantry. It is not something that belongs only to finance and not to the real world. On the contrary, a loss of these dimensions means that for years past—and, indeed, for some time to come—a large body of men with great skills are employed in the work of destruction. It is not merely that their labours and their efforts are being wasted —that they are not being employed in any way—but that they are actually producing a minus result. It is not their fault; but it is a fact that we are not entitled to overlook.

Certainly we are not entitled to confuse it with the importance which we all attach to minimising unemployment. In the first place, stable employment cannot be founded upon loss-making activities. Of course, the Government recognise that in the decision which they have plainly taken.

Secondly, the reality of a financial loss is not wished out of existence by the fact that employment is being provided at the same time. An important exchange took place on 8th May between the hon. Member for Newton (Mr. Evans) and my right hon. Friend the Member for Belfast, East. I shall recall this exchange in case anyone should suppose that any hon. Member taking part in this debate, above all from Northern Ireland, can be insensitive to the relevance to employment in Northern Ireland. The hon. Member for Newton intervened to suggest that it was better to have accepted the fixed price contracts with the colossal losses that they involved than have no orders at all". My right hon. Friend replied: That is an argument which I am reluctant to accept. I am aware of the social needs and of the problems arising out of the availability of employment in Harland and Wolff. But, in my opinion there are many other ways in which we could find a solution to the problems."—[Official Report, 8th May 1975; Vol. 891, c. 1767, 1766.] The fact is that, as loss-making cannot be a basis of continued stable employment, we shall have to find other ways of solving those problems unless there is a revolutionary alteration in a very short time in the prospects of Harland and Wolff. I am not saying anything there which is distinct from the position the Government have taken up.

So, the first general consideration we must have in mind is that loss-making by its nature damages every element in the community and is no basis for stable employment.

The second consideration is that judgment of commercial prospects is not commonly most successfully exercised by politicians and public bodies. One of the most striking features of the piece of history which we have in the document presented by the right hon. Gentleman is that it was the Shipbuilding Industry Board, set up on behalf of the public to form a judgment on these matters, which aided and abetted Harland and Wolff in the most crucial miscalculation of the past 10 years. The Shipbuilding Industry Board proved to be no wiser than the management of Harland and Wolff, to put it mildly.

As politicians we must recognise that we have no special expertise in judging the prospects of profitability or the chances of a future market two, five or 10 years ahead. Indeed, I think that, as politicians, we are more at the mercy of fashionable views about what is needed and what will be needed than those who, in the privacy of a board room, risking their own money and other people's, form a cool and often secret judgment as to future developments. This is no abstract consideration, because, in the basic statement made by the right hon. Gentleman on 26th March, the condition is laid down that the Government will not allow the firm to undertake future work unless they satisfy him that all direct costs and overheads can be covered in the building years beyond 1978…Unless it can obtain orders which can be completed without loss, a halt must be called."—[Official Report, 26th March 1975; Vol. 889, c. 498.] The Secretary of State's judgment as to orders which will be completed years ahead without loss is as fallible as the judgments which his predecessors and the Shipbuilding Industry Board took in the past.

From this I deduce a principle which I hope may win acceptance—that, in forming the judgment which is built into his condition for this subvention, he will proceed, as far as humanly possible, upon strict commercial lines, that he will not feed into his judgment factors which would not be taken into account in the board room of a private enterprise company, but that his judgment will be, as near as may be, an objective one. I believe that is the intention; but it is salutary that we should remind ourselves how often in the past judgments about future profitability and loss-making in the case of Harland and Wolff have gone astray despite the very best political intentions.

I come to my third general consideration. There is always a temptation—I hope I shall be forgiven if I say that it is a temptation which assails Socialists even more violently than it assails the rest of us—to assume that human nature can somehow be altered so as to make our plans and wishes come true—that it has been thus and thus in the past, but, cheer up, people will behave differently in future and so, because we have confidence that they will behave differently, we put forward this or that proposition.

Does the right hon. Gentleman accept that what we say in reality is that we will change the environment in which people operate and thereby hope that they will change their ways?

I do not want to get into the debate between the geneticists and the environmentalists. For practical political purposes it is always safest to treat human nature—whether individual human nature or human nature collectively—as a constant. If it turns out to be better than it has been in the past, that will be a bonus. However, in the context of judgments such as the one that is taking place today, we have no right to assume that future experience will differ substantially from that of the past. I am not pouring cold water upon the Minister of State's notions of participation or on his hopes for the improvement of labour relations, which we all share in this undertaking. However, we as politicians should face the fact that we are too often tempted to assume that people will behave differently and too often, to our disappointment, find, as might have been predicted, that they continue to behave as they have commonly done before.

I should like to quote two sad phrases from the document of the right hon. Gentleman. It refers to the P200 scheme on page 7 and to the reasons why this did not come to the intended fruition. The words are: much of the basic planning data remains unvalidated against the shop-floor experience". Translated into English, that means that the plan assumed that people would behave differently from the way in which they did behave.

Referring to the future, the next page of the document says: Steps have been taken to bring overhead costs under control, but these will take some time to bear fruit… Then come the crucial words: and depend essentially on the proper motivation of the staff that actually incurs expenditure. I am all in favour of responding to the intervention by the hon. Member for St. Pancras, North, who suggested putting human beings into an environment in which the desirable stimuli will be brought to bear upon them. I have no objection to hoping for a change of motivation and a fundamental change of collective behaviour; but to rest our plans on that happening is to fly in the face of all political experience.

I turn to the judgment which my right hon. and hon. Friends and I, with a full sense of responsibility, take upon the proposition which is before the House in the terms of this order. I use the words which my right hon. Friend the Member for Belfast, East used when the announcement was made on 26th March. He said: the important part of the statement, to my mind, is the sentence, 'Unless it can obtain orders which can be completed without a loss, a halt must be called'" —[ Official Report , 26th March, 1975; [Vol. 889, c. 500.] It is important that that should have been emphasised by the right hon. Gentleman, who in this House represents not only the area where the shipyard is situated but also a substantial proportion of those who directly or indirectly are employed as a result of its operations. It means that we accept, under the severest conditions and limitations, the decision of the Government: first, that this firm could not now be brought to a full stop, that no one could justify that, and that no one would propose it, but secondly, that we can only be justified in providing this extra£60 million, at the cost of resources which will come from profit-making activities in the rest of the economy, if we seriously mean, and will not go back upon, our undertaking that no future activities will be undertaken which, on commercial judgment and with the most objective appraisal, are not likely to prove profitable.

That was what the right hon. Gentleman meant when he used those fatal words that this is the "final and last chance". They are too often used in political vocabulary. There is usually a chance after the last chance: we are always talking about the last chance and not meaning it. Here, however, we are merely playing with men's lives, with the economy of Northern Ireland, and with our own responsibilities if we do not mean what is said in that statement in the most literal sense of the term.

Let us accept this order subject to those conditions and considerations. In doing that, right hon. and hon. Gentlemen representing constituencies in Northern Ireland are making a commitment themselves. They are making the commitment for the future that if and when the Government are called upon to carry out and fulfil the conditions which they have attached to this decision, they will give the Government their support in so doing.

2.06 p.m.

It will be clear from the exchanges which have taken place this morning that the Belfast shipyard is no ordinary shipyard. It has an exclusiveness all its own, by virtue of the fact that it is situated in Northern Ireland and because of the political situation. My right hon. Friend the Minister of State mentioned, during the course of his remarks this morning something that we have known for a long time in Northern Ireland, namely, that the Belfast shipyard has been kept going and kept in existence because of political considerations. That has to be admitted. We in Northern Ireland have known that for quite a long time.

The right hon. Member for Down, South (Mr. Powell) has, in the past, taken offence at the fact that sometimes it would appear that Northern Ireland accounts are made up separately from other parts of the economy of the United Kingdom and, therefore, the spotlight of public opinion can be focused on the financial assistance and subsidy which is given. However, I do not believe that he will object to the fact that the Belfast shipyard is being treated as a separate entity. It bears very little relationship to other shipyards in other parts of the United Kingdom. Had it not been for the political situation in Northern Ireland, I am convinced—and my right hon. Friend has confirmed my impression—that the Belfast shipyard would have closed. The right hon. Member for Down, South questioned my right hon. Friend the Secretary of State, asking "Why stress the fact that it is the Northern Irish people who are concerned with the Belfast shipyard when Cornwall is just as concerned because it is a United Kingdom matter rather than a Northern Ireland matter?"

There was evidently a misunderstanding. The right hon. Gentleman said that the shipyard would be for the ownership of the people of Northern Ireland. I am not denying that it is of greater concern to the people of Northern Ireland than it is to the people of the rest of the United Kingdom. However, I invited the right hon. Gentleman to correct his statement that the ownership was in any way peculiar to or vested in the people of Northern Ireland. It is a separate point.

I understand that it is the right hon. Gentleman's intention at all times to forge the links—which exist—between Northern Ireland and the rest of the United Kingdom so that it will not be shown up as being the nigger in the woodpile or the black sheep of the family. That is, and always has been, the right hon. Gentleman's intention. He stresses that it is a United Kingdom project rather than a Northern Ireland project. This highlights the fact that although the British Government are subsidising the Belfast shipyard and have kept it in existence for many years, a Celt from Cornwall, a Scotsman from Scotland or a Welshman from Wales would not get a job in the Belfast shipyard because of the Safeguarding of Employment Act (Northern Ireland) 1947, which is on the statute book in Northern Ireland. The position is that Northern Ireland will take whatever financial assistance it can but it will prevent Englishmen, Scotsmen or Welshmen, indeed, any other United Kingdom citizen, from getting a job in that very same industrial establishment.

If there were no one in Northern Ireland to fill a particular position or who did not have the qualifications to fill a position, it was quite in order to recruit someone from any part of the United Kingdom.

