§ Mr. Gordon Wilson
asked the Secretary of State for Industry (1) what representations he has received regarding the retention of European regional development fund payments by the Government; and if he will allow such European Community payments to be made direct to British industry to supplement the United Kingdom grants system;
(2) which European Community states retain receipts from the European regional development fund under article 4(2)(a) of regulation No. 724/79 and which member states allow payments direct to recipients of national aid; and whether there have been any changes in this matter since the inception of the fund.
§ Mr. MacGregor
Representations of this nature are occasionally received. However, article 4(2)(a) of the ERDF regulation specifically provides that member states may retain payments in respect of industrial projects as a partial repayment of their own aid, and I understand that all member states adopt this procedure. In the United Kingdom, this is because the aid provided under section 7 of the Industrial Development Act 1982 is negotiated with the applicant at a level sufficient to enable the project to proceed; additional payments would thus serve no useful purpose. Moreover, in certain cases we would in any case be prevented from passing on the full benefit of an ERDF grant because it would lead to the applicant's receiving more than is permitted under the Community's regional aid ceilings. The effect would thus be to produce unjustifiable discrimination between applicants.
Payments in respect of United Kingdom infrastructure projects are passed on in full to the spending bodies.