Orders of the Day — Industry [Money]

– in the House of Commons at 12:00 am on 23rd January 1979.

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Queen's Recommendation having been signified

Motion made, and Question proposed,That, for the purposes of any Act of the present Session to make provision with respect to the limits on sums borrowed by, or paid by Ministers of the Crown to the National Enterprise Board, the Scottish Development Agency and the Welsh Development Agency and subsidiaries of theirs, on sums paid by the Treasury in pursuance of guarantees of loans to the Board or either of those Agencies and on loans guaranteed by the Board or either of those Agencies or subsidiaries of the Scottish Development Agency, it is expedient to authorise all such increased payments—

  1. (a) out of the National Loans Fund, the Consolidated Fund and moneys provided by Parliament, and
  2. (b) into the National Loans Fund and the Consolidated Fund,
as may result from provisions of that Act increasing to the new amount the limit imposed by the Industry Act 1975 ("the Industry Act"), the Scottish Development Agency Act 1975 ("the Scottish Act") and the Welsh Development Agency Act 1975 ("the Welsh Act") on the amount outstanding, otherwise than by way of interest, in respect of the relevant sums specified in those Acts respectively.
  1. (1) For the purposes of this resolution the new amount of any such limit is—
    1. (a) the case of the relevant sums specified in the Industry Act, £4,500 million;
    2. (b) in the case of the relevant sums specified in the Scottish Act, £800 million;
    3. (c) in the case of the relevant sums specified in the Welsh Act, £400 million.
  2. (2) For the purposes of the resolution the following are relevant sums in the case of any of those Acts, that is to say—
    1. (a) the general external borrowing (as defined in that Act) of the National Enterprise Board, the Scottish Development Agency or the Welsh Development Agency, as the case may be, and their respective subsidiaries;
    2. (b) sums issued by the Treasury in fulfilment of guarantees in respect of sums borrowed by the Board or either of those Agencies from a person other than the Secretary of State;
    3. (c) in the case of the Industry Act, sums paid to the Board as public dividend capital (as defined in that Act);
    4. (d) in the case of the Scottish Act, sums paid to the Scottish Development Agency by the Secretary of State less repayments to the Secretary of State by the Agency (other than payments made by the Agency in consideration of receiving public dividend capital) and less sums paid in respect of the administrative expenses of the Agency
    5. (e) in the case of the Welsh Act, sums paid to the Welsh Development Agency by the Secretary of State less repayments to him by the Agency and less sums paid in respect of the administrative expenses of the Agency; and
    6. (f) in the case of each of those Acts, loans guaranteed by the Board or either of those Agencies otherwise than in the exercise of powers conferred on the Secretary of State under section 7 or 8 of the Industry Act 1972 as applied by that Act and loans guaranteed by a subsidiary of the Scottish Development Agency.—[Mrs. Ann Taylor.]

7.32 p.m.

Photo of Mr Robert Taylor Mr Robert Taylor , Croydon North West

I oppose the money resolution for several reasons. My right hon. Friend the Member for Leeds, North-East (Sir K. Joseph) referred on Second Reading to firms that the NEB has supported, and will support as a result of the money resolution, as "unbankruptable companies". This is an apt description because most business men regard competition from Government-sponsored companies as unfair competition from firms which will be supported, regardless of cost, out of the taxes paid by successful companies and individuals.

That process will be even more inevitable if the money resolution for this enormous amount of money is passed. Nothing is calculated to infuriate the successful business man more than the knowledge that the results of his efforts, which are confiscated by the Inland Revenue through penal taxation, are being used to prop up inefficient and unsuccessful enterprises that compete with his own company.

The successful business man pays extortionate rates of tax and has had any incentive to work harder, which would create jobs, or to sell abroad, which would create jobs, or to improve efficiency at home, which would create jobs, drained away from him. [Interruption.]

Photo of Mr Myer Galpern Mr Myer Galpern , Glasgow Shettleston

Order. I see that a minor disturbance is going on. I hope that hon. Members will respect the right of the hon. Member for Croydon, North-West (Mr. Taylor) to address the House.

Photo of Mr Robert Taylor Mr Robert Taylor , Croydon North West

The Prime Minister is on record as stating that the nation wants a reduction in direct taxation, yet by the money resolution we are making available enormous sums to three agencies which have neither adequate parliamentary scrutiny nor track records which give us confidence to believe that the money will be spent wisely.

There are many politicians and civil servants who believe that they can tell business men how to run their businesses and that they know better than the commercial banks and the City institutions how to invest money. Before we approve the money resolution, we should look at an example from each of the three agencies to see whether the judgments of those who are able to hand out large amounts of taxpayers' money are better than the judgments of the professionals who have rejected appeals from the same sources.

