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§ Mr. Foulkes
rose——
§ Mr. Stewart
I cannot give way, because the hon. Gentleman took well over his 15 minutes.
The Select Committee on Public Accounts, in its report, recognised the advantages of private participation in projects of this kind, both for the relief of calls on public spending and for the injection of commercial know-how. It expressed the need for private participation to be sought in good time, and that was accepted.
The agency decision in July 1980 to appoint a receiver rather than put the company into liquidation provided another breathing space in which to attract a suitable partner. My hon. Friend the Member for Edinburgh, Central (Mr. Fletcher), who is now the Under-Secretary of State for Trade and Industry, then made it clear and the Government were delighted to consider and support any viable proposition from a private buyer to continue production in Scotland. The most strenuous efforts were made by Scottish Office Ministers, officials, the SDA, the receiver himself and private sector interests in Scotland to identify all possible interested parties and to follow up any prospect that would give the project a starting order book.
Two of the interested companies made direct inquiries in Malaysia to follow up the much-rumoured order from that source, but without result. My Department followed up with the Government's trade consul in Saudi Arabia news of a possible order from that country. A private approach was made to American Motors, manufacturers of the jeep. Discussions were also held with Land Rover, which showed an interest in the vehicle. Unfortunately, at the end of the day Land Rover felt unable to back the project.
That is what was done, and that shows the efforts that were made. Eventually, in March 1981, an offer to continue production of the Stonefield vehicle at its original base in Cumnock was received from Gomba UK, which proposed to provide further substantial capital investment at Cumnock. That offered a chance for success.
§ Mr. Foulkes
What about the other one?
§ Mr. Stewart
I am coming to the other one. If the hon. Member is referring to the other offer that was turned down because it involved transferring production to England——
§ Mr. Foulkes
Not that one.
§ Mr. Stewart
—had that been accepted, he would, I am sure, have been the first to criticise.
§ Mr. Foulkes
May I clarify that matter?
§ Mr. Stewart
The hon. Gentleman spent 18 minutes on his speech and asked me many questions, which I am trying to answer. I have only five minutes left.
I confirm that Gomba-Stonefield received an offer of regional development grant assistance, selective financial assistance, and a two-year rent-free period for the three factories at Cumnock.
The hon. Gentleman made several allegations. It is not true that my hon. Friend was not committed to the Stonefield project, and I wish to put that on the record ——
§ Mr. Foulkes
He told me that.
§ Mr. Stewart
It is because my hon. Friend wished the project to succeed that he insisted that the agency should bring in the private participation and expertise which alone could make the project a success. The chairman and chief executive of the SDA will confirm, if the hon. Gentleman wishes to ask them, that my predecessor was in no way opposed to Stonefield Vehicles as a project.
It is also completely untrue to say that my hon. Friend went back on verbal agreements with the company, or that he authorised the agency to do so. The agency's action in paying cheques to creditors of the former Stonefield Vehicles Company was done with the aim of securing normal trading relationships between those suppliers and Gomba-Stonefield. The payments which the agency made secured the assurances from suppliers which my hon. Friend promised to endeavour to secure, and I assure the hon. Gentleman that I shall write in further explanation of that point if he wishes me to do so. However, I give him that absolute assurance tonight.
The hon. Gentleman said one thing with which I agreed — that the SDA had improved. It has, of course, improved considerably since the Government took office and gave it a much better and more successful role. But the SDA has an excellent record in Scotland, a record which is widely accepted by people of all politicial persuasions, including many Opposition Members.
The company's claims against the SDA are the subject of legal action. The company took action against the agency in the High Court in London. That action was recently dismissed as being more appropriate for a Scottish court. The agency has been told that the company intends to pursue its action in the Scottish courts. The company has still to state in detail the claims which are the basis of its action. In the circumstances, the hon. Gentleman will understand that it is impossible for me to comment in any detail on the various points that he raised which relate to the legal action.
However, I assure the House that the hon. Gentleman cannot accuse either the Scottish Office or the agency of being indifferent to the company's difficulties. During the latter part of 1981 and in 1982, there were several meetings at which attempts were made to ensure that those misunderstandings did not prevent the company from obtaining necessary supplies. We all regret that the difference of view between the company and the SDA resulted in legal action, but the record is one of continuing efforts by successive Governments to ensure a future for a project that was always a high risk. I regret, as will the House and the hon. Gentleman, that those efforts were unsuccessful. I do not hold out any hope of there being success on that basis in the near future. Nevertheless, substantial efforts were made by many people over a long period.
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