§ 33. Mr. Grimondasked the Chancellor of the Exchequer if he will now sell the Government holding in the British Petroleum Company.
§ Sir E. BoyleNo, Sir.
§ Mr. GrimondIf the Government intend to retain their holding, will the right hon. Gentleman reconsider the position of their directors, who represent the majority holding in the company, and who, I understand, do not take part in the ordinary decisions of the company, with resultant embarrassment caused to the Government when a dividend decision such as that of the week before last is taken? Should these directors not take a full share in such decisions?
§ Sir E. BoyleI have nothing to add to what my right hon. Friend said to the hon. Member on 1st March, 1955—that it has riot been our practice to interfere with the commercial management of the company.
§ Mr. BeswickIs the hon. Member aware that everyone will applaud his decision not to undo the good work done by the right hon. Member for Woodford (Sir W. Churchill) as far back as 1911 in putting Government money into this concern; but is it not a fact that in modern conditions it is essential that we should take a more positive part in the direction of this company?
§ Sir E. BoyleI cannot add to what I have just said.
§ 36. Mr. Osborneasked the Chancellor of the Exchequer what consultations the British Government directors of the British Petroleum Company had with him on dividend policy, prior to that company substantially increasing its interim dividend the day after his supplementary Budget.
§ Sir E. BoyleI would refer my hon. Friend to the reply by my right hon. Friend the then Economic Secretary to the hon. Member for Uxbridge (Mr. Beswick) on 27th November, 1952.
§ Mr. OsborneDoes not my hon. Friend agree that it was most unfortunate timing to increase this dividend the day after the Chancellor of the Exchequer made an appeal for restraint? Secondly, what is the use of having Government directors in this company if they perform no function?
§ Sir E. BoyleI have made it quite plain, in my earlier Answer to the hon. Member for Orkney and Shetland (Mr. Grimond), that the Government do not take an active part in these decisions. In answer to the first part of my hon. Friend's question, I would remind him of what the chairman of the company announced in December, 1954, namely, the company's intention in future to make any interim dividend payment larger in relation to the expected total payment than has been the case in the exceptional circumstances of recent years. I suggest that in the light of this statement we should suspend judgment until the total distribution over the year is made.
§ Mr. OsborneIn view of the fact that the Chancellor made his appeal only the day before the announcement, was it not most unfortunate timing?
§ Sir E. BoyleI have answered that point and I have nothing more to say.
§ Mr. H. MorrisonWill the Economic Secretary answer the latter point in his hon. Friend's question—the part which the Government directors play? Is it the case that the Government directors are not supposed to take part in the commercial and financial affairs of the undertaking? If so, does not that reduce their appointment to something in the nature of a sinecure—something in the nature of giving them jobs and substantial salaries without responsibility?
§ Sir E. BoyleThe arrangements have been exactly the same ever since 26th March, 1929, which is a very long time ago. I would make two comments to the right hon. Gentleman. First, as my right hon. Friend said on 1st March, 1955, it has not been our practice to interfere with the commercial management of the company. Secondly, as my predecessor said, on 27th November, 1952:
I regret that I cannot disclose information about communications which pass between Her Majesty's Government and their representatives."—[OFFICIAL REPORT, 27th November, 1952; Vol. 508, c. 610.]I stand by that.
§ Mr. MorrisonThe hon. Member still has not answered the question. Never mind how long the arrangement has lasted. Is it understood, as between the Government and the Government directors, that they do not take an active part in the commercial and financial operations of the company? If it is so, then are not these appointments in the nature of sinecures, and objectionable?
§ Sir E. BoyleI think that I have made the position perfectly clear to the House, and I have nothing to add to what I said.
§ Mr. MorrisonI am entitled to an answer to the Question. Why is the hon. Gentleman so evasive? Is it understood that they have active commercial and financial duties or not? If not, are not the appointments in the nature of sinecures for material award?
§ Sir E. BoyleI have told the House many times that the position has been exactly the same since 1929, and I have nothing to add to that.
§ 48. Mr. Collinsasked the Chancellor of the Exchequer if he is aware that the interim dividend recently announced by British Petroleum, a company in which Her Majesty's Government has a controlling interest, was eight times as much as the previous interim dividend; and whether, in view of the inflationary nature of such increases, he will reconsider the Government's policy not normally to interfere with the commercial operations of this company.
§ Sir E. BoyleThe answer to the first part of the Question is "Yes, Sir"; and to the second part, "No, Sir."
§ Mr. CollinsIs the hon. Gentleman aware that this tremendous dividend—quite unprecedented since 1929—was declared the day after the Chancellor made his Budget Statement, that it made nonsense of his appeal for dividend restraint, and, in the eyes of the workers, is a positive incitement to wage demands? Will the Government therefore reconsider their policy in regard to a company in which they own the majority interest?
§ Sir E. BoyleI can only repeat what I said to my hon. Friend the Member for Louth (Mr. Osborne) just now, that in the light of the statement made at the meeting of the company in December, 1954, we should suspend judgment until the total distribution for this year is known.