Those are not the reasons why the Safeguarding of Employment Act (Northern Ireland) 1947 was put on the statute book in the Stormont Parliament. It was meant to prevent people coming from Southern Ireland, the Republic, to take jobs in Northern Ireland. It is putting a sugar coating on the pill to say that it applies to Englishmen, Scotsmen and Welshmen. We all know the political reasons which would prevent a person from the United Kingdom from getting a job in the Belfast shipyard.

Representatives of Belfast, of whatever political persuasion, are all very concerned to see that the shipyard proves to be efficient in the future and that it maintains or even increases its present labour force. Much depends on the employment position in the shipyard. The spin-off to all the ancillary industries is very important in the Northern Ireland economy.

However, we have not arrived at the position I should like to see. This was brought out today by my hon. Friend the Member for St. Pancras, North (Mr. Stallard). I want to see effective and urgent steps taken to bring about a balanced labour force in the shipyard. For many years the vast majority of jobs in the shipyard—9,000 as opposed to 1.000, or 9,500 as opposed to 500—have been given to supporters of one political per suasion. This cannot be good for industrial relations, for efficiency or for the overall morale of people employed in the industry. I believe that my right hon. Friend the Minister has already had representations made to him on that aspect.

There are people in the rural areas outside Belfast, where there is very high unemployment, who quite naturally feel that the Belfast shipyard has been given too much priority. They feel that at all times it is given all sorts of financial assistance because of the political situation, but to the detriment of trying to build up commerce and industry in the more remote areas of Northern Ireland. That feeling is not limited exclusively to the minority community. There are areas of high unemployment within the majority community, and they also look askance at the preferential treatment given to the shipyard.

The hon. Member for Epping Forest (Mr. Biggs-Davison) seemed to be objecting to the fact that we were running thin on the ground when we were talking about nationalisation. We are even thinner now, as I see no Tories who will express their concern about it. However, there is one on the Opposition benches. I am not certain into which category I should put my Northern Ireland colleagues—Tories or semi-Tories. But more interest should have been shown in the matter.

Only this week I have spoken to many of my hon. Friends—and, indeed, to some Opposition Members—who are deeply concerned at the closure of Norton-Villiers-Triumph, which is a British concern in England. Thousands of people will become unemployed and the motor cycle industry will die because it will never be possible to breathe back life into the industry as the world markets will have gone and others, particularly the Japanese, will have taken up those markets. We have seen the killing off of an industry.

Naturally my hon. Friends who represent the constituencies concerned, and trade unionists, would feel very concerned at what appears to be preferential treatment for the Belfast shipyard. The sums that have been mentioned today would go a long way towards saving NVT and perhaps settling its whole financial problem.

My right hon. Friend said that he was hoping to bring about a balanced labour force in the shipyard. I am concerned about this matter, especially representing a constituency such as mine. Expressing a Socialist viewpoint, I have always been opposed to the fact that there appear to be strictures on the religious qualifications of people seeking jobs in the Belfast shipyard. My right hon. Friend says that an apprentice training scheme is being started which in future will mean that representatives of the minority Catholic community would have the skills required to take up employment in the yard. That is all to the good, and I accept that. But there are many semi-skilled jobs in the yard for which no great skills are required, and many labouring jobs, in which people of other political or religious persuasions could be employed. That certainly has not happened.

I can agree with the right hon. Member for Down, South when he says that there is a feeling that, whatever may come, the Belfast shipyard will be kept going. One of my hon. Friends quite recently met people employed in that yard and talked to them about the financial implications involved. The response he got was one that we have heard for many years in Northern Ireland: "It is all talk about closing down the Belfast shipyard. The British Government would be afraid to do it because of the political repercussions, and 10,000 unemployed people with a particular political allegiance could not be thrown on the streets because of the chaos which would ensue, particularly in Belfast."

That is an impression which exists in that shipyard. I do not believe that the skilled and semi-skilled work force there have been responsible for the gross inefficiency which has come to light over recent years. I believe that it was a question of gross inefficiency at management level, such as accepting fixed-price contracts, completely against the trend. It was the management that was to blame rather than the work force.

It is said that if the yard were to close down we could find work for the skilled engineers and men employed there in other parts of the United Kingdom. But that is not realistic because in Northern Ireland there is no great attachment to the doctrine of mobility of labour. People do not like travelling very far to their work in Northern Ireland. It is such a small place. People do not like being asked to travel more than two or three miles to work.

Therefore, it would be much more difficult to try to find employment for the 10,000 people employed in the Belfast shipyard in industries in the United Kingdom, especially when we are in the middle of an economic recession in Britain. If we cannot find jobs in the United Kingdom for those who will be made redundant because of the closure of NVT, it is highly unlikely that Northern Ireland people, unemployed because of the closure of the shipyard, would be able to find jobs.

I support the order, I have always supported keeping open the yard. However, I have the objection that there appears to be a bias in favour of people giving allegiance to one political persuasion before they get jobs in that yard. I hope that that will end very soon. Now that the Government are in complete financial control, I hope that they will be able to use their authority to ensure that other people who have the skills and are able to do the job will get jobs in the yard on their merits.

In that connection the Government should again make matters clear. I can see the headlines in tomorrow's newspapers in Northern Ireland: "Enoch Powell demands closure of the shipyard." That is the way in which it will be taken in Northern Ireland. I do not think that that is what the right hon. Gentleman was advocating. He was pointing out the gross inefficiency and saying that there must come a day when, if the yard cannot be made more efficient, it will have to close. I agree that he is no supporter of lame duck industries in Northern Ireland. He has been quite honest in his political life in making that point clear.

I support the order as it stands, but I do so with the reservation that before I could give it my wholehearted support I should have to be convinced that the overall direction was being changed to encourage people to apply for jobs in the yard because they need the jobs and not because of their religious or political beliefs.

2.19 p.m.

It has been said that sooner or later everyone must sit down at the banquet of consequences. This is true not only of individuals but also of industrial establishments. To this banquet of consequences we can invite the previous administration, the yard management and the work force of Harland and Wolff. But the purpose of reflecting upon past decisions is not only to apportion blame but to learn from mistakes and to engender the hope in Northern Ireland that Harland and Wolff can and must become viable. It has been said in a previous debate on Harland and Wolff that one cannot envisage Northern Ireland without the contribution of this industry, strong and viable, taking its place in the total economy of the Province.

Looking at the record of the previous Government—my right hon. Friend the Member for Down, South (Mr. Powell) alluded to this—we see one or two disturbing facts. First, there is the salary and terms of employment of the previous managing director and, second, there is the whole question of possible bonuses which may have led to unrealistic delivery dates being quoted, which in turn led to expensive penalty clauses.

In 1973, I am led to understand, the then Minister for Commerce was informed by shop floor representatives from the yard that there was tremendous overloading of the work force and of middle management, that there were two men for every job in Harland and Wolff and that, therefore, advance planning and, if possible, immediate diversification were necessary. But the then Minister said that that was nonsense, and that everyone involved and employed in the yard was needed.

That statement was based on the fact that there was to be future planning and that the planning department was working overtime—but no new plans for diversification or new structures were forthcoming. Indeed, one man in middle management, Mr. McCallum, stated the need for drastic reduction in middle management. He was sacked because he had spoken the truth at an inopportune time.

My right hon. Friend the Member for Belfast, East (Mr. Craig), who unfortunately cannot be here for reasons of health, alluded to the cancellation of contracts involving Island Fruit Contractors, who are a subsidiary of Maritime Fruit Carriers. He asked for clarification and for much more information about the cancellation of fixed price contracts. After some research, some disturbing facts have come to our attention. The share price of Maritime Fruit Carriers, which not so long ago stood at$29, is now 7½cents. The company's assets are$66 million and its debts$281 million. Orders for new ships were placed with Swan Hunter and with Harland and Wolff, but the company has recently had to charter eight tankers to the Soviet Union. The company has also asked the Government and other shipping concerns to take over responsibility for nine ships which it had placed on order. It is thought that there may be political reasons why the true financial state of the company is not made more public.

Harland and Wolff entered into an agreement for the cancellation of contracts which cost it a considerable amount. My right hon. Friend the Member for Belfast, East asked for clarification, but to my knowledge—I spoke to him on the telephone not long ago—this information has not yet been given.

The work force are aware that Harland and Wolff has a poor record and low productivity. I say this having contacted a number of groups in the yard who are most concerned about their past record over the last decade. These men have been saying that most contracts are a year late, that Harland and Wolff takes three times as long to produce a vessel as a foreign yard and that there is a lack of flexibility. Other yards in the world committed to producing tankers will be competing now for specialised tonnage and their task will be much more difficult.

The company is only too well aware of the great problems and the poor record, but it is not prepared to leave it there. It is also aware of the need for advanced and imaginative planning and looks forward to the worker participation of which the Minister has spoken.

Some of these men, in their untrained and unskilled way, have tried to project their planning on to paper. They talk about the possibility of indoor construction methods, which would reduce the loss of time and labour and the cost of production. They have referred to the great strides in indoor construction in Sweden at the moment, where vessels of up to 73,000 tons can be built under cover. They have also considered the possibility of oil rig construction. A number of rigs are being constructed in Northern Europe. They are trying in the only ways open to them at present to consider diversification and future planning.

The morale of the work force has suffered over the past few years because of the uncertainty and the number of changes in management. There is now a sense of anticipation. They are delighted that the gentleman who is to asume responsibility at Harland and Wolff has come up through the ranks. He knows the situation at Harland and Wolff. The workers are prepared to trust him. That trust will contribute a great deal to a a new atmosphere. Whether we share the reservations expressed by my right hon. Friend the Member for Down, South is not the issue. At least the relationships at Harland and Wolff will be improved, with a consequent improvement in morale.

The workers are aware that there is not a bottomless well of Government resources. They realise that as a result of the tremendous economic plight obtaining in the rest of the kingdom, there is no longer any possibility of saying "If the productivity rate does not match that which is expected of us, so what?"

