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Lord Sainsbury of Turville: My Lords, I hope I have made clear that the Government are taking all sensible steps to help the industry, which has been a great success story. The fact remains that as the North Sea matures geologically with the discovery of far fewer large fields, the industry will have to accept reduced demand for larger platforms, and action must be taken both to improve cost-effectiveness for smaller fields and to look for exports. That is the basic strategic thrust of what the industry must do. We shall give the industry all possible help to achieve that. I hope that I have indicated some of the many ways whereby, through working closely with the industry--a central part of the strategy--we seek to help the process.

Lord Taylor of Gryfe: My Lords, is the Minister aware that there has been a good deal of criticism about the expansion of the North Sea oil industry from so-called environmental lobbies, including Greenpeace? Does he accept that any restrictions that may be imposed from that source will severely damage the facilities we are now discussing?

Lord Sainsbury of Turville: My Lords, the court case initiated by Greenpeace means that there will be some delay while we consider the implications. That will not be helpful to the industry. However, we are looking at matters as speedily as we can.

Lord Lang of Monkton: My Lords, does the Minister agree that the industry, particularly the construction sector, needs long-term stability, given the cycle of the offshore oil business? In that context, does he also agree that the protracted, and ultimately inconclusive, review of the tax regime undertaken by his right honourable friend the Chancellor has had an unsettling effect on the industry? It is a highly competitive industry with other parts of the world very keen to attract the construction sector and oil companies equally interested in investing, given the difficulties in the North Sea and west of Shetland. Against that background, will the noble Lord seek to persuade his colleagues in government to desist from interfering in the industry's long-term interests?

Lord Sainsbury of Turville: My Lords, as the tax review was undertaken at the express request of the industry, and, so far as I know, in a perfectly sensible time frame, with some changes made to the benefit of the industry, it is not entirely fair to say that the problems of the industry can be attributed to that. The problems can be attributed to a fundamentally changing situation to which the industry has to adapt. We have looked, I think very fairly, to see whether we can do anything as regards the tax situation to help the industry. We have made one significant change on the roll-over relief on licences which is of great importance to the industry.

Lord Hughes of Woodside: My Lords, is the Minister aware that when the noble Earl, Lord Caithness, asked the Question, and the noble Lord, Lord Campbell of Croy, asked a supplementary question, we thought we would have to congratulate the Conservative Party on

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its conversion to caring about those who work in the industry? Following the question of the noble Lord, Lord Lang, it appears that it has reverted to type in blaming everything on taxation and trying to find ways for their friends to avoid paying tax.

Lord Sainsbury of Turville: My Lords, I can only refer back to the fundamental situation--a change in the nature of the challenge that the industry faces. It is up to the Government to work with the industry to help it as much as possible. As I clearly indicated, that is what we are doing.

Lord Forsyth of Drumlean: My Lords, is this not a catastrophe for the Highlands? The workers who will lose their jobs will not be inspired by the establishment of a web site. Is my noble friend's point not correct? It is the failure of the Chancellor of the Exchequer to spell out precisely the long-term tax regime and the liabilities on the industry, both prospective and retrospective, which are leading to the lack of investment which results in these people losing their jobs. Will the Government take some responsibility for that and set out a programme to help secure future work in the North Sea for Scotland, or will they simply ignore the plight of people in the Highlands?

Lord Sainsbury of Turville: My Lords, I shall deal, first, with the website. That was undertaken in conjunction with the industry. It is to enable the trading of licences, which is of great interest and importance to the industry. The production of a web site is not a negligible matter to be swept aside. It is a key part of licence trading which is important to the industry.

The Chancellor of the Exchequer spelt out clearly the tax position as regards the industry. That has been established. We have made some changes to it. The situation is not to do with the tax regime. The industry--it faces a changing environment--has cut back on investment at this stage.

Lord Razzall: My Lords, would the Minister care to comment on the apparent conversion of the Tory Opposition to interventionist economic policies which they did not practise in office, with devastating consequences to these people?

Lord Sainsbury of Turville: My Lords, I was recently provoked by another noble Lord on the Liberal Democrat Benches to comment on the Opposition's policies. I can only say on this occasion that I should be interested to know what they are suggesting and whether it might come into the category of a subsidy.

Lord Monro of Langholm: My Lords, the Minister does not seem to realise the urgency of the situation. The long-term policy of oil and the ideas he has floated in the Chamber today will not help 3,000 men and women who will be out of work in the very near future. Can the noble Lord make clear who is responsible? Is it the Scottish Executive, the Scottish Office in London, the alleged Cabinet committee looking after

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Scotland, or the Department of Trade and Industry? There seem to be many wheels in the cog and none is turning correctly.

Lord Sainsbury of Turville: My Lords, the situation is quite the reverse of what has been suggested. The problem has been known for some time. Far from having to be pushed into taking action, as I have clearly stated we have already taken action to a considerable extent. The DTI has a responsibility which it is exercising very properly.

Lord Mackay of Ardbrecknish: My Lords, is the Minister aware that people in the Highlands will notice in his contribution a considerable lack of urgency? They will also note that the Liberal Democrats do not seem to care very much despite the fact that their leader is the Member of Parliament for the constituency in which many of the jobs will go. Can the Minister not take on board that the Government should look urgently at how, whether by a new tax regime or other means, they can encourage new development in the new fields to the west of Shetland and in that way bring some work to these yards? If we do not gain a sense of urgency, I can tell the noble Lord that the yards will never build another item for the North Sea.

Lord Sainsbury of Turville: My Lords, these exchanges demonstrate that we are the party which cares about what is going on in the industry and which has already taken considerable action and that the other side is coming very late in the day without clear proposals. No proposals have been put forward. Many statements have been made about wanting to help. We have already taken steps which include a new and clear regime of bringing new exploration online.

The Earl of Caithness: My Lords, notwithstanding what the Minister has told us, does he agree that a forecast in September of this year stated that the loss of 3,000 jobs was the mere start to the loss of a further 7,000 jobs--that a total of 10,000 jobs would go? That is a quarter of the workforce.

Lord Sainsbury of Turville: My Lords, we never sought to hide that if the industry is unable to take action to reorientate itself to the new demands upon it in terms of cost-effective facilities for smaller fields and overseas work, it will lead for certain to a loss of jobs. There is no denying that. Those are the economic facts. The industry, with the help of the Government, has to find new markets for its products. In the long term that is the only way that jobs can be kept secure.

Business of the House: Debate this Day

3.7 p.m.

The Attorney-General (Lord Williams of Mostyn): My Lords, on behalf of my noble friend the Leader of the House, I beg to move the Motion standing in her name on the Order Paper.

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Moved, That the debate on the Motion in the name of the Earl Ferrers set down for today shall be limited to five hours.--(Lord Williams of Mostyn.)

On Question, Motion agreed to.

The Countryside

3.8 p.m.

Earl Ferrers rose to call attention to the countryside; and to move for Papers.

The noble Earl said: My Lords, at the outset, I should declare an interest. I live in the countryside and I am and always have been financially involved in agriculture and all that goes with it.

Perhaps I may also be allowed to express my gratitude to all those who, in this last curious election, cast their votes in such a way as to enable me to remain a Member of your Lordships' House: one of 42. I am deeply grateful.

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