My first example is from the work of the National Enterprise Board. I make no apology for raising again the case of the company Thwaites and Reed. I do so because the injection of money by the NEB into that concern affected two competing companies in my constituency.

Since I last raised the matter, there has been a startling new development. The NEB acquired 90 per cent. of Thwaites and Reed for £420,000. We were told that this was one of the speedy decisions which the Board like to take and prided itself in making much quicker than could the banks and other institutions in the private sector. As my hon. Friend the Member for Kingston upon Thames (Mr. Lamont) said earlier, when Lord Ryder was questioned in the Public Accounts Committee about why he had made the investment, he said that it was a "breathtaking" opportunity. It was certainly an opportunity which should have taken away the breath of every hon. Member because the investment of £420,000 was sold only a year later for £78,000 to one of the competing companies in my constituency.

My next example is a company supported by the Welsh Development Agency. It is, presumably, the type of company that will continue to be supported if the money resolution is approved. The company concerned is Penrad, and, against specific advice from the Industrial Development Advisory Board, taxpayers' money was poured into the company from many and varied sources. It started with a grant of £300,000 in 1975 from the Department of Industry as a forerunner to the WDA. Eight months later, another £100,000 of taxpayers' money went into the concern. In May 1977 a receiver was appointed and a few months later a private company was induced to come to the rescue. The agency provided £600,000, interest-free for five years, to induce the company to do so.

The Welsh Office chipped in another £190,000 by way of interest relief on a loan from the European Coal and Steel Commission. Well over £1 million went into the company, and when the matter was last ventilated in the Public Accounts Committee it was learned that about 38 jobs, with an eventual target of 90, were involved.

It is no wonder that the permanent secretary at the Welsh Office, Sir Hywel Evans, told the Public Accounts Committee on 26 June 1978 regarding the provision of £600,000 to the company: I had misgivings about the form of this investment. If Sir Harold had misgivings about the form of investments being made by the agency, how much more important it must be for the House to examine the money resolution with care.

My final example comes from the work of the Scottish Development Agency. A total of £600,000 was recently invested in a firm called Scofisco, which I presume is short for the Scottish Fishery Company. It failed within a year of the money being put into it and the investment could not be justified on grounds of the number of jobs involved because there were very few jobs indeed.

I appreciate that there must be some success stories to compensate for the failures, and certainly the advance factories in Scotland have contributed substantially to the number of jobs available there. But I do not believe that the policy of investing money, procured by this resolution, in companies against the advice of those people whose life work it has been to assess such questions has anything to commend it. I do not think that that policy should be commended to the House, and that is my principal reason for objecting to the resolution.

Lame ducks come about as a result of bad management, poor products or bad industrial relations, and none of these maladies can be cured by milking successful companies and having an open cheque book for those which are unsuccessful.

I mentioned earlier that if we vote this money, Parliament has very little opportunity to scrutinise investments made by the NEB. Indeed, Sir Peter Carey, the permanent secretary at the Department of Industry, has bravely fought in the Public Accounts Committee against greater scrutiny by this House on the ground of need for confidentiality. I make no apology for quoting from the answer he gave to my hon. Friend the Member for Canterbury (Mr. Crouch) on 8 May 1978. Sir Peter said: I believe that these private sector companies, many of which are approaching the NEB rather than being approached by it, would take a different attitude if they believed that this new procedure was operating. He was referring to the procedure of greater scrutiny by this House, upon which we were trying to reach agreement. He went on: I think that they would see themselves being placed in quite a different category from the normal run of private sector companies. I agree that they probably would feel that they were in a different category from the normal run of private sector companies, and so indeed they would be. It is my view that any company from the private sector which comes cap in hand to the National Enterprise Board for a dollop of this money that we are asked to approve tonight is in a very different position, and the management should have no misapprehensions on that score. Its accounts should be an open book for this House as soon as it gets the first penny of taxpayers' money.

It can be argued that at the present time some information is available to the House where the NEB or the agencies have control of a company or, in other words, have 51 per cent. of the equity. But such a requirement gives a shield to the NEB or to the agencies, and as a result there is an incentive for the NEB and the agencies to keep their holding of the voting equity below 50 per cent. This is particularly so in the case of the NEB. It keeps the voting equity below 50 per cent. but in many cases the taxpayer shoulders 100 per cent. of the preference debenture or loan stock, which carries no voting rights.

In the 1977 accounts of the National Enterprise Board, 11 out of 16 of the associate companies fall into this category; in other words, the taxpayer has less than half of the voting stock but very nearly 100 per cent. of the non-voting stock. In my view, the taxpayer is taking an unfair risk in these cases. The taxpayer should not be involved at all. But if the taxpayer is involved, he should not be at such a disadvantage.

