HL Deb 20 July 1976 vol 373 cc683-7

2.50 p.m.

Lord TREFGARNE

My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.

The Question was as follows:

To ask Her Majesty's Government whether they will state the names of the three smallest ship repairing companies to be nationalised under the Aircraft and Shipbuilding Industries Bill presently before the House of Commons together with the names of the three largest ship repairing companies not to be nationalised, and whether they will also state the precise criteria by which the identity of these companies was established.

The PARLIAMENTARY UNDER-SECRETARY of STATE, DEPARTMENT of INDUSTRY (Lord Melchett)

My Lords, paragraph 3 of Schedule 2 to the Aircraft and Shipbuilding Industries Bill sets out the criteria for ship repairing companies whose shares are to vest in British Shipbuilders. In terms of turnover in the relevant financial year, the three smallest ship repairing companies named in the Bill which are not already in the public sector are, with the smallest first, J. B. Howie Limited, The Wallsend Slipway and Engineering Company Limited, and Western Shiprepairers Limited. There are a number of companies engaged in ship repair which for one reason or other do not fulfil the criteria set out in Schedule 2 to the Bill and it would be inappropriate to rank them.

Lord TREFGARNE

My Lords, I thank the noble Lord for that Answer, but may I ask whether he is aware that the criterion for the inclusion of shipbuilding companies in the Bill is the size of the ships they produce; the criterion for the inclusion of diesel engine manufacturers is the size of the engines they produce? Why, therefore, is it not appropriate to include ship repairers by the size of ship they are able to repair?

Lord MELCHETT

My Lords, it was thought appropriate to use other criteria because what is suitable for shipbuilders is not necessarily suitable for ship repairers.

Lord REDESDALE

My Lords, would the noble Lord agree that, in view of the fact that some of the other companies have larger work forces and that it is not the criterion of the number of employees which is used, this provision is drawn as a definition to include the Britsol Channel Ship Repairers and that this is therefore an act of political vindictiveness alone?

Lord MELCHETT

My Lords, the criteria were not drawn up on that basis.

Lord ROBBINS

My Lords, I only wish to ask an innocent question. Can the Minister reveal the deeper grounds for the selection of this particular criterion that he has mentioned?

Lord MELCHETT

My Lords, as I said, it is a complicated business distinguishing between one company and another, in particular as many shipbuilding companies are also involved in ship repair. Many ship repair companies either have access to a dry dock, for example, or may belong to a group which has access to a dry dock while the individual company has not. It is for that reason that the somewhat complicated, two-limbed criteria are in the Bill.

Lord MERRIVALE

My Lords, can the Minister say why the Government departed from the criteria laid down in the Government discussion paper of 31st July 1974, when it was said that the Government did not think it necessary or appropriate to take into public ownership the smaller companies and also that companies which had no more than approximately 400 employees would not be nationalised? In effect, therefore, would the noble Lord not agree that there is possibly discrimination regarding Bristol Channel Ship Repairers, who have only 380 employees? Further, if, in effect, the Government are bound by the criterion of £3.4 million turnover, could the criterion of a possibly slightly lower figure not be applied to the turnover per port, rather than as an overall figure?

Lord MELCHETT

My Lords, the consultation document issued by the Government described in general terms the sort of ship repairing companies that would be included in the Bill. On the specific point that Bristol Channel has been picked on in some way, I should point out that they are one of the largest ship repairing companies included in the Bill and, in fact, constitute the ship repairing industry of that important part of the United Kingdom, Wales.

Lord SHINWELL

My Lords, did my noble friend not say in reply to one of the Questions that what was suitable for shipbuilding might not be suitable for ship repairing? In that case, why interfere with ship repairing?

Lord MELCHETT

My Lords, I said, as my noble friend will know, that the similar definition was not necessarily applicable in the two cases, in particular because some shipbuilding companies may also be ship repairers and vice versa. We said right from the start in both Election Manifestoes where the commitment was given that we felt there was a good industrial case for taking the ship repairing element as well as shipbuilding into public ownership. The industrial case for this was made out very strongly by management consultants appointed by Government of noble Lords opposite.

Lord ROCHESTER

My Lords, would the noble Lord nevertheless not agree that Bristol Channel Ship Repairers is altogether independent of other interests; that it employs fewer people than some of the companies which are not to be nationalised; that it has a higher productivity than any comparable unit in the country; that it has lost no time through labour disputes in the last eight years; and is he further aware that, in the opinion of its board, including employee directors who are members of the two largest unions in the country, it will be disadvantageous to the country's export performance if the company is nationalised?

Lord MELCHETT

My Lords, it is not the Government's policy to take into public ownership only those companies which are not successful. The fact that Bristol Channel Ship Repairers is a successful company, which I acknowledge, does not mean that it should be excluded from the Bill. We see no reason why this company should not continue to be successful and finish by being more successful after it has been nationalised, as are many other ship repairing companies which are currently in public ownership. As to the views of the trade union representatives, we have seen shop stewards and officials of the Transport and General Workers' Union representing the work force of Bristol Channel Ship Repairers who told us that their view is that public ownership is in the workers' best interests.

Lord TREFGARNE

Is the noble Lord aware that the list of companies to be included is as curious as is the list of companies to be excluded? Can he state why the Jeffries Company, based on Bristol and Avonmouth, is not to be included in the Bill, bearing in mind that its dry dock is much larger than that of BCSR and that its payroll also is much larger?

Lord MELCHETT

My Lords, I have already told the House that the number of employees is not one of the criteria laid down in the Bill. Companies not included in the Bill do not meet the criteria laid down in the Bill.

Lord PARGITER

My Lords, can my noble friend say whether we are engaged in a Second Reading debate?

The LORD PRIVY SEAL (Lord Shepherd)

My Lords, I am glad that my noble friend asked that question because I can see that we are in some difficulties. Twenty minutes have passed and we are still on the third Question—

Several noble Lords

It is the second Question!

Lord SHEPHERD

The second Question, my Lords. It seems like the third. There are some 33 speakers in two important debates. I suggest that we ought to make quicker progress and perhaps move to the next Question.