We are debating the issue of Harland and Wolff against the backcloth of reality. That reality is shared by Members of Parliament and the work force at Harland and Wolff. If, after sharing a feast of facts at this banquet of consequences, the management of Harland and Wolff can give clearsighted and determined leardership, and if the workers accept that productivity is the key, Belfast will find itself again with the world's greatest shipyard.

2.32 p.m.

It may seem incongruous that a Member of Parliament representing a landlocked constituency should wish to involve himself in the affairs of one great shipyard. I suspect that I am the only Member of Parliament who has worked at Queen's Island. I worked for Short Bros. and Harland in 1955 and 1956. In those days the people at Short Bros. and Harland felt themselves to be the poor relations. We looked up at the gantries and saw the great ships on the slipways at Harland and Wolff. I remember someone saying to me after I came to Belfast that Belfast was Harland and Wolff. We could not imagine one without the other.

Having worked for the poor relation, Short Bros. and Harland, I was surprised to notice in the annual report for Harland and Wolff for 1974 that£164,000 profit had been returned by the poor relation to Harland and Wolff, which has now become a sick giant.

The right hon. Member for Down, South (Mr. Powell) said that a post mortem should take place on what happened to bring Harland and Wolff to the pass whereby we are proposing that it should be nationalised. I thought, from the tenor of what the right hon. Gentleman said, that he felt this was not the moment for such a post mortem. Perhaps he is right. When I think of those halcyon days of 1955 and 1956, when Harland and Wolff was profitable, rich and effective. I am obliged to ask a number of questions about what happened.

The Government have provided us with an excellent statement. We also have a number of the company's annual reports to read. Having read those documents, we are left with an equal number of unanswered and answered questions.

The Minister of State repeated what he said on 8th May, which was as follows: For the yard to be kept open and given a chance to survive financial help must be provided now. The company will need funds by the end of May. If the order is not made tonight the yard will immediately close."—[Official Report, 8th May 1975; Vol. 891, c. 1759.] The right hon. Gentleman was right. In that speech he also said that the Government were proposing to give the company a loan of up to£40 million which imposed on both the Government and the company a duty to ensure that the money was used in a manner best calculated to restore the company, if at all possible, to commercial viability. He was right to use the qualification "if at all possible".

There must be a doubt in our minds, when this order is passed, whether we are pouring good money after bad, whether the yard can once again be the king of Belfast Lough or whether by 1979, or perhaps sooner, it will be faced with a different fate which has been clearly spelt out.

I take comfort not from the admirable words of the Minister of State but from the fact that his words were almost exactly those used by Mr. Robin Bailie, the Minister of Commerce in the Northern Ireland Government, in 1971. On that occasion, after the Northern Ireland Government had given£7 million worth of assistance to the company, he said: Once this financial support has been given there will be no question of either the United Kingdom Government or the Northern Ireland Government accepting responsibility for making good any deficiency in the company's resources, should it get into financial difficulties in the future. The right hon. Member for Down, South has good cause to cast doubts on the words of the Minister of State. There was a precedent. I am sure that the Minister of State will remind himself of Mr. Bailie's words. Perhaps he will wonder how he is able to say almost exactly the same words four years later. He may wonder why we should believe that what he says is the last word.

It is incredible that this great shipyard, which has been extensively re-equipped, which has the largest capacity building dock in the world, with a matchless team of 10,000 workers, with an order book of£200 million and with 13 ships under construction, is now bankrupt. How was it possible that in 1974 it turned in a loss of£16 million, which admittedly was only half that of 1973? But if those figures are taken together, they total£50 million. We must ask how this has come about. Is it the fault of the fixed-price contracts? It would be too simple if we found just one reason for the catastrophe. But if it is the fault of fixed-price contracts, why was nothing said about them in any of the annual reports?

Why did not Lord Rochdale, the chairman of the company, give a warning of the position of the company? Who fixed the contracts, who takes the responsibility —Mr. Hoppe, Mr. Watt or Lord Rochdale? Who decided on the policy? When will we be told his name? Will he be made accountable to the House of Commons? Did the bankruptcy occur as a result of the Ulster Workers' Council strike? Was the steel strike one of the causes of the problem? Not nearly enough information is supplied. Was it bad management? Was it overmanning? Lord Rochdale has been remarkably uncommunicative since he took over in 1971. When Mr. Bailie made the statement about the£7 million in 1971, who told him that£7 million would be enough to get Harland and Wolff out of its difficulties and into a profitable state?

Who was it in the management of Harland and Wolff who was quoted in The Times as stating that by 1972 Harland and Wolff would be on the verge of profitability, by 1973 it would be profitable and by 1974 it would be very profitable? If the management of Harland and Wolff believed that, no wonder we are in the mess we are in now, because it was living in a fool's paradise.

Just when did it all go wrong, and why was nothing ever told to the shareholders and the Northern Ireland Government who, after Mr. Baillie's statement, had taken up a 47.6 per cent. holding in the company? Somewhere accountability did not seem to get into the heads of management, and we have a right to that accountability in the House of Commons.

When Lord Rochdale became chairman, the company also took on the very expensive Mr. Iver Hoppe to be its managing director. Mr. Hoppe said that what was needed was a master plan to examine the yard and devise the right solutions. He called his master plan the P200. It was to be the blueprint for the future. Both Lord Rochdale and Mr. Hoppe seem to have been so enamoured of what they thought they could do that they persuaded my right hon. Friend the Member for Penrith and the Border (Mr. Whitelaw) when he was Secretary of State for Ireland to put£23 million of Government money into the yard, admittedly with a further£12 million from Harland and Wolff, to extend the facilities, modernise and even, it was said, find 4,000 further jobs for people in the Belfast area. At the time that money was provided,£14 million was provided to cover losses. That was the situation as recently as 1972.

Mr. Hoppe was a little more cautious than the management in his statements about Harland and Wolff being very profitable by 1974. He thought that profitability could come in four or five years, which if one leads on from 1972 takes us to 1976–77. Yet, as we know from what the Minister of State told us in one of the more recent debates, every order to be completed by 1978 will turn in a loss for the company. It is a remarkable state of affairs.

I am reminded of the RB211 situation with Lockheed and the bankruptcy of Rolls-Royce. I might even wonder whether the bankruptcy of Rolls-Royce did not enable the Government to renegotiate the contract with Lockheed. By the same token, if Harland and Wolff had been bankrupted perhaps the contracts for the ships now being built might have been renegotiated.

Will the Minister of State say what, if any, measures have been taken to renegotiate some of the fixed-price contracts and whether there is any possibility of calling in aid the huge rise in costs caused by inflation which must have made a profound difference to each of those contracts and which could not have been envisaged when they were let?

Mr. Hoppe was fairly cautious in thinking that four or five years would elapse before profitability was achieved but in his chairman's statement which he signed on 19th April 1973 Lord Rochdale said: Assuming the expected co-operation from all our employees, the total contribution from the ships under construction should re-establish the profitability of the company. Certainly the growing potential of the company gives your Board encouragement and confidence for the future. That was what Lord Rochdale said in April 1973. A month later the company was back asking the Government for assistance to continue its business. So I wonder whether the Chairman of Harland and Wolff really knew what he was writing about. If he did not, one wonders what sort of lead he could have been giving to the company since he was appointed in 1971. Perhaps I am being unfair to Lord Rochdale. Perhaps if he were here he could explain these matters and make me wish to withdraw those words. But as I read his chairman's statement I am left with a growing sense of unease about his knowledge of what was going on in his company.

So we move on from 1973 through 1974 to this debate, and all the time the company is having to receive Government assistance. In July 1974 the Minister of State said that he envisaged full public ownership if the company was to be kept afloat. He was clearly right. At the same time he talked of a comprehensive review of the company's business affairs and the company's management, structure and resources, an examination of its order book, strenuous action to reduce the overheads and the implementation of realistic manpower policies.

Am I right in assuming that those are the terms of reference which Mr. Downey was given for his committee's work which, I understand, has culminated in a report? Although we have had a statement from the Government, if Mr. Downey's report is in existence the House of Commons would have benefited considerably from a sight of it. Do the Government at any stage intend to publish a White Paper on Harland and Wolff, giving details of what has happened and what they plan for the future? If they do, will it include Mr. Downey's report?

Mr. Downey and his small project team were put into Harland and Wolff to assess the financial situation for the Government. As the hon. Gentleman said, we were dealing with forward orders, fixed price orders not to be completed for three years. I have published in the explanatory memorandum as much as possible of what Mr. Downey presented to the Government. The Government have to be careful not to jeopardise the commercial viability of the company, as has been recognised by the right hon. Member for Down, South (Mr. Powell) on previous occasions when he has raised the matter.

I should not like the hon. Gentleman to feel that we are sitting on a fat report from Mr. Downey which contains all the the answers. It has not worked that way. As recommendations have been made, the Government, if they have agreed with them, have examined and implemented them and I have presented as much of the report as possible to the House.

I am grateful to the Minister for that statement.

As I have said, I should have liked to have seen some parts of the report, but at least the Government's memorandum was very valuable. When I was looking through it, what struck me most forcefully was that in 1967 the company was considering the problems of the yard in terms of what is described as an untidy management—I assume that that does not describe their clothing so much as their effectiveness, lack of budgetary control and a marketing side that needed strength.

In 1971 the company again went in for a period of self-analysis and considered that it should be looking at the reorganisation of management and the reorganisation of financial control. So there is the common factor in both cases of budgetary control, and that should have caused considerable concern. As the right hon. Member for Down, South said, what is the point of making products at a loss? It merely wastes the labour of the human beings that goes into the products and without budgetary control, one will never know whether the company is profitable. In four years the company did not succeed in achieving, even to its own satisfaction, the sort of budgetary control that might conceivably have staved off the situation it is now in.

One is obliged to say that if those individual items had to be looked at in 1967 and 1971, and if under the heading of "Budgetary control" no suggestion was made that fixed price contracts deserved a second look, there was something wrong with the management of Harland and Wolff, and something wrong with the financial control, something which may well be the root cause of what has gone wrong.

