Previous Section Back to Table of Contents Lords Hansard Home Page

Lord Inglewood: I am grateful to my noble friend Lord Brabazon of Tara for speaking to the amendments on behalf of my noble friend Lord Wade. We too believe that the amendments are not necessary to ensure that TransCo is operated on a completely separate basis from British Gas's supply and shipping businesses. That is already provided for.

Rigorous procedural requirements are in place to ensure that completely separate and transparent accounts are produced for British Gas TransCo, its component businesses, and those parts of British Gas which provide services to both TransCo and to trading businesses. Those requirements are stricter than those applicable to a subsidiary company's statutory accounts.

There are very stringent safeguards in place within British Gas to ensure that there is no improper contact between the arms of British Gas's operations. There are also licence restrictions on cross-subsidy between TransCo and the BG trading businesses.

Those arrangements are intended to ensure that there is a level playing field—I hope my noble friend Lord Ferrers will forgive me for using those words—for shippers, including those connected to British Gas, supervised by Ofgas.

The arrangements have only recently been put in place (in February this year) and should be given a chance to work before being written off as insufficient. If they prove in practice not to be effective, there is a mechanism in place in the Bill to remedy that.

22 Jun 1995 : Column 468

The proposed new Section 36A of the Gas Act 1986 will give the director powers to make references to the Monopolies and Mergers Commission under the Fair Trading Act 1973. If, following a proper investigation of the matter, the Monopolies and Mergers Commission found that the rules had been put in place and were operating, or might be expected to operate, against the public interest, the commission could recommend divestment, a separate subsidiary, or whatever other remedy it thought appropriate.

We believe that it is right for a private company to be given a choice as to how to respond to the Bill's requirement for separate supply/shipping and transportation licence holders. I hope that explains the Government's position and give reassurance to my noble friend.

The Earl of Caithness: I listened with care to what my noble friend Lord Brabazon of Tara said, because, like my noble friend Lady Gardner, I was attracted originally to the idea of a separate company within British Gas or TransCo. I am sure that the Committee is agreed that British Gas should remain as owners and controllers of TransCo, not least because of the importance it gives to British Gas in its exploration and marketing overseas. That was something I mentioned on Second Reading, and believe to be of immense importance to UK Limited.

I listened to what my noble friend Lord Inglewood said in reply. I believe that he made out a convincing case for letting the situation evolve as it has been arranged at the moment. We are, after all, interfering with a private company, something of which I do not approve in principle, but having made that interference, it is right to let it decide which way matters should evolve.

A great deal of restructuring within British Gas has been done to make for the best possible separation, and, as my noble friend Lord Inglewood said, that has led to strict rules that will be heavily policed. Of course there is the fall back, and I hope that, given what was said, my noble friend Lord Brabazon will think that the Government and British Gas have it about right at the moment.

Lord Brabazon of Tara: I listened carefully to the debate which my noble friend's amendment engendered, and I am grateful to those who spoke in it. Obviously, my noble friend Lord Wade will wish to read what has been said. The amendment was intended only as a probing amendment to ascertain the views of Members of the Committee. I am sorry that Members opposite had nothing to say about it, but no doubt they have been thinking about it nevertheless. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 5 agreed to.

Earl Ferrers: This may be a convenient moment on which to conclude this part of the Bill. I beg to move that the House do now resume.

Moved according, and, on Question, Motion agreed to.

House resumed.

22 Jun 1995 : Column 469

Appropriation (No. 2) (Northern Ireland) Order 1995

7.10 p.m.

The Parliamentary Under-Secretary of State, Northern Ireland Office (Baroness Denton of Wakefield) rose to move, That the draft order laid before the House on 8th June be approved.

The noble Baroness said: My Lords, the draft order authorises expenditure of £3,437 million for Northern Ireland departments in the current financial year. This is in addition to the sum of £2,705 million voted on account in March and brings total estimates provision for Northern Ireland departments to £6,142 million, an increase of 4.4 per cent. on 1994-95. The order also authorises the use of additional receipts to meet an excess Vote in 1993-94.

I know that your Lordships continue to take a close interest in the prospects for economic development in Northern Ireland and I would like to say a few words about the local economic situation before turning to the contents of the Estimates. Both official data and survey evidence show a marked improvement in the recent performance of the Northern Ireland economy and future prospects are now looking very optimistic.

The output of manufacturing and production industries continues to rise at a rate above the national average. Over the past five years, Northern Ireland's manufacturing sector has increased output by 14.3 per cent. compared to a 0.1 per cent. rise nationally. Over a similar timescale there has been a significant improvement in the Province's gross domestic product relative to the United Kingdom figures. Over the period from 1991-92, compared to 1993-94, export sales from Northern Ireland grew by 24 per cent. significantly outperforming growth in exports in the UK of 18 per cent. The retail sector in Northern Ireland is booming. For example, Sainsbury is setting up shop in Northern Ireland for the first time with the planned opening of seven stores throughout the Province. In addition, a number of existing retail chain stores have announced expansion plans for Northern Ireland. These investments have the potential to create hundreds of jobs.

In the first five months of 1995 there were a total of 193,426 inquiries to tourist board offices in Northern Ireland, a splendid increase of 72.5 per cent. over the same period in 1994. There is a very favourable outlook for the tourism sector in Northern Ireland.

At March 1995 the seasonally adjusted number of employees in employment in the Province stood at 566,810, the best ever March figure. In addition, the seasonally adjusted unemployment rate of 11.7 per cent. is at its lowest level for 13 years.

All of this is very welcome news for the people of Northern Ireland and I am confident that the prospects and performance of the economy will continue to improve as the peace process becomes embedded. I continue to believe that the best cement for peace is jobs.

I now turn to the main items of expenditure covered by the order as detailed in the Estimates booklet. All the figures are of course in pounds sterling. I shall start with the Department of Agriculture. The net provision in the two agriculture Votes amounts to some £155 million. In

22 Jun 1995 : Column 470

Vote 1, some £21 million is to fund EC and national agriculture and fishery support measures. In addition to various market support measures under the common agricultural policy, the Vote includes some £6 million for grants for capital and other farm improvements and £14 million is for the hill livestock compensatory allowance scheme.

Vote 2 includes £133 million for regional services and support measures. This includes £60 million for agri-food development and for scientific and veterinary services; £38 million for farm support, environmental areas, fisheries and forestry services; and £5 million for the rural development programme.

In the Department of Economic Development's Vote 1, some £135 million is for the Industrial Development Board. Against a background of peace the board will increase its activities to attract firms to set up and expand in Northern Ireland. The board has set itself a target of securing 20 inward investment projects involving some 4,500 jobs during the current year.

In Vote 2, £33 million is for the local enterprise development unit and £16 million is for the industrial research and technology unit. Elsewhere in the Vote, £13.6 million is for the Northern Ireland Tourist Board.

In Vote 3, £203 million is for the Training and Employment Agency. This includes £77 million for the new jobskills training programme and £55 million for the action for community employment programme, which includes £1.3 million for the community work programme pilot. Eighteen million pounds is to assist companies improve their competitiveness through structured training and development of their workforce and by providing future managers with the skills and experience they require to succeed.

I now turn to the Estimates for the Department of the Environment, where £180 million in Vote 1 is for roads, transport and ports. This includes some £150 million for the development, operation and maintenance of Northern Ireland's public road system.