Before we pass the resolution, it is my view that the guidelines of the NEB and of the agencies should be altered to prevent taxpayers' money being invested in any company in the non-voting stock at a higher ratio than its investment in the voting stock. This would satisfy me to a certain degree, and that is something which should be carefully considered. Perhaps, if the money resolution is passed, it might be considered in the Committee which looks at the Bill.

Finally, each of the agencies—and particularly the NEB—excuses its speculative ventures into the private sector by claiming to be an entrepreneur. That word has been used on a number of occasions in the preceding debate. None claims louder to be an entrepreneur than Sir Leslie Murphy. I believe such a claim to be a misuse of the English language. We are not voting this money resolution tonight so that the money shall go to entrepreneurs. An entrepreneur is essentially a man who backs his own judgment with his own resources, be they financial or his own labour. They are the men upon whose shoulders depends the future industrial success of our nation. I can only hope that it will never depend on faceless men backing corporate judgments with a bottomless pit of taxpayers' money, such as we are voting in this resolution tonight.

7.46 p.m.

Photo of Mr John Watkinson Mr John Watkinson , Gloucestershire West

I shall not follow entirely the line of argument pursued by the hon. Member for Croydon, North-West (Mr. Taylor), except to say that I, too, am a member of the Public Accounts Committee, which considered the National Enterprise Board. The hon. Gentleman has, I acknowledge, been a consistent critic of the NEB, and so his remarks come as no great surprise to me.

If the hon. Gentleman is seriously asking the House to oppose this money resolution, I presume that this means that he is asking the House not to continue the supply of funds to British Leyland and not to continue the supply of funds to Rolls-Royce and to other concerns. Perhaps he and his hon. Friends will wish to go to the Midlands to explain this decision. The hon. Gentleman knows, as I do, from our study and our investigation in the Public Accounts Committee, that the major proportion of funds available to the NEB is directed towards and involved with British Leyland and Rolls-Royce. I do not see any way at all in which anyone in this House at this stage could vote to cut off funds to those two organisations. But it is with the other sector of the NEB investment that I wish to concern myself.

Photo of Mr Peter Rost Mr Peter Rost , Derbyshire South East

Surely the hon. Gentleman is not assuming that a company such as Rolls-Royce is not perfectly capable of raising money in the market in the ordinary way, or in the way that nationalised industries do now. It is not necessarily dependent on the NEB for every penny of cash. It should be accountable in the market.

Photo of Mr John Watkinson Mr John Watkinson , Gloucestershire West

I believe that the hon. Gentleman's party rescued Rolls-Royce as a lame duck, so I think that he should ask himself that question about recourse to the private market.

I wish to come to the point made in the Public Accounts Committee by both Lord Ryder and Sir Leslie Murphy. It is a point to which even those Conservative Members who feel themselves doctrinally opposed to the operation of the NEB should give consideration. We on the Labour Benches have no doctrinal opposition to the intervention of the State in British industry.

Perhaps Conservative Members will consider what was said in evidence to that Committee by Lord Ryder and by Sir Leslie Murphy. It was that in their opinion there was and is a gap in the equity market. Both Lord Ryder and Sir Leslie underlined this point. The hon. Member for Croydon, North-West is shaking his head. They were asked point-blank about this in the Committee. They both readily agreed that there was this equity gap. From their experience they found that firms with a capitalisation of between £10 million and £15 million found it difficult to raise funds.

These companies found that they could not go to the banking sector and found it difficult to raise money through rights issues. The evidence is that companies are coming to the NEB knowing that the NEB is setting a stiff test of between 15 and 20 per cent. That is the return which they are looking for and which they expect.

Photo of Mr Timothy Renton Mr Timothy Renton , Mid Sussex

The hon. Gentleman would have realised if he had been present to any great extent in the debate that the rate of 15 per cent. is before tax and before interest. Bearing in mind that the Government have to borrow at an interest rate of 14 per cent., it is effectively a negative return as far as the NEB is concerned, because it does not cover interest costs.

Photo of Mr John Watkinson Mr John Watkinson , Gloucestershire West

In answer to the hon. Gentleman I would like briefly to deal with the point raised by his hon. Friend the Member for Horsham and Crawley (Mr. Hordern). This was dealt with in the Public Accounts Committee. It is not possible to hypothecate in the way that the hon. Gentleman was indicating. I accept that some adjustment must be made to the return that is being sought by the National Enterprise Board. Nevertheless, a substantial return is being looked for in this area.

Photo of Mr Peter Hordern Mr Peter Hordern , Horsham and Crawley

It is not only possible but it is essential to hypothecate in this instance. The NEB itself puts on a target rate of return. It has to take into account the cost of borrowing the money. One cannot take taxpayers' money, allow no cost of interest, and then talk of a supposed rate of return of 14 to 15 per cent. It simply cannot be done.