I very much hope that the industrial democracy proposals to which the Minister referred, which are so well set out in the little booklet, may give the firm the new board and new management control that it so clearly needs. I hope that Mr. Punt will be a great success. The fact that he starts with so much popular support in the yard must augur well for his future. However, he is taking over at a time when the shipbuilding industry of Great Britain faces a very difficult future, perhaps more uncertain than at any time in its history. Therefore, it is not unreasonable to suppose that Harland and Wolff will have the same sort of difficulties.

The Minister rightly said that Harland and Wolff is a shipbuilding organisation. That is its raison d'etre . That is its tradition. I remember the chairman of Short Bros, and Harland telling me once, when someone talked about that company diversifying," You cannot diversify as simply as that. You have your skills in one direction. If you want to diversify into some other skill, the only way is to buy that skill, in terms of buying a company." Yet I was impressed by the suggestion of the hon. Member for Belfast, South (Mr. Bradford) that the company should be looking at North Sea oil exploitation and considering whether it could emulate some of the work being done in Norway. At Stavanger last year I saw huge oil rigs being assembled. One suspects that they have something in common with marine technology. I should like to think that at least some such consideration has gone through the minds of those who manage Harland and Wolff, in terms of North Sea and perhaps Celtic Sea oil.

I wonder whether the ships being built are the right ones. I am no expert on shipping—I wish I were—but I recently talked to a shipping engineer who said that our yards should be looking again at the sort of ships that they are turning out, maximising their skills to turn out specialist ships, which apparently still have a very good market.

How will the yard compete against the rest of the British shipbuilding industry if it is to be nationalised, as the Government have said? Will Harland and Wolff be forced into a simple competitive situation? Will it receive the same treatment as the rest of the nationalised yards? Will there be some form of sharing, so that it at least does not lose out because the other yards are able to gain Government support, and therefore perhaps a subsidy which Harland and Wolff does not possess? I wonder why Harland and Wolff could not have been kept going with further loans until the shipbuilding nationalisation proposals became law.

If I were working at Harland and Wolff, I should want to feel that I was part of the British shipbuilding industry overall. I should feel that my future was safer if that were so. Therefore, I shall be grateful if the Minister can say why he has decided that the yard should he cast adrift from the rest of the industry.

I feel that in conclusion I can do no better than to use once again some words of the ever-optimistic Lord Rochdale, the present Chairman of Harland and Wolff. Little more than nine months ago, when the company was rocketing towards bankruptcy, he said virtually nothing in his chairman's statement about the company's problems. But he managed to add in that statement, on 17th October 1974: Whilst we are by no means yet out of the wood, there are some signs for encouragement. At any rate, I believe we are on the move again and in the right direction. I do not know what Lord Rochdale had in mind, but I have a feeling that the Minister of State and perhaps the order are in the right direction.

2.56 p.m.

I listened to the Minister of State with a sinking feeling as he rolled out the damning statistics. I kept saying to myself "Before he finishes, he will say those things which I believe he naturally feels, he will give some encouragement and strike a note of optimism, as he has in the several statements he has made about the matter in the House during the past year." But he did not do it. He did not speak in anything like the way in which he has spoken before.

The note struck by the right hon. Gentleman has been taken up by my hon. Friends. I do not want to appear critical, but my right hon. Friend the Member for Down, South (Mr. Powell) was almost writing the firm's obituary for 1978 or 1979 when he suggested that his colleagues should be prepared now to back the Government in the action which they are threatening might be necessary then. This should be a rebirth. We are not digging graves. I hope that we are heralding a new dawn for Harland and Wolff. That may sound like a clichébut I do not want it to sound like that.

The Minister of State should be a male midwife this afternoon. We are not, I hope, here to pronounce the obituary on Harland and Wolff. The Minister said that success would depend essentially on the proper motivation of the staff. How can we establish the proper motivation of the staff to face five critical years if we start by almost saying today that we do not believe that the firm has much chance anyway? I can understand how one can read the memorandum and look at experience and perhaps come to that conclusion. Perhaps to some extent I am falling into the same trap, but we should not be prepared to take up that attitude here.

I am not prepared to say that I shall do anything in the years ahead which could ultimately result in 10,000 of my countrymen being thrown on to the dole, but I emphasise that I do not expect an open cheque. There are things that can be done during the period ahead.

We should not lose sight of the fact that we are discussing the order in the context of 38,000 unemployed in Northern Ireland, of whom 10,000 have become unemployed during the past 12 months. We are discussing the largest employer in the Province, whose labour force would represent 25 per cent. of that total of unemployed. If they were thrown on the dole tomorrow, the unemployment statistics would run into double figures.

It is no solution for me to be told that my countrymen could find jobs in other parts of the United Kingdom. I do not want to see Northern Ireland a depopulated wilderness. I am not interested in the fact that an engineer from Belfast may find a job in Glasgow, Liverpool, Birmingham or somewhere else. I wish to see pursued regional and economic policies which will maintain employment in Northern Ireland.

Does my hon. Friend accept that the new found enthusiasm and honesty of the people on the shop floor in Harland and Wolff give us as politicians and, to some extent, leaders the cue and represent a perfect example in this important phase which is a watershed in the history of Harland and Wolff?

One can take encouragement from that. My hon. Friend has stated the position much more accurately than the hon. Member for Belfast, West (Mr. Fitt), who tended to imply that there was an irresponsible attitude among the Harland and Wolff work force that they should be bailed out in any circumstances. I did not find such an attitude, and nor did my colleagues, at the meeting with the Confederation of Shipbuilding and Engineering Unions. It is unfortunate that the hon. Gentleman was not present at it. If he had been, he would have obtained a more accurate picture.

I do not use the unemployment statistics solely as an argument for maintaining employment in Harland and Wolff. The shipyard represents the focus and base of engineering technology in Northern Ireland, and the consequence of its closure would not be a few thousand unemployed; it would have severe repercussions throughout the economic and industrial structure of our Province.

In view of the history of the Government's financial intervention in Harland and Wolff in the past 10 years, it was inevitable that this day would come. No further public funds should be invested in the shipyard without its being taken into public ownership. However, the Minister of State knows from discussions with me that I object to the way in which he proposes it. I am not interested in parliamentary control, and the argument for the type of structure which he has set up does not appeal to me.

Harland and Wolff should have been integrated into the United Kingdom shipbuilding nationalisation programme. It is no answer to say, "We hope that there will be acceptable devolved Government in Northern Ireland and that they will accept responsibility for the shipbuilding functions". Does that mean that a Scottish Assembly will accept responsibility for the shipbuilding activities, mining activities and steelmaking activities in Scotland? Would the Minister of State support that? If so, he would not be speaking with the same voice as the Under-Secretary of State for Industry, who a few weeks ago I heard successfully countering the arguments of the Scottish nationalists when they were putting this case. When the hon. Gentleman was speaking, I said to myself, "I wish that I could have him on these benches when the order comes forward". I recommend to the Minister of State that he should read the comments of his colleague.

As I have said, Harland and Wolff should come within the United Kingdom's shipbuilding nationalisation programme. I welcome the suggestion in the Minister's speech that the door is not shut to that possibility. Perhaps he will expand on that matter. If the Secretary of State for Industry believes that Bristol Channel Ship Repairers are essential to a United Kingdom shipbuilding nationalisation programme, surely Harland and Wolff must have a much stronger case.

Harland and Wolff occupies a unique position not only in the economy of Northern Ireland but in the development and history of Belfast and Northern Ireland in general. There is a mythology surrounding it. Stories abound in Northern Ireland about the behaviour of its work force. There was perhaps a basis for this mythology in the halcyon days of 20 or 30 years ago. It would be easy to fall into the trap of blaming the problems of Harland and Wolff on the work force. It would be akin to a ship running on a reef and sinking and blaming the stokers for the disaster. The responsibility for such a position in the company must lie with the management. I tend to have reservations when a memorandum details further proposals before earlier recommendations have been put into effect.

In retrospect, I know that it is easy to be critical of the management and of people who made those recommendations. It would be too easy to blame the last régime which was in charge, but they must surely bear a heavy responsibility for the impasse which has been reached in the last year. It is difficult to be optimistic and to look forward to a rosy future for shipbuilding in Northern Ireland, and indeed in the United Kingdom. I hope that the Minister in his reply to this debate will make clear his own hopes for Harland and Wolff in the future. We must have leadership if these hopes are to be realised. I very much welcome the document which has been issued on the subject of industrial democracy. I welcome the realistic, sound proposals which it contains. They were not proposed in any hard-line fashion. They contained a range of matters which the work force may have an opportunity to discuss. I hope that we shall be given an assurance that the workers will be brought into these matters very quickly. Can the Minister give more details about the work of the new managing director and about when he is expected to get things moving?

I welcome the appointment of Mr. Punt. That is a rather unusual name for somebody who will be building super tankers, but I hope at any rate that he will be successful. I certainly wish him every success and I am sure that I speak for everybody in Northern Ireland.

3.8 p.m.

I should like to make a brief contribution to the debate, more on a personal and perhaps emotional basis than others who have so far taken part.

I have said before in the House that my father worked on Queen's Island. I am a trade unionist and the son of a trade unionist. My father was an ardent trade unionist and an artisan tradesman. As a small boy I remember being taken by the hand on a Sunday afternoon down to Harland and Wolff to see the White Star liner "Olympic" which had been brought in for reconditioning just after the First World War. My father had the doubtful honour of French-polishing the captain's cabin. I remember seeing his work.

I also remember that many times during the civil war in the early 1920s I tried to comfort my mother who waited fearful that my father would not reach home after work. During that period in those terrible days many workers had to cross Fraser Street bridge and then walk through Bryson Street and Seaford Street. In those same streets men are still being shot down in cold blood by the same enemies who are the scourge of our country.