Vote 2 covers the important area of housing. Some £203 million will provide assistance mainly to the Northern Ireland Housing Executive and to the voluntary housing movement. When net borrowing and the Housing Executive's rents and capital receipts are taken into account the total resources available for housing will be some £593 million. This is £20 million more than in 1994-95 and will enable us to build on the progress which has been made in recent years.

In Vote 3, gross expenditure on water and sewerage services is estimated at £202 million. Ninety-four million pounds is for capital expenditure and some £108 million is for operational and maintenance purposes.

In Vote 4, £142 million is for environmental services, including some £35 million for urban regeneration measures. These continue to be targeted at areas of social, economic and environmental need and have helped secure a welcome improvement to many areas of Northern Ireland.

The Estimates for the Department of Education seek a total of £1,380 million, an increase of 4.3 per cent. over last year. Vote 1 includes £842 million for recurrent expenditure by education and library boards, an increase

22 Jun 1995 : Column 471

of £39 million over 1994-95. This includes £794 million for schools and colleges of further education and will help maintain the pupil/teacher ratio at present levels. Also included is some £48 million for libraries, youth services and administration, and £41 million for boards' capital projects. One hundred and forty-three million pounds is for voluntary schools and some £15 million is for integrated schools. There are now 23 integrated schools in operation with over 4,700 pupils in attendance. Approval has been given for four further integrated schools from September 1995, with another one in the pipeline.

Vote 2 includes £119 million for universities, £124 million for student support, £16 million for arts and museums and £3 million for community relations.

In the Department of Health and Social Services, Vote 1 includes £1,380 million for expenditure on hospital, community health, personal social services, health and social services trusts and family health services. That is an increase of 5.6 per cent. on last year.

In Vote 3 gross provision of some £224 million is for the department's administration and other costs. That includes £122 million for the Social Security Agency, £19 million for the Child Support Agency and £13 million for the Health and Personal Social Services Management Executive.

In Vote 4 £1,463 million is for a range of social security benefits, an increase of 5.8 per cent. on last year. In Vote 5, £406 million is to cover expenditure on the independent living funds, housing benefit, the Social Fund and payments to the National Insurance fund.

Finally, I turn to the Department of Finance and Personnel. Within Votes 1 and 3, some £5.6 million is for the community relations programme. Taken together with the expenditure by the Department of Education, total spending on the community relations programme will be some £8.7 million and reflects the importance which government continue to attach to that area.

I hope that that short summary of the main components of the Estimates is helpful to your Lordships. This is a very special time in Northern Ireland. We need to build on the opportunities that the new climate brings to us and ensure that the benefits of the ceasefires are shared by everyone in the community. I commend the order to your Lordships.

Moved, That the draft order laid before the House on 8th June be approved.—(Baroness Denton of Wakefield.)

7.22 p.m.

Lord Cooke of Islandreagh: My Lords, I welcome the Minister's presentation of the order. Indeed, I enjoyed hearing the good news that she was able to give us about the economy. I work in manufacturing industry in Northern Ireland and I can support everything that the Minister said. The economy is in good shape; it is trying very hard; and I am sure that it will do even better.

However, I wonder whether the Minister declared her interest. I say that because the noble Baroness is the Minister for the economy and also the Minister for agriculture. Those are two very big jobs. I do not know how she manages them both; but I can tell your Lordships

22 Jun 1995 : Column 472

that she does, and very well too. I am quite certain that any questions that I ask tonight will not add to her workload, which is something that I would not wish to do. There are so many items in the public expenditure between the different departments that one could talk about them and discuss them all night, but in the short time at my disposal I shall just speak about a few of them.

I do not believe that the Minister mentioned this, but, in addition to the funds allocated, I understand that funds have recently been redirected from the security forces as a result of the ceasefire. That is very welcome and I hope that that reduction in security costs can be carried out carefully and sensibly so as not to cause undue hardship to those who have given so much to the service over many years. I understand that about £50 million will be released this year and £60 million next year. That additional money will be very welcome and will be used to assist health, education, housing and roads.

In Northern Ireland we have long been fortunate in having an excellent health service with very high standards, but there is a widespread feeling that the cost and complexity of administration is getting out of hand and that it is getting worse rather than better. The cost of administration above hospital level has recently been estimated at £80 million, which seems quite an absurd amount for the Province with 1.6 million people.

I believe that the health service administration needs a radical examination and that whole layers of administration could be cut out. That review should be carried out by an independent outside consultant. I believe that the Minister conducted an internal review about 18 months ago, but much more than that is required. Just as an example, perhaps I may point out that it is almost impossible to get decisions on policy matters. However, I must temper that by saying that the recent decision to undertake modernisation of the Royal Victoria Hospital in Belfast is very welcome and, indeed, essential.

In education there is urgent need for money to repair and renovate school buildings, some of which are in a very bad state of repair. On the other hand, there are regular reports on the move to develop a university on the Springvale site in west Belfast. Perhaps the pressure comes from academics who wish to extend their empires. However, it would be very costly and I wonder whether it would be worth while. Quite apart from the cost, I cannot believe that a university would be right for west Belfast where the educational and training needs are at a lower level. There is great need in that area for vocational and technical training, perhaps extending at the top level to polytech but not university standard. I hope that good sense will prevail.

So far there has been no peace dividend for the construction industry in Northern Ireland. There is less work in hand than there has been for years. There has been a serious and substantial drop in output, activity and employment. The matter has been referred to in another place in recent months.

Investment in construction is a very cost-efficient method of creating jobs. At this particular point in the peace process, job creation is vitally important. I understand that there are many projects ready to go ahead but that there has been no money for them. Can the Minister now identify the major public sector

22 Jun 1995 : Column 473

construction contracts that will be brought forward in the current year? That information will be most helpful to the construction industry.

Roads have been a matter for concern because the general road system, especially the second class roads, is deteriorating. I hope that the money that is being allocated tonight will be sufficient to improve the maintenance.

The Department of Agriculture in Northern Ireland works hard. It gives an excellent service to the farming and food industry and, in general, its work is to be commended. However, I must mention the Sub Programme for Agricultural and Rural Development, known as SPARD. That scheme offers a rate of grant of 30 per cent. payable for capital items on the farm designed to improve competitiveness and to enhance the environment. It also includes expenditure to combat pollution. The scheme, with 70 per cent. paid by the landowner, is a highly efficient mechanism to channel resources into localised jobs. The money will be spent on new buildings, culverts, concrete structures, fencing and restoration. These are high labour content items which will create or underpin localised jobs and, therefore, rural prosperity. As a form of peace dividend for farmers, it is hard to imagine anything better.

The scheme was open for applications in November 1994, but was suspended on 24th March this year when a total of 11,000 applications had been received. It was closed because the department had insufficient funds to meet many of those applications. I understand the budget for the SPARD project is £8.5 million this year, with £10 million in subsequent years. Schemes of this sort are time-sensitive as farmers must have the will and the cash available. They may have the will and the cash now, but next year things may have changed and they could either not have the will or the money. In view of the reallocation of funds presently being made, surely the extra few million pounds required could be found to support this excellent scheme for rural employment and rural development.

