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Aerospace Industry
6. Mr. John Wilkinson (Ruislip-Northwood): How much launch aid from his Department for aerospace companies over the last 10 years has been devoted to projects which have dual civil and military applications. [124586]
The Minister for Energy and Competitiveness in Europe (Mrs. Helen Liddell): Launch aid, which is now referred to as launch investment, is available to assist only in the design and development of civil aerospace projects.
Mr. Wilkinson: Notwithstanding the Minister's reply, is it not the case that the EH101 helicopter received substantial investment aid from the Department, before this Government came to power, as did the RTM322 power plant and helicopter engine? Is it not therefore important that the Department recognise the industrial implications of the procurement in future by the Royal Air Force and the Royal Navy of amphibious and support helicopters to replace the Puma and the Sea King HC4? That is necessary to ensure that the British helicopter industry remains, as it is now, at the forefront of European technology.
Mrs. Liddell: The hon. Gentleman knows that we will do what we can to support the British industrial base as much as possible. The EH101 began as a military aircraft and, in the mid-80s, my Department put resources into it to see whether it could be developed for civil purposes. We work with the Ministry of Defence, especially through the Civil Aircraft Research and Technology Demonstration--or CARAD--to ensure that any synergies that can be developed out of military research capability are also available for civil capability. However, the launch aid recently given to British Aerospace for the A3XX represents a considerable opportunity to help the British aerospace industry and will benefit both the civil and military aspects of that industry.
Mr. Barry Jones (Alyn and Deeside): May I thank my right hon. Friend, her Department and the Government for the £530 million launch aid for the A3XX, and for the £133 million launch aid for the A340, the stretch version? That aid is massively important for my constituency, but how can my right hon. Friend help me prise out of the Welsh Assembly a £25 million regional grant for the Airbus 3XX? That grant would guarantee 1,400 jobs for a generation. If we do not have those jobs in my constituency, they will be exported--perhaps to Hamburg, or even to the English regions.
Mrs. Liddell: Matters relating to regional development assistance in Wales are for the Welsh Assembly, but my right hon. Friend is right to point out the job-creating potential of that assistance. The assistance that we have been able to give to British Aerospace for the A3XX will
create 22,000 jobs, and preserve 60,000 others. That very considerable investment will have very considerable benefits for the British economy.
Mr. Nigel Evans (Ribble Valley): I welcome the launch aid for the A3XX, and the two big contracts for Meteor and the A400M. However, BAE Systems today announced a total of 3,800 job losses. I have BAE Systems Samlesbury in my constituency, and the plant at Warton, where 750 jobs have been lost, is nearby, A number of smaller companies supply and contract to BAE Systems and may suffer job losses that have not yet been identified.
Will the Minister have talks with the Secretary of State for Defence to see whether the two big projects could be brought forward to alleviate some of the job losses that have been announced? What will her Department do to give direct assistance to workers who will lose their jobs over the coming months in an area that has been hit already by a number of manufacturing job losses?
Mrs. Liddell: I very much regret the decision and the job losses that have been announced today. I understand that the job losses arise largely from the merger of British Aerospace with Marconi and from the consequent rationalisation and restructuring process that is aimed at improving BAE's global competitiveness. I know that BAE has acknowledged the support that it has received from the Government.
The Government, especially my Department and the Department for Education and Employment, will certainly react in the most positive possible way to give necessary assistance to people losing their jobs. We will do what we can to allow the process of change to go ahead as painlessly as possible.
Regional Selective Assistance
7. Mr. Bob Blizzard (Waveney): What preparations his Department is making for implementation of the new assisted areas map. [124587]
The Minister for Trade (Mr. Richard Caborn): As I said earlier, my right hon. Friend the Secretary of State announced on 21 December last year that we would be giving indicative offers of regional selective assistance. We have done that, and we hope to make that assistance available as soon as the European Union clears the map.
Mr. Blizzard: My constituents are delighted that the Government have designated Lowestoft for assisted area status--unlike the previous Government, who did not seem to know where Lowestoft was.
However, in the expectation that the European Union will soon clear the map, and given the length of time that has passed since the original announcement, will my right hon. Friend authorise a relaunch in the region? He will know that a number of the assisted areas on the east coast contain fabrication yards that are having to adjust to the smaller scale of the North sea oil and gas industry. Does he agree that it is essential that those businesses get help
from assisted area funds, to enable them to restructure and diversify? Will he ensure that the Government regional offices and the RDAs recognise that as a priority?
Mr. Caborn: First, I congratulate my hon. Friend and those colleagues who represent that part of the eastern region on the exhibition in the Upper Waiting Hall about oil and gas industry exploration, which I had the privilege to open on Monday. I suggest to my hon. Friend that it would be far better if the companies that want to get involved in applications for RSA put their plans forward so that we can evaluate them. I hope that they will be part of the reconstruction of a sector of the economy that has been neglected for many years. I think it is now coming round, and restructuring will allow it to have a very bright future.
