Oral question asked in the House of Commons, by Dari Taylor (Labour). It was answered on Friday, 25 September 2009 on behalf of the North East Regional Grand Committee.

Regional Policy

Question: I want to pursue the issue of state aid. We are well aware that the Spanish and Italian Governments find ways around state aid. We know that Artenius, a Spanish company on the River Tees with a serious threat notice above its head, has been given £15 million from its regional government in Spain. We know that the Italian Government and their regional governments are doing the same. The company Dow produces a product that influences every chemical manufacturer on the Tees and in Great Britain. We want to know why it is not only struggling to get private money, but seemingly struggling to obtain Government money to survive. If Dow, Artenius and Corus all go down, we are in serious trouble on the Tees. Should we, too, put state aid and its regulations to the side?

Answer: My hon. Friend is right to raise that issue. It involves a complex set of circumstances, which I have looked at very closely. I have been in contact with the processing industry and individual company representatives. It is effectively a private sector supply chain issue. Each private sector interest in the chemical sector on Teesside has a slightly different take on it. What I have said to the industry, collectively, is that if it can come up with a private sector-led solution to the issue—my hon. Friend is absolutely right to say that Dow is at the heart of it—I will do everything that I can to ensure that the Government come to the table with a reasonable and proportional support package, provided that the solution has a reasonable chance of getting us through the difficulties. However, it does have to be private sector-led. Thought is being given to that and, in fairness, the private sector has been looking at that for the past three years. My hon. Friend, by the sense of urgency that underpins my her question, is doing the right thing by her constituents, because we do not have another three years. We need a timely solution to the problem and that means now, or as quick as we can.

Secondary information