The Northern Ireland fishing fleet is in difficulties. In common with fishing fleets elsewhere in the UK, the quotas have been reduced. The white fish quota has been reduced for the Northern Ireland fleet and pressure is now on prawns because white fish trawlers have moved across to prawns and in order to be economic they are using two nets. Unfortunately that puts the traditional prawn boats, which only use one net, at a disadvantage. Prawn prices have recently been low due to heavy landings and some owners of prawn trawlers want to get out. There is a belief that the next tranche of decommissioning will exclude prawn trawlers. As the whole object of decommissioning is to reduce the size of our fleets, surely the prawn boat owners should also have the opportunity to get out if they wish.

The cost of electricity is causing great concern in Northern Ireland. It is perhaps the biggest cloud on our horizon, both on the domestic and the industrial fronts. For domestic users the cost of electricity is presently about 19 per cent. above the GB average. That difference will widen when the 8 per cent. levy is removed in Great Britain. By the end of next year Northern Ireland could be at a 30 per cent. disadvantage compared with GB householders. Those figures were given in evidence to the

22 Jun 1995 : Column 474

Northern Ireland special affairs committee in another place by the chairman of the Northern Ireland consumer committee for electricity.

For industrial users it is more difficult to generalise because of the many different tariffs and forms of contract, but comparisons have been made between plants in Northern Ireland and almost exactly similar plants in Great Britain. When assistance from the trust fund ceases at the end of this year the difference will vary from 15 per cent. to 30 per cent. and that will get worse because the use of systems charges will increase by inflation plus 3.5 per cent. In Great Britain they increase by inflation less 2 per cent. This means that in five or six years the 30 per cent. difference will be increased to about 50 per cent. greater cost in Northern Ireland.

The main reason for the higher cost in Northern Ireland is because the contracts for purchase of the generating stations guarantee payment of all costs plus profit except fuel against making plant available. Most of these contracts extend until the year 2010. The consequence of this is that no new generator, however efficient, will reduce unit costs because the fixed costs of the present generators have to be paid even if no power is taken. An additional reason is that flue treatment costs, which in Great Britain are borne by the generators, are to be paid for by the consumer in Northern Ireland. Next year Ballylumford will convert to gas and, later, desulphurisation equipment will be fitted at Kilroot. Large sums are involved, probably in excess of £100 million, all of which will add to the cost of a unit of electricity. The consequence of these matters, plus the need to offer a high rate of return in the shares of NIE, has resulted in the profit formula for Northern Ireland Electricity being much more generous than for other regional electricity companies in Great Britain.

The Office of Electricity Regulation has a duty to promote competition in generation and supply and to protect the interests of consumers. Although competition is theoretically possible in 1996, the director general himself has admitted that this will have no material effect on prices until well into the next century. The regulator has power to review the distribution charges levied by Northern Ireland Electricity which at present are permitted to increase by inflation plus 3.5 per cent. If he could instead reduce them by one and a half times inflation each and every year, it would barely stabilise prices. This is because the generating costs which represent 60 per cent. of the total charges are fixed by contract which the regulator has no power to change. In short the director general cannot do his job; he cannot protect the interests of consumers.

The declared objective of privatisation was to improve efficiency, improve competition and reduce the cost to the consumer. Unfortunately the way the service has been privatised has resulted in increasing the cost to the consumer. Efficiency gains have been made by the generators but the fixed form of contract means that efficiency gains are not passed on to the consumer. Domestic users and industry are faced with ever higher costs of electricity compared with those on the mainland and most of this is unfortunately a direct result of government approved contracts.

22 Jun 1995 : Column 475

The steadily increasing costs of electricity compared with those in Great Britain will seriously affect householders, existing industry and its competitiveness, and the decision of companies thinking of coming to Northern Ireland. Large sums of money will be involved. I have not been able to calculate that, but I know that £100 million would not go far to meet this adverse difference. This important matter is presently being investigated by the Northern Ireland Affairs Committee in another place. I have no doubt that its findings will be in line with what I have described. I will not press the Minister for an answer to this whole situation this evening because it does not appear that the Government have yet faced the facts or have considered what should be done about this serious handicap to industry. I sincerely hope that some straight thinking and appropriate action will develop in the next few months.

When speaking of spending perhaps I may refer to grants which will be made to Northern Ireland by the European Union under the terms of the European initiative for peace and reconciliation. I hope that some of that money will be spent in Northern Ireland. I believe that some community groups are coming together with the intention of managing this expenditure on behalf of the European Union. Is that the proper way, I wonder, to manage such funds? Should not local councils be involved? After all, we want and need to build up the democratic process in Northern Ireland. I have taken rather a long time but there were many matters to cover and there were many more that I would like to have covered. However, the House will be spared that.

7.39 p.m.

Lord Hylton: My Lords, I am grateful to the noble Baroness for her clear explanation of today's order. The context of our debate is one of ceasefires continuing through the marching season, and despite various difficulties. The ending of shootings and explosions has enabled people to enjoy normal life, sometimes for the first time. It is encouraging tourism and investment and we very much welcome the economic improvements which the noble Baroness mentioned earlier.

I am glad to say there has also been an increase in dialogue between the two main traditions. I particularly welcome moves towards proportionality and power sharing within Belfast City Council and I hope that these will make further progress.

One of the main obstacles to real peace is the continuance of intimidation and punishment beatings, all of which were much mentioned in the earlier debate in your Lordships' House on emergency legislation. My hope is that the paramilitaries and related parties will sit down and discuss the details of future policing within so-called hard-line areas. Those groups may have many useful ideas to contribute and I feel that such a move would be a major confidence-building measure in itself.

So far, there does not seem to be much progress towards the start of negotiations for an overall political settlement. The issues are complex and we must be patient. However, no task is more urgent than to find an acceptable replacement for direct rule and a means for

22 Jun 1995 : Column 476

dispensing with emergency law and special courts. Equally important is the search for ways in which the whole society in Northern Ireland may become demilitarised. Those processes can be assisted powerfully by many different ideas and groups. I trust that there will be maximum consultation and participation by the public.

My friend Mr. David Bleakley, who has relevant experience as a trade unionist, former Minister for community relations and general secretary of the Irish Council of Churches, in a recently published book called for a movement proclaiming "Ulster says yes". By that he meant yes to consent; yes to constructive negotiations; and yes to conflict resolution. I trust that there will be a groundswell of public opinion in such a positive direction.

At the same time, it is necessary to appreciate the cultural differences which distinguish the Protestant and Catholic approaches to serious problems. By and large, Protestants like to advance step by step and case by case, respecting individual conscience. On the other hand, Catholics often prefer to proceed from the general to the particular. They tend to go for the framework first before filling in the details. Those mental and cultural differences are important and we need to remember that the majority of the population has a Protestant background.

Earlier this year—I think it was in January—I suggested to the Secretary of State that an interim elected assembly might be a useful and helpful measure in view of the likely length of the main trilateral negotiations. Such an assembly could be partly directly elected and partly chosen from party lists. In that way, new talent could be drawn in both for consultation and so that new entrants might gain political and administrative experience. I very much hope that that idea will not be discarded entirely. Some kind of transitional period is likely to be necessary in any event between full direct rule and any new agreed system. An assembly could help to bridge that gap.

It is for consideration whether an independent truth commission could be helpful, particularly in disentangling various disputed and unresolved injuries and deaths which still cause much anguish. There is, of course, a South African parallel for such an inquiry.