Photo of Mr John Watkinson Mr John Watkinson , Gloucestershire West

If one follows the hon. Gentleman's argument, all areas of Government expenditure must be considered in that way. That is the evidence given before the Committee by the Treasury witness.

The National Enterprise Board should be subject to the scrutiny of this House. It has been claimed that there is adequate scrutiny through the Secretary of State, to whom the National Enterprise Board is answerable. The only proper way in which the National Enterprise Board can be held accountable is through investigation by a Select Committee such as the Public Accounts Committee; and the Comptroller and Auditor General should have access to its books.

The Minister has instituted an inquiry into the general operation of the audit Acts and the position of the Comptroller and Auditor General. I welcome this. My first concern is to see the NEB survive. It has presented cogent argument before the Committee that, if the Committee has the power to investigate, this will undermine the operation of the NEB. I do not want to see that. I want to see the NEB survive.

If we can ask questions on defence contracts or go into private session, it is possible for us to investigate the National Enterprise Board and to have these matters before us. In a day and age in which in America, for instance, the CIA can be investigated, it is not beyond the wit of man that this Parliament or one of its Select Committees should be able to investigate the NEB.

7.55 p.m.

Photo of Mr Nicholas Budgen Mr Nicholas Budgen , Wolverhampton South West

I shall deal with only one point. In the course of our deliberations over two days it was frequently said that it was not envisaged that there would be any additional burden upon public expenditure as a result of passing this money resolution and the Industry Bill. It was said that the limits were to be raised so that the limits of the three agencies concerned could rise to £5·7 billion. Yet it was also very firmly said that there would be no additional public expenditure.

I am prepared to concede that there will probably be no additional public expenditure in this financial year. I have no doubt that the Government are anxiously looking round for areas of public expenditure that can be cut back and if possible, cut back without the Left wing of the Labour Party seeing what is being done. I dare say that when vigorous Labour politicians are visiting the regions of the United Kingdom they believe that it is sufficient to point to the amount of industrial intervention that has taken place, to point to the raised limits that might unhappily be passed tonight and say "After the election you will get the factory you want and the support that you want." There may not be any increased public expenditure before the general election.

In this money resolution we are dealing with what might happen in the unhappy event of the Labour Party winning the next general election. In table 2(4) on page 49 of the Government's public expenditure White Paper which we had recently, the projections were that for the next four years the expenditure on the NEB would remain constant in present money terms—indeed, that it would slightly decline by 1982–83. Those projections are nonsense. The essence of the NEB's operation is that it is propping up a large number of different firms. God knows what the requirement for money will be for British Leyland if the Labour Government win the next general election. God knows how much Sir Kenneth Keith will want in his begging bowl in three years' time if the Labour Government win the next general election.

When Ministers say that there will be no additional public expenditure because of these proposals, they are making an assertion which they cannot possibly make in good faith. There is no way of saying that. It is certain that if they win the next general election they will use this money to try to bribe the electorate in order to win the following election.

7.58 p.m.

Photo of Mr Leslie Huckfield Mr Leslie Huckfield , Nuneaton

The hon. Member for Croydon, North-West (Mr. Taylor) made specific reference to Penrad. He seemed to be admitting that that company was in receivership before the Welsh Development Agency became involved. He may have some detailed criticism of the Welsh Development Agency for that involvement. He should take cognisance of the fact that the WDA got involved after receivership. If he has any detailed criticism to make, I hope that he will pass that on to my right hon. and learned Friend the Secretary of State for Wales, who will be glad to study it in detail.

We had a very full debate on the NEB guidelines, which have been approved by the whole House. If the hon. Gentleman had doubts about the guidelines of the NEB, he should have been here for that debate. If he was, I apologise to him, but I do not recall seeing him.

My hon. Friend the Member for Gloucestershire, West (Mr. Watkinson) is right in saying that without the NEB there would be considerably higher unemployment in many regions of this country, particularly in the West Midlands. There are currently in the West Midlands some 100,000 workers who owe the existence of their jobs to the NEB. Almost 20 per cent. of the working population of Coventry is employed by companies which are subsidiaries of the NEB. If the hon. Member for Croydon, North-West wants to vote against such issues, I shall make sure that my constituents know about it and I know that my hon. Friends will make sure that their constituents know about it as well.

The views of the hon. Member for Wolverhampton, South-West (Mr. Budgen) on British Leyland and companies that we have rescued in the West

Division No. 48]AYES[8.01 p.m.
Abse, LeoCanavan, DennisDunn, James A.
Allaun, FrankCant, R. B.Dunnett, Jack
Anderson, DonaldCarmichael, NeilEadie, Alex
Archer, Rt Hon PeterCarter, RayEdge, Geoff
Armstrong, ErnestCarter-Jones, LewisEllis, John (Brigg & Scun)
Ashton, JoeCartwright, JohnEnglish, Michael
Atkins, Ronald (Preston N)Clemitson, IvorEnnals, Rt Hon David
Atkinson, Norman (H'gey, Tott'ham)Cocks, Rt Hon Michael (Bristol S)Evans, Fred (Caerphilly)
Bagier, Gordon A. T.Cohen, StanleyEvans, Gwyntor (Carmarthen)
Barnett, Guy (Greenwich)Colquhoun, Ms MaureenEvans, Ioan (Aberdare)
Barnett, Rt Hon Joel (Heywood)Concannon, Rt Hon JohnEvans, John (Newton)
Bates, AlfCook, Robin F. (Edin C)Ewing, Harry (Stirling)
Bean, R. E.Corbett, RobinFaulds, Andrew
Bonn, Rt Hon Anthony WedgwoodCowans, HarryFernyhough, Rt Hon E.
Bennett, Andrew (Stockport N)Cox, Thomas (Tooting)Flannery, Martin
Bidwell, SydneyCraigen, Jim (Maryhill)Fletcher, Ted (Darlington)
Bishop, Rt Hon EdwardCrawshaw, RichardFoot, Rt Hon Michael
Blenkinsop, ArthurCrowther, Stan (Rotherham)Ford, Ben
Boardman, H.Cryer, BobForrester, John
Booth, Rt Hon AlbertCunningham, Dr J. (Whiteh)Fowler, Gerald (The Wrekin)
Boothroyd, Miss BettyDavidson, ArthurFraser, John (Lambeth, N'w'd)
Bottomley, Rt Hon ArthurDavies, Bryan (Enfield N)Garrett, John (Norwich S)
Bradley, TomDavies, Ifor (Gower)Garrett, W. E. (Wallsend)
Bray, Dr JeremyDavis, Clinton (Hackney C)George, Bruce
Brown, Hugh D. (Provan)Deakins, EricGilbert, Rt Hon Dr John
Brown, Robert C. (Newcastle W)Dean, Joseph (Leeds West)Ginsburg, David
Brown, Ronald (Hackney S)de Freitas, Rt Hon Sir GeoffreyGould, Bryan
Buchan, NormanDell, Rt Hon EdmundGourlay, Harry
Buchanan, RichardDempsey, JamesGraham, Ted
Butler, Mrs Joyce (Wood Green)Dewar, DonaldGrant, George (Morpeth)
Callaghan, Rt Hon J. (Cardiff SE)Doig, PeterGrant, John (Islington C)
Callaghan, Jim (Middleton & P)Dormand, J. D.Grocott, Bruce
Campbell, IanDuffy, A. E. P.Hamilton, James (Bothwell)

Midlands are well known. He has said time and time again, and when it comes to an election he will be on the record as saying, that these companies should have gone bankrupt or into receivership. His constituents will get that message passed home to them very forcefully at the time of the next election.

However, the hon. Gentleman seems to have forgotten to take into account that in the passage of time something like one-half of the increase of £3,500 million which is being talked about in this money resolution will come from private sources of finance. It is not good enough to stand up in the House and make generalised criticisms of the public expenditure White Paper without understanding the meaning of those criticisms. Certainly, to judge from the hon. Gentleman's comments tonight, he does not understand what they mean.

Having said that, I hope that the House will agree to the money resolution. It is essential, before we can bring about any changes in the NEB, that the money resolution goes through. Shortly, the NEB will be hard up against its borrowing limit, and a large number of jobs are at stake.

Question put:

The House divided: Ayes 275, Noes 255.