I was very disappointed at the remarks of the hon. Member for Belfast, West (Mr. Fitt) who got on to his usual political tack. I am sorry that the hon. Gentleman is not now present in the Chamber. There are times when he reminds me of an old 78 record with its needle stuck in the middle. He does not seem to be able to get any further in respect of political alignment in Northern Ireland. I submit that it has nothing at all to do with the position of Harland and Wolff today.

I believe that if there were a wholesale infusion of workers—skilled, semi-skilled or unskilled—from the Falls Road, Ballymurphy or Ardoyne into the shipyard it would not make any difference to its viability today.

In my opinion, the reason for there being a sort of imbalance of workers in the Queen's Island is that Harland and Wolff is in East Belfast. People have been born and reared in the shadow of the gantries of Harland and Wolff, and reared to shipbuilding. They have gone into it because their fathers were in it, in just the same way as the miners of the Welsh valleys go into mining because their fathers were in it. No one can conceive of thousands of miners being transhipped from the Welsh valleys to the motor car or engineering industry of the Midlands because of any political alignment. We cannot imagine such a situation. Therefore, I am sorry that the hon. Member for Belfast, West introduced this element into his speech. I should have thought that he would be more factual and say something more encouraging about the prospects of this great shipyard in the future. I join with my colleagues in saying that I should be deeply hurt and that it would be a very great sadness to me if that great shipyard were to fail and cease to be part and parcel of the economic structure of Northern Ireland.

I am sure that the Minister of State will forgive me if I return to something I mentioned some time ago. That is the solitary oil rig which was built at Harland and Wolff and which is now operating very successfully in the North Sea. The question has been asked: why did they stop at one when there is a demand for this type of engineering product and when there might be much more demand in the future? Can the Minister tell us whether this one oil rig was built at a loss and whether the building of the oil rig contributed to some of the losses incurred by Harland and Wolff? It would be interesting to know whether that is the case.

Mr. Punt, one of the new managing directors, has been mentioned. I had the privilege of travelling home to Northern Ireland with him on a British Airways flight. The reason we got into conversation was that—

You were late.

Yes, we were late. We got into conversation and we were trying between us to find out why, for reasons of security British Airways could not give us a cup of tea or coffee and some biscuits and yet we could see a trolley full of booze being pushed up the gangway of the aircraft and offered for sale.

Good temperance stuff.

We could not understand the strange fact, that for security reasons, apparently, we could not get tea or coffee, but it did not seem to matter that we could get booze. Mr. Punt told me that he was the deputy managing director of Harland and Wolff. He did not, naturally talk too deeply about the prospects of the yard, or about his own prospects, but we had a conversation about the shipyard and about my association with it.

In conclusion, I join my colleagues in saying that we do not want to see the demise of Harland and Wolff. We believe that, if it were integrated into the full programme of nationalisation of the shipbuilding industry of Great Britain and Northern Ireland, there would be better days ahead for Harland and Wolff.

3.14 p.m.

The presence of so many Members from Northern Ireland in the House on a Friday underlines the fact that we are discussing a very important subject which has ramifications for the whole of the Province.

My hon. Friend the Member for Mid-Ulster (Mr. Dunlop) was fortunate to get on a flight to Ulster. Some of us will not be able to return to that part of the United Kingdom this evening and must delay our return until tomorrow, simply because the British Airways service has become so abominable between Belfast and London. We are part of the United Kingdom, but the amazing fact now is that parts of the United Kingdom are less accessible than Timbuctoo, South Africa or even Uganda.

We in Northern Ireland have a deep interest in this subject. All hon. Members may not know that Northern Ireland's industry has in the past had its fulcrum in this shipyard. It is all very well to attempt to discuss the shipyard as a separte economic unit, but those of us from the Province know that there are small businesses in County Fermanagh and in my constituency of North Antrim that depend for their livelihood and for the continuity of employment of their small work force on contracts from the Belfast shipyard.

We are not talking about an isolated shipyard. We are talking about an undertaking which is integrated into the whole of our economy and which is essential to our future well-being. No hon. Member on these benches can say to the Minister, even though the Minister might take some comfort from things which have been said today, that at a future date we might be prepared to vote for the complete collapse of the Belfast shipyard.

I am dedicated to keeping the Belfast shipyard in operation. I believe that there is hope and a future for the shipyard. I believe that the steps being taken today will bring us to a realisation of this.

I do not attempt to blink at the hard facts. I have lived all my working life in East Belfast where the shipyard is situated. For many years I have worked among the shipyard workers as a minister of religion. I know how these families think. I know their outlook. It must be realised that today we are not dealing with an intangible concept. We are dealing with men's lives, their livelihood, their future, their homes, their morale.

I wish to identify myself with the very relevant remarks made by my hon. Friend the Member for Armagh (Mr. McCusker). We in Northern Ireland believe that this intervention will help to secure the future of the Belfast shipyard.

The Minister of State has brought a sympathetic touch to this question and it would be churlish of my hon. Friends and I not to pay him a warm tribute. Many of us have talked to him about this matter and he has an exact grasp of the situation. He will be the first to recognise that there will be a reduction in the workforce.

Like my hon. Friends I have no desire that the people of Belfast should have to go to another part of the United Kingdom to obtain employment. I want them to be employed in the Province in which they were born, the Province in which they have their roots and, as far as possible, in the place where they have been brought up.

But I sound a note of warning. It may be that the people of Northern Ireland will have to learn that in order to get employment they will have to travel greater distances than they have ever done before. We have a strange situation in my own constituency where a large heavy engineering firm is short of skilled workers. Even in this day and age, when there is mass unemployment in Northern Ireland, there are small pockets where skilled workers are needed. The people of Northern Ireland will have to learn that they may have to travel considerable distances, which they have never contemplated before, in order to be suitably employed.

I am alarmed to find that the Belfast shipyard is outside the scope of the United Kingdom dimension. I first raised this matter many months ago—I think in a previous Parliament. I am sorry that the Government have not seen fit to treat the Belfast shipyard in the overall context of the shipbuilding industry and its nationalisation in the remainder of the United Kingdom. It is strange, when such a suggestion is made about the Welsh and Scottish shipyards and when Wales and Scotland are to have devolved Assemblies, that the Northern Ireland shipyard appears to be isolated.

That brings me to what is perhaps the most vitally important feature of this proposal, which entails£60 million being put into the Belfast shipyard. Other areas of Ulster's economy will suffer, including areas which at the moment are profitable but which perhaps will not remain profitable if it is not possible for them to have help. We are all aware of the general economic situation affecting the United Kingdom. Northern Ireland being on the periphery of the United Kingdom, will suffer far more severely. In this situation, a person's most valuable possession is a job. We must see that there are jobs and that those who have jobs already have them preserved. The right hon. Gentleman will remember emphasising the importance of this recently in the constituency of my hon. Friend the Member for Londonderry (Mr. Ross). He said that there must be a drive to get new jobs and, even more important, to keep the jobs that we have already.

Today, we have a measure which we hope will be of help in that direction. While there is a bright hope for the viability of the yard, I feel that we must face the realities of the situation.

The shipyard has had a sorry past, and the appointment of Mr. Hoppe only highlighted that past. The Minister of State is not responsible for what took place in the past, of course, but those who were responsible did not accept their accountability to the taxpayers who supplied the money to help the shipyard.

Mention has been made of the shareholders. They should realise that they are very fortunate in getting the deal that they have been offered. The shipyard could have been closed and then reopened without the shareholders getting a penny. I do not want to hear any shipyard shareholder grousing about what has taken place. The shareholders are getting a good deal. They are fortunate to get anything at all. I can tell hon. Members on the Opposition Front Bench that, because of what they were to receive, the shareholders present at the meeting were near to getting on their knees to thank Almighty God that the shipyard was to be taken over.

I was not really dealing with the merits, if any, of their claims. I was merely dealing with people's rights in relation to this House.

The hon. Member knows that I would not try to misconstrue what he has said. This matter arose in Northern Ireland when I was a Member of the old Stormont. I want to make it clear to the general public that if the Government had bought the shares at their then market value, they would not have had to pay so much for obtaining a controlling interest in the shipyard. This matter was raised in another House.

I appreciate that no Government have the right to confiscate a person's private property, whether it be shares or other property. However, it should be spelt out today that the shareholders of Harland and Wolff have done very well out of what has happened. Indeed, perhaps in this uneconomic climate they have done too well. The sun has perhaps shone upon them too much.

The unfortunate aspect about the shipyard is that it has put all its eggs in one basket. It has been modernised to build super-tankers. Perhaps the market for super-tankers is finished. Therefore, we have a modernised shipyard geared to produce an unviable product. This is very serious and must be faced.

The healthy heart of a shipyard is the engineering shop. That is a viable unit. From that can flow renewed strength to perhaps the periphery of the shipyard, thus strengthening the whole. I must apologise to the Minister because I did not hear his opening remarks. However, if he failed to inject a note of confidence and optimism when he opened the debate, I am sure he will inject that note when he replies. He has all the facts and still believes—I am sure he would not present this order today if he did not—that something can be done.

I regret that any political or sectarian matters should have been brought into the debate by the hon. Member for Belfast, West (Mr. Fitt). The history of Northern Ireland requires study. Since coming to Northern Ireland, the Minister has become aware of the circumstances and the background.

I could take the Minister to industries in certain areas where no Protestants are employed, but nobody shouts that it is discrimination. Those areas have always had traditional employment for the Roman Catholic section of the population. I can call to mind sections of the building trade where no Protestants are employed. I think particularly of tilers and roofers. Those industries are completely controlled by members of the Roman Catholic population. It is not because as specialists in roofing and tiling they want to keep the Protestants out but because in the long history of Northern Ireland these jobs have always been limited to certain families, and people have been brought up to develop these talents.

I do not believe that there is discrimination in the shipyard. The Ombudsman has never been asked to deal with this matter. Not one case has been referred to him concerning this matter.