The release of prisoners whose offences have been largely politically motivated is another important and difficult matter. As president of NIACRO, I say only that I believe that the research published recently by that organisation into the procedures adopted by other countries which have experienced serious internal conflict has been an aid to serious discussion of the issues involved.

Speaking personally, I urge the Government to remove the anomaly whereby those sentenced since March 1989 have a lower rate of remission compared with those sentenced before that date. I would counsel against the premature release of Private Clegg and I should like to emphasise that all releases should be accompanied by measures which recognise the sufferings of victims of violence and which show that those sufferings have not been in vain.

I conclude by stating that ceasefires and the search for political solutions pose a real challenge to the Churches, in particular in Northern Ireland. We all know that

22 Jun 1995 : Column 477

relationships at the level of archbishops, cardinals and moderators are good and friendly. But I ask whether those friendships are being translated into the breaking down of long-standing barriers at parish and local community level. Is the present moment seen as an opportunity for new kinds of dialogue and local co-operation? For many years now voluntary ecumenical groups, of which PACE, Corrymeela, Cornerstone and Rostrevor are perhaps the best known, have shown how people of different traditions can live and work together for common purposes. I wonder whether that experience has been analysed and digested fully. Will it now be applied at all levels of the traditional church structures? I trust that those structures will, from now on, become components and active builders of the solution which is so greatly desired.

7.47 p.m.

Lord Fitt: My Lords, I wish to speak on one or two subjects that have already been mentioned by the noble Baroness. I was in Belfast recently and I had discussions with various groups. They were all impressing upon me the importance of community relations organisations in Northern Ireland because throughout the past number of years they have been indispensable in trying to create the atmosphere in which the ceasefire has eventually arrived. Whatever increase there may have been in expenditure, that has been money well spent. From what I have heard, and what I know prior to my arrival in this House, since its inception, the Community Relations Council has carried out remarkable work in a very dangerous atmosphere.

The noble Baroness mentioned Sainsbury's. I am sure that she is aware of the debate which took place yesterday evening at the other end of this building. Everyone in Northern Ireland welcomes investment there. We are only too well aware that with the ceasefire in operation we may be more hopeful of attracting more investment.

The announcement that Sainsbury's is set to open seven or possibly 12 stores is to be welcomed throughout Northern Ireland. But the way in which the announcement was made has caused some controversy. There are stores in Northern Ireland which have operated in very difficult circumstances for the past 25 years. Many of those stores have been blown up repeatedly and put out of business and it has taken a great deal of courage to start them up again.

Many of those have made applications in relation to certain sites in order to expand their businesses and were told by the planning authorities that those sites were unsuitable; that they were for recreational purposes; and that they were not to be used for the beginnings of a retail business. An announcement is then made by the Sainsbury organisation that it is to open its retail outlets on the very sites for which planning permission had been refused to local retailers. Naturally that has caused great concern. Deputations were here yesterday and today and I questioned them very closely. I certainly told them that I would not be party to trying to prevent inward investment. But they say that they simply ask that if planning permission is to be given to a retailer, it should be given whether such investment be home based or inward investment.

22 Jun 1995 : Column 478

The Sainsbury organisation has not been in Northern Ireland during the past 25 years. I do not believe that it would ask for any great favours. I reinforce what has been said by elected representatives on the other side who are much more closely involved with the people in Northern Ireland and with that problem: that no undue or privileged treatment be given to organisations in order to set up retail outlets in Northern Ireland to the disadvantage of those who have been in Northern Ireland and have made applications on planning over numbers of years. There should be a level playing field for everyone.

I realise that the issue is not, strictly speaking, a matter for the noble Baroness. Some would say that it is for the Department of the Environment. However, one cannot isolate the environment from the whole economic approach or atmosphere in Northern Ireland.

I urge the noble Baroness to take account of what was said at the other end of the building. All that the home bred retailers want is a fair allocation of planning permissions when those are necessary to open up such outlets.

7.53 p.m.

Lord Holme of Cheltenham: My Lords, it is always a great pleasure to follow the noble Lord, Lord Fitt. Perhaps I may refer to the Sainsbury's investment. It is obviously extremely welcome. It is a symbol of the greater peace and tranquillity that now obtains in Northern Ireland.

Perhaps I may add to the warning that the noble Lord gave. As the noble Baroness will be aware, at the very moment that her colleague the Secretary of State for the Environment seeks to ensure that not all supermarket development is out of town and to recreate a sense of community by making sure that the high streets are revived, it would be a shame if the whole of the Sainsbury's investment in Northern Ireland went into large, new shopping centres out of town and did not contribute to what is most needed—the re-creation of many run-down urban areas.

On the larger issues which the noble Baroness so ably presented, I was pleased that she began with the larger macroeconomic situation in Northern Ireland because there is much good news, and it is right to emphasise it. Potentially there is a virtuous circle of good news leading to further investment leading to greater confidence and greater economic activity.

However, although the figures for unemployment in Northern Ireland have dropped by 10,000 in the past 12 months, we should remember that they still stand at 88,700. As a proportion of population in the United Kingdom, it is the worst figure. I know that the noble Baroness will share our concern that within that figure 57 per cent. of claimants of unemployment benefit in Northern Ireland have been unemployed for more than one year. In other words, they are long-term unemployed. Of those, one in five have been unemployed for over five years. In fact, if one considers Northern Ireland as a whole, one in five of Northern Ireland households claims social security benefit compared with about one in eight in the United Kingdom as a whole.

There are no grounds whatever for complacency. I do not imply that that is the case as regards the Government. The question is this. What can we do to achieve better

22 Jun 1995 : Column 479

organic growth, not just to ensure that the inward flow of investment continues as a spin off of the ceasefire? How can we create significantly extra economic activity in Northern Ireland? For instance, so long as we discuss these appropriation orders in this House—and before long may they be discussed in a devolved power-sharing assembly in Northern Ireland—it would be wonderful to see a reverse in the trend in unemployment so that a greater percentage of the appropriation could then go on trade, industry, training and infrastructure, and less on social security.

It is worth recording that social security accounts for 32.5 per cent. of the total appropriation that we are considering. The situation is not getting better. In 1987-88 the figure was 31 per cent. If anything, the position is slightly worse. The subsidy, the subvention that every household in mainland Great Britain gives to Northern Ireland goes to social security to an enormous extent.

I very much support the Action for Community Employment Scheme. It has produced a reduction in unemployment. However, I was curious that in Vote 2 on page 4 there is a reduction in funding for training programmes, management and enterprise education. I should have thought that a skilled workforce has never been more crucial. When the noble Baroness responds, I should be grateful if she will tell us why the total estimate budget of the IBD—which has doubled its own job creation target to 4,500 in 1995-96—is being cut from £149 million to £134.5 million?

As regards the relative attractiveness of Northern Ireland and the Republic of Ireland for investment, I shall be interested in the noble Baroness's comments on this matter. In this new, improved atmosphere, in some ways Northern Ireland is in danger of losing out to the Republic of Ireland as regards inward investment. Just this month Northern Ireland lost 1,500 jobs to the republic. The sum of £21 million was invested by Seagate Technology in Tipperary, rather than in Derry, as expected, where the company already employs 350 people. Between 1980 and 1993, the republic gained an extraordinary achievement: 100,000 manufacturing jobs. That is 10 times the number that we have created in Northern Ireland.

