HC Deb 28 February 1961 vol 635 cc1354-5
16. Mr. Lee

asked the Chancellor of the Exchequer what are the changed considerations which now ensure that the sale of assets held by the Iron and Steel Holding and Realisation Agency will yield a return which is financially adequate.

Mr. Selwyn Lloyd

I do not understand the hon. Member's Question. I know of no changed consideration affecting the realisation of the assets of the Agency.

Mr. Lee

Is the right hon. and learned Gentleman aware that, according to the 1953 Act, the Agency is permitted to postpone the sale of these things only if it cannot get a return which is, in the words of the Act, "financially adequate"? What are the conditions which have changed which now make it possible to get a "financially adequate" return which have not obtained in the last seven years, when we know, from the prospectus issued yesterday, that the Government are bound to drop at least £20 million of public money on this transaction?

Mr. Lloyd

As the hon. Gentleman knows, I do not accept that the Government are dropping £20 million, because, as I have explained in a previous answer, the books show a profit of £5 million with regard to the four companies whose equity and prior charges fund have been realised. There is a statutory obligation on the Agency to secure, without disregard to other relevant matters, a return which is financially adequate.

Mr. Jay

Are we to assume from the Chancellor's Answer that the Government chose the moment to sell these stocks at which the loss to the taxpayer would be at its maximum?

Mr. Lloyd

What the right hon. Gentleman must understand is that when one is trying to disengage from a nationalisation project as disastrous as the one carried out by his own Government, it takes time, and it has taken time to dispose of the equities. It is a major operation to dispose of these prior charges, which has taken a very long time to arrange.

Mr. Nabarro

Is my right hon. Friend aware that this operation has been widely welcomed as being highly skilfully conducted and that it has the unanimous support of the party sitting behind him?

Mr. Lloyd

I think I am aware of that.

Mr. Lee

Would the right hon. and learned Gentleman agree that there is for sale now £105 million of nominal stock which will yield some £85⅓ million in return? Does not that add up to something like a £20 million loss?

Mr. Lloyd

The hon. Gentleman has said "nominal stock". As I said before, part of it was issued at a time when the Government disposed of the equity. To take the case of the Steel Company of Wales, there was not the slightest prospect of getting £40 million for the equity of that concern unless the Government had put up £40 million for the second debentures.

Mr. Lee

Owing to the unsatisfactory nature of the reply, I beg to give notice that at 3.30 p.m. I shall attempt to move the Adjournment of the House to raise this matter.

Mr. Nabarro

That is a forlorn hope.