We welcome the fact that we have been allowed longer than usual to discuss this order. Usually we grouse that we have only one and a half hours. We welcome the fact that the Government have lent us a kindly ear in this matter. We appreciate what they are doing. We are facing the facts as representatives of Northern Ireland. I trust that what has been done today will close the sorry chronicle of past years and open a new book, the chapters of which will tell of the sturdy independence—I do not use the world "independence" in a political sense—of the hard-working, self-reliant Ulster people who will again put the Belfast shipyard on the map and ensure that it gives employment to many of the people of East Belfast as well as in other areas of Northern Ireland.

3.30 p.m.

I should like to add my congratulations to the right hon. Gentleman the Minister of State on what he is doing for the Belfast shipyard. I represent Belfast, North and many of my constituents are employed by the shipyard. On behalf of the workers in North Belfast I should like to tell the Minister how much we appreciate the time, the energy and the concern which he has given to the plight of the Belfast shipyard.

Some people welcome the kiss of life for the shipyard. However, when an industry or project is nationalised we often hear that it has received the kiss of death. We have often read in the Press in the past of a nationalised industry which has shown a loss of so many million pounds over the past 12 months. Many people in my constituency and throughout Northern Ireland hold the view that once a shipyard is nationalised it has received the kiss of death.

The majority of people who work at the Belfast shipyard are highly skilled and semi-skilled but all, including labourers, are loyal to the shipyard. There is a minority who maintain that it is their money that has been paid back, that it is public money and that they are entitled to abuse their position within the shipyard and accept all that is given.

We welcome the£60 million injection to the shipyard. However, we cannot keep dipping into the well. The well will not continue for ever. I should like to put on record a warning to the workers of the shipyard. Not only does the management need a shaking up, but I am sure the Minister will agree that during the past seven years there have been too many changes in management. It has been headlined that a certain gentleman will take control of the shipyard and wonderful changes are promised. We may even see a magic wand being waved over the shipyard. We have been promised that the shipyard will be viable yet, alas, every report strikes a note of sadness and despair into the very heart of Belfast, to see, once again, the plight of the shipyard—the money being lost, the tremendous threat to employment in the area and even to the business community.

The roots of the shipyard cover a large area and are not just confined to the immediate area of the shipyard. By providing employment for a large section of the Belfast work force, the shipyard provides a living for people on the shop floor and people in areas to the east and north of Belfast. Shop doors are often kept open because of the money that comes from the Belfast shipyard, because that money provides employment for shop assistants and many other resources for the family.

We welcome this injection into the Belfast shipyard. We implore the workers of the shipyards—not only the management, which needs shaking up—to tighten their belts and realise that they are, perhaps, getting their last chance. They must pull together and make the Belfast shipyard, which was once the greatest industry in Northern Ireland, viable, make it pay and make it a place to be proud of and in which everyone will have a pride, from the workers up to the chairman.

3.35 p.m.

This debate has been helpful to the Government. I say that with confidence, but nevertheless with the warning that has just been given by the hon. Member for Belfast, North (Mr. Carson). I hope that the order will be helpful to Harland and Wolff in its new presence and new organisation. I shall come shortly to one or two of the central issues which have been raised, not least that of confidence in the future of the shipyard itself. However, I turn first to the central point which has been reflected in many of the speeches.

The hon. Member for Epping Forest (Mr. Biggs-Davison) raised the question of unemployment and whether it would be possible to re-employ people if anything happened to the shipyard or to part of it. The hon. Member for Antrim, North (Rev. Ian Paisley) underlined the point I want to make. As Minister responsible for industrial and economic affairs in the Province, I am concerned about rising unemployment, which is affecting the Province as a whole. Some areas in Northern Ireland are now for the first time in recent years witnessing a rise in unemployment. I have said previously that it does not matter whether one is unemployed in Coleraine or unemployed in Strabane because the effects are still just as bad for one's family, wherever the unemployment occurs.

I want to use the employment aspect in a broader context. As we know, the unemployment figures are now well over 8 per cent. in Northern Ireland. Unfortunately they are rising. As much as one wants to get new investment and new industry—I spend a great deal of time trying to attract these—to lose jobs and employment which are long established would be a serious blow indeed. The textile, clothing and shoe industries and farming have all suffered serious blows. I am pleased to say that the engineering industry is holding its own. I hope that it will improve beyond just doing that.

If industry were to take out of the engineering industry a complex of industry the size and importance of Harland and Wolff, it would have the effect of not merely the loss of 10,000 jobs, because about 30,000 jobs throughout the Province are reliant, to varying degrees, upon the shipyard. We have only to think of the effect that this would have on Belfast as an engineering centre which is known throughout the world to realise the implications.

I have said on several occasions to employers in Northern Ireland who looked upon such a development as something that might be in their interest that they should be very careful before they wish for that sort of development, because if the industrial base, which is far too narrow already, had a severe hammer blow of losing a shipyard the size of Harland and Wolff, it would affect the prospect for engineering and manufacturing in the whole of Northern Ireland. I know that the hon. Member for Epping Forest attaches importance to employment. He asked what effect there would be and I have tried to explain.

I thank the hon. Gentleman for what he said about industrial democracy. The right hon. Gentleman for Down, South (Mr. Powell) welcomed the experiment. I agree with him that we cannot change the minds of men about public or private enterprise by passing an order, but the Government are trying to create the conditions in which the type of development we believe necessary for the shipyard can be undertaken.

The hon. Member for Newbury (Mr. McNair-Wilson) made an informative and detailed speech stemming from his understanding of that situation after having worked in the complex. If I do not answer all his points, I will see that he gets a reply in writing. I want to link his question about fixed-price orders with the situation of the shipbuilding industry as a whole.

The present order book of the company comprises 13 ships, a substantial numbers of which are on fixed prices. It would not be in the company's commercial interests to disclose further details. Every effort is being made to accelerate completion of the remaining fixed-price contracts to minimise the anticipated losses. The cancellation of the three bulk carriers was the simplest way of getting rid of some of the worst loss-makers in the industry.

One has to consider the shipbuilding industry world-wide when dealing with a complex situation such as that of Harland and Wolff. The trouble is that those who place the orders have been able to call the tune. They have fought for fixed prices. Harland and Wolff is not the only shipyard that has suffered.

The right hon. Member for Down. South mentioned a wider philosophical point—whether a Government can run a shipyard when they do not have the commercial expertise. I accept that no Minister or civil servant can run a yard from outside. We are trying to do what needs to be done by way of the order, industrial democracy and the appointment of the right people to make the decisions which will make the yard viable.

This is not just a philosophical point. The writ of Adam Smith does not run in any shipyard in the world. From Japan to Belfast, every shipyard is losing orders—including West Germany, Sweden, Africa, South America. So I do not underestimate the difficulties. That is why I say to the hon. Member for Armagh (Mr. McCusker) that it would have been wrong if I had not put the facts on the table today. They make sorry reading but all of them are true. In the Harland and Wolff context I need not invent the facts or make the situation appear worse. There is this difficulty. The position of Harland and Wolff, despite the plight of the other shipyards, is worse than that of most other shipyards. Productivity has increased and we hope that that will continue.

I welcome the confidence which has been expressed about the appointment of Mr. Punt. I hope that we do not expect miracles from him. He has a difficult task to perform. He cannot perform it without the co-operation of everyone at the shipyard. The Government must create the right conditions so that he can implement his plans for the shipyard. He was freely selected by public advertisement and has the good will of the work people. The trade unionists on the board of assessors did not seek to appoint a person who would be easy on the workers in the shipyard. They recognised that he would have many difficult decisions to take, and that he must gain the cooperation and the confidence of the work people to carry out those decisions. I know that he will receive that confidence. I look forward to future developments along those lines.

Mr. Bailey's words were quoted by the hon. Member for Newbury. I had not read those words previously. The fact that they happened to coincide is purely coincidental. I am sure that he will respect that point of view.

The hon. Member for Armagh spoke about confidence. I have given the unpleasant facts and have said that the Government cannot go on indefinitely underwriting this situation. Nevertheless the Government would not invest£60 million of new money, would not be going ahead with the appointments and would not be considering diversification and industrial democracy if they had no confidence in the industry. I would not be doing so if I did not believe that there was hope for the future. However, it would be equally wrong for me to paint a picture based on supposition or on my hope that the situation could be corrected. It would be wrong and dishonest of me to do that. I believe that there is hope, which we must work to fulfil. We must take into account the world trade situation, the question of tankers and bulk carriers and the fact that the yard might be able to build 10,000-ton steel barges. There is no easy answer or panacea.

Reference was made to oil rigs, of which there is a surplus. One company in Scotland is already experiencing difficulties. I shall not comment on that. The method of design is changing from steel to concrete. Those realities must be taken into account. The engine works is making engines for the shipyard and also exporting them to Japan. The survival of that shipyard will depend on the development of ships.

Money begins to lose its reality when we talk in terms of£60 million, but we have to bear in mind that the order book contains orders worth£270 million. In spite of these large sums of money, the difference between success and failure can be very narrow.

I welcome the support given by my hon. Friend the Member for Belfast, West (Mr. Fitt) for the continuation of the shipyard. The best way to resolve the problem which he raised, and the way in which I am trying to resolve it, is to make sure that opportunities for learning skills are given to the whole community. That is why I put such trust in the Government training centres and why I want a wider industrial base. That can be achieved through apprentice training and we must remember that these skills cannot be learned overnight.

I have talked over these issues with the shop stewards who know what it is like to work in the shipyards and who talk to the workpeople day in, day out. One sees things differently perhaps from a long way off—whether in Belfast, in a Government office or in the House. The shop stewards have assured me that the last thing they want to be plagued by is discrimination. There is a genuine desire throughout the shipyard to avoid discrimination. The Government have not lost sight of that problem and the constructive way to proceed is by convincing the people on the shop floor. I visited Dungannon recently where I saw a small co-operative with a mixed work force which was doing a remarkable job. I went there to congratulate the co-operative which had not only made a profit but was able to pay back a Government loan. A large part of the work it was doing was subcontracting work for the shipyard. Similar efforts are being made in many parts of the Province. This shows that the existence of the shipyard means work for many other establishments outside it.