At present the Republic of Ireland, which has by any measure a small population, is attracting 23 per cent. of all new American investment into Europe. People have stated that one of the reasons for that differential attraction is taxation. Corporation tax for Northern Ireland is 33 per cent. for companies with taxable profits of more than £1.5 million. As we know, the republic has a super competitive rate of 10 per cent. It is not an easy problem to solve. I do not have an easy solution. However, I am most interested to hear the Minister's comments because it would be a great tragedy if, in the United States, Japan, Korea and in other parts of the world where the good news about peace in Ireland is being heard, investment heads only towards the south.

That brings me to the question of what strategy there is to co-ordinate decision-making between government departments regarding development of business opportunities with the republic. The noble Baroness may recall that when we discussed the appropriation order in March, on these Benches we suggested that there might

22 Jun 1995 : Column 480

be more North-South co-operation on telecommunication and tourism. I am delighted to see that there is a pilot scheme for concessionary telecommunication tariffs now planned between Dublin and Belfast. I am delighted too, by the six new joint marketing projects between the board in the republic and the Northern Ireland Tourist Board.

Perhaps I may ask the noble Baroness a question on roads. She referred to the vast increase of tourism coming to Northern Ireland. It is exciting. When developing the infrastructure is so vital for both inward investment, economic development and tourism, I wonder why the estimates for expenditure on roads and transport services are down from £189 million to £180 million. That comes at a time when freight traffic on Northern Ireland roads is growing by 7 per cent. per annum as a result of the activity that she described. On the Belfast-Dublin route, it is growing by 20 per cent. a year—and high time too. There is an overall road maintenance backlog of £58 million, and many of the major thoroughfares in Northern Ireland date from the 1960s, as we all know.

The noble Baroness will not be surprised to hear that I should like to raise briefly the question of integrated education. There is no mention of integrated education in the order. That is not of itself surprising, but there has been no other indication from the department about how much planned expenditure there will be in that area. Yet in February this year, the Minister's colleague, the right honourable Michael Ancram, said,

    "Integrated education has an important role to play in creating better understanding and tolerance in Northern Ireland".

I find the Government's reticence on funding a bit of a problem, given that there is still less than 2 per cent. of the school population at integrated schools.

I very much enjoyed the remarks of the noble Lord, Lord Cooke. Incidentally, I agree with what the noble Lord said about electricity prices in Northern Ireland. At a time when the profitability of Northern Ireland Electricity has gone up by 15 per cent., it does not seem that consumers and industry there are getting a particularly good deal. I did not agree with the noble Lord on the matter of the Springvale peace line campus. Potentially, it is a very imaginative concept. As has been the case at Coleraine, it could represent a tremendous impetus for local employment. The effect of the Coleraine campus, with a student population of 4,500 is that it has generated over 1,000 jobs on campus, 900 of them full-time. Wellworths, the food and clothes retailer said that, if there is a Springvale campus, it will create 120 jobs in a new West Belfast supermarket. Given that Northern Ireland has a need for more student places at the tertiary level, it would be an imaginative concept to go ahead with Springvale. Although the capital cost is considerable, it has been estimated that the annual running cost would be of the order of some £6 million a year to the Northern Ireland Department of Education. When the noble Baroness and I last addressed this subject across the Floor of the House, I believe she expected her right honourable friend to reach some sort of conclusion by the end of April. We have still heard nothing, and it is now nearly the end of June. It would be most interesting to hear the Government's thinking on that issue.

22 Jun 1995 : Column 481

Reference was made by the noble Lord, Lord Fitt, and by the Minister in her opening remarks, to community programmes. I was delighted to see the increase in allocation to community programmes. The importance of community work, both in the run-up to the ceasefire and now in cementing and building the peace, cannot be over-estimated. There are great social problems in Northern Ireland. Many are results of the long years of savage tension. For instance, levels of sickness in West Belfast are at their worst for 25 years. There is unemployment of 40 per cent. on the Shankill and Falls Roads. Anything that helps community work is welcome. We on these Benches very much welcome the Interface Project of the Community Relations Council, which involves work with communities on the peace lines.

Finally, will the Minister confirm that the Government agree with Jacques Santer's comment in relation to the £240 million peace package; namely, that European funds are 100 per cent. additional: the UK and Irish funds should be additional as well? It would be very good to receive that confirmation.

8.3 p.m.

Lord Prys-Davies: My Lords, I very much regret that my noble friend Lord Williams of Mostyn is unavoidably absent. Needless to say, I thank the Minister very much for explaining with her usual clarity the terms of this order and for drawing attention to its main components.

Perhaps I may begin by referring to a recent visit that I made as a member of Committee D of the British-Irish Parliamentary Body to the city of Londonderry—or, to express a different culture, Derry. It was some years since I had last been to that proud city. Speaking to people in the great Guildhall and to eager teachers and students, I had the clear impression that thinking was on the move and that positive and hopeful efforts were being made to work together to encourage community development at grass roots level.

Clearly, the ceasefire has opened up an opportunity to take a fundamental look at the problems of the Province and the policies and programmes that are being implemented to address them. As the Minister and other noble Lords know well, this has been a theme of a number of valuable conferences on Northern Ireland during the past six months.

Unemployment is one of the two main elements at the heart of the problem. Therefore, reducing unemployment must also be at the heart of the solution. On this, I agree with other speakers this evening: the Minister was most encouraging. A week ago the noble Baroness announced the unemployment figures for May. They show that unemployment fell for the eleventh consecutive month. I follow the remarks of the noble Lord, Lord Holme, about hardcore unemployment, and I touch upon that. I thought that the most encouraging part of the Minister's statement was her confirmation that the number of long-term unemployed—those out of work for more than a year—was falling, albeit only by a very small reduction. I fully share the concern of the noble Lord, Lord Holme, about long-term unemployment. Does the Minister have any firm grounds for believing that the hardcore long-term unemployed can be halved by the year 2000? After all, we want opportunities for all, and in both communities.

22 Jun 1995 : Column 482

In her press statement, repeated this evening, on the May unemployment figures, the Minister warned against the temptation of complacency and called on Northern Ireland to redouble its efforts. A week ago in Paris she spoke of the need for the Province "to aim high". I am all for optimism. Can the Minister be a little more specific about those aims? What are the detailed aims of policy over the next five years or so; and what are the timescales for achieving those objectives? Will she also indicate the provisions in the draft order that are geared in particular to achieving those aims? It was Sir George Quigley, the chief executive of Ulster Bank and chairman of the Economic Council, who recently said:

    "I would like to see us indicate what we want to achieve by the year 2000, since it may help to prevent our becoming the prisoners of past policy assumptions".

Those words are the source of my question.

It needs no words from these Benches to remind the House that Northern Ireland is on the westernmost limit of the British Isles and at the farthest point from the industrial and business centres of the European Union. Obviously, that does not come without its disadvantages. Of course, looking at it the other way round, Northern Ireland is on the doorstep of the Union. But it has been said that the doorstep can be very draughty. We therefore welcome very much those European initiatives that have been specially designed to meet some of the conditions that are unique to Northern Ireland.