Mr. Owen Paterson (North Shropshire): How much has the presentation of an ineligible map to the EU cost the British taxpayer?
Mr. Caborn: I cannot reply to the hon. Gentleman now, but I shall find out the answer and write to him. I can assure him, however, that seven years ago, when the previous Administration carried out this exercise, they did so in a far more party political way. That is one thing that the present Government cannot be accused of, as we have conducted wide consultation through the regional development agencies and the Government offices for the regions. Indeed, we had to withdraw the July map because it was said that we had tried to get more than our fair share. We then went back to consultation, in which many people participated. The process has not been part of a political fix, as it was under the previous Administration seven years ago.
Mr. John Cryer (Hornchurch): My right hon. Friend will know that Rainham, in my constituency, has been removed from assisted area status. Rainham is bang next to the Ford Dagenham factory, and since that decision was taken, the management of Ford have decided to end car production at Dagenham, with the potential loss of thousands of jobs. Will my hon. Friend reconsider that decision and reverse it?
Mr. Caborn: As my hon. Friend knows, we have set up a working party to look at Dagenham. However, once the map has been cleared--we are asking the Commission to clear it as speedily as possible--it will apply for the next seven years. The point that my hon. Friend has raised will be taken on board by the working party that has been set up to look at the fallout from Dagenham.
Diesel Manufacturers
8. Mr. Bob Russell (Colchester): What assistance he is giving to United Kingdom diesel manufacturers to increase sales in the UK and overseas. [124589]
The Minister for Energy and Competitiveness in Europe (Mrs. Helen Liddell): The Department works in partnership with the UK diesel engine industry to help improve its competitiveness and thereby increase sales in the UK and internationally. Our activities include support
for the development of diesel engine technology and the extensive export promotion services offered by British Trade International.
Mr. Russell: I am grateful to the Minister for her reply, as far as it went, but does she not agree that diesel engine manufacturers feel that they are not getting the support that they need? In particular, may I draw her attention to Paxman in my constituency, now owned by MAN? Does she agree that her Department, and the Government in general, should encourage the Ministry of Defence and the privatised rail industry to purchase British-made diesel engines?
Mrs. Liddell: I know of the hon. Gentleman's interest in this matter. Indeed, he has raised it before on the Floor of the House. As for promoting diesel engine development, I have just come from a meeting with the Department of the Environment, Transport and the Regions that brought together the refining industry, the downstream oil industry and motor manufacturers. One of the first issues that we discussed was the emergence of new forms of diesel engine technology.
Indeed, through the Engineering and Physical Sciences Research Council, we support projects that are focused on the diesel engine sector. Eight grants have been awarded, amounting to some £1.3 million, specifically to support the development of diesel engines. Whenever the Government carry out procurement exercises for defence vehicles, they are aware that that is a matter of considerable importance to the industry, and do everything that they can to assist British industry.
I am conscious of the fact that the company in the hon. Gentleman's constituency has recently been taken over. I believe that that is viewed positively as an excellent opportunity to enlarge its potential, not just in the United Kingdom but internationally.
Mr. David Chaytor (Bury, North): Is not the difficulty for diesel engines the fact that as the years go by, they are likely to become less important for private cars? That is because of the inevitable exhaustion of the world's oil reserves, which will reach their peak of production in a few years time, the inevitable rising price of oil, and the need to reduce carbon emissions by about 60 per cent. by the middle of this century. Would not the best support for diesel engine manufacturers be to encourage them to diversify into alternative sources of fuel, such as hybrid engines, gas-powered vehicles and fuel cells?
Mrs. Liddell: My hon. Friend makes an interesting point. It has to be said that this is not an either/or situation, or a question of solely developing new diesel technology at the expense of other technologies. Automotive manufacturers, and, indeed, diesel manufacturers, are looking at other aspects of powering vehicles, but some big issues have to be addressed.
Many of us associate diesel engines with the diesel engines of the past, and think of the London buses that belched out black fumes. New diesel technology is improving considerably, but we must still strike a balance--we must understand the extent to which these engines have an impact on the environment. My hon. Friend is right to say that it is essential to look at every
new technology that comes along. As demand for cars increases, we must be sure that we have the fuels to drive them.
Mr. Geoffrey Clifton-Brown (Cotswold): If the Minister is so concerned about the competitiveness of the vehicle manufacturing industry, will she make representations to her colleagues in the Treasury to drop the £1 billion energy tax to which the Labour party is committed, and to stop increasing the duty on diesel way in excess of inflation through the fuel duty escalator, which hits motorists so hard, particularly in rural areas?
Mrs. Liddell: I think that it was the Deputy Prime Minister who accused Conservative Members of wanting the country to have collective amnesia. I seem to recall that it was the previous Government who introduced the fuel duty escalator.
As for the climate change levy, Governments across the world are having to consider means of reducing emissions into the atmosphere. That is why the Government are taking action in a coherent focused way, by contrast with the behaviour of the Conservative party, which introduced the fuel duty escalator when it was in power.
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