I have dealt in some detail with employment and I have tried to deal with many of the broader aspects—

If the hon. Gentleman is leaving industrial relations, may I ask whether any conclusion has been reached about the possible representation of the work force on the advisory board?

We have to proceed as quickly as possible but we cannot proceed faster than the rate at which the decisions can be implemented. Proposals brought forward by the workers are before the management. I try to see that the workers do not simply have to adopt what the Government say. We want the proposals to come from them. I understand that the discussions are going extremely well, and I hope to have some of those proposals before me in August.

We have heard a lot of criticism of management today and the Government's intention is to start reorganising management as quickly as possible. There must not be any slackness in the speed with which the trade unions and the company discuss these proposals, and I am glad that the hon. Member for Epping Forest raised that point. There is a sense of urgency, because of the need to complete the reorganisation as quickly as possible. That is one of the reasons why we so desperately want to put the order into effect as soon as possible.

The issue of the links between this publicly-owned industry and any future shipbuilding board was raised. We went over well-rehearsed arguments. It is rather odd that many hon. Members on the Opposition benches are members of a party which wants a strong, devolved form of government in Northern Iceland, covering a wide cross-section of the community. The matter is being discussed in the Convention. But suddenly, when the argument does not suit, it appears that such a form of Government is wanted in the United Kingdom context when it comes to the shipyard. There is an anomaly in that argument.

I do not want to enter into the political argument with the right hon. Gentleman today, but I am sure that he will realise that the form of devolved government for which the United Unionists are pressing is one within the United Kingdom. There are hon. Members from other parts of the United Kingdom who want a form of devolved government that will eventually lead to breaking up the United Kingdom. We want a form of devolved government which retains our place within the kingdom, and which could lead to the strengthening of the Kingdom. We believe that that is the road that a devolved government should take in the whole United Kingdom.

I accept the point. I did not try to imply that such a form of Government would be outside the United Kingdom. I accept that the whole argument is within the United Kingdom and that we are talking about devolved government, whether in Scotland, Wales or Northern Ireland, within the context of the United Kingdom.

But the Government felt that it was necessary to bring home the urgency of the situation. They have been forced by lack of legislative time to postpone the shipbuilding Bill until the next Session. It will go through early in that Session, but for Harland and Wolff we could not afford to wait. We must get on with the job. To have waited, no matter how long it took, would have been disastrous.

I do not want to give the impression that I am moving away from a firm decision that the Government have taken. I argued with the right hon. Member for Down, South that there is a direct relationship between our policy, the Department of Commerce and the devolved Government in Northern Ireland. If we are in the United Kingdom context, the Minister is still answerable in this House. This is the supreme Parliament. The Government have clearly stated that we shall answer questions and be more accountable to the House than are the current nationalised industries.

Will the Minister say absolutely clearly who will own Harland and Wolff after the order has come into effect? Will it belong to Her Majesty's Government in Westminster or to the Department of Commerce in Northern Ireland? The rest of the shipbuilding industry will belong to the Government, so if Harland and Wolff belonged to them I cannot see why the two could not have been put together.

The order makes it clear that it is vested in the Department of Commerce. But we are in a period of direct rule. I am the Minister—plainly there will be other Ministers—who is answerable to the House. If there were a form of devolved government in Northern Ireland, the relationship would have to be discussed with this Parliament. I hope that that makes the position clear.

I thank hon. Members for the tenor of their speeches and for the appreciation of the problem which they have shown. We are talking about the survival of a basic United Kingdom industry situated in Belfast which is known world-wide, which has a reputation for skill in the building of ships and which the Government want to see succeed. We hope that we have laid the basis for that. I am sure that the House will wish the venture every success.

Question put and agreed to .

Resolved . That the Shipbuilding Industry (No. 2) (Northern Ireland) Order 1975, a draft of which was laid before this House on 9th July, be approved.

You, Mr. Deputy Speaker, and I seem to be back where we left off at 6.30 this morning.

I wish to raise maters of ministerial approval for investment by British Rail. I understand that under the Transport Act 1962 decisions on British Rail investment projects should be taken in consultation with the Minister. Although no specific money limit is listed, if a sum over£250,000 is involved it is generally accepted that ministerial consent is needed for such projects as ships, hovercraft, and hotel developments. That is why I am entirely within my rights in raising the question of the future of the hovercraft industry. I asked for this debate particularly because the development of the hovercraft industry on the civil side—and I emphasise that—is at the crossroads.

The principal company in hovercraft construction is the British Hovercraft Corporation, which is a subsidiary of the well-known Westland Aircraft Company, whose main works are at East Cowes, in my constituency. Its total work force is about 2,000 and the current turnover is about£10 million. Apart from our three local authorities, it is the largest employer of labour in the Isle of Wight.

The British Hovercraft Corporation is a direct descendant of the former Saunders Roe Company, which used to build flying boats. It stopped doing so when flying boats went out of favour. One of the last flying boats to be built crashed into a hillside adjoining my home. It was a very sad occasion. The company then moved into the development of the SR53 rocket turbojet fighter. There were many hopes for the project when suddenly it was cancelled in the late 1950s, putting many of my constituents out of work. The memory of it still haunts us on the island. It had a profound effect on the economy of the island.

It is true that we have since managed to diversify by attracting new industries. We have had Government help in the period since 1958 and we are pleased to have those industries on the island today. All our eggs are no longer virtually in one basket as they were at that time. Nevertheless, any cut-back on BHC now would be a serious matter.

Moreover, at a time of high unemployment and when the relations between management and work force are so good, it would be a tragedy for the nation as a whole if this contract were to end.

This subject was well aired during a short but excellent debate conducted in the other place on 1st May last when the noble Earl Lord Kinnoull asked some pertinent questions about the future prospects of civil and military craft and wanted to know about the industry's progress in respect of the further development of hovercraft. This was prompted by the Government's decision to cancel the construction of the Channel Tunnel, and indeed we supported that decision. That provided an opportunity for hovercraft to play their role in carrying cross-Channel traffic.

The two operators concerned were Sea-speed, which is a subsidiary of British Rail and HoverLloyd, both companies using the SRN4 type craft. Already these companies have captured a substantial share of the cross-Channel traffic. The figures for 1974 show that the hovercraft carried 30.9 per cent. of passenger traffic and 23.9 per cent. of the cars crossing on the existing short sea routes, such as those from Dover to Calais and from Pegwell Bay to Boulogne.

There is a good case for increasing the capacity of those craft and, as is well known, Seaspeed and BHC have reached a fairly advanced stage in their negotiations for the stretching of these two craft which would increase capacity from 254 to 400 people and the maximum car capacity from 31 to 59. This is an interesting process. The craft is cut in the middle and a further section is inserted. This process has already been successfully carried out by BHC on its SRN6 cross-Solent craft which I use regularly at weekends to get to my constituency.

I do not wish to list, nor do I have the time to do so, all the advantages of this exercise. They were well covered in the Lords debate and it is there for all to read. But suffice it to say that if this contract, which will need Government sanction, is allowed to proceed it will provide the company with the necessary incentive to move into the next stage of development when an entirely new craft, which can compete favourably with existing ships on all Channel routes, can be constructed. I hope that these figures have been shown to the Minister because they are very encouraging indeed. They show that BHC can compete with existing ships.

The figures on energy saving, speed and reliability are highly encouraging. Reliability has been improving with experience over the years. If new and longer routes are introduced—such as routes from Southampton and perhaps up the east coast—the level of fares charged will fall within the bracket of those now obtaining on the cross-Channel ships.

Since the debate in the other place the Cairncross Report has been published. Unfortunately, we are now about to go into recess without having had an opportunity to debate that report. Indeed, this is the reason why I am so pleased that I am able to raise this matter today because the decision will arise during the recess. I suggest that the report provides greater evidence of the potentialities of the use of larger and more efficient hovercraft. I refer merely to the summary of their findings, in paragraph 35, where they state that The future of Hovercraft particularly as a premium service should be seriously considered". HoverLloyd, a private company, is reported to have made a profit of some £200,000 on its operations with three slightly wider craft last year, despite increased fuel costs. This shows what can be done. Seaspeed made a profit in 1973. It may well be the reason for the Cairn-cross Committee querying why British Rail have not charged a premium for their more rapid cross-Channel journey and improved interchange facilities.

Another important matter is the immediate challenge of the French, with the Sedam N500. They were astute enough to carry on with their hovercraft development at the same time as the Channel Tunnel, covering the situation from both aspects. Their hovercraft will have an equivalent number of passengers to the SRN4 and it is now in an advanced stage of construction. There are advances being made also to a lesser extent in Japan and the United States. The Americans are building two 2,000-ton craft.

I hope that the Under-Secretary read the interesting article by John Petty in the Daily Telegraph of 21st July last, under the heading "British Technology Humiliated". It would be an absolute tragedy and another example of allowing others to cash in on our inventions if his dreary prognostications were proved to be true, and the French allowed to take over where we left off. They will be able to offer their craft within the next 12 to 18 months, and, if we are not going ahead, it is fairly obvious that British Railways, possibly HoverLloyd and possibly even Seaspeed, may be forced to purchase from France.

The seven unions at British Hovercraft have desperately wanted to see the Minister of Transport to tell him personally of their conviction concerning the future viability of large hovercraft. They are 100 per cent. behind their company in this and absolutely convinced that they have the right machine for the right job. I have tried to arrange a deputation, for which there is an application. The unions, among many of us, from Sir Christopher Cockerell, the inventor of the hovercraft, downwards, together with those Members of Parliament who have taken the trouble to go to British Hovercraft and see for themselves, would be horrified if the wrong decision were taken. I was at BHC with two Labour Members only recently.

In conclusion, I want to emphasise that the British Hovercraft Corporation is no lame duck company. Far from it. It received a Queen's Award for its export performance only a few months ago, and the military side is doing very well. All it asks is that, should the British Rail management, after its board meeting on 4th August, indicate to the Government that it wishes to place the contract for stretching its two SRN4s, the Government should accede to its request without delay.