As I understand the case of the Institute of Directors (and I may have misunderstood it), there may be some grounds for concern about the loans structure of the European Investment Bank. We have had experience in Wales of the European Investment Bank. I believe that the Institute of Directors was referring to the interest subsidies and loan guarantees structure of the bank. Can the Minister say whether there is anything in that complaint? Is this matter being explored by her department? Will she also comment as to whether more could be done in this direction by the Northern Ireland financial institutions themselves?

The Minister attended the important Washington Conference on Trade and Investment in Northern Ireland. Is her department in a position by now to make a preliminary judgment about the success of that conference? How successful will it be in attracting innovative American firms to the Province, in addition to the 20 inward investment projects to which she referred in her opening speech?

In an article published in the Belfast Telegraph on 23rd May, the eve of the Washington conference, the noble Baroness listed the benefits which Northern Ireland offered to American firms. In the list there appeared "our education". There are two uncomfortable questions that I want to raise about education. It has been known for a long time that far too many young people in Northern Ireland leave school poorly equipped with vocational skills. This was roughly touched upon by the noble Lord, Lord Cooke, as I understood him. The Department of Education has for many years been in trouble over this failure. Some of us are, I fear, puzzled by the inability of the department to tackle the problem effectively.

22 Jun 1995 : Column 483

That leads me to the second issue. If, as we expect and earnestly hope, the ceasefire leads to a lasting peace, we understand that some 12,000 people now employed in the security services will become redundant during the next few years and up to 1,000 prisoners will be released. A very high percentage of those people will require retraining. Is there not a great risk that retraining facilities will not be there? What will be the result if they are not in place? Perhaps the Minister can meet some of our concerns by identifying those provisions in the order which are commensurate with those needs.

I am sure that the Northern Ireland Ministers are fully conscious of those problems. All the same, I wish to place on the record that there is a growing conviction in Northern Ireland—it is not confined to the well documented concerns of the leaders of the Church of Ireland, the Methodists, the Presbyterians and of the Defenders of the South Eastern Education Board—that there may be deep-rooted problems of management within the Department of Education and that public confidence in it is less than it used to be. In fact, that is reinforced to some degree by the need for the department to obtain authority, in the first item of this order, for the excess Vote of 1993-94. The first item stands in splendid isolation in Part I of Schedule 1. Unless I missed the Minister's words, we did not receive a word of explanation for that item.

The explanation given by the department is that that calculation, which is in excess of £1,000, arose out of a miscalculation "prepared by inexperienced staff". Again, that is an indication that all may not be well in that department.

Perhaps I may also venture to refer to the management of one part of the Minister's own department: the Department of Economic Development. Clearly, not a word of criticism is levelled at the noble Baroness, Lady Denton. I have a feeling that if she had been in her post at the time, the concerns would not have arisen at all.

Noble Lords will recall that in both Houses of Parliament there was united and strong opposition to the privatisation of the Northern Ireland electricity industry. Yet, at all times, the Department of Economic Development was deaf and blind to all the arguments.

However, now we have before us the report of the Public Accounts Committee on the privatisation of Northern Ireland Electricity. It is very interesting to re-read the debates on the privatisation of the electricity industry in the light of the contents of that report. It came as news to me that it was the department's assessment from the outset that major benefits were unlikely to become available for a considerable period of time. It was also news that there had not been a proper valuation of the generating stations and that one of the department's own advisers—a well-paid adviser—in the sale of the generating stations, oddly, was also providing advice to one of the companies tendering for the generating stations. That names but three of the 10 mischiefs that are highlighted in the report. Clearly, the report raises many doubts about the management of one part of the department during the relevant period.

22 Jun 1995 : Column 484

I come to the central issue of the cost of electricity for the Northern Ireland consumer. It remains too high. It is, as usual, significantly higher than for the consumer in parts of the mainland. I should like to ask a question of the Minister that has not been asked this evening. Will she be good enough to confirm that I have correctly understood, from evidence that she gave to the Northern Ireland Select Committee a day or two ago, that the Government have now decided in principle that they will subsidise the costs of generating electricity in Northern Ireland under specified conditions? If I have that right, can she give details of the arrangement and of the specified conditions?

We are also aware that the leaders of the voluntary and community organisations—chief among them the Northern Ireland Council for Voluntary Action, the Co-operative Movement and the Irish Congress of Trade Unions—are pressing for greater partnership between the private sector, the public sector and the voluntary agencies. It is important that their role is fully recognised and supported by the Government.

Action on the reduction of social inequality, action to close the gap between the haves and the have-nots within both communities and the promotion of co-operation is, in the opinion of many people, of equal importance to the creation of jobs. I may mention that that is a specific area of anxiety to my noble friend Lord Blease of Cromac, who has always been concerned for both communities. That concern always showed in his contributions, which we have greatly missed in these debates over the past year or so.

Mentioning the noble Lord, Lord Blease, leads me naturally to my next point; namely, the profound concern of the Council for the Homeless that the problem of homelessness is worsening in Northern Ireland. Its fear is that future plans will inevitably worsen the position. I must say to the Minister that, if the report is reliable, the position seems to me to be extremely unsatisfactory. Up to now there has not been a word in the speech about the homeless. However, I accept that the Minister was principally concerned with explaining the framework of the document. Given the words of that charity, one wonders how much further down the existing road this Government think it fitting to go. I urge the Government to reconsider their strategy.

I return to the visits which the noble Baroness, Lady Denton, has paid to the city of Londonderry during the past six months or so in connection with the expansion of the Foyle Fisheries Commission. That is a long-standing cross-border institution. I noticed that the Republic of Ireland also sent its Minister to the meeting at the commission. We are naturally interested in the Foyle Commission because the ceasefire and the Framework document have given added importance to such institutions. May I ask whether the Foyle Commission has genuine popular support? How are local people given an opportunity to have a say in what is provided by it? Who provides the purse? Can the commission's role be extended without new primary or secondary legislation? If it is necessary to obtain legislation, when shall we see the colour of that legislation?

Finally, I want to say a word about the Tower Museum in Londonderry that I visited. It is a noteworthy museum. It depicts the origins and development of its community

22 Jun 1995 : Column 485

on the banks of the Foyle and its solid traditions of absolute loyalty since early days. Obviously, much thought had gone into the planning of that museum. I wondered how the history of the past 25 years will be presented—obviously it will have to be recorded and interpreted—to the new generation of schoolchildren in the schools of Northern Ireland. That is difficult territory but I leave that thought with the Minister.

I shall not raise any further issues. I welcome the order as I welcome the good news from Harland and Wolff, Shorts and Sainsbury, though I take note of what my noble friend Lord Fitt said in regard to Sainsbury. I look forward to some enlightenment and assurances on the few questions I asked.

8.20 p.m.

Baroness Denton of Wakefield: My Lords, I thank your Lordships for the usual high standard of contributions which I have come to expect on Northern Ireland issues. I was delighted that on the whole the views expressed were extremely optimistic about the future and shared my view that, while there is much to do, there is now the possibility to do it.

I welcome also the return of the noble Lord, Lord Prys-Davies, to the Front Bench on Northern Ireland issues. The noble Lord, Lord Williams, should be grateful that he has such an able substitute to call upon. I join the noble Lord in saying that we miss the contributions of the noble Lord, Lord Blease, to Northern Ireland debates. I am afraid we also miss now the noble Lord, Lord Holme, who tonight brought a touch of elegance to the debate. Unfortunately he had to leave because of the commitment that caused his elegant dress. I have no doubt that he will read every word that I say with great care and follow up if I do not answer his questions. I will try to cover all the matters raised. There were many which were on common ground and the noble Lord touched on some of the most important issues on Northern Ireland. If I miss anything, I shall make certain that I reply in writing.