Hamilton, W. W. (Central Fife)McMillan, Tom (Glasgow C)Sever, John
Hardy, PeterMcNamara, KevinShaw, Arnold (Ilford South)
Harrison, Rt Hon WalterMadden, MaxSheldon, Rt Hon Robert
Hattersley, Rt Hon RoyMagee, BryanShore, Rt Hon Peter
Hayman, Mrs HeleneMahon, SimonSilkin, Rt Hon S. C. (Dulwich)
Healey, Rt Hon DenisMallalieu, J. P. W.Silverman, Julius
Heffer, Eric S.Marks, KennethSkinner, Dennis
Home Robertson, JohnMarshall, Dr Edmund (Goole)Smith, Rt Hon John (N Lanarkshire)
Horam, JohnMarshall, Jim (Leicester S)Snape, Peter
Hoyle, Doug (Nelson)Maynard, Miss JoanSpearing, Nigel
Huckfield, LesMeacher, MichaelSpriggs, Leslie
Hughes, Rt Hon C. (Anglesey)Mellish, Rt Hon RobertStallard, A. W.
Hughes, Mark (Durham)Mikardo, IanStewart, Rt Hon M. (Fulham)
Hughes, Robert (Aberdeen N)Millan, Rt Hon BruceStoddart, David
Hughes, Roy (Newport)Miller, Dr M. S. (E Kilbride)Stott, Roger
Hunter, AdamMitchell, Austin (Grimsby)Strauss, Rt Hon G. R.
Irving, Rt Hon S. (Dartford)Molloy, WilliamSwain, Thomas
Jackson, Colin (Brighouse)Moonman, EricTaylor, Mrs Ann (Bolton W)
Jackson, Miss Margaret (Lincoln)Morris, Alfred (Wythenshawe)Thomas, Dafydd (Merioneth)
Janner, GrevilleMorris, Rt Hon J. (Aberavon)Thomas, Jeffrey (Abertillery)
Jay, Rt Hon DouglasMorton, GeorgeThomas, Mike (Newcastle E)
Jeger, Mrs LenaMoyle, Rt Hon RolandThomas, Ron (Bristol NW)
Jenkins, Hugh (Putney)Mulley, Rt Hon FrederickThompson, George
John, BrynmorMurray, Rt Hon Ronald KingThorne, Stan (Preston South)
Johnson, James (Hull West)Newens, StanleyTierney, Sydney
Jones, Alec (Rhondda)Noble, MikeTilley, John
Jones, Barry (East Flint)Oakes, GordonTomlinson, John
Jones, Dan (Burnley)Ogden, EricTuck, Raphael
Judd, FrankO'Halloran, MichaelUrwin, T. W.
Kaufman, Rt Hon GeraldOrbach, MauriceVarley, Rt Hon Eric G.
Kelley, RichardOrme, Rt Hon StanleyWainwright, Edwin (Dearne V)
Kerr, RussellOvenden, JohnWalker, Harold (Doncaster)
Kilroy-Silk, RobertPadley, WalterWalker, Terry (Kingswood)
Kinnock, NeilPalmer, ArthurWard, Michael
Lambie, DavidPark, GeorgeWatkins, David
Lamborn, HarryParker, JohnWatkinson, John
Lamond, JamesParry, RobertWatt, Hamish
Latham, Arthur (Paddington)Pendry, TomWeetch, Ken
Leadbitter, TedPerry, ErnestWeitzman, David
Lee, JohnPhipps, Dr ColinWellbeloved, James
Lestor, Miss Joan (Eton & Slough)Price, C. (Lewisham W)Welsh, Andrew
Lever, Rt Hon HaroldPrice, William (Rugby)White, Frank R. (Bury)
Lewis, Arthur (Newham N)Radice, GilesWhite, James (Pollok)
Lewis, Ron (Carlisle)Rees, Rt Hon Merlyn (Leeds S)Whitehead, Phillip
Litterick, TomReid, GeorgeWhitlock, William
Lofthouse, GeoffreyRichardson, Miss JoWigley, Dafydd
Loyden, EddieRoberts, Albert (Normanton)Willey, Rt Hon Frederick
Luard, EvanRoberts, Gwilym (Cannock)Williams, Rt Hon Alan (Swansea W)
Lyon, Alexander (York)Robertson, George (Hamilton)Williams, Alan Lee (Hornch'ch)
Lyons, Edward (Bradford W)Robinson, GeoffreyWilliams, Sir Thomas (Warrington)
Mabon, Rt Hon Dr J. DicksonRoderick, CaerwynWilson, Gordon (Dundee E)
McCartney, HughRodgers, George (Chorley)Wilson, William (Coventry SE)
MacCormick, IainRodgers, Rt Hon William (Stockton)Wise, Mrs Audrey
McDonald, Dr OonaghRooker, J. W.Woodall, Alec
McElhone, FrankRoper, JohnWoof, Robert
MacFarquhar, RoderickRoss, Rt Hon W. (Kilmarnock)Young, David (Bolton E)
McGuire, Michael (Ince)Rowlands, Ted
McKay, Allen (Penistone)Ryman, JohnTELLERS FOR THE AYES:
MacKenzie, Rt Hon GregorSedgemore, BrianMr. Donald Coleman and
Maclennan, RobertSelby, HarryMr. James Tinn
NOES
Adley, RobertBoyson, Dr Rhodes (Brent)Cockcroft, John
Aitken, JonathanBraine, Sir BernardCooke, Robert (Bristol W)
Alison, MichaelBrittan, LeonCope, John
Amery, Rt Hon JulianBrocklebank-Fowler, C.Cormack, Patrick
Arnold, TomBrooke, Hon PeterCorrie, John
Atkins, Rt Hon H. (Spelthorne)Brotherton, MichaelCostain, A. P.
Atkinson, David (B'mouth, East)Brown, Sir Edward (Bath)Critchley, Julian
Baker, KennethBryan, Sir PaulCrouch, David
Banks, RobertBuchanan-Smith, AlickCrowder, F. P.
Beith, A. J.Buck, AntonyDean, Paul (N Somerset)
Bell, RonaldBudgen, NickDodsworth, Geoffrey
Bendall, VivianBulmer, EsmondDouglas-Hamilton, Lord James
Bennett, Dr Reginald (Fareham)Burden, F. A.Drayson, Burnaby
Benyon, W.Butler, Adam (Bosworth)du Cann, Rt Hon Edward
Berry, Hon AnthonyCarlisle, MarkDurant, Tony
Biffen, JohnChalker, Mrs LyndaDykes, Hugh
Biggs-Davison, JohnChannon, PaulEden, Rt Hon Sir John
Blaker, PeterChurchill, W. S.Edwards, Nicholas (Pembroke)
Body, RichardClark, Alan (Plymouth, Sutton)Elliott, Sir William
Boscawen, Hon RobertClark, William (Croydon S)Emery, peter
Bottomley, PeterClarke, Kenneth (Rushcliffe)Eyre, Reginald
Bowden, A. (Brighton, Kemptown)Clegg, WalterFairgrieve, Russell
Farr, JohnKing, Tom (Bridgwater)Rathbone, Tim
Fell, AnthonyKitson, Sir TimothyRees, Peter (Dover & Deal)
Finsberg, GeoffreyKnight, Mrs JillRees-Davies, W. R.
Fisher, Sir NigelKnox, DavidRenton, Rt Hon Sir D. (Hunts)
Fletcher, Alex (Edinburgh N)Lamont, NormanRenton, Tim (Mid-Sussex)
Fookes, Miss JanetLangford-Holt, Sir JohnRhodes James, R.
Forman, NigelLatham, Michael (Melton)Ridley, Hon Nicholas
Fowler, Norman (Sutton C'f'd)Lawrence, IvanRidsdale, Julian
Fox, MarcusLawson, NigelRifkind, Malcolm
Fraser, Rt Hon H. (Stafford & St)Lester, Jim (Beeston)Roberts, Wyn (Conway)
Fry, PeterLewis, Kenneth (Rutland)Rodgers, Sir John (Sevenoaks)
Galbraith, Hon T. G. D.Lloyd, IanRoss, Stephen (Isle of Wight)
Gardiner, George (Reigate)Loveridge, JohnRossi, Hugh (Hornsey)
Gardner, Edward (S Fylde)Luce, RichardRost, Peter (SE Derbyshire)
Gilmour, Rt Hon Sir Ian (Chesham)McAdden, Sir StephenRoyle, Sir Anthony
Gilmour, Sir John (East Fife)McCrindle, RobertSainsbury, Tim
Glyn, Dr AlanMacfarlane, NeilSt. John-Stevas, Norman
Godber, Rt Hon JosephMacGregor, JohnShaw, Michael (Scarborough)
Goodhart, PhilipMacKay, Andrew (Stechford)Shelton, William (Streatham)
Goodhew, VictorMacmillan, Rt Hon M. (Farnham)Shepherd, Colin
Goodlad, AlastairMcNair-Wilson, M. (Newbury)Shersby, Michael
Gorst, JohnMcNair-Wilson, P. (New Forest)Silvester, Fred
Gow, Ian (Eastbourne)Madel, DavidSims, Roger
Gower, Sir Raymond (Barry)Marshall, Michael (Arundel)Sinclair, Sir George
Grant, Anthony (Harrow C)Marten, NeilSkeet, T. H. H.
Gray, HamishMates, MichaelSmith, Dudley (Warwick)
Grieve, PercyMather, CarolSmith, Timothy John (Ashfield)
Griffiths, EldonMawby, RaySpence, John
Grist, IanMaxwell-Hyslop, RobinSpicer, Michael (S Worcester)
Grylls, MichaelMayhew, PatrickSproat, Iain
Hall-Davis, A. G. F.Meyer, Sir AnthonyStainton, Keith
Hamilton, Archibald (Epsom & Ewell)Miller, Hal (Bromsgrove)Stanbrook, Ivor
Hamilton, Michael (Salisbury)Mills, PeterStanley, John
Hampson, Dr KeithMiscampbell, NormanSteen, Anthony (Wavertree)
Hannam, JohnMitchell, David (Basingstoke)Stokes, John
Harrison, Col Sir Harwood (Eye)Moate, RogerStradling Thomas, J.
Harvie Anderson, Rt Hon MissMolyneaux, JamesTapsell, Peter
Haselhurst, AlanMonro, HectorTaylor, R. (Croydon NW)
Hastings, StephenMontgomery, FergusTaylor, Teddy (Cathcart)
Havers, Rt Hon Sir MichaelMoore, John (Croydon C)Tebbit, Norman
Hawkins, PaulMorgan, GeraintTemple-Morris, Peter
Hayhoe, BarneyMorris, Michael (Northampton S)Thatcher, Rt Hon Margaret
Heseltine, MichaelMorrison, Hon Charles (Devizes)Townsend, Cyril D.
Hicks, RobertMorrison, Hon Peter (Chester)Trotter, Neville
Higgins, Terence L.Mudd, DavidVan Straubenzee, W. R.
Hodgson, RobinNeave, AireyVaughan, Dr Gerard
Holland, PhilipNelson, AnthonyViggers, Peter
Hordern, PeterNeubert, MichaelWainwright, Richard (Colne V)
Howe, Rt Hon Sir GeoffreyNewton, TonyWakeham, John
Howell, David (Guildford)Onslow, CranleyWalker, RI Hon P. (Worcester)
Hunt, David (Wirral)Oppenheim, Mrs SallyWalker-Smith, Rt Hon Sir Derek
Hunt, John (Ravensbourne)Osborn, JohnWall, Patrick
Hurd, DouglasPage, John (Harrow West)Warren, Kenneth
Irving, Charles (Cheltenham)Page, Rt Hon R. Graham (Crosby)Weatherill, Bernard
James, DavidPage, Richard (Workington)Wells, John
Jenkin, Rt Hon P. (Wanst'd & W'df'd)Parkinson, CecilWhitelaw, Rt Hon William
Jessel, TobyPattie, GeoffreyWiggin, Jerry
Johnson Smith, G. (E Grinstead)Penhaligon, DavidWinterton, Nicholas
Jones, Arthur (Daventry)Percival, IanWood, Rt Hon Richard
Jopling, MichaelPink, R. BonnerYoung, Sir G. (Ealing, Acton)
Joseph, Rt Hon Sir KeithPrentice, Rt Hon Reg
Kaberry, Sir DonaldPrice, David (Eastleigh)TELLERS FOR THE NOES:
Kellett-Bowman, Mrs ElainePrior, Rt Hon JamesMr. Spencer LeMerchant and
Kershaw, AnthonyRaison, TimothyMr. Michael Roberts.
Kimball, Marcus

Question accordingly agreed to.

Resolved,That, for the purpose of any Act of the present Session to make provision with respect to the limits on sums borrowed by, or paid by Ministers of the Crown to the National Enterprise Board, the Scottish Development Agency and the Welsh Development Agency and subsidiaries of theirs, on sums paid by the Treasury in pursuance of guarantees of loans to the Board or either of those Agencies and on loans guaranteed by the Board or either of those Agencies or subsidiaries of the Scottish Development Agency, it is expedient to authorise all such increased payments—

  1. (a) out of the National Loans Fund, the Consolidated Fund and moneys provided by Parliament, and
  2. (b) into the National Loans Fund and the Consolidated Fund,
as may result from provisions of that Act increasing to the new amount the limit imposed by the Industry Act 1975 ('the Industry Act') the Scottish Development Agency Act 1975 ('the Scottish Act') and the Welsh Development Agency Act 1975 ('the Welsh Act') on the amount outstanding, otherwise than by way of interest, in respect of the relevant sums specified in those Acts respectively.
  1. (1) for the purposes of this resolution the new amount of any such limit is—
    1. (a) in the case of the relevant sums specified in the Industry Act, £4,500 million;
    2. (b) in the case of the relevant sums specified in the Scottish Act, £800 million;
    3. (c) in the case of the relevant sums specified in the Welsh Act, £400 million.
  2. (2) For the purpose of this resolution the following are relevant sums in the case of any of those Actd, that is to say—
    1. (a) the general external borrowing (as defined in that Act) of the National Enterprise Board, the Scottish Development Agency or the Welsh Development Agency, as the case may be, and their respective subsidiaries;
    2. (b) sums issued by the Treasury in fulfilment of guarantees in respect of sums borrowed by the Board or either of those Agencies from a person other than the Secretary of State;
    3. (c) in the case of the Industry Act, sums paid to the Board as public dividend capital (as defined in that Act);
    4. (d) in the case of the Scottish Act, sums paid to the Scottish Development Agency by the Secretary of State less repayments to the Secretary of State by the Agency (other than payments made by the Agency in consideration of receiving public dividend capital) and less sums paid in respect of the administrative expenses of the Agency;
    5. (e) in the case of the Welsh Act, sums paid to the Welsh Development Agency by the Secretary of State less repayments to him by the Agency and less sums paid in respect of the administrative expenses of the Agency; and
    6. (f) in the case of each of those Acts, loans guaranteed by the Board or either of those Agencies otherwise than in the exercise of powers conferred on the Secretary of State under section 7 or 8 of the Industry Act 1972 as applied by that Act and loans guaranteed by a subsidiary of the Scottish Development Agency.