Orders of the Day — Shipbuilding (Northern Ireland)

Part of the debate – in the House of Commons at 12:13 am on 26th July 1982.

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Photo of Mr Clive Soley Mr Clive Soley , Hammersmith North 12:13 am, 26th July 1982

I listened with a deepening sense of gloom to the Minister's comments. He has just spelled out a sentence of death on Harland and Wolff that at best will be delayed. I listened with horror as he described the £600 million subsidy as something that could possibly have been better spent elsewhere. I listened with desperate anxiety when he talked about an 18 per cent. subsidy for Harland and Wolff compared with 15 per cent for the rest of the United Kingdom. What on earth is 3 per cent., given the extra transport and energy costs in Northern Ireland? The Minister's whole philosophy stems from the Government's absurd belief that they should not interfere with the economy of Northern Ireland or the United Kingdom as a whole.

We know from this debate and from the one that preceded it that the competition that Ministers talk about comes from countries whose Governments involve themselves in the planning, payment, investment and the production of ships. Yet the Government are abandoning shipbuilding in Britain and Northern Ireland and are abandoning those involved in the industry. The Minister has more or less said that he will pull out the plug if they do not cut their costs and pull themselves together. What are they supposed to do? Are they to make yet more people redundant? How small does Harland and Wolff have to become before it is viable? There is a work force now of about 7,000. What will it have to be if the company is to be viable? Will it have to be 5,000 or 3,000? Perhaps the company will have to contract to the extent of building rowing boats before it becomes viable. Is that what the investment in Harland and Wolff has been for?

In the previous debate the Minister said something that chilled me, and the Minister of State, Northern Ireland Office has said nothing to dispel my fears. The Minister of State, Department of Industry said that Europe has taken the decision not to subsidise, whereas we have been told in this debate that there will be a 3 per cent. increase in the subsidy for Harland and Wolff. If that is the Government's philosophy, the shipbuilding industry in Northern Ireland is doomed to die, and to die quickly.

If that is the decision that the Government have taken—having listened to the Minister I suspect that it is—it would be far better if they said so openly and immediately embarked on a massive policy of restraint and put money into other investment areas and capital projects to provide alternative employment. Nothing could be worse than letting Harland and Wolff die and doing nothing about it other than saying that it must put its own house in order. It cannot do so without full and detailed involvement by the Government in precisely the same way as Governments involve themselves in Japan, Korea, Germany, France, Spain and in all the other shipbuilding nations. One example was given in the previous debate of three orders being given to the Scandinavian yards. Until we take a similar approach our industries will die.

When Harland and Wolff dies, what will the Minister do? Will he pick on the next largest industry and say "Unless it gets its house in order it, too, will go to the wall"? If he adopts that approach, we shall go right through the Northern Ireland industries in that way. Indeed, that is what has been happening for the past three years. This is a desperate comment on the Government's economic policies.

The extension of the scheme for another two years is welcome in its own right, but it shows the seriousness of the position that the company faces. Where is the Minister in the fight for the replacement of the "Atlantic Conveyor"? In the previous debate we heard many appeals for the order to be placed in British yards. I can understand that, especially when the appeal is made by those who represent shipbuilding constituencies. One of the tasks of the Northern Ireland Minister is to try to get the order for Harland and Wolff. The company is capable of building a replacement for the "Atlantic Conveyor". If I lost the fight, I would argue that the company should be given the order to build the engine for the replacement vessel. Let us have some positive involvement by the Ministers responsible for Northern Ireland. The position in Northern Ireland is desperate. I have said many times that even the CBI in Northern Ireland acknowledges that the economy will not get off the ground again until the Government involve themselves in public expenditure programmes.

I am the first to acknowledge that it is difficult to identify the right programmes that will bring the best sort of employment and the best return. However, that is no excuse for inaction. That does not mean that Ministers should sit back and do nothing. The Minister of State has told us that £600 million of subsidy could well have been spent elsewhere. We are told that the subsidy is to be increased by a marginal 3 per cent. That will not touch transport and energy costs. It seems that that is all that the company will get. There was nothing from the Minister about a battle to get orders for Harland and Wolff, only a demoralising speech that spelt doom and gloom to the workers not only of Harland and Wolff but of all the associated industries that will die with that great company.

As the Minister said, redundancy payments soften the blow of unemployment but they do not necessarily resolve the individual's longer-term social and economic problems. A sufficiently large sum may give the individual a chance to find alternative work without undue hardship. Alternatively, combined with any savings that he or she might have, he might be able to start a small business or buy a shop, but that applies to a small number of people. The amounts of money that we are talking about are small for such encouragement.

The other matter that I should like to draw to the Government's attention, if they are serious about generous redundancy payments, is the absurd ruling by the Government through the Department of Health and Social Security that for supplementary benefit purposes there is to be a savings limit of £2,000. What does that mean? It means that if one gets a significant sum that brings one's savings to over £2,000, one has to spend that money before one can get supplementary benefit. It would be fine if one could invest the money in an oil painting or something that would increase in value over the years, but no one is talking seriously about that. Therefore, the person is faced with the choice of either getting no supplementary benefit, or of spending the money on things that he may not need or on luxuries that do not involve more important and long-term decisions. Therefore, that £2,000 minimum savings level imposed by the Department of Health and Social Security is a positive discouragement to use the redundancy money effectively. I should like the Minister to take up that matter with his colleagues and get that rule changed.

I note that article 3 is amended so that all employees are entitled to a lump sum worked out by age and length of service. That is a marked improvement on the fixed sum that was previously paid to the under-40s. I welcome that.

In the long run the Government will be judged by the way in which they have allowed British industry, above all in Northern Ireland, to die. They have stood back and said "You must put your own house in order". The Minister did just that tonight.

No one disputes the fact that industry can be run more efficiently and that improvements can be made. No one disputes that any of the successful economies of the world do not have a detailed and complex involvement by the Government, yet the Government have decided that that is no part of their job. To do that in Northern Ireland of all places is perhaps more than a crime—it is a sin against the people who have already suffered enough.

If the Minister is going to let Harland and Wolff die, a massive education and retraining scheme will be needed for the workers who lose their jobs, not only the workers from Harland and Wolff but the workers from all the dependent industries and small companies that cling on to it. If those 7,000 people lose their jobs, the multiplier effect on the rest of the economy will be gigantic. The Government complain about increased public expenditure, but the area of public expenditure that has gone up the most desperately and in a most uncontrolled way has been unemployment benefit. So what on earth are we doing, with 21 per cent. unemployed, saying that Harland and Wolff will die if it does not put its own house in order. A minimum of 7,000 people will go on the dole and all the other people in the affected industries that rely on it and the people who rely on the work force in Harland and Wolff spending their wages in their shops and on their businesses will suffer. That is a dangerous economic nonsense.

Much as I welcome the increases in the order, the Government have failed the country desperately, particularly in Northern Ireland. I want to hear why the Minister has not been fighting for extra consideration for Harland and Wolff, not just 3 per cent. but sufficient to make up for the difference in the transport and energy costs. I want to know why the Government are not fighting for the "Atlantic Conveyor" order and for the order for the engine of that ship. I want to know why they are not trying to arrange other orders, wherever possible, to keep Harland and Wolff working. When it comes to the crunch, people want not redundancy payments, but paid employment. That is not an unreasonable demand.