Before I start with the noble Lord, Lord Prys-Davies, perhaps I can take issue with him. It could be said that geographically Northern Ireland is peripheral. But we feel that our task is to convince the world that Northern Ireland is the centre of the universe, and we spend our time trying to do that—with some success.

The noble Lord, Lord Cooke of Islandreagh, speaks with direct first hand knowledge of the situation in Northern Ireland and raised the issue of what may be termed "peace dividend money". The ceasefires have allowed the security forces to respond to a diminished threat and that, in turn, allowed the Secretary of State to allocate savings totalling £180 million over the next three years from criminal damage and emergency provisions compensation and RUC overtime. Those savings have been reallocated to important economic and social programmes in Northern Ireland, including, I am delighted to reassure the noble Lord opposite, the provision for raising school standards. New resources will be put into first year primary school education and extra resources have been allocated to the "Making Belfast Work" initiative and also to the community work programme for the long-term unemployed. We are

22 Jun 1995 : Column 486

therefore using the money—we have the commitment of the Prime Minister that we can keep it—for extremely constructive purposes.

The noble Lord, Lord Cooke, referred to the cost of the health service administration. I stress that the expenditure on health and social care services in Northern Ireland is over £1,500 million, or nearly £1,000 per man, woman and child in the population. Those are large sums. The Government's reforms of the health and social care services were designed to improve quality and raise levels of efficiency. The devolution of responsibilities to local level encouraged greater innovation and responsiveness to the needs of patients and clients. I can assure the noble Lord that the cost of administering the services is kept under close review.

Recently the DHSS imposed a ceiling on the management costs of boards. Trusts will be required to publicise their management costs in their annual reports and I am confident that moves are being made to exert downward pressure on those costs in the HPSS. It is an important issue. The noble Lord opposite and the noble Lord, Lord Holme, raised the question of Springvale, coming from opposite sides of the scale. The situation is that an economic appraisal has been commissioned from the consultants Pieda, and the Northern Ireland Higher Education Council has been asked to consider the educational aspects. Those reports are expected in the near future. In advance of those, no comments can be made on the Springvale situation.

Both noble Lords also raised the question of funding for roads. The importance of the road networks in the Province is well recognised. As the noble Lord, Lord Holme, said, it is important to building the economy for the future. A sum in excess of £150 million is invested annually on the development, operation and maintenance of the system. As the noble Lord, Lord Cooke, knows, there are many competing demands for funds available within the Northern Ireland block, but I am convinced that the roads message is well heard. I register the comment of the noble Lord, Lord Holme, on the reduction on expenditure by pointing out that the M3 Cross Harbour Bridge, phase one, has been completed. For those of us who use it, it brought great benefit to the speed with which we can move about the Province and therefore achieve more in our jobs.

The noble Lord, Lord Cooke, raised the question of the budget for SPARD schemes. As he said, that was closed temporarily on 24th March to allow the department time to assess its financial commitments to farmers. The reason behind the temporary closure was to ensure that those farmers who had applied could be assured of the funds to meet their applications. That is our first requirement—financially to support those farmers who applied. As the noble Lord, Lord Cooke, well knows, when I offered two days' amnesty for people to apply, we doubled the number of applications received. That leaves us with a considerable assessment job ahead of us and we shall reopen the scheme as soon as we are reassured in regard to the amount of money needed to honour the applications.

In answering that point I should share with your Lordships, with some pleasure, that farming incomes in Northern Ireland are at the highest level in real terms for

22 Jun 1995 : Column 487

21 years. Last year saw farm incomes up 19 per cent. There are always individual cases of difference, but there is good news for farmers in Northern Ireland.

The noble Lord, Lord Cooke, also touched on another major issue; that is, the opportunities for fishing and for fishermen. I have much sympathy for this area because there comes the basic issue of the lack of stock in the Irish Sea and I fully appreciate that fishermen want to fish. I am aware of the problems of nephrops trawlers in the Northern Ireland fleet and the strength of feeling in the Northern Ireland industry to have them included in the next round of decommissioning. I can assure the noble Lord that those points have been made to the UK fisheries Minister, not only by me but also by the fishermen themselves.

Again, at the noble Lord's request perhaps I may comment on the state of the construction industry in Northern Ireland. The estimated value of construction work from planned public expenditure in 1995-96 is £869 million; that is some £18 million higher than the planned figure for the year 1994-95. Construction output in Northern Ireland has increased by 7.5 per cent. since 1990. As the noble Lord rightly pointed out, there are schemes such as the Royal Victoria Hospital and others, coming along. We appreciate the need that the capital and maintenance involved in the construction industry should begin at the earliest possible opportunity determined by the availability of resources.

Most noble Lords referred to electricity prices in Northern Ireland. The issue there is very much one of divergence with Great Britain because the United Kingdom has a low energy cost. When we are talking to potential inward investors from Japan we learn that the cost there of energy is more than twice as high as it is in Northern Ireland. I must say that I am more optimistic than noble Lords about the outlook for the future. Prices have been stable in real terms. If Northern Ireland prices are to be compared with the average in Great Britain I would urge noble Lords also to look at areas like the south west and Wales, where the problems on the edge show in the differential between the prices of electricity in more central regions.

There are major basic problems about the cost of electricity in Northern Ireland compared with the cost in Great Britain. There is the isolation, and the smaller scale of the market means that we cannot make the economies of scale. We have currently a heavy oil dependency but I am delighted that all projections show that that will decrease very rapidly in the coming years to the benefit of the Province. We have a difference in density of population. It costs us more to get our electricity to the people in the rural areas. Those are facts in Northern Ireland and we have to live with them.

Noble Lords should also look at recent fuel price rises. The cost of oil has more than doubled in the past two years and that reflects in the price. Physical problems are being tackled very hard through the development of the planned electricity interconnector and the gas pipeline project. A study is in existence on the potential for combined heat and power in Northern Ireland, which will bring considerable benefits. There will be a growth of competition within the industry in the coming years. The

22 Jun 1995 : Column 488

more efficient use of electricity will also help to keep a downward pressure on future prices. In the past the domestic user subsidised the large industrial user. In evening that out, there will undoubtedly be an effect on industrial users. I am also delighted that the considerable amounts allocated to the energy efficiency programmes—more than £6 million—are focused on those people with greatest need and the older members of our population, to whom we must give support.

The regulator will examine very closely the position in 1997. Northern Ireland is only two years into privatisation. The first price review is in 1997. Great Britain is undoubtedly doing better because the industry was privatised earlier. However, just two years into privatisation, Northern Ireland is doing at least as well as Great Britain was doing at the same point.

The noble Lord, Lord Prys-Davies, referred to the announcement made yesterday to the Select Committee by my right honourable friend the Secretary of State that the Government have decided to provide financial assistance to ensure that Northern Ireland electricity consumers will enjoy an equivalent benefit to their counterparts in Great Britain when the nuclear levy is abolished. That is to be decided in detail, but it is tremendously good news for Northern Ireland and will stop the differential increasing to the horrendous figure that the noble Lord, Lord Cooke, brought to our attention. The Public Accounts Committee report, Privatisation of Northern Ireland Electricity was published on 25th May this year. A comprehensive response will be issued in due course. The noble Lord will be aware that it is not normal practice to comment on a report until a memorandum of reply has been laid. It will be laid before the House.