Speed is essential in this matter. The first hovercraft should come in for stretching this winter. Such action could well generate a world market large enough to make the development of a new craft a commercial proposition in its own right. It would also stimulate advances in technology, which would benefit the whole range of craft they have to offer, and help them maintain the favourable position they have built up in overseas military markets.

I understand the suggestion made in the other place that finance might be arranged through the European Investment Bank, but, judging by the criteria under which the bank advances money, it would appear to be a non-starter. In the other place, the noble Lord, Lord Beswick, gave grounds for optimism in his far-reaching reply. I hope to hear rather more in that direction from the Minister—I am grateful to him for staying here on a Friday to hear my pleas—when he replies.

4.15 p.m.

I congratulate the hon. Member for the Isle of Wight (Mr. Ross) on his stamina in being able to speak at two ends of the day on behalf of his constituents. I also congratulate you, Mr. Deputy Speaker, on your stamina in being able to grace us with your presence in the Chair for the hon. Member's two contributions.

The hon. Member made, as one would expect from him, not only a highly knowledgeable contribution but the type of contribution phrased in moderate terms which often makes more impact on a Government than more strident interventions.

Hon. Members will recall that the British Hovercraft Corporation recently put on a display in the Upper Waiting Hall of the House relating to its production. I understand that some hon. Members attended subsequent briefings. Part of this exhibition was concerned with the future development of hovercraft, and it no doubt generated an increased awareness by hon. Members of the importance of this industry for future travel and freight transport as well as in the application of the air cushion principle in lifting heavy and awkward loads.

The outlook for hovercraft is brighter than it has been for the last few years and there is now a much wider acceptance of a steadily increasing variety of hovercraft as a possible solution to particular transport problems or the use of the principle to solve difficult civil engineering problems. This has come about by the industry's steady and successful efforts in convincing possible customers of the capabilities and versatility of their product.

The United Kingdom hovercraft industry still has a considerable technical lead over its overseas competitors and this lead can be maintained only by adequate research and development. Apart from the industry's own considerable research and development effort, financial support from outside sources is expected to amount to£1.4 million in the current financial year. This includes military commitments and funds provided by the National Research Development Corporation as well as by the Department of Industry under the Science and Technology Act.

The NRDC, whose support is of great assistance to the industry, normally channels its funds in support of industry's own research and development projects through its subsidiary, Hovercraft Development Limited. The NRDC does not make grants but will share with a company, usually on a 50–50 basis, the cost of developing a new product and will expect a financial return on its investment. The NRDC has recently agreed to contribute about£1½ million to assist the development by Hovermarine Transport Limited of a 20-seater sidewall craft designated HM5.

I am grateful for the fact that the Minister mentioned Hovermarine Limited. It may be felt that, as my debate was on the future of the hovercraft industry, I should have Bone much wider and mentioned other firms. I should not like it to be thought that, because I dealt with one company in the main, I was not aware of the existence of and efforts being made by other firms.

I appreciate that. The hon. Gentleman would be hard put to it to mention all the hovercraft companies, his constituency being the centre of the hovercraft industry, which is one reason why he is particularly suited to raise this subject in the House.

This latest development represents a significant advance over the existing HM2 which carries 65 people and which itself continues to be successful. Apart from major new craft, modifications and new ideas for engines, propulsors and skirts are constantly being tried and tested in order to enable the next generation of hovercraft to travel faster, to have even fewer journeys than hitherto cancelled because of the state of the sea, and to provide increased comfort for passengers.

In the debate in another place, one noble Lord gave a somewhat deterring account of his earliest journey in a hovercraft and of the ordeal of the child who travelled with him. Things are much better now.

Research and development to achieve these objectives are going on continually. The British Hovercraft Corporation, which is based in the hon. Gentleman's constituency and is the largest employer of labour in the Isle of Wight, hopes to secure an order this year from British Rail to "stretch" the two SRN4s at present in operation on the cross-Channel routes. This is obviously a matter of great concern and the wish for a decision is understandable. This is not a matter to be decided by my Department. It is for the Department of the Environment.

I understand from the Department of the Environment that the British Railway Board is expected to decide during August whether its present SRN4s should be "stretched".

The hon. Gentleman pointed out the unusual nature of this "stretching" operation. It consists of cutting the craft in half, leaving the more complicated bow and stern installations and engines and machinery intact, and inserting a 56-feet section in the centre. This somewhat crude piece of surgery will increase passenger capacity from 254 to 400 and car capacity from 31 to 59. The decision by British Rail to make the modification was, of course, delayed for two years or so mainly by the proposal to construct the Channel Tunnel, and it is now reviewing its cross-Channel hovercraft and ferry operations since the tunnel project has been abandoned.

I recognise that British Rail's decision is of considerable importance to British Hovercraft Corporation in maintaining the position of its craft on the vital Channel route. If the decision is to go ahead, the Corporation hopes to use the experience gained in the development of the next generation of large passenger and vehicle hovercraft. This new BH88 hovercraft—which is not expected to be significantly larger than the stretched SRN4—will incorporate a number of new features related to power plant, propulsion system, lift system and craft resistance. BHC hopes that collectively these improvements will reduce power consumption by 40 per cent. and give a fuel saving of 60 per cent. The craft will be able to operate in up to a force 9 gale with consequent reduction in cancellations because of weather and sea conditions. BHC expects such a craft to be able to compete on equal terms economically with ship ferries.

The British Hovercraft Corporation has, besides the SRN4 craft, two other types of hovercraft in current production —the SRN6, which is a general utility craft capable of carrying 38 passengers with a lengthened version for 58 passengers, and the BH7 logistic and fast attack military vehicle. The Corporation has had particular success in selling the military craft overseas, and there are good prospects for it particularly in the Middle East where it has already made good sales. One important overseas contract that the British Hovercraft Corporation has won is that for development of the bow seal for the 2,000-ton surface effect ship development programme for the US Navy.

I am sure that the hon. Gentleman will be interested to hear something of the wider situation. He has properly raised his general constituency interest, but this is a much wider area of activity than that to which he has referred.

On the United Kingdom military prospects, the Royal Navy Hovercraft Trials Unit is testing the military utilisation of craft in a variety of naval roles including mine counter-measures. If the mine counter-measures application is successful, this could open up an important new market for the hovercraft industry.

Besides the bigger craft that I have already mentioned, some seven other hovercraft manufacturers in the United Kingdom construct smaller hovercraft. These manufacturers look mainly to overseas markets where they have had considerable success, and they are continuously developing new designs. Besides being used for pleasure, the smaller type of hovercraft is used in surveying, inshore rescue, as ambulances and for general transport.

The industrial applications of the hover principle are also proving to be extremely important in solving certain civil engineering problems. Industry is gradually becoming aware of the possibilities in the fields of materials handling, and the possible applications seem to be increasing. These range from small hover-pallets to large hoverplatforms, and even large oil storage tanks have been moved in one piece by the air cushion principle without the need to dismantle them, which was often the only way to do the job in the past. Air Cushion Equipment, which pioneered this method of moving tanks, has recently interested contacts in the United States, where the potential is great, and has now gone into partnership with a large American company.

The main markets for hover platforms appear to be overseas for work in an inhospitable terrain. Mackley Ace has built two 750-ton air cushion transporters for use in the Persian Gulf and has obtained an order for two transporters to be used on the Alaska pipeline. Hover-trailers International Ltd has developed a range of air cushion vehicles for working over marshland, and these are selling overseas. The British Hovercraft Corporation has developed with the Central Electricity Generating Board a system for reducing the axle loading on transporters. Before this development, it was often necessary to strengthen roads and bridges before large loads such as big transformers could be moved across them.

There has been criticism in the Press from time to time that Sir Christopher Cockerell's invention has not been used to the best advantage of the United Kingdom. It has taken a long time to achieve a wider acceptance of the totally new development which the hovercraft represents, but markets are now opening up and our industry is taking full advantage. It was to be expected that other countries might emulate our success, and, as the hon. Gentleman pointed out, some are now taking more interest in the construction of hovercraft. The French, as he told us, are building a 225-ton craft to compete on the cross-Channel route and the Americans are developing the 2,000-ton naval hovercraft, though there is as yet no firm commitment to the construction of this craft.

I hope that journalists, rightly giving their readers information, will not be too lugubrious. There is a great tendency in the Press not to recognise the major achievements of British industry, whether by the correspondent in the Daily Telegraph or anybody else. It is right that the Press should warn us against complacency, because far too many experiences in the past which have upset us so much have stemmed from complacency. I do not complain that we should have drawn to our attention the need always to be up to the mark.

It was inevitable that competition of this kind would arise, but it is happy for us to know that these other countries still have some way to go. It seems likely that the United Kingdom hovercraft industry will hold its paramount position in the world for some time to come.

When news is not often as bright as it might be, I welcome this opportunity to give details of a real success story for British industry. With new technology being applied to the construction of hovercraft all the time, I am sure that the United Kingdom industry is set for a bright future.

I am grateful to the Minister for his encouraging reply and the history which he has fairly put. I hope that the record he has given will be shown to his colleagues and that the Government will feel that this is a form of technology which should be given every encouragement to go on. That means that the next stage in the hovercraft development which I have suggested can be given through the Seaspeed extension. I am grateful for the hon. Gentleman's courteous answer.

I am obliged to the hon. Gentleman for what he said. We need to secure a viable, profitable industry providing long-term, well-paid em- ployment for its employees and giving us a gain on the balance of payments. That is what we want. It seems to me from what I have seen of the situation in the hovercraft industry that that is what we are likely to get. I hope that the industry will be encouraged by the hon. Gentleman's interest and concern. On behalf of the Government, I assure the industry that we are anxious and hopeful for its success.

Question put and agreed to .

Adjourned accordingly at twenty-eight minutes past Four o'clock .