Noble Lords required information about how the European Union funds granted under the peace and reconciliation terms of the European initiative will be used. The programme is still under negotiation with the Commission and it is too early to say what the nature of the intermediary bodies might be. I assure the noble Lord, Lord Cooke, that the councils will have an important and constructive role to play in this programme because, as he rightly said, we have to encourage them to take responsibility for the future shape of the Province.

The noble Lord, Lord Fitt, paid tribute to the work of community relations. We all hope that we are coming to a time when peace can be consolidated and we work hard towards that end. There is a need for constructive dialogue across all communities. The budget for that is well reinforced. There will be a new urgency towards and emphasis on community relations work. Never has it been more important. We as a government are fully committed to it.

I listened carefully and with great interest to the noble Lord, Lord Hylton. He said very strongly something with which I wholeheartedly agree. He said that the people of Northern Ireland do not want to return to violence and that they cherish the current situation. He also drew attention to the knowledge displayed in David Bleakley's book which is based on much personal experience. That recommendation also came from the noble Lord, Lord Fitt, last week. I cannot go for much longer without ensuring that I do indeed read it. The Government will react to an improved climate when it is judged correct to

22 Jun 1995 : Column 489

do so. We have made it clear that the possibility of movement on prison issues, including release issues, in parallel with progress in other areas, is not excluded. But that would be governed by an objective assessment of the paramilitary threat and there will be no amnesty for those convicted of terrorist offences. There are no political prisoners in Northern Ireland.

The noble Lord, Lord Hylton, asked about an interim assembly. When we brought forward the framework document, it was a document for discussion. Other constitutional political parties which renounce violence can bring forward suggestions and documents for discussion, because it is important that we talk and that we build. The noble Lord indicated that there was no easy progress of this path and that we would all have to work extremely hard at it.

I was pleased that the noble Lord referred to the fall in the number of long-term unemployed. But there is the issue of how we get even more of these 56,000 people back into work. We shall have to be extremely innovative in our programmes to attract them back into the workforce. I stress how much we need them because the private sector estimates that we shall see 60,000 more jobs in Northern Ireland by the end of the decade. That is an ambitious estimate, but I hope it is achievable. That means that we shall need to train and skill every single member of our community.

A start has been made with the community work programme. The noble Lord, Lord Prys-Davies, challenged us as to where the programme will be at the end of the century. We have had to tear up some of our projections. There is a whole new situation in Northern Ireland. Many people have come up with projections of what the figures will be. The private sector-led initiative has suggested that a 5 per cent. growth in GDP is a target to aim for. What we are doing right now is looking at all these projections, along with our own, in order to be able to publish the challenge that we are prepared to accept and, I hope, meet.

The noble Lord, Lord Holme, asked about provision for the Training and Employment Agency. I read it as being similar to the provisions for the previous year. I will double check that for the noble Lord, but he is absolutely right when he says that we have to upskill our population.

The IDB provision commences in 1995-96 with a higher provision than last year. Early indications are that we may need to seek to increase that provision even more during the current financial year because we do not intend to lose one prospect of inward investment. We shall continue to work to do that.

The noble Lord, Lord Holme, also questioned the size of the Government's forward commitment on funds to integrated education. I simply stress that we are committed to integrated education, but it is in response to viable proposals from parents so it is a budget which is demand led. It is moving steadily upwards and with success. Again, I put on record that the Prime Minister and the Secretary of State have made it crystal clear that the full amount of the European Union Peace Funds including the matching funds, will be additional.

22 Jun 1995 : Column 490

I also say to the noble Lord that we are indeed looking at the issue of the European Investment Bank for an interest rate subsidy scheme to be administered under the European Union scheme. The details are being negotiated at the moment.

The visit to Washington was a wonderful success. It was made a success by those who were there. There was some doubt as regards the cost of the Washington conference, but that turned out to be a total investment in the future of Northern Ireland. We are already seeing commitments from the American corporate sector. We had the commitment of the President, the Vice-President and the two Secretaries of State for a time. Representatives of the corporate sector stayed with us throughout the breakouts of individual areas. I have already had people in my office, following the conference, who have been over to look at the opportunities. I can assure the noble Lord that we are seeing a great follow-up faster than we anticipated. I further assure him that we are well aware of the need for training and support in setting up in business that the security forces will need, we hope, in due course. Already plans are laid for that. We are seeing members of the RUC talking to our small business agency.

I know that the noble Lord will ensure that NIACRO works hard in ensuring that prisoners being released are offered opportunities to achieve in the community. The Foyle fisheries have enormous support locally. There are consultative committees in which views can be expressed. We shall need primary legislation and the drafting work is being undertaken at the moment. The two governments are committed to contributing a £400,000 grant to the commission to ensure that its work continues.

It is a responsibility of the Northern Ireland Housing Executive to assess housing need; to bring forward programmes and to allocate resources to meet the needs of the homeless. I shall look at the figures which the noble Lord quoted. We have increased the budget for housing. We have splendid public sector housing in Northern Ireland. I was disappointed to hear the noble Lord's views and I shall examine them.

The noble Lord also raised the question of the excess vote we are looking for when commenting on the Northern Ireland education system. There is a paper attached to the estimate which explains the full details and that is why I did not go into detail. It covers two issues. It is important that Government officers are spread throughout the Province. This was a relocation from Bangor to Londonderry which brought in new players who did not get it right first time. But it was not a major problem financially and neither did it have an effect on education.

We work constantly to ensure that children leave with qualifications. We are seeing improvements. The number of pupils obtaining one or more higher grades at GCSE has gone from 59.5 per cent. in 1987-88 to 75.8 per cent. in 1992-93. To ensure fair employment and equal benefit to all communities, we have to ensure that there are qualified youngsters and we work to do that.

I conclude with two points which I believe I have not covered. As regards Sainsbury's plans for the Province, some of them involve sites which already have planning permission. Those create no difficulties. My honourable

22 Jun 1995 : Column 491

friend in the other place promised last night that Sainsburys, as anyone else, will be subject to normal planning requirements. There is no question of special opportunities. However, it is a great boost to the economy to see such a company interested in locating there.

The noble Lord, Lord Holme, raised the question of the benefit that the Republic of Ireland has with its 10 per cent. corporation tax. I am not surprised that it has managed to attract more investment in past years. With the images that were being sent around the world from Northern Ireland, I believe that IDB did a magnificent job to attract any investment to Northern Ireland in those years. We have certainly not lost out.

We are dealing with inward investment and with sophisticated companies which have many requirements in their future plans. Northern Ireland can indeed offer a very convincing package. What is tremendously important is that those companies that have come have frequently reinvested, which is the best tribute that could be paid to the workforce.

I thank all noble Lords for their commitment to Northern Ireland and the points raised in this debate. They were important points and I shall ensure that none of them is missed. We have much to do and we now have a great opportunity to do it. When terrorism goes off the agenda we can concentrate on targeting social need to make sure that everyone shares in the prosperity which peace can bring.

On Question, Motion agreed to.

Next Section Back to Table of Contents Lords